October 13, 2009
California Governor Vetoes CRV Expansion
California Governor Arnold Schwarzenegger has vetoed Senate Bill 402, which sought to expand the state’s Beverage Container Recycling Program by adding new containers to the fee program, as well as increase the fee on some existing containers. Excess money raised through the recycling program also was used to supplement other programs in the state.
In opting not to sign the bill, Schwarzenegger noted that while the fund is facing a severe deficit at the end of the 2009-2010 because Californians are recycling more and because this fund has made loans to the General Fund of several hundred million dollars over the past several years. To combat this deficit, the Department of Conservation has had to implement an across the board cut of 85 percent to the funding programs paid by the Fund. My Administration has offered solutions for long-term repair of the Fund, but unfortunately, SB 402 does not contain those solutions.
The Governor also noted that the bill would expand the program to include fruit and vegetable juices and soy based drinks, which, Schwarzenegger notes, is inappropriate given that these products are often dietary necessities for families. Meanwhile, wine and distilled spirits, which are typically paid for from consumer’s disposable income, remain exempt from the program.
Furthermore, while the bill proposes to capture more beverage containers for the recycling market rather than the waste stream, there are, at present, no known California end users for the material types SB 402 adds to the Program. This bill proposes that CRV be applied to products that will likely end up in a landfill.
This bill would also change the CRV threshold to beverage containers carrying 20 fluid ounces or less to $0.05 per container, and beverage containers carrying 20 fluid ounces or more to $0.10 per container, effective January 1, 2010. This change in law, combined with the additional containers and beverage types, would cost consumers about $300 million annually.
Additionally, these changes are merely a patch that provides relief for only one fiscal year. The Fund cannot support the expenditures continued by SB 402 beyond the first half of Fiscal Year 2010-2011.
Finally, in addition to several other fatal flaws, this bill unjustifiably uses the Fund to increase grant amounts for some programs, guarantee payments into the future for others, and decrease or eliminate grant funding for still others, including public education used to inform consumers of the program expansion and fee increase.
"Consistent with a provision already included in SB 402 and in an effort to mitigate this hardship, I am ordering the Department of Conservation to adopt emergency regulations to accelerate the deposit paid into the Fund by adjusting the payment schedule for distributors from every three months to every two months. I recognize this action will not solve the problems faced by the Fund, but, with the cooperation of those who pay into and receive grants from the Fund, it should smooth out the challenges in the current fiscal year as we work on additional, long term solutions," Schwarzenegger added.