Environment – Packaging, Containers, and Paper Products – Producer Responsibility

EXPLANATION: CAPITALS INDICATE MATTER ADDED TO EXISTING LAW. [Brackets] indicate matter deleted from existing law. *hb0036* HOUSE BILL 36 M3 1lr0998 (PRE–FILED) By: Delegates Lierman, Charkoudian, D. Jones, R. Lewis, Love, and Terrasa Requested: October 15, 2020 Introduced and read first time: January 13, 2021 Assigned to: Environment and Transportation and Economic Matters A BILL ENTITLED AN ACT concerning 1 Environment – Packaging, Containers, and Paper Products – Producer 2 Responsibility 3 FOR the purpose of requiring, on or before a certain date, a certain producer of certain 4 packaging, containers, and paper products to individually or as part of a stewardship 5 organization submit a certain covered materials and products stewardship plan to 6 the Department of the Environment for review and approval; prohibiting, on or after 7 a certain date, a producer of certain covered materials and products from selling, 8 offering for sale, distributing, or importing certain covered materials and products 9 unless the producer, individually or as part of a stewardship organization, has an 10 approved stewardship plan on file with the Department; requiring the stewardship 11 plan to include certain information; requiring a stewardship plan to provide a certain 12 method for financing the implementation o f the stewardship plan, including 13 establishing a certain fee structure for certain producers; requiring certain methods 14 of financing the stewardship plan to be evaluated by an independent financial 15 auditor, as designated by the Department, for certain purp oses; requiring the 16 Department to approve or reject a certain stewardship plan within a certain period 17 of time under certain circumstances ; requiring a certain producer or stewardship 18 organization to implement a stewardship plan within a certain amount of time after 19 the Department approves the stewardship plan; specifying that a certain producer 20 or stewardship organization is immune from certain liability under certain 21 circumstances; requiring a certain producer or stewardship organization to submit a 22 certain report, on or before a certain date each year, to the Department in accordance 23 with certain requirements; requiring the Department to review a certain report in 24 accordance with certain requirements; requiring an approved stewardship plan to 25 expire after a certain number of years; authorizing the Department to rescind 26 approval of a stewardship plan at any time; authorizing a local government to 27 request reimbursement from a certain producer that has an approved stewardship 28 plan on file with the Department for certain costs in a certain manner; requiring a 29 certain producer to submit a certain report to the Department on or before a certain 30 2 HOUSE BILL 36 date each year and requiring the report to be posted on the websit e of the producer 1 or the Department; requiring the Department to keep certain data confidential; 2 requiring the Department to adopt certain regulations; establishing certain 3 penalties for certain violations; providing for the application of this Act; defining 4 certain terms; and generally relating to producer responsibility for packaging, 5 containers, and paper products. 