Establishes the "Producer Responsibility Program for Statewide Recycling Act"

SECOND REGULAR SESSION HOUSE BILL NO. 3504 103RD GENERAL ASSEMBL Y INTRODUCED BY REPRESENT A TIVE THOMAS. 7015H.01I JOSEPH ENGLER, Chief Clerk AN ACT T o amend chapter 260, RSMo, by adding thereto fifteen new sections relating to the producer responsibility program for statewide recycling act, with penalty provisions. Be it enacted by the General Assembly of the state of Missouri, as follows: Section A. Chapter 260, RSMo, is amended by adding thereto fifteen new sections, to 2 be known as sections 260.1 160, 260.1 162, 260.1 164, 260.1 166, 260.1 168, 260.1 170, 3 260.1 172, 260.1 174, 260.1 176, 260.1 178, 260.1 180, 260.1 182, 260.1 184, 260.1 186, and 4 260.1 188, to read as follows: 260.1 160. Sections 260.1 160 to 260.1 188 shall be known and may be cited as the 2 "Pr oducer Responsibility Pr ogram for Statewide Recycling Act". 260.1 162. As used in sections 260.1 160 to 260.1 188, unless the context pr ovides 2 otherwise, the following terms mean: 3 (1) "Additional prod ucer res ponsibility organization", a nonpro fit organization 4 designated by the department as an additional pr oducer res ponsibility organization 5 under subsection 2 of section 260.1 172; 6 (2) "Advisory board", the pr oducer responsibi lity pr ogram for statewide 7 r ecycling advisory board crea ted in section 260.1 164; 8 (3) "Amended plan pr oposal", an amended plan pr oposal for the 9 implementation of the pr ogram submitted to the advisory board after the advisory 10 board's initial rev iew of the plan prop osal in accordance with subsection 5 of section 11 260.1 166; 12 (4) "Collection", the gathering and transportation of covere d materials fr om 13 cover ed entities for the purpose of recycli ng; EXPLANA TION — Matter enclosed in bold-faced brackets [thus] in the above bill is not enacted and is intended to be omitted from the law . Matter in bold-face type in the above bill is proposed language. 14 (5) "Collection rate", the weight of covered materials that ar e collected under 15 the pr ogram in a calendar year divided by the weight of covered materials used for 16 pr oducts sold or distributed by pr oducers within or into the state in the same calendar 17 year , expr essed as a perc entage; 18 (6) "Compost", the material or pro duct that is developed under controll ed 19 conditions and that res ults fro m biological degradation process es by which organic 20 wastes decompose; 21 (7) "Compost facility", a site where compost is prod uced and includes only those 22 compost facilities that readi ly accept and pr ocess packaging material collected fr om 23 consumers; 24 (8) "Compostable", a cover ed material associated with organic waste stre ams 25 that is capable of undergoing aero bic biological decomposition in a controll ed 26 composting system as demonstrated by meeting ASTM D6400 or ASTM D6868 27 standards, or any successor standards; 28 (9) "Consumer", any person who purc hases or receives cover ed materials in the 29 state and is located at a cover ed entity; 30 (10) "Convenience standards", the standards for the pr ogram as described in 31 subsection 3 of section 260.1 168; 32 (1 1) "Covered entity", the following locations in the state fro m which cover ed 33 materials are collected: 34 (a) All single-family or multifamily res idences in the state; and 35 (b) Nonr esidential locations identified in the final plan, including public places, 36 small businesses, schools as defined under state law , hospitality locations, and state and 37 local government buildings; 38 (12) "Covered materials": 39 (a) Shall include: 40 a. Packaging materials except as indicated in paragraph (b) of this subdivision; 41 and 42 b. Paper pr oducts, except as indicated in paragraph (b) of this subdivision; 43 (b) Shall not include: 44 a. Packaging materials intended to be used for the long-term storage or 45 pr otection of a durable pr oduct and that ar e intended to transport, pr otect, or stor e the 46 pr oduct for at least five years; 47 b. Paper pr oducts that, thr ough their use, could become unsafe or insanitary to 48 handle; HB 3504 2 49 c. Printed paper used to distribute financial statements, billing statements, 50 medical documents, or other vital documents requi red to be provi ded in paper form by 51 applicable consumer pr otection laws or other state or federal laws; 52 d. Bound books; 53 e. Beverage containers subject to a ret urnable container deposit, if applicable; 54 f. Packaging material used exclusively in industrial or manufacturing proce sses; 55 g. Packaging material used to contain a pr oduct that is regul ated as a drug, 56 medical device, or dietary supplement by the federal Food and Drug Administration 57 under the Federal Food, Drug, and Cosmetic Act, 21 U.S.C. Section 301 et seq., as 58 amended, or any federal regu lation pro mulgated under such act, or any equipment and 59 materials used to manufactur e such pro ducts; 60 h. Packaging material used to contain a pr oduct that is r egulated as animal 61 biologics, including vaccines, bacterins, antisera, diagnostic kits, and other prod ucts of 62 biological origin under the federal V irus-Serum-T oxin Act, 21 U.S.C. Section 151 et seq., 63 as amended; 64 i. Packaging material used to contain a pr oduct that is re gulated under the 65 Federal Insecticide, Fungicide, and Rodenticide Act, 7 U.S.C. Section 136 et seq., as 66 amended; 67 j. Packaging material used to contain arc hitectural paint; 68 k. Packaging material used to contain a pro duct that is r equir ed under state law 69 to be sold in packaging material that meets the standards set forth in the Poison 70 Pr evention Packaging Act of 1970, 15 U.S.C. Section 1471 et seq., as amended; 71 l. Packaging material used to contain a portable electr onic device that has been 72 r epair ed and recond itioned to be sold as a r efurbished prod uct; 73 m. Paper prod ucts used for a print publication that primarily includes content 74 derived fr om primary sourc es relat ed to news and curren t events; 75 n. Packaging material used to contain a pr oduct that is regul ated as infant 76 formula as defined in 21 U.S.C. Section 321 (z), as a medical food as defined in 21 U.S.C. 77 Section 360 ee (b)(3), or as fortified nutritional supplements used for individuals who 78 r equir e supplemental or sole source nutrition to meet nutritional needs due to special 79 dietary needs dir ectly r elated to cancer , chr onic kidney disease, diabetes, malnutrition, 80 or failure to thrive, as those terms are defined by the W orld Health Organization's 81 International Classification of Diseases (tenth revision), as amended or revi sed, or any 82 other medical conditions as determined by the department by rule; and 83 o. Any other material that, based on an analysis by the organization of the 84 operational and financial