CC 2017-11-14_12b Loss of Beverage Container Recycling Centers
MEMORANDUM
TO: CITY COUNCIL
FROM: JAMES A. BERGMAN, CITY MANAGER
SUBJECT: DISCUSSION OF THE LOSS OF BEVERAGE CONTAINER
RECYCLING CENTERS AND CONSIDERATION OF DIRECTION TO
ADVOCATE THROUGH THE LEGISLATIVE PROCESS FOR
PROGRAM ADJUSTMENTS
DATE: NOVEMBER 14, 2017
SUMMARY OF ACTION:
Discussion to determine if there is Council support to use staff resources to advocate for
adjustments to the CalRecycle program for beverage container recycling.
IMPACT ON FINANCIAL AND PERSONNEL RESOURCES:
No direct financial impact other than staff time.
RECOMMENDATION:
It is recommended that the Council discuss the issue of the loss of recycling centers
and provide direction to staff to advocate through the legislative process for program
adjustments.
BACKGROUND:
At your September 26, 2017 Council meeting, staff was directed to place an item on a
future agenda to discuss beverage container recycling centers.
ANALYSIS OF ISSUES:
The attached Mercury News article provides an overview of the declining number of
recycle centers throughout California, declining rates of recycling, and how this issue is
affecting different segments of the population. The trends and impacts in the article
appear to mirror concerns within the City of Arroyo Grande.
California law developed to incentivize recycling requires that a recycling center must be
located within a half mile of large grocery stores or the stores must offer recycling on
their premises or pay a $100 per day “opt-out fee.” There are exceptions to these
requirements based upon specific conditions including: Ease of access to redemption
centers by consumers, reasonable distance to next closest recycling center, consumers
Item 12.b. - Page 1
CITY COUNCIL
DISCUSSION OF THE LOSS OF BEVERAGE CONTAINER RECYCLING CENTERS
AND CONSIDERATION OF DIRECTION TO ADVOCATE THROUGH THE
LEGISLATIVE PROCESS FOR PROGRAM ADJUSTMENTS
NOVEMBER 14, 2017
PAGE 2
in the area predominantly use curbside program for recycling, and recycling centers in
the area fail to meet a sufficient volume for economic viability. The requirement to
establish a recycling center or payment of the opt-out fee can also be in a holding
pattern (hold zone) awaiting review in the exemption process. A review of the
CalRecycle website shows that none of the three grocery stores in the city limits are
subject to the mandate to offer recycling on-site or pay the opt out fee at this time.
Currently there are no recycling centers in the City although curbside recycling is
provided through our waste hauling agreement. The closest recycling center where
beverage containers can be redeemed for cash is located on Tefft Street in Nipomo.
ALTERNATIVES:
The following alternatives are provided for the Council’s consideration:
1. Provide direction to staff to monitor the recycling situation and advocate for
program changes that increase recycling rates and decrease the financial
burdens on local grocery stores during regularly scheduled League of California
Cities meetings or conferences;
2. Direct staff to actively seek out opportunities to advocate for program changes
that increase recycling rates and decrease the financial burdens on local grocery
stores outside of regularly scheduled League of California Cities meetings or
conferences;
3. Direct staff to not advocate for program changes; or
4. Provide other direction to staff.
PUBLIC NOTIFICATION AND COMMENTS:
The Agenda was posted at City Hall and on the City’s website in accordance with
Government Code Section 54954.2.
Attachments:
1. Mercury News article “Recycling Centers Continue to Struggle, Driving California
Recycling Rates Down”
Item 12.b. - Page 2
11/8/2017 Recycling rates decline as Californ ia recyc lers shutter
Business
Recycling centers continue to
struggle, driving California
recycling rates down
By ANNIE SCIACCA I asciacca@bayareanewsgroup.com I Bay Area News Group
PUBLISHED : June 17, 2017 at 9:45 am I UPDATED : June 18, 2017 at 1:40 pm
http ://www.mercurynews .c om/2 017 /06 /17 /recycling-centers-continue-to -st ruggle-driving-ca lifornia-recycling-rates-down/
1/6
ATTACHMENT 1
Item 12.b. - Page 3
11 /8/2017 Recycling rates decline as California recyclers shutter
In a state that prides itself as a global leader in protecting the environment,
recycling rates for beverage containers have dropped to their lowest point in
almost a decade amid the continued closing of centers that pay for bottles and
cans and the fallout from changes to California 's recycling program.
Beyond the environmental concerns, the financial effects are also growing -
pinching large supermarket chains and low-income , and even homeless ,
residents alike .
Beverage container recycling rates in California have fallen below 80 percent for
the first time since 2008, according to data recently released by the California
Department of Resources Recycling and Recovery (known as CalRecycle). In
2016, 79.8 percent of beverage containers were recycled, down from 81 percent
in 2015. The beverage container recycling rate had reached a high of 85 percent
as recently as 2013.
Bay Area residents have far fewer options to cash in on recyclables than they did
several years ago. The value of plastic, glass and aluminum has decreased,
prompting hundreds of recycling centers to close their doors in the past two
years and putting pressure on the existing centers, which are struggling to meet
the demand with little funds.
With fewer locations to redeem containers, people looking to get cash for the ~r
bottles and cans have to travel farther to existing recycling centers, which are
often busy and subject to long waits.
An employee at the Tri-CED Community Recycling Center in Union City,
Juancarlos Alayo, said the buyback center sees new customers daily, many of
whom say they are coming to Tri-CED because their local recycling center shut
down.
According to Tri-CED founder and Alameda County Supervisor Richard Valle,
the center typically serves about 60 ,000 customers annually, but this past year it
saw about 70,000, he said.