6 BY adding to 7 Article – Environment 8 Section 9–2301 through 9–2308 to be under the new subtitle “Subtitle 23. Packaging, 9 Containers, and Paper Products” 10 Annotated Code of Maryland 11 (2014 Replacement Volume and 2020 Supplement) 12 SECTION 1. BE IT ENACTED BY THE GENERAL ASSEMBLY OF MARYLAND, 13 That the Laws of Maryland read as follows: 14 Article – Environment 15 SUBTITLE 23. PACKAGING, CONTAINERS, AND PAPER PRODUCTS. 16 9–2301. 17 (A) IN THIS SUBTITLE THE FOLLOWING WORDS HAVE THE MEANINGS 18 INDICATED. 19 (B) (1) “COVERED MATERIALS AND PRODUCTS” MEANS, REGARDLESS OF 20 RECYCLABILITY: 21 (I) ANY PART OF A PACKAGE OR CONTAINER , INCLUDING 22 MATERIAL THAT IS USE D FOR THE CONTAINMEN T, PROTECTION, HANDLING, 23 DELIVERY, AND PRESENTATION OF A PRODUCT THAT IS SOLD, OFFERED FOR SALE, 24 IMPORTED, OR DISTRIBUTED IN THE STATE; AND 25 (II) PAPER PRODUCTS. 26 (2) “COVERED MATERIALS AND PRODUCTS” INCLUDES: 27 (I) PRIMARY, SECONDARY, AND TERTIARY PACKAGI NG 28 INTENDED FOR THE CONSUMER MARKET; 29 (II) SERVICE PACKAGING DES IGNED AND INTENDED T O BE 30 FILLED AT THE POINT OF SALE, INCLUDING: 31 1. CARRY–OUT BAGS; 32 HOUSE BILL 36 3 2. BULK GOODS BAGS; 1 3. TAKE–OUT AND HOME DELIVER Y FOOD SERVICE 2 PACKAGING; AND 3 4. PRESCRIPTION BOTTLES; 4 (III) PAPER SOLD AS A PRODUCT; 5 (IV) PRINTED MATERIALS; AND 6 (V) BEVERAGE CONTAINERS. 7 (3) “COVERED MATERIALS AND PRODUCTS” DOES NOT INCLUDE ANY 8 LITERARY, TEXT, OR REFERENCE BOUND BOOK. 9 (C) (1) “PRODUCER” MEANS A PERSON THAT: 10 (I) 1. MANUFACTURES A COVERED MATERIAL OR PRODUCT 11 UNDER THE PERSON’S OWN NAME OR BRAND; AND 12 2. SELLS, OFFERS FOR SALE , OR DISTRIBUTES THE 13 COVERED MATERIAL OR PRODUCT IN THE STATE; 14 (II) IMPORTS A COVERED MATERIAL OR PRODUCT AS OWNER OR 15 LICENSEE OF A TRADEMARK OR BRAND UNDER WHICH A COVERE D MATERIAL OR 16 PRODUCT IS SOLD OR DISTRIBUTED IN THE STATE; OR 17 (III) SELLS, OFFERS FOR SALE , OR DISTRIBUTES A COVERED 18 MATERIAL OR PRODUCT IN THE STATE. 19 (2) “PRODUCER” DOES NOT INCLUDE A LOCAL GOVERNMENT. 20 (D) “STEWARDSHIP ORGANIZATION” MEANS A NONPROFIT OR GANIZATION 21 CREATED BY A GROUP OF PRODUCERS TO IMPLEMENT A STEWARDSHIP PLAN. 22 (E) “STEWARDSHIP PLAN” MEANS A COVERED MATERIALS AND PRODUCTS 23 STEWARDSHIP PLAN DEVELOPED BY A PRODUCER OR STEWARDSHIP ORGANIZATION 24 IN ACCORDANCE WITH § 9–2303 OF THIS SUBTITLE. 25 9–2302. 