impacts of the pr oposed changes and after consultation with 85 the advisory board, the department determines by rule to not be a cover ed material; HB 3504 3 86 (13) "Department", the department of natural res our ces; 87 (14) "Dir ector", the dir ector of the department of natural res ourc es, or the 88 dir ector's designee; 89 (15) "Enviro nmentally sound management practices", policies that ensur e 90 compliance with all applicable environm ental laws, including laws addres sing 9 1 r ecordkeeping, tracking and documenting the disposition of cover ed materials 9 2 collected fr om covered entities, and envir onmental liability coverage for pr ofessional 93 services and contractor operations; 94 (16) "Final plan", the plan pr oposal or amended plan pr oposal that has been 95 designated as the final plan by the director under subsection 5 of section 260.1 166; 96 (17) "Local government", any county , city , or village; 97 (18) "Materials recov ery facility", a facility for process ing cover ed materials 98 that ar e collected for recycli ng befor e they are conveyed to end-market businesses; 99 (19) "Mechanical recycl ing", a form of r ecycling that does not change the basic 100 molecular structure of the material being r ecycled; 101 (20) "Minimum recy clable list", the list of covere d materials developed under 102 subsection 1 of section 260.1 168; 103 (21) "Needs assessment", the assessment of the state's recycl ing needs conducted 104 under subsection 3 of section 260.1 166; 105 (22) "Nonpr ofit organization", a tax-exempt charitable or social welfare 106 organization operating under 26 U.S.C. 501(c)(3) or 501(c)(4) of the federal Internal 107 Revenue Code of 1986, as amended; 108 (23) "Packaging material": 109 (a) Any of the following: 110 a. Any material, reg ardless of r ecyclability , that is intended for single or short- 111 term use and is used for the containment, pr otection, handling, or delivery of prod ucts 112 to the consumer at the point of sale, including thr ough an internet transaction; 113 b. Pr oducts supplied to or pur chased by consumers for the express purpose of 114 facilitating food or beverage consumption and that are ordinarily disposed of after a 115 single or short-term use and not designed for reuse or ref ill; 116 c. Paper , plastic, glass, metal, cartons, flexible foam, ridge packaging, or other 117 materials, or combination of these materials; and 118 (b) Shall not include: 119 a. Packaging materials used solely in transportation or distribution to 12 0 nonconsumers; 121 b. Packaging materials used solely in business-to-business transactions where a 122 cover ed material is not intended to be distributed to the end consumer; HB 3504 4 123 c. Packaging materials that ar e not sold or distributed to cover ed entities; or 124 d. Packaging materials that are used for pr oducts sold or distributed outside the 125 state; 126 (24) "Paper pr oducts", paper and other cellulosic fibers whether they are used 127 as a medium for text or images including flyers, bro chur es, booklets, catalogues, 128 telephone dir ectories, newspapers, magazines, and paper used for writing or any other 129 purpose; 130 (25) "Plan pr oposal", the plan pr oposal for the implementation of the pr ogram 131 submitted to the advisory board under subsection 4 of section 260.1 166; 132 (26) "Postconsumer -r ecycled-content rate", the amount of postconsumer 133 r ecycled materials used in the pr oduction of cover ed materials in a calendar year 134 divided by the amount of cover ed materials used for pro ducts sold or distributed by 135 pr oducers within or into their United States market territory in the same calendar year , 136 expr essed as a per centage; 137 (27) "Postconsumer recycl ed material", only those cover ed materials that have 138 served their intended end use as consumer items and that have been separated or 139 diverted fr om the waste str eam for the purposes of collection and recy cling as a 140 secondary material feedstock. "Postconsumer r ecycled material" includes ret urns of 141 material fr om the distribution chain, but excludes waste material generated during or 142 after the completion of a manufacturing pr ocess; 143 (28) "Prod ucer": 144 (a) Any of the following: 145 a. If the prod uct is sold or distributed in the state using packaging materials 146 under the manufactur er's own brand or is sold or distributed in the state using 147 packaging materials that lack identification of a brand, the person who manufactur es 148 the pro duct; 149 b. If the prod uct is manufactur ed by a person other than the brand owner , the 150 person who is the licensee of a brand or trademark under which a packaged item is sold 151 or distributed in the state, whether the trademark is regist ered in the state; or 152 c. If ther e is no person described in subparagraph a. of this paragraph within the 153 United States, the person who imports the pr oduct using cover ed materials into the 154 United States for use in a commer cial undertaking that sells or distributes the item in 155 the state; 156 (b) For the purposes of pr oducts that ar e sold or distributed in the state thr ough 157 an internet transaction: 158 a. The pr oducer of the packaging material used to directly protect or contain the 159 pr oduct; or HB 3504 5 160 b. For the purposes of packaging material used to ship a pr oduct to a consumer , 161 the person that packages or ships the pr oduct to the consumer; 162 (c) For the purposes of a paper pro duct that is a magazine, newspaper , catalog, 163 telephone dir ectory , or similar publication, the publisher of the paper pr oduct; 164 (d) For the purposes of paper pr oducts not described in paragraph (c) of this 165 subdivision: 166 a. The person that manufactur es the paper pr oduct under the manufactur er's 167 own brand; or 168 b. If the paper pr oduct is manufactur ed by a person other than the brand owner , 169 the person that is the owner or licensee of the brand or trademark under which the 170 paper prod uct is used in a commer cial undertaking, sold, or distributed in or into the 171 state, whether the trademark is reg istered in the state; or 172 (e) For any other covere d material, the person that first distributes the cover ed 173 material in or into the state; 174 (29) "Prod ucer re sponsibility dues", the amounts established in subdivision (9) 175 of subsection 4 of section 260.1 166 that a pr oducer participating in the pro gram pays 176 annually into the progr am under subsection 1 of section 260.1 174; 177 (30) "Pr oducer res ponsibility organization" or "organization", the nonpr ofit 178 organization designated to implement the pr ogram under subdivision (2) of subsection 1 179 of section 260.1 166; 180 (31) "Prod ucer res ponsibility pr ogram for statewide recy cling" or "pr ogram", 181 the prod ucer res ponsibility pr ogram for statewide