House of Representatives
Office of Program Research
This analysis was prepared by non-partisan legislative staff for the use of legislative members in their deliberations. This analysis is not a part of the legislation nor does it constitute a statement of legislative intent.
Brief Description: Concerning paint stewardship.
Sponsors: Representatives Peterson, Goodman, Tarleton, Gregerson, Ormsby, Bergquist and Stanford.
Hearing Date: 1/26/17
Staff: Jacob Lipson (786-7196).
Households and businesses use paints for a variety of purposes, including as a way to add color or preservative qualities to the interior and exterior of buildings. Paint may be characterized as either oil-based paint (also called solvent-based paint) or latex-based paint (also called acrylic or water-based paint), depending on the type of liquid solvent that contains the paint's dissolved coloring pigments. Options for the management of leftover architectural paints may include reuse, recycling, use as an energy source, or disposal through solid waste management streams. Under waste management regulations in Washington, the collection and disposal requirements associated with leftover paint depend on the size of the entity generating the leftover waste. Households and certain small-quantity generators that generate less than 220 pounds of dangerous wastes per month are exempt from managing their leftover architectural paints as dangerous wastes. The dangerous wastes generated by households and small quantity generators are referred to as moderate risk wastes (MRW).
Household hazardous waste (HHW) and MRW facilities are collection sites that provide for the disposal of dangerous wastes from households, small businesses, or government generators. The HHW or MRW facilities, and similar mobile collection services, are operated under the solid waste management plans developed by local governments and are financed by rates charged for solid waste collection services. The HHW and MRW facilities may provide one option for small quantity generators and households to dispose of their leftover architectural paints, although not all HHW or MRW collection locations and services accept either or both types of paint.
Where HHW or MRW paint collection services are not available, one permissible disposal option for leftover paint, where available, is voluntary collections coordinated by paint retailers or mobile facilities. A second additional permissible disposal option is to dry and solidify latex-based paint prior to disposal via local solid waste management collection streams.
Businesses that generate volumes of dangerous waste that exceed exempt levels must manage their leftover oil-based paints in the same manner as other dangerous wastes by meeting certain storage and handling requirements, and by recycling or disposing of paint at a facility specifically permitted to handle dangerous wastes. Business generators of nonexempt volumes of dangerous waste may also need to manage leftover latex-based paints as dangerous wastes, depending on the contents of the latex paint.
Other Relevant Program Context.
The Pollution Control Hearings Board (PCHB) is an appeals board with jurisdiction to hear appeals of certain decisions, orders, and penalties made by the Department of Ecology (Department) and several other state agencies. Parties aggrieved by a PCHB decision may obtain subsequent judicial review.
The Utilities and Transportation Commission (UTC) supervises and regulates private solid waste companies, including reviewing and approving their rates and fees. Cities and towns also sometimes provide solid waste collection services.
The Public Records Act requires state and local government agencies to make all public records available for public inspection and copying unless the records fall within a statutory exemption.
Summary of Bill:
Manufacturer and Retailer Responsibilities.
Producers of interior or exterior architectural paint sold in containers of five gallons or less are required to participate in an approved stewardship plan and fund a paint stewardship organization. Producers that do not participate in an approved stewardship plan may not sell architectural paint in or into Washington.
Retailers may not sell the paint of producers who do not participate in an approved stewardship plan and fund a stewardship organization. Retailers must verify that a producer is listed as compliant on the Department website prior to selling that producer's paint. Paint retailers may elect to serve as paint collection sites for the stewardship program, but are not required to do so. Architectural paint sold to consumers must be accompanied by information about the end-of-life paint management options offered by the stewardship program.
Paint Stewardship Program.
A stewardship organization representing producers is required to submit a stewardship program plan to the Department by January 15, 2018. A stewardship organization must implement the program by July 1, 2018, or within three months of the plan's approval by the Department, whichever comes later.
The plan the stewardship organization submits to the Department must include a description of the operations and management of the stewardship program, including:
a list of the architectural paint producers and brands participating in the program;
how the program will collect, transport, and manage the leftover architectural paints;
a process for managing the cans containing leftover paint;
the program's funding mechanism;
the program's goals, based on current or historical collection data, for paint waste reductions, reuse and recycling, and end-of-life management; and
the program's statewide paint collection system.
The stewardship program must collect leftover oil-based and latex-based architectural paints from households and small quantity generators, as well as latex-based paint from regulated generators. Under the stewardship program, architectural paints must be managed using both environmentally and economically sound practices and must prioritize the following waste management options in descending order: paint reduction, reuse, recycling, energy recovery, and disposal. The stewardship program must also include a process for handling the canisters that contain the leftover paint, with an emphasis on recycling the canisters.