26 4 HOUSE BILL 36 THIS SUBTITLE DOES NOT APPLY TO A PRODUCER THAT: 1 (1) (I) GENERATED LESS THAN $1,000,000 IN GROSS REVENUE 2 DURING THE IMMEDIATELY PRECEDING CALENDAR YEAR; 3 (II) SOLD, OFFERED FOR SALE, OR DISTRIBUTED FOR SALE IN 4 THE STATE DURING THE IMME DIATELY PRECEDING CALENDAR YEAR LESS THAN 1 5 TON OF COVERED MATERIALS OR PRODUCTS; OR 6 (III) CONDUCTED ALL OF THE COVERED MATERIALS OR 7 PRODUCTS SALES IN THE STATE DURING THE IMMEDIATELY PRECEDING CALENDAR 8 YEAR AT A SINGLE POINT OF RETAIL SALE THAT WAS NOT SUPPLIED OR OPERATED 9 AS PART OF A FRANCHISE; AND 10 (2) ON REQUEST BY THE DEPARTMENT, PROVIDES TO THE 11 DEPARTMENT SUFFICIENT INFORMATION TO DEMONSTRATE THAT THE PRODUCER 12 MEETS THE CONDITIONS OF THIS SECTION. 13 9–2303. 14 (A) (1) ON OR BEFORE OCTOBER 1, 2022, EACH PRODUCER SHALL, 15 INDIVIDUALLY OR AS P ART OF A STEWARDSHIP ORGANIZATION, SUBMIT A 16 STEWARDSHIP PLAN TO THE DEPARTMENT FOR REVIEW AND APPROVAL. 17 (2) ON OR AFTER OCTOBER 1, 2024, A PRODUCER MAY NOT S ELL, 18 OFFER FOR SALE, DISTRIBUTE, OR IMPORT FOR SALE O R DISTRIBUTION COVERED 19 MATERIALS OR PRODUCT S FOR USE IN THE STATE UNLESS THE PROD UCER, 20 INDIVIDUALLY OR AS PART OF A STEWARDSHIP ORGANIZATION, HAS AN APPROVED 21 STEWARDSHIP PLAN ON FILE WITH THE DEPARTMENT. 22 (B) A STEWARDSHIP PLAN SHALL: 23 (1) LIST THE PRODUCERS AN D BRANDS COVERED BY TH E 24 STEWARDSHIP PLAN, INCLUDING: 25 (I) EACH PARTICIPATING PR ODUCER AND THE STEWA RDSHIP 26 ORGANIZATION’S CONTACT INFORMATION; AND 27 (II) EACH BRAND OF COVERED MATERIALS AND PRODUC TS 28 COVERED BY THE STEWARDSHIP PLAN; 29 (2) INCLUDE PERFORMANCE GOALS FOR A MINIMUM POSTCONSUMER 30 RECYCLED MATERIAL CO NTENT RATE AND A MIN IMUM RECYCLING RATE FOR 31 HOUSE BILL 36 5 COVERED MATERIALS OR PRODUCTS THAT INCLUDES, AT A MINIMUM, A GOAL FOR: 1 (I) ALL SINGLE –USE PACKAGING AND PR ODUCTS TO BE AT 2 LEAST 75% POSTCONSUMER CONTENT BY OCTOBER 1, 2027; 3 (II) ALL SINGLE –USE PACKAGING AND PR ODUCTS TO BE 4 READILY RECYCLABLE OR COMPOSTABLE BY OCTOBER 1, 2030; AND 5 (III) ALL SINGLE –USE PLASTIC PACKAGIN G AND SINGLE –USE 6 PLASTIC FOODWARE TO BE REDUCED, TO THE MAXIMUM EXTENT PRACTICABLE, AND 7 BY NOT LESS THAN 25% BY OCTOBER 1, 2030; 8 (3) DESCRIBE, IN ACCORDANCE WITH S UBSECTION (C) OF THIS 9 SECTION, THE FINANCING METHOD THAT WILL BE USED TO IMPLEMENT THE 10 STEWARDSHIP PLAN; 11 (4) DESCRIBE HOW THE PERFORMANCE GOAL S UNDER ITEM (2) OF 12 THIS SUBSECTION WILL BE MET OR EXCEEDED; 13 (5) DESCRIBE HOW STAKEHOLDER COMMENTS WERE CONSIDERED IN 14 THE DEVELOPMENT OF THE STEWARDSHIP PLAN; 15 (6) DESCRIBE H OW STAFFING AND ADMI NISTERING THE 16 IMPLEMENTATION OF THE STEWARDSHIP PLAN WILL BE HANDLED; 17 (7) DESCRIBE HOW PRODUCERS PARTICIPATING IN A S TEWARDSHIP 18 PLAN WILL WORK TOGETHER TO REDUCE PACKAGING THROUGH PRODUCT DESIGN 19 AND PROGRAM INNOVATIONS; 20 (8) DESCRIBE THE ACTIONS TAKEN OR THAT WILL BE TAKEN FOR 21 PUBLIC OUTREACH , EDUCATION, AND COMMUNICATION , TAKING INTO ACCOUNT 22 THAT PUBLIC OUTREACH, EDUCATION, AND COMMUNICATION SHALL: 23 (I) PROMOTE THE PROPER END –OF–LIFE MANAGEMENT OF 24 COVERED MATERIALS AND PRODUCTS, INCLUDING BEVERAGE CONTAINERS; 25 (II) PROVIDE I NFORMATION ON H OW TO PREVENT LITTER OF 26 COVERED MATERIALS AND PRODUCTS, INCLUDING BEVERAGE CONTAINERS; 