recycli ng described under section 182 260.1 166; 183 (32) "Prop rietary information", information that, if made public: 184 (a) W ould divulge competitive business information or trade secr ets of the entity 185 that developed the information; or 186 (b) W ould r easonably hinder the entity's competitive advantage in the market; 187 (33) "Public place", an indoor or outdoor location in the state that is open to and 188 generally used by the public including, but not limited to, street s; sidewalks; plazas; 189 town squar es; state-owned or local-government-owned parks, beaches, and for ests; 190 other state-owned or local-government-owned land open for recr eation or other public 191 uses; and transportation facilities including bus and train stations and airports. The 192 term "public place" does not include industrial, commer cial, or privately owned 193 pr operty; 194 (34) "Readily r ecyclable material", a cover ed material that is included on the 195 minimum recyc lable list; HB 3504 6 196 (35) "Recycling", the rep roces sing by means of a manufacturing pr ocess of a 197 used material into a pro duct or a secondary raw material. The term "recy cling" does 198 not include: 199 (a) Energy recovery or energy generation by means of combustion; 200 (b) Use as a fuel; 201 (c) Use as alternative daily cover as defined under the rules and r egulations of 202 the department of natural r esources ; or 203 (d) Landfill disposal of discarded cover ed materials; 204 (36) "Recycling rate", the weight of cover ed materials that are recycl ed under 205 the pr ogram in a calendar year divided by the weight of covered materials used for 206 pr oducts sold or distributed by pr oducers within or into the state in the same calendar 207 year , expr essed as a per centage. The r ecycling rate is measur ed at the point wher e 208 collected cover ed materials have been pre pared for sale or delivery to material 209 r eclaimers or end markets after pro cessing at a materials recover y facility or similar 210 establishment that sells directly to recla imers or end markets; 211 (37) "Recycling services", services prov ided for the recycli ng of cover ed 212 materials, including the collection, transportation, and process ing of cover ed materials 213 fr om the consumer to the end market. "Recycling services" includes curbside services 214 and drop -off centers; 215 (38) "Recycling services costs", the costs of recycling pro grams to provi de 216 r ecycling services, including applicable costs rela ted to: 217 (a) The administration of recy cling pr ograms; 218 (b) Capital improv ements to r ecycling pr ograms; 219 (c) The collection, transportation, sorting, and pro cessing of covered materials; 220 (d) Public education about re cycling pr ograms; and 221 (e) Disposal of nonr ecyclable collected cover ed materials; 222 (39) "Responsible end market", a materials market in which the recy cling of 223 materials or the disposal of contaminants is conducted in a way that benefits the 224 envir onment and minimizes risks to public health and worker health and safety; 225 (40) "Retailer", a person that sells to consumers within or into the state, 226 including sales made thr ough an internet transaction, pr oducts for which cover ed 227 materials are used; 228 (41) "Reuse" or "r efill", the r eturn into the marketplace of a cover ed material 229 that has alre ady been used in the same manner as originally intended without a change 230 in the cover ed material's purpose, and was intended to be used for its original purpose 231 at least five times; HB 3504 7 232 (42) "Service prov ider", a public or private entity , other than the prod ucer 233 r esponsibility organization, that pro vides r ecycling services in the state. 260.1 164. 1. There is her eby cre ated in the department of natural res ource s the 2 "Pr oducer Responsibility Pr ogram for Statewide Recycling Advisory Board". The 3 department shall select an impartial, third-party facilitator to convene and prov ide 4 administrative support to the advisory board. 5 2. The advisory board shall consist of the following thirteen voting members and 6 two nonvoting members appointed by the department director: 7 (1) Thre e voting members r epre senting local governments in the state, 8 including: 9 (a) One member rep res enting a city; 10 (b) One member rep res enting a county; and 11 (c) One member repr esenting a local government located in a rural county; 12 (2) One voting member rep rese nting a materials rec overy facility; 13 (3) One voting member rep res enting a hauler of recycla ble materials, whether 14 r epresent ing the public or private sector; 15 (4) One voting member repr esenting an envir onmental or community-based 16 nonpr ofit organization; 17 (5) One voting member r epresent ing a packaging material supplier that is not a 18 pr oducer , with the member rot ating to a packaging material supplier of a differ ent type 19 of packaging material after each new term; 20 (6) One voting member r epresent ing a manufactur er of r ecycled paper products 21 that is not a prod ucer; 22 (7) One voting member rep res enting a trade association, chamber of commer ce, 23 or other business advocacy organization r epresent ing businesses that are headquarter ed 24 in the state; 25 (8) One voting member r epresent ing a reta iler's association or a r etailer that is 26 not a prod ucer; 27 (9) One voting member rep rese nting a compost facility; 28 (10) One voting member who has experience in envir onmental justice and 29 r epresent ing underserved communities; 30 (1 1) One voting member repr esenting a solid waste landfill or transfer station 31 operating an on-site, public-facing r ecycling collection pr ogram; 32 (12) One nonvoting member repr esenting the department; and 33 (13) One nonvoting member r epresen ting the pr oducer r esponsibility 3 4 organization. HB 3504 8 35 3. The members of the advisory board shall have rele vant knowledge and 36 expertise in recycl ing pr ograms or the impacts of covere d materials on the state and the 37 envir onment. 38 4. In appointing members, the dir ector shall ensur e to the extent practicable the 39 geographic diversity of the advisory board's membership, including r egions outside of 40 urban area s. 41 5. The department dir ector shall make all appointments to the advisory board 42 no later than December 31, 2027. The appointments for initial terms to the advisory 43 board shall be stagger ed so that some of the members serve initial two-year terms and 44 other members serve initial thr ee-year terms, and all members serve subsequent terms 45 of thr ee years. The department dir ector shall fill any vacancy by appointment for the 46 r emainder of the unexpired term. 47 6. The advisory board shall convene its first meeting no later than March 1, 48 2028. At the first meeting, the voting members shall select a chair and vice chair fr om 49 among the voting members for a term not to exceed two years, as determined by the 50 advisory board. The advisory board shall conduct annual meetings and may conduct 51 meetings mor e freq uently upon the requ est of the chair or of at least seven of the voting 52 members of the advisory board. The organization and the department may prov ide 53 technical and staff assistance to the advisory board. 