Newsom signs SB 353 into law

California Gov. Gavin Newsom signed SB 353 into law Oct. 13. The Container Recycling Institute (CRI), Sacramento, California, says the law will provide fairer compensation to beverage container redemption centers and prevent further center closures that undermine the success of the state’s deposit return, or bottle bill, program.

Introduced by Sen. Bill Dodd of Napa, California, in early February, the new law expands the California Beverage Container Recycling and Litter Reduction Act to include any size container of 100 percent fruit juice and any size container of vegetable juice, beginning Jan. 1, 2024. CRI says this change will add deposits to an estimated 188 million new containers in addition to the 18.4 billion containers currently in the program.

More importantly, from CRI’s perspective, SB 353 addresses what it says is a “serious flaw” in the state’s bottle bill regarding the per-ton “processing payments” redemption centers receive from California’s Department of Resources Recycling and Recovery (CalRecycle) to supplement the revenues they earn from polyethylene terephthalate (PET), glass and aluminum scrap values.

These processing payments are provided so the state’s redemption centers can cover their operating costs and earn a reasonable profit, CRI says. However, the current payment formula uses a 12-month scrap value average from the previous year, with a minimum three-month lag time, meaning it does not account for real-time changes in scrap values. “This undermines the economic viability of centers at times when payments do not compensate centers enough if scrap prices quickly drop, resulting in shortfalls,” CRI says in a news release about Newsom signing the bill into law.

The organization adds that SB 353 will help halt these trends by allowing CalRecycle to base processing payments on the average scrap value from the preceding three months.

CRI says it has been recommending a reevaluation of California’s redemption center processing payment formula since 2016.

In 2019, Ontario, California-based rePlanet LLC, which operated a network of beverage container redemption centers throughout California, ceased operations, closing all of its 284 recycling centers and processing facilities and terminating its entire workforce.

The company cited continued reductions in state fees, depressed pricing of recycled aluminum and PET and rising operating costs for the closure.

The new law includes other changes to California’s bottle bill.

SB 353 requires plastic beverage containers to contain a specified average percentage of postconsumer recycled plastic, providing for periodic increases in the required percentage.

Beverage containers measuring 46 ounces or more of 100 percent fruit juice and beverage containers with more than 16 ounces of vegetable juice are exempted from consideration in calculating the required percentage of postconsumer recycled plastic until Jan. 1, 2026, according to the text of the bill. 

Previously, the California Beverage Container Recycling and Litter Reduced Act defined a “beverage manufacturer” as “a person who bottles, cans or otherwise fills beverage containers, or imports filled beverage containers, for sale to distributors, dealers or consumers.” With SB 253’s passage, that definition is amended to mean the same as above, except in the case of beer, wine or distilled spirits, the “beverage manufacturer” is defined as the “person who holds the license from the Department of Alcoholic Beverage Control authorizing the manufacture of the beer, wine or distilled spirits, regardless of whether that person contracts with a third party to bottle, can or otherwise fill the beverage container, so long as the beverage container is provided for sale to a distributor, dealer or consumer by the holder of the license.”