27 (III) PROVIDE R ECYCLING AND COMPOST ING INSTRUCTIONS 28 THAT ARE, TO THE EXTENT PRACTICABLE: 29 1. CONSISTENT STATEWIDE , TAKING INTO ACCOUNT 30 6 HOUSE BILL 36 DIFFERENCES AMONG LOCAL LAWS AND PROCESSING CAPABILITIES; 1 2. EASY TO UNDERSTAND; AND 2 3. EASILY ACCESSIBLE; AND 3 (IV) PROVIDE FOR OUTREACH AND EDUCATION THAT ARE: 4 1. DESIGNED TO ACHIEVE C OVERED MATERIALS AND 5 PRODUCTS MANAGEMENT GOALS AND REQUIREMEN TS, INCLUDING THE 6 PREVENTION OF CONTAMINATION OF COVERED MATERIALS AND PRODUCTS; 7 2. COORDINATED ACROSS PR OGRAMS TO AVOID 8 CONFUSION FOR CONSUMERS; AND 9 3. DEVELOPED IN CONSULTA TION WITH LOCAL 10 GOVERNMENTS AND OTHER STAKEHOLDERS; AND 11 (9) INCLUDE ANY OTHER INF ORMATION THAT IS REQUIRED BY THE 12 DEPARTMENT. 13 (C) (1) THE FINANCING METHOD THAT WILL BE USED BY A PRODUCER OR 14 STEWARDSHIP ORGANIZATION TO IMPLEMENT A STEWARDSHIP PLAN SHALL: 15 (I) PROVIDE THE METHOD FO R REIMBURSING LOCAL 16 GOVERNMENTS FOR COSTS ASSOCIATED WITH COLLECTING, TRANSPORTING, AND 17 PROCESSING COVERED M ATERIALS AND PRODUCT S THAT ARE LISTED IN THE 18 STEWARDSHIP PLAN; 19 (II) ESTABLISH A FEE STRUCTURE FOR PARTICIPATING 20 PRODUCERS THAT IS SET IN A MANNER TO COVER COSTS ASSOCIATED WITH: 21 1. IMPLEMENTING THE STEW ARDSHIP PLAN , 22 INCLUDING THE ADMINISTRATIVE C OSTS OF A PRODUCER O R STEWARDSHIP 23 ORGANIZATION; 24 2. REIMBURSING LOCAL G OVERNMENTS FOR COSTS IN 25 ACCORDANCE WITH PARAGRAPH (1)(I) OF THIS SUBSECTION; AND 26 3. THE ADMINISTRATION , REVIEW, OVERSIGHT, AND 27 ENFORCEMENT OF THE STEWARDSHIP PLAN BY THE DEPARTMENT; 28 (III) 1. DESCRIBE THE INCENTIV ES TO ENCOURAGE 29 HOUSE BILL 36 7 PARTICIPATING PRODUC ERS TO ENGAGE IN WAS TE REDUCTION AND REC YCLING 1 ACTIVITIES; AND 2 2. DESCRIBE THE DISINCENTIVES TO DIS COURAGE 3 DESIGNS OR PRACTICES THAT INCREASE THE CO ST OF MANAGING COVER ED 4 MATERIALS AND PRODUCTS; 5 (IV) BE EVALUATED BY AN INDEPENDENT FINANCIAL AUDITOR, 6 AS DESIGNATED BY THE DEPARTMENT, TO ENSURE THE COSTS OF IMPLEMENTING 7 THE STEWARDSHIP PLAN ARE COVERED; AND 8 (V) MEET ANY OTHER REQUIR EMENT ESTABLISHED BY THE 9 DEPARTMENT BY REGULATION. 10 (2) THE FEE STRUCTURE ESTABLISHED UNDER PARAGRAPH (1)(II) 11 OF THIS SUBSECTION MAY BE VARIABLE BASED ON: 12 (I) COSTS ASSOCIATED WITH TRANSPORTING, COLLECTING, 13 AND PROCESSING COVERED MATERIALS AND PRODUCTS; AND 14 (II) ANY OTHER FACTOR , AS DETERMINED BY THE 15 DEPARTMENT. 16 (D) THE DEPARTMENT SHALL REVIEW: 17 (1) THE STEWARDSHIP PLAN REQUIRED UNDER SUBSECTION (A) OF 18 THIS SECTION; AND 19 (2) THE WORK PRODUCT OF THE INDEPENDENT FINANCIAL AUDITOR 20 DESIGNATED BY THE DEPARTMENT TO EVALUATE THE FINANCING COMPONENT OF 21 THE STEWARDSHIP PLAN UNDER SUBSECTION (C)(1)(IV) OF THIS SECTION. 