54 7. The advisory board is subject to the open meetings pr ovisions of the Missouri 55 sunshine law , in chapter 610. 56 8. Advisory board members are entitled to be reim bursed at a rate consistent 57 with other boards and commissions cr eated within the department for necessary travel 58 within the state and other r easonable expenses incurr ed in the performance of their 59 official duties. 60 9. The advisory board shall: 61 (1) Advise the organization thr oughout the needs assessment process in 62 accordance with subsection 3 of section 260.1 166; 63 (2) Review the needs assessment repo rted to the advisory board under 64 subsection 3 of section 260.1 166; 65 (3) Review the plan pr oposal submitted under section 260.1 166; 66 (4) Consult with the organization on amendments to the plan pr oposal and the 67 amended plan pr oposal; 68 (5) Recommend that the dir ector appr ove or rej ect the plan pr oposal or 69 amended plan pr oposal; 70 (6) Review the annual r eport submitted by the organization under subsection 2 71 of section 260.1 174; and HB 3504 9 72 (7) Consult with the organization on the development and updating of the 73 minimum recyc lable list. 74 10. In consultation with the organization, the advisory board shall r ecommend 75 amendments to the final plan to the dir ector for inclusion in the annual repo rt under 76 subsection 2 of section 260.1 174. 260.1 166. 1. (1) On or before June 1, 2028, pr oducers or their designated agents 2 shall establish a nonpro fit organization to fulfill the req uiremen ts of sections 260.1 160 to 3 260.1 188 and shall pr ovide notification to the department that includes: 4 (a) The name, addr ess, and contact information of a person res ponsible for 5 ensuring the compliance of the nonpr ofit organization and participating pro ducers 6 under sections 260.1 160 to 260.1 188; 7 (b) A list of participating pro ducers; and 8 (c) A description of the funding mechanism that the nonprof it organization shall 9 use to conduct the needs assessment. 10 (2) Upon receipt of the notification given under subdivision (1) of this subsection, 11 the dir ector shall: 12 (a) Acknowledge receip t of the notification; and 13 (b) Designate the nonpr ofit organization as the pr oducer r esponsibility 14 organization to implement and administer the pr oducer r esponsibility progra m for 15 statewide recycling. 16 (3) The organization designated by the director under subdivision (2) of this 17 subsection shall have a governing board with voting members that rep res ent a diverse 18 range of pr oducers by size and type and rep res ent pr oducers of differ ent types of 19 cover ed materials. The members of the governing board shall not have mor e than one 20 member per corporate entity . The governing board of the organization shall include 21 nonvoting members that r epresent trade associations for types of cover ed materials. 22 The organization shall provi de public notice of any board meetings at least seventy-two 23 hours befor e the board meeting. 24 2. The pr oducer res ponsibility organization shall: 25 (1) Facilitate a needs assessment in consultation with the advisory board; 26 (2) Consult with the advisory board in the development of the plan pro posal 27 prior to its submission, including in the development of the cost formulas for 28 r eimbursements to service pr oviders under subsection 3 of this section; 29 (3) Submit a plan pr oposal in accordance with subsection 4 of this section that 30 covers a period of five years; and HB 3504 10 31 (4) Operate and administer the prog ram in accordance with the final plan, the 32 pr ovisions of sections 260.1 160 to 260.1 188, and the rules adopted by the department 33 under sections 260.1 160 to 260.1 188. 34 3. (1) On or before September 1, 2027, the organization shall hir e an 35 independent third party appr oved by the dir ector to conduct an assessment of the state's 36 r ecycling needs. The organization shall issue a requ est for prop osals in accordance with 37 the provi sions of chapter 34, and applicable rules, for the selection of the independent 38 third party . Prior to the commencement of the needs assessment, the organization shall 39 consult with the advisory board on the scope of the needs assessment and pro vide any 40 necessary r ecommendations to the third-party consultant conducting the needs 41 assessment. The needs assessment shall be inclusive of and addr ess the needs of all 42 geographic areas of the state. At a minimum, the needs assessment shall identify: 43 (a) The service availability , capacity , performance, and gaps in recycli ng services 44 pr ovided to res idential cover ed entities thr oughout the state and the prices paid for 45 r ecycling services; 46 (b) The documented recy cling services costs incurr ed by public and private 47 service pr oviders to pro vide recycli ng services for res idential cover ed entities; 48 (c) Demographic factors and other variables to be consider ed in the development 49 of reim bursement rates for service pr oviders in accordance with subdivision (10) of 50 subsection 4 of this section; 51 (d) The levels of contamination at materials recovery facilities and compost 52 facilities thr oughout the state and the impacts of contamination on those facilities; 53 (e) The service availability , gaps, and recy cling services costs associated with 54 pr oviding re cycling services to nonr esidential covered entities, with particular attention 55 to small businesses, and which types and locations of nonr esidential cover ed entities 56 could be pr ovided with r ecycling services that would incr ease statewide collection and 57 r ecycling rates in a cost-effective manner; 58 (f) The process ing capacity of existing infrastructur e and the additional 59 infrastructur e needed to meet or exceed the convenience standards, re duce 6 0 contamination, and impr ove the quality of recycl able materials and the pro jected 61 scenarios for incr easing the recycl ing rate and collection rate of cover ed materials, as 62 identified under paragraph (m) of this subdivision; 63 (g) An evaluation of the opportunities and costs of various service methods to 64 incr ease recycli ng rates overall for specific cover ed material types; 65 (h) A prop osed list of covere d materials for inclusion in the minimum r ecyclable 66 list and additional materials that shall be collected in differ ent geographic ar eas thr ough 67 curbside services, dr