The stewardship program must develop and distribute informational materials to collection sites and educational materials to consumers.
Paint Collection Requirements for Stewardship Programs.
A stewardship program plan must provide reasonably convenient and available statewide collection and must utilize existing solid waste services and facilities, including public and private waste collection services and existing paint retail stores as collection sites, if it is cost-effective and mutually agreeable to do so. Retail sites are not required to participate as collection sites. The program must fairly compensate service providers for their costs. The stewardship organization must renegotiate collection site contracts every two years, unless both parties agree otherwise. Curbside collection services may be used in lieu of paint collection facilities by the stewardship program, so long as doing so provides at least equivalent convenience and access. The program must use geographic modeling to ensure that distribution of collection sites in rural and urban areas meets certain criteria, including requiring that collection service be provided within 15 miles of 90 percent of the state's population. Collection sites must be identified in the plan submitted for approval by the Department and must be operational within the first year of the program.
Paint producers are responsible for the funding of all of the stewardship program activities of the plan in which they participate, including collection, reuse, recycling, and transportation costs. The funding of a stewardship program must be based on a uniform assessment levied on the sales of architectural paint. The program must categorize the sizes of paint containers sold at retail, and establish a uniform assessment that applies to each category of container size.
The assessments added to sales of architectural paint must be remitted to the stewardship organization for purposes of implementing the stewardship program.
There are two possible mechanisms for remitting the paint assessment to the stewardship organization:
the paint assessment must be added to the price of paint sold by producers to retailers or distributors and then remitted by the producer to the stewardship organization; or
a retailer or distributor may voluntarily agree to directly remit the assessment to the stewardship organization for cans of paint sold by the retailer or distributor.
The per-can assessment on producers must be added to the price of the paint sold at retail, but may not be described as a Department recycling fee. The receipts associated with the per-can assessment on paint are exempted from the state Business and Occupation tax. The per-can assessment proposed in a stewardship organization's plan must be reviewed by an independent auditor, who must then recommend an amount to the Department for approval. Surplus funds from the assessment must either be put back into program services or used to reduce the amount of the assessment in future years.
The program may not add an additional fee at the time of leftover paint collection at a drop-off or take-back location; however, curbside collection services may charge an additional fee to cover their additional collection costs as provided by a contract with a city or as allowed under the UTC regulations. The assessment must be sufficient to recover, but not exceed, the stewardship program's costs.
An account is created in the State Treasury to accept the receipts owed to the Department by stewardship organizations and may only be used for administering and enforcing the program.
Program Oversight and Compliance Mechanisms.
The Department is responsible for reviewing the plan submitted by the stewardship organization within 120 days of receipt and must approve the plan if it meets statutory requirements. Proposed stewardship plans and plan amendments must be made available for at least 30 days of public comment.
The Department must also supervise the stewardship organization's implementation of the paint assessment, approve the amount of the paint assessment, and review the annual reports of stewardship organizations to ensure compliance with program requirements. The Department must maintain a list of paint producers who are compliant with stewardship program participation requirements on its website. The Department's costs in administering and enforcing the stewardship program must be paid via an annual fee by the stewardship organization or organizations. If there are multiple stewardship programs, they must equally divide the Department's fee.
A civil penalty of up to $1,000 per violation per day may be imposed by the Department for violations of the act or up to $10,000 per violation per day for known, intentional, or negligent violations. Penalties imposed by the Department are appealable to the PCHB.
Reporting Requirements and Other Provisions.
Beginning in 2019, stewardship organizations must submit an annual report by October 15. The report, made publicly available online, must include descriptions of the program's paint management methods, the volumes of different types of paint collected by the program, and various costs associated with implementing the program, including an independent financial audit of the program.
Valuable commercial information submitted to the Department is exempt from disclosure under the Public Records Act, although information that does not directly or indirectly identify an individual producer or stewardship organization may be disclosed. Persons submitting information to the Department must designate records or portions of records that are valuable commercial information. Records that are valuable commercial information submitted to the Department may not be disclosed without advanced notice to the submitter, although reports and aggregated or summary information is not subject to this notification requirement. If a person who submitted records does not obtain a superior court order protecting the records within 10 days of receiving notice of a request to release the records, the Department may release them. A superior court must protect the records if disclosure would result in private loss, including unfair competitive disadvantage.
Producers and stewardship organizations are granted immunity from state antitrust laws in establishing the stewardship program and in establishing the paint assessment.
The Paint Stewardship Program laws are deemed void if a federal paint recycling program is established.
The Department may adopt rules to implement, administer, and enforce the program.
Fiscal Note: Available.
Effective Date: The bill takes effect 90 days after adjournment of the session in which the bill is passed.