Jane Greaney, a Union City resident , said that many times the line gets so long
at the Tri-CED center that she turns around and comes back another day.
Despite her city 's curbside recycling program, it's important to Greaney to come
to Tri-CED, where she brings everything from electronic waste to cans and
bottles. She believes in the good work the center does in providing jobs and
getting trash out of the landfill, but it's also nice to get cash back from bringing
the recyclables there , she said.
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Item 12.b. - Page 4
11/8/2017 Recycling rates decline as Ca lifornia recyclers shutter
Many people depend on the money they get from redeeming their recyclables,
and for them, the widespread closures of recycling centers is dire, Valle said.
"We've done surveys and found that people living in homeless encampments in
Oakland, Fremont and Union City have indicated they were raising $50 to $100 a
day by picking up cans and bottles that were under the redemption law."
Some grocery stores are taking a hit as well, thanks to a state requirement that
supermarkets must have a recycling center within a half-mile radius of the store.
Otherwise they must redeem the containers in the store or pay a daily fine.
Nannette Miranda, manager of public and government affairs for grocery chain
The Save Mart Companies, said that as recycling centers have closed, almost 40
Lucky and FoodMaxx stores in the Bay Area have been left without recycling
centers near them.
http ://www.mercurynews .com/2017 /06/17 /recycling-centers-continue-to-struggle-driv ing-ca lifornia-recycling-rates-down/ 3/6
Item 12.b. - Page 5
11/8/2017 Recycli ng rates decline as Cal iforn ia recyclers shutter
RECYCLIN ·O RATE DO'WN
Bev,erage contain er recyc Ii ng
rates in Ca I if o rn ia have dip p,ed
below 80 perce,nt for the fl rst
time since ,200&
90°/o
80
75
70 ·-.·---------
60 r·· I .. I I I I I .1 I I
'07'08 '09 ·10 ·11 ·12 '13 '14 ·15 '16
Source : CalRecycle
BAY AREA NEWS GROUP
http://www.mercurynews .com/2017 /06 /17 /recycling -centers-cont i nue-to-struggle-d ri vi ng -californ ia-recycling-rates-down/ 4/6
Item 12.b. - Page 6
11 /8/2017 Recycl ing rates decline as Californ ia recyclers shutter
The retailer chose not to redeem the containers inside stores because there is no
room to do so in a sanitary way and because of the cost of paying out the
redemption values to customers, Miranda said. Instead, the store pays an opt-
out fee of $100 per day per store, which will add up to $2 million this year alone .
"For an industry that operates on less than 2 percent (profit) margins, that's
quite a blow," Miranda said.
More than 300 of those recycling centers within a half-mile of supermarkets,
known as "convenience zone" recycling centers, have closed since Jan. 1, 2016,
according to an April report from the Legislative Analyst's Office.
Mark Oldfield , communications director for CalRecycle , estimates that in peak
years, there were between 2,200 and 2,300 recycling centers in the state, but as
of today, the database shows 1,680 . Processing centers, which take recyclables
from these centers, have closed, too. There are 183 active ones in California,
down from 196 in 2016 and 217 in 2015.
Environmentalists also have cause for concern. Mark Murray, executive director
of environmental advocacy group Californians Against Waste, said the closed
recycling centers mean that more than 3.5 million additional containers are
littered or put in the landfill every day. And because oil is needed to produce
beverage container materials, the closures have led to the missed opportunity to
save the equivalent of 222,000 barrels of oil and prevent tons of carbon dioxide
in greenhouse gas emissions, he said.
Part of the reason for the closures is that the value of scrap materials have
declined in recent years and remain low, experts say. Low oil prices have made
producing goods from virgin materials cheaper, creating competition for
recycled material, said CalRecycle 's Oldfield. Because rec ycling centers that are
under the California Redemption Value program are required to take all types of
CRV-eligible material, the program stipulated from the beginning that the state
would subsidize the costs of materials like plastic and glass that generally do not
pay for themselves .
CalRecycle has to adjust the processing payments at least every January,
according to the statute. But critics of the program say the formula is not
responsive to what's happening in the market right now. Oldfield said
CalRecycle is determining whether it will adjust payments in the remaining
quarters of the year.
htt p ://www.mercurynews .com/2017 /06/17 /recycl ing -centers-contin ue-to-strugg le-d rivi ng-california-recy cl ing-rates-down/ 5/6
Item 12.b. - Page 7
11 /8/2017 Recycling rates decline as Californ ia recyclers shutter
Murray said his group and other advocates have suggested potential fixes , such
as returning subsidy payments to previous levels and allowing CalRecycle to
provide supplemental money to rural recycling centers, which are most affected.
The state Assembly's budget subcommittee on natural resources introduced
some short-term adjustments to the program, but after the state Senate rejected
its inclusion in the main state budget bill , it's unclear if or when those
fixes would become law.
Until the state revamps the program in some way, advocates say recycling
centers could continue to struggle and even close, leaving even fewer options for
the many people who rely on them for income, and chipping away at California's
efforts to increase recycling overall.
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Annie Sciacca Annie Sciacca is a reporter at Bay Area
News Group, where she writes about business and
economy topics that affect consumers throughout the
region. She joined the company in 2016 after three
years at the San Francisco Business Times, where she
covered the food, retail, manufacturing and hotels
industries throughout the Bay Area. She holds an
undergraduate degree from UC Berkeley and a
master 's degree in political science from San Francisco
State University.
~ Follow Annie Sciacca @AnnieSciacca
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Item 12.b. - Page 8