op-off centers, or other means; HB 3504 1 1 68 (i) The market conditions and opportunities for the use of r ecycled cover ed 69 materials in the state and in differ ent geographic areas of the state, including the 70 transportation gaps and opportunities affecting access to markets; 71 (j) Opportunities for the use of innovative new technologies, including artificial 72 intelligence technologies, for the recy cling and reu se of cover ed materials; 73 (k) The availability and scope of any reu se or r efill systems in the state affecting 74 the use of cover ed materials; 75 (l) Education needs in the state; and 76 (m) At least thr ee pr ojected scenarios for increa sing the recycl ing rate and 77 collection rate of covered materials in the state, including recycl ing rates and collection 78 rates that the state could meet by January 1, 2033, and January 1, 2036, and the 79 operating and capital costs needed to rea ch each pr ojected scenario, including: 80 a. A rev iew and assessment of the impact of the exemptions described in 81 paragraph (b) of subdivision (12) and paragraph (b) of subdivision (23) of section 82 260.1 162, and in section 260.1 182 on the feasibility and short-term and long-term 83 success of the prog ram; 84 b. A revi ew and assessment of the impact of pro ducer exemptions in other 85 international and domestic extended pr oducer res ponsibility pr ograms implemented by 86 a pr oducer res ponsibility organization; and 87 c. A determination of whether any industry sector would be dispr oportionately 88 impacted as a r esult of the exemptions described in paragraph (m) of subdivision (1) of 89 this subsection; and 90 (n) The capacity , costs, and gaps for compost facilities to pr ocess and r ecover 91 compostable materials. 92 (2) The organization shall consult with the advisory board thr oughout the needs 93 assessment proc ess and in determining which projecte d scenario identified in paragraph 94 (m) of subdivision (1) of this subsection to implement in its plan prop osal. 95 (3) On or before January 30, 2030, the organization shall r eport the res ults of the 96 needs assessment to the advisory board and the dir ector . The dir ector shall post the 97 r esults of the needs assessment on the department's website and pro vide public notice 98 and an opportunity to comment on the res ults of the needs assessment. In finalizing the 99 needs assessment, the dir ector shall include in the needs assessment a summary of any 100 comments receiv ed under this subsection and identify any significant changes made to 101 the needs assessment based on such comments. 102 (4) On or before May 1, 2033, and on or before May first every five years 103 ther eafter , the organization shall hir e an independent third party appr oved by the 104 dir ector to conduct an updated assessment of the state's recy cling needs to reev aluate HB 3504 12 105 the pro gram and identify any recy cling service needs in the state that are not being met 106 by the pr ogram. In consultation with the advisory board, the organization may modify 107 the scope of an updated needs assessment by April 15, 2033, and on or before April 108 fifteenth every five years ther eafter . The organization shall rep ort the results of the 109 updated needs assessment to the dir ector in accordance with the reporting r equir ements 110 set forth in subdivision (3) of this subsection. The organization shall use the findings of 111 the updated needs assessment to crea te an updated plan pr oposal and submit the 112 updated plan prop osal to the advisory board in accordance with subsection 4 of this 113 section. In consultation with the advisory board and the organization, the director may 114 waive the req uirement to conduct an updated needs assessment under this subsection. 115 4. On or before February 1, 2030, the organization shall submit a plan prop osal 116 for the pro gram to the advisory board, that, except as set forth in this subsection, only 117 addr esses r ecycling services for res idential covered entities. The plan prop osal shall 118 cover a period of five years, and an updated plan pr oposal shall be submitted to the 119 advisory board on or befor e February first every five years ther eafter . Any updated 120 plan prop osal shall addr ess recycl ing services for both res idential and any applicable 121 nonr esidential cover ed entities, as identified in the needs assessment under subsection 3 122 of this section. In developing the plan pro posal and any updated plan prop osals, the 123 organization shall solicit and consider input fr om the advisory board and provi de 124 opportunity for additional stakeholder input. T o be appr oved, a plan prop osal shall: 125 (1) Pr ovide contact information for the organization and a repr esentative of the 126 organization; 127 (2) Describe how the plan pr oposal shall addr ess and implement the findings of 128 the needs assessment; 129 (3) Describe the manner in which the organization solicited and consider ed 130 input fr om stakeholders and the advisory board in developing the plan pro posal. The 131 organization shall pr ovide a summary of any comments about the plan pr oposal fr om 132 the advisory board and additional stakeholders and identify changes made to the plan 133 pr oposal based on the comments; 134 (4) Describe how the organization shall notify affected prod ucers of their 135 obligations under sections 260.1 160 to 260.1 188; 136 (5) Describe how the organization shall track compliance among pr oducers and 137 shall collaborate with the dir ector to bring pr oducers into compliance; 138 (6) Include a compr ehensive list of the covered materials included in the 139 pr ogram in accordance with sections 260.1 160 to 260.1 188; 140 (7) Establish re cycling practices that: 141 (a) Meet or exceed the convenience standards; HB 3504 13 142 (b) Use open, competitive, and fair pr ocur ement practices when entering into 143 contracts with service pr oviders, and, when entering into contracts with private service 144 pr oviders, adopt a pr efer ence for service pr oviders with str ong labor standards and 145 worker safety practices; 146 (c) Ensure that any covere d materials collected for r ecycling shall be transferr ed 147 to a r esponsible end market; and 148 (d) Use envir onmentally sound management practices; 149 (8) Describe how the organization shall work with newspaper publishers and 150 magazine and periodical publishers to accept print or online advertising in lieu of all or 151 a portion of the pr oducer respo nsibility dues for newspapers, magazines, and 15 2 periodicals cir culated within the state; 153 (9) Establish a funding mechanism that: 154 (a) Does not exceed the dir ect and indirec t costs of implementing the pr ogram, 155 including the costs of: 156 a. Pr oviding recycl ing services under the pr ogram thr ough contracts with 157 