THE SB 54 CARNIVAL COMES TO TOWN WITH MANDATORY ROLLER COASTERS By Melissa Koshlaychuk, California Government Affairs Analyst
Senate Bill 54, known as the Plastic Pollution Prevention and Packaging Producer Responsibility Act, was signed into law in 2022 with the goal of drastically reducing single-use plastic waste in California. The law imposes sweeping requirements on producers to ensure that by 2032, 100 percent of packaging in the state is recyclable or compostable, with a mandated 25 percent reduction in single-use plastic packaging and a 65 percent recycling rate. SB 54 also establishes an extended producer responsibility (EPR) program, requiring producers to fund the implementation of the law's goals, including the collection, recycling and disposal of covered materials through a Producer Responsibility Organization (PRO) overseen by the California Department of Resources Recycling and Recovery (CalRecycle). Gov. Gavin Newsom directed CalRecycle to halt their regulatory package finalization to address concerns over the costs and negative impacts on businesses. Honestly, there is gratitude for California’s governor and his last- minute emergency brake maneuver, but businesses need so much more than just an e-brake on a steep roller coaster. The core message echoing at the Capitol this year has been “affordability” and rightfully so. The business and residential departures from the state are far more than just potential outcomes now. The numbers are real, not mere speculation. For the past two decades, the State Legislature and regulatory agencies have operated with an attitude of: “Anything is possible, you simply have to dream it!” This approach to lawmaking has led to the creation of mandates that lack proper support and guidance for how to successfully achieve them. CalRecycle’s current divergence from the statutory language in their regulation has only exacerbated this issue further. All impacted industries have voiced their need for more time and legitimate off-ramps. California is not alone in this push for packaging Extended Producer Responsibility (EPR) laws. Since 2021, eight states have passed similar laws, and four additional states are grappling with proposed bills this year. However, none of those regulations are as expensive or as aggressive as SB 54. Additionally, California is the only packaging EPR that is solely responsible for infusing environmental justice groups with $500 million annually for a decade. So, while California is not alone in these efforts to develop more “sustainable” packaging and increase recycling rates, this is certainly not a level playing ground.
Next Steps CalRecycle has stated they will be revising their final regulation, including a “review” of their Standardized Regulatory Impact Assessment (SRIA). The SRIA outlined the speculated costs for businesses to comply with SB 54 as well as the cost to consumers. The validity of this analysis has been called into question by industry and economic experts. CalRecycle has noted its shortcomings with both the SRIA and the Program Environmental Impact Report (PEIR), stating they generated conservative estimates among other issues. The PEIR referenced data and informational sources that were outdated and insufficiently comprehensive to meaningfully inform or support accurate guidance or assessment regarding the actual costs and impacts of SB 54. With the one-year regulatory process re-initiated, CalRecycle is looking to have their revised regulation out for public comment this summer. If we don’t get this right, SB 54 will be a burden that the entire supply chain will have to bear. The governor is asking CalRecycle to find ways to reduce the total financial impact on businesses and consumers, so a few numbers have been highlighted below to truly appreciate the SB 54 price tag: • Industry is responsible for funding SB 54 in its entirety, which CalRecycle estimates to be $36.3 billion dollars in direct costs (shared across the 5,741 regulated “producers” in the state). • SB 54 implementation is estimated to cost over a billion more annually than the entire department’s expenditure.
8 Western Grower & Shipper | www.wga.com May | June 2025
Made with FlippingBook - professional solution for displaying marketing and sales documents online