E-Waste Debate Could Influence Package Recycling Legislation

Date: Jul 01, 2005

As we have reported previously, increasing public concern over solid waste management is spurring consideration of "extended producer responsibility" (EPR) and "shared responsibility" approaches to waste minimization and reduction. A case in point is the divergent electronic waste (E-waste) legislation in Maine and California.

Maine's E-waste law implements EPR principles by placing the burden for disposing of E-waste in the state squarely on manufacturers. In contrast, California's Electronic Waste Recycling Act of 2003 imposes an advanced recovery fee (ARF) on consumers to cover the costs of recovering and recycling cathode ray tubes and other similar display devices.

Increasingly concerned about the potential for a patchwork of state EPR-based E-waste laws, the Electronic Mfrs.' Coalition for Responsible Recycling (the Coalition), which includes Canon, JVC, Panasonic, Philips, RCA, and Sharp, among others, proposed the management of E-waste should be funded by collecting the ARF from consumers at the point of sale.

Although the Coalition ultimately seeks passage of national E-waste legislation, the immediate goal of its "End-of-Life Management of Electronics: Implementation of an ARF-Financed and Stakeholder-Managed System" proposal is to encourage states to adopt the Coalition's model E-waste legislation.

The Coalition's model legislation is significantly broader in scope than either the California or Maine laws.1 Like the California and Maine requirements, the model legislation would apply to televisions, flat-panel monitors, and laptop computers. However, the Coalition's proposal also would regulate central processing units and printers. As with California's E-waste statute, the model legislation asks consumers to share responsibility for recycling and disposing of E-waste by paying a $7-$10 ARF when purchasing any covered equipment. The model legislation differs from both state programs in that the role of government is significantly limited to program oversight. Instead, the electronics industry envisions the use of a private third-party organization (TPO), comprising all stakeholders in the chain of commerce, to administer the electronics recycling program. The TPO would collect the ARF from retailers and contract with recyclers for the collection and management of electronic waste.

Alternatively, manufacturers, retailers, and local governments would have the option of establishing their own voluntary collection and recycling program for which they would be reimbursed by the TPO from the ARF fund.

The electronics industry proposal comes at a critical juncture as other states contemplate E-waste legislation,2 and at least one other state is evaluating an EPR approach to E-waste. On May 10 the governor of Maryland signed the Statewide Computer Recycling Pilot Program into law. The law, which implements EPR principles by requiring computer manufacturers that make more than 1,000 computers/yr to pay an annual fee of $5,0003 to fund computer recycling programs, will be in effect for a five-year trial period until the end of 2010, at which point the Maryland legislature will have to reauthorize the law to keep the annual fee in effect.

At the Federal level, there are currently several bills before the House and Senate, each advocating a different approach to the issue. For instance, H.R. 425, which has been referred to the House Energy and Commerce Committee, would require EPA to collect a consumer fee on the sale of computers and computer monitors to be disbursed to individuals and organizations involved in the collection and recycling of computers, including local governments.

Senate Bill 510, on the other hand, takes a less direct approach by proposing tax credits for recycling qualified E-waste.4 The bill, currently in the Senate Finance Committee, also directs EPA to study the feasibility of a nationwide E-waste recycling program, including EPR and shared responsibility solutions. The growing volume of E-waste is a major factor in federal and state legislative attention to E-waste recycling.

The current E-waste debate should serve as a lesson and a warning for the converting industry, not only because of its impact on the industry's disposal of computers and other electronic equipment but also because of the potential to influence the ongoing dialog about packaging wastes.

Historically, there has been limited acceptance of deposits and fees. The new model legislation on E-waste may reinvigorate discussions of fees and other mechanisms to promote recycling of packaging.

Reproduced with the permission of Paper, Film & Foil CONVERTER magazine (312.726.2802). Copyright © 2005 by Intertec Publishing. All rights reserved.

Sheila A. Millar, a partner with Keller and Heckman LLP, counsels both corporate and association clients. Contact her at 202/434-4143; millar@khlaw.com.

1Although touted as a shared responsibility statute, Maine's E-waste law is in reality an EPR statute. The state holds manufacturers responsible for the real cost of transporting and recycling their own computer and television products and also for a proportional share of the recycling cost for "orphan" products, or products of unknown origin.

2Washington state passed E-waste legislation in 2004, but the state will be studying the best implementation and financing method through at least September 2005.

3Computer manufacturers that implement a computer recycling program will have to pay an annual fee of only $500 for each year after the recycling program has been implemented.

4H.R. 1723 and H.R. 320 also would provide tax incentives for establishing E-waste recycling programs and for actually recycling E-waste.