service pr oviders or reim bursement of r ecycling services costs under the reim bursement 158 rates pr oposed under subdivision (10) of this subsection; 159 b. Meeting the rep orting r equir ements set forth in section 260.1 174; 160 c. Conducting the needs assessment; 161 d. Developing and updating the final plan; 162 e. Implementing the education and outreach pr ogram under state law; 163 f. Reimbursing the department for its costs in administering and implementing 164 sections 260.1 160 to 260.1 188, including the costs of the advisory board; and 165 g. Reimbursing the department for the costs of enfor cing sections 260.1 160 to 166 260.1 188; 167 (b) Is funded thr ough pr oducer res ponsibility dues. The pr oducer 1 6 8 r esponsibility dues shall vary by the type of cover ed material, whether the material is 169 r eadily r ecyclable, and be based on the net recy cling services costs for each cover ed 170 material in the state. The organization may use up to five per cent of the prod ucer 171 r esponsibility dues collected from producers for administration of the pr ogram, over the 172 terms of the prog ram, in accordance with generally accepted accounting principles, but 173 the organization shall not use any pr oducer res ponsibility dues collected fr om pro ducers 174 to pay employee bonuses; 175 (c) Requir es: 176 a. Any surplus moneys generated by the prog ram to be placed back into the 177 pr ogram for pro gram impr ovements or a redu ction in pr oducer re sponsibility dues; HB 3504 14 178 b. The organization to maintain a financial res erve sufficient to operate the 179 pr ogram in a fiscally prudent and re sponsible manner; and 180 c. Annual updates to the prod ucer res ponsibility dues schedule to ref lect changes 181 in pr ogram costs and rele vant plan revision s and how the organization shall solicit and 182 incorporate input fr om all pr oducers in setting and revising the annual prod ucer 183 r esponsibility dues schedule; 184 (d) Includes ecomodulation factors that lower pr oducer r esponsibility dues to 185 incentivize: 186 a. Reductions in the amount of packaging materials used for pro ducts; 187 b. Innovations and practices to enhance the r ecyclability or commodity value of 188 cover ed materials; 189 c. High levels of postconsumer rec ycled material use; 190 d. Designs for the reuse and ref ill of covered materials; and 191 e. High recy cling and ref ill rates of cover ed materials; 192 (e) Includes ecomodulation factors that increa se prod ucer r esponsibility dues to 193 discourage: 194 a. Designs and practices that increa se the costs of recycling, r eusing, or 195 composting cover ed materials; 196 b. Designs and practices that disrupt the recycl ing of other materials; and 197 c. Pr oducers fr om using covered materials that are not on the minimum 198 r ecyclable list; and 199 (f) At the request of a pr oducer or prod ucers of a cover ed material, shall include 200 a special assessment paid by the producers of that covered material to cover system 201 impr ovements that impr ove the collection and recycl ing of that covered material or 202 facilitate the addition of the cover ed material to the list of re adily r ecyclable materials; 203 (10) Include reim bursement rates for one hundre d per cent of the net recycli ng 204 services costs of the recycl ing services provi ded by service provi ders under the pr ogram 205 consistent with the req uire ments of section 260.1 168. The reim bursement rates shall: 206 (a) Be calculated using an objective cost formula or formulas; 207 (b) Incorporate the relev ant cost information identified by the needs assessment 208 under subsection 3 of this section; 209 (c) Be calculated on a per -unit basis such as per ton, per household, or other unit 210 of measur ement; and 211 (d) T ake into account: 212 a. Regional recyc ling services costs; 213 b. Population density; 214 c. The number and types of households served; HB 3504 15 215 d. The collection method used; 216 e. The rev enue generated fr om cover ed materials; 217 f. The amount of inbound contamination and other factors affecting the quality 218 of covered materials; and 219 g. Other demographic factors identified in the needs assessment under 220 subdivision (1) of subsection 3 of this section; 221 (1 1) Describe the pr ocess to evaluate and r evise the objective cost formulas as 222 necessary and using documented costs. If the plan pro posal includes mor e than one 223 objective cost formula for recyc ling services, the plan pr oposal shall describe the 224 conditions under which each formula shall be applied; 225 (12) Include a schedule of r eimbursement rates for service pr oviders that elect to 226 participate in the prog ram and be reim bursed by the organization for pr oviding 227 r ecycling services for the pro gram and describe a proc ess for updating the schedule 228 periodically and as necessary; 229 (13) Include a pr oposed budget and a description of the pro cess used to 230 determine pr oducer r esponsibility dues, including a de minimis level in which no dues 231 ar e charged and an optional flat rate for pr oducers below a certain size to minimize the 232 administrative and re porting costs of the prod ucers and the organization; 233 (14) Describe a plan that outlines, if the organization ceases to exist or ceases to 234 administer the pro gram, how any prod ucer r esponsibility dues that have not been used 235 to implement the pr ogram shall be transferr ed to another organization designated by 236 the dir ector under subdivision (1) of subsection 1 of this section to administer the 237 pr ogram or shall be transferred to the fund to be managed by the department until 238 transferr ed to another designated organization; 239 (15) Include the minimum recycl able list established in accordance with section 240 260.1 168; 241 (16) Set targets for the minimum collection rates, minimum recycli ng rates, and 242 minimum postconsumer -r ecycled-content rates for certain types of cover ed materials, 243 including paper pr oducts, glass, metal, and plastic, that the state shall strive to meet by 244 January 1, 2034, and January 1, 2039; 245 (17) Describe how the organization plans to continue to incr ease the state's 246 minimum collection rates, minimum recycli ng rates, and minimum postconsumer - 247 r ecycled-content rates after January 1, 2034, and January 1, 2039; 248 (18) Describe how the organization shall verify minimum postconsumer - 249 r ecycled-content rates and how postconsumer -r ecycled-content rates shall be calculated 250 using weight and other metrics and describe any waivers fr om minimum postconsumer - 251 r ecycled-content rates granted to a type or subcategory of cover ed materials and the HB 3504 16 252 criteria for evaluating such waivers, including food safety re quir ements, technological 253 feasibility , or inadequate supply , and how often the waivers shall be rev iewed; 254 (19) Describe how the organization shall provi de pr oducers with the opportunity 255 to pur chase postconsumer -r ecycled materials fro m pr ocessors at market prices if the 256 pr oducer is interes ted in obtaining r ecycled feedstock to achieve minimum 2 5 7 postconsumer -r ecycled-content rates; 258 (20) Describe how the organization shall r educe or offset the prod ucer 259 r esponsibility dues for any pro ducer or gr oup of pr oducers that fund or operate a 260 collection pro gram that: 261 (a) Covers a specific type of cover ed material that is not pro cessed by materials 262 r ecovery facilities; and 263 (b) Has recycl ing rates that meet or exceed the minimum re cycling rate target set 264 forth in the plan pr oposal under this subsection; 265 (21) Describe how the organization shall work with service pr oviders to: 266 (a) Utilize and expand on existing recy cling services and infrastructur e and 267 existing education and outreach pr ograms; 268 (b) Reduce contamination of covered materials deliver ed to materials reco very 269 facilities and compost facilities by: 270 a. Requiring each materials recovery facility and compost facility participating 271 in the pr ogram to rep ort annually to the organization on contamination levels at each 272 facility; and 273 b. Pr oviding funding or other assistance to compost facilities to redu ce the costs 274 of managing or incr ease the effectiveness of efforts to manage contamination and to 275 pr ocess and re cover compostable packaging materials; 276 (c) Invest in new or upgraded recycl ing infrastructure ; 277 (d) Pr opose an appr oach to measur e and re port on the use of reusable and 278 r efillable cover ed materials and establish goals and strategies for incr easing the use of 279 r eusable and ref illable covered materials; 280 (e) Mitigate the impacts of cover ed materials on other materials and equipment 281 at sorting and pr ocessing facilities; 282 (f) Invest in market development for cover ed materials in the state; and 283 (g) Increas e the r ecycling of collected covered materials; 284 (22) Describe how the organization shall work with and incentivize pr oducers to 285 r educe the packaging of prod ucts using cover ed materials thr ough pro duct design 286 changes, the development or expansion of systems for r eusable packaging, and pr oduct 287 innovation; HB 3504 17 288 (23) Describe how the pr ogram shall prioritize the use of end markets that 289 r eturn postconsumer recycled materials to their original pr oduct type; 290 (24) Describe how the organization shall evaluate and monitor the use of 291 r esponsible end markets thr ough methods such as pr ocessor contracts or financial 292 incentives; 293 (25) Describe how the organization shall implement the education and outrea ch 294 pr ogram; 295 (26) Describe a pr ocess and timeline, beginning no later than 2028, to expand 296 r ecycling services to applicable nonr esidential cover ed entities, as identified in the needs 297 assessment under subsection 3 of this section; and 298 (27) Include any additional information req uired by the department. 299 5. (1) The advisory board shall revi ew the plan pr oposal for compliance with 300 sections 260.1 160 to 260.1 188. The advisory board shall consult with the organization 301 thr oughout its rev iew of the plan pr oposal. Within ninety days after the submission of 302 the plan pro posal to the advisory board, the advisory board shall either pr ovide any 303 r ecommended amendments to the plan pr oposal to the organization or , if the advisory 304 board does not have any re commended amendments, forward the plan pr oposal to the 305 dir ector . The organization shall pr ovide res ponsive answers to the advisory board's 306 r ecommendations and submit the amended plan prop osal to the advisory board within 307 sixty days after its rec eipt of the recomm ended amendments. Wi thin forty-five days 308 after the submission of the amended plan prop osal to the advisory board, the advisory 309 board shall forward the amended plan prop osal to the direc tor with its rec ommendation 310 for appr oval or rej ection and, if applicable, a written explanation of the basis for 311 r ecommending rejection of the plan prop osal. Within eight days after recei ving the plan 312 pr oposal, the dir ector shall post the plan pr oposal on the department's website and 313 pr ovide public notice and an opportunity to comment on the plan pro posal. 314 (2) Wi thin one hundred twenty days after recei ving the plan pr oposal or 315 amended plan pr oposal, the dir ector shall: 316 (a) Appr ove the plan pr oposal or amended plan pr oposal; or 317 (b) Reject the plan pr oposal or amended plan pr oposal. 318 (3) If the dir ector rej ects the plan pr oposal or amended plan pro posal, the 319 dir ector shall notify the organization of the rej ection and the reas ons for the rej ection. 320 The reas ons shall be based on the failur e of the plan pr oposal or amended plan pro posal 321 to comply with the r equir ements specified in subsection 4 of this section. The 322 organization shall submit a new plan pr oposal to the advisory board within sixty days 323 after receivi ng the dir ector's r ejection. The new plan pro posal shall be revi ewed by the HB 3504 18 324 advisory board and the new plan pr oposal or new amended plan prop osal shall be 325 r eviewed and appr oved or rej ected by the director in accordance with this subsection. 326 (4) (a) If the dir ector appr oves the plan pr oposal or amended plan pro posal 327 under this subsection, the dir ector shall designate the plan prop osal or amended plan 328 pr oposal as the final plan and shall publish the final plan on the department's website. 329 (b) The organization shall begin implementing the final plan within six months 330 after it is appr oved. 331 6. (1) The organization shall submit pr oposed amendments to the final plan 332 annually to the advisory board for inclusion in the annual rep ort under section 333 260.1 174. At least sixty days prior to the deadline to submit the annual rep ort, the 334 department shall reque st that the organization submit an amendment to the annual plan 335 to addr ess a specific concern or aspect of the plan. At least thirty days prior to 336 submitting the annual repo rt under section 260.1 174, the organization shall consult with 337 the advisory board on any pr oposed amendments to the final plan. The advisory board 338 shall submit any pr oposed amendments to the dir ector . The dir ector shall appr ove or 339 r eject the prop osed amendments based on the plan pr oposal requ irem ents specified in 340 subsection 4 of this section. 