22 (E) (1) WITHIN 90 DAYS AFTER RECEIVING A PROPOSED STEWARDSHIP 23 PLAN, THE DEPARTMENT SHALL APPROVE, APPROVE WITH CONDITIONS, OR REJECT 24 THE STEWARDSHIP PLAN. 25 (2) IN MAKING A DETERMINA TION UNDER PARAGRAPH (1) OF THIS 26 SUBSECTION, THE DEPARTMENT SHALL CONSIDER WHETHER: 27 (I) THE STEWARDSHIP PLAN COMPLIES WITH THE 28 REQUIREMENTS OF THIS SECTION, INCLUDING WHETHER THE FINANCING METHOD 29 WILL COVER THE COSTS OF IMPLEMENTING THE STEWARDSHIP PLAN; AND 30 8 HOUSE BILL 36 (II) THE PRODUCER , INDIVIDUALLY OR AS P ART OF A 1 STEWARDSHIP ORGANIZA TION, ENGAGED SUFFICIENTLY WITH STAKEHOLDERS , 2 INCLUDING LOCAL GOVERNMENTS, IN DEVELOPING THE STEWARDSHIP PLAN; 3 (F) WITHIN 6 MONTHS AFTER THE DAT E A STEWARDSHIP PLAN IS 4 APPROVED UNDER THIS SECTION, A PRODUCER OR STEWAR DSHIP ORGANIZATION 5 SHALL IMPLEMENT THE STEWARDSHIP PLAN. 6 (G) (1) SUBJECT TO PARAGRAPH (2) OF THIS SUBSECTION, AN APPROVED 7 STEWARDSHIP PLAN SHALL EXPIRE AFTER 5 YEARS. 8 (2) THE DEPARTMENT MAY RESCIND APPROVAL OF A STEWARDSHIP 9 PLAN AT ANY TIME. 10 9–2304. 11 A LOCAL GOVERNMENT MAY REQUEST REIMBURSEMENT FROM A PRODUCER 12 OR STEWARDSHIP ORGANIZATION THAT HAS AN APPROVED STEWARDSHIP PLAN ON 13 FILE WITH THE DEPARTMENT FOR COSTS ASSOCIATED WITH COLL ECTING, 14 TRANSPORTING, AND PROCESSING COVERED MATERIALS AND PRODUCTS THAT ARE 15 LISTED UNDER THE STEWARDSHIP PLAN, IN ACCORDANCE WITH: 16 (1) THE REQUIREMENTS OF T HE PRODUCER , AS ESTABLISHED 17 UNDER THE STEWARDSHIP PLAN; AND 18 (2) ANY OTHER REQUIREMENT ADOPTED B Y THE DEPARTMENT BY 19 REGULATION. 20 9–2305. 21 (A) ON OR BEFORE OCTOBER 1, 2023, AND EACH OCTOBER 1 THEREAFTER, 22 A PRODUCER SHALL SUBMIT A REPORT TO T HE DEPARTMENT, IN A MANNER 23 REQUIRED BY THE DEPARTMENT, EVALUATING PROGRESS TOWARD MEET ING 24 STEWARDSHIP PLAN REQ UIREMENTS AND GOALS FOR THE IMMEDIATELY 25 PRECEDING YEAR. 26 (B) FINANCIAL, PRODUCTION, OR SALES DATA REPORT ED TO THE 27 DEPARTMENT BY A PRODUCER , INDIVIDUALLY OR AS P ART OF A STEWARDSHIP 28 ORGANIZATION, SHALL BE KEPT CONFIDENTIAL BY THE DEPARTMENT AND MAY NOT 29 BE SUBJECT TO PUBLIC INSPECTION. 30 (C) SUBJECT TO SUBSECTION (B) OF THIS SECTION, THE REPORT SHALL BE 31 POSTED O N THE WEBSITE OF THE DEPARTMENT AND THE PRODUCER OR 32 HOUSE BILL 36 9 STEWARDSHIP ORGANIZATION. 1 9–2306. 2 ANY PERSON PARTICIPATING IN A STEWARDSHIP PLAN IN COMPLIANCE WITH 3 THIS SUBTITLE IS IMM UNE FROM LIABILITY U NDER STATE LAW RELATING TO 4 ANTITRUST AND RESTRAINT OF TRADE FOR ANY COOPERATED ACTIVITIES ARISING 5 OUT OF THE RECYCLING , REUSE, AND DISPOSAL OF COVE RED MATERIALS AND 6 PRODUCTS. 7 9–2307. 8 THE DEPARTMENT SHALL ADOP T REGULATIONS TO CAR RY OUT THIS 9 SUBTITLE. 10 9–2308. 11 (A) A PRODUCER OR STEWARDS HIP ORGANIZATION THA T VIOLATES THIS 12 SUBTITLE IS SUBJECT TO: 13 (1) FOR A FIRST VIOLATION, A CIVIL PENALTY OF $5,000; 14 (2) FOR A SECOND VIOLATION, A CIVIL PENALTY OF $10,000; AND 15 (3) FOR A THIRD AND SUBSEQUENT VIOLATION, A CIVIL PENALTY OF 16 $20,000. 17 (B) IF A PENALTY IS IMPOS ED ON A STEWARDSHIP ORGANIZATION UNDER 18 THIS SECTION , EACH PRODUCER PARTICI PATING IN THE STEWARDSHIP 19 ORGANIZATION IS JOINTLY AND SEVERALL Y LIABLE FOR THE PAYMENT OF THE 20 PENALTY. 21 SECTION 2. AND BE IT FURTHER ENACTED, That this Act shall take effect 22 October 1, 2021. 23