341 (2) The organization shall continue to operate the pro gram in accordance with 342 the final plan pending the appr oval or rej ection of a prop osed amendment by the 343 dir ector . The dir ector's r ejection of a prop osed amendment under this subsection does 344 not relieve the organization of its res ponsibility to continue to operate the prog ram in 345 accordance with the final plan. 346 7. The dire ctor shall enforce sections 260.1 160 to 260.1 188 and the department 347 shall promul gate rules as may be necessary for the administration of sections 260.1 160 348 to 260.1 188. Notwithstanding any law to the contrary , the organization shall not make 349 any determination as to a person's compliance under sections 260.1 160 to 260.1 188. 350 8. (1) On January 1, 2030, and each January first ther eafter , as an alternative to 351 participating in the pro gram, a pr oducer shall submit to the advisory board an 352 individual pr ogram plan prop osal. A pr oducer shall notify the department of its intent 353 to submit an individual prog ram plan pr oposal by January 1, 2029, and by each 354 January first ther eafter . The individual pr ogram plan prop osal shall: 355 (a) Comply with the requi rem ents of subsection 4 of this section, as applicable; 356 (b) Describe how the pr oducer participating in the individual prog ram plan 357 pr oposal shall contribute to the costs of the department in overseeing the pr ogram; 358 (c) Describe how the pr oducer shall reim burse service pr oviders that prov ide 359 r ecycling services for the covered materials cover ed by the individual pr ogram plan 360 pr oposal; and HB 3504 19 361 (d) Describe any alternative collection prog rams run by the pr oducer and its 362 r ecycling rates. 363 (2) The advisory board shall r eview and make recomm endations on, and the 364 dir ector shall appr ove or re ject, any individual prog ram plan pr oposals in accordance 365 with the pr ocedur es set forth in subsection 5 of this section. After the director appr oves 366 the individual pr ogram plan pr oposal, the direc tor shall designate the individual 367 pr ogram plan pr oposal as the plan that the pr oducer is authorized to implement and 368 administer as an alternative to participating in the pro gram. 369 (3) The pr oducer implementing a plan described in this subsection shall submit 370 any amendments to the plan to the advisory board in accordance with subsection 6 of 371 this section. The advisory board shall rev iew and make recomm endations on, and the 372 dir ector shall appr ove or rej ect, any amendments to the plan in accordance with 373 subsection 6 of this section. 260.1 168. 1. (1) The organization shall develop a minimum recy clable list based 2 on the availability of rec ycling services, recyc ling collection and pr ocessing 3 infrastructur e, and recycl ing end markets for cover ed materials, as determined by 4 the needs assessment. 5 (2) The organization shall update the minimum recy clable list, and submit any 6 updates for inclusion in the annual repor t under section 260.1 174, in res ponse to 7 r ecycling collection and pr ocessing impr ovements and changes in recy cling end markets. 8 The advisory board shall consult with the organization on any updates to the minimum 9 r ecyclable list in accordance with the proce dures set forth in subsection 5 of section 10 260.1 166. 11 2. (1) T o be eligible for r eimbursement for recycli ng services pr ovided under the 12 pr ogram, service provi ders shall pr ovide recy cling services for all readi ly recyclable 13 materials in a manner that facilitates attaining the rate targets established in the final 14 plan under subsection 4 of section 260.1 166. 15 (2) The dir ector may grant a service pro vider an exception to the r equir ements 16 under subdivision (1) of this subsection if the service provi der demonstrates to the 17 r easonable satisfaction of the dir ector that it is not able to prov ide recyc ling services or 18 meet the convenience standards for a read ily recycla ble material. 19 (3) Service prov iders ar e eligible for reim bursement fr om the organization for 20 the collection of covere d materials that are not included in the minimum recyc lable list 21 for the regio ns wher e the organization has established a re asonable cost for the 22 supplemental collection of cover ed materials that ar e not rea dily r ecyclable and a 23 r esponsible end market has been established. The services described in this subdivision 24 ar e not subject to the convenience standards. HB 3504 20 25 (4) The organization shall r eimburse service pr oviders for the rec ycling services 26 costs to pr ovide r ecycling services for all read ily re cyclable materials and cover ed 27 materials that the organization appr oves under subdivision (3) of this subsection. 28 (5) Notwithstanding any law to the contrary , nothing in sections 260.1 160 to 29 260.1 188 shall restrict a service provi der fr om collecting or pr ocessing cover ed materials 30 that ar e not included in the minimum recyclable list. 31 3. (1) The organization shall contract with service provi ders to pr ovide cover ed 32 entities with convenient and equitable access to recy cling services for all readi ly 33 r ecyclable materials, at no charge to the covere d entity , with the goal of achieving the 34 r ecycling rate, collection rate, and postconsumer -r ecycled-content rate targets 3 5 established in the final plan under section 260.1 166. 36 (2) The collection of r eadily recycl able materials shall be provi ded in a manner 37 that is as convenient as the collection of solid waste in the geographic area in which the 38 cover ed entity is located. 39 (3) Any cover ed entities in the state that ar e recei ving r ecycling services on 40 December 31, 2026, shall continue to receiv e equivalent recy cling services thr ough the 41 pr ogram or a service prov ider on and after December 31, 2026. 42 (4) The organization shall not res trict a person's ability to contract directly with 43 service pr oviders to obtain recycl ing services for cover ed materials. 44 (5) Notwithstanding any law to the contrary , nothing in sections 260.1 160 to 45 260.1 188 voids or cancels any contract between a res ident and a service pr ovider for the 46 pr ovision of r ecycling services that is executed prior to December 31, 2026. 260.1 170. 1. The organization shall develop and implement a statewide 2 education and outr each prog ram that is designed to incr ease the recy cling and r euse of 3 cover ed materials and includes education and outr each on: 4 (1) Pr oper end-of-life management of cover ed materials; 5 (2) The location and availability of recycl ing services under the prog ram; and 6 (3) How to prev ent littering in the proc ess of pro viding recycli ng services for 7 cover ed materials. 8 2. The education and outreach pr ogram shall, at a minimum: 9 (1) Pr ovide clear and concise recycl ing instructions that ar e consistent statewide 10 and accessible for all demographic gr oups; 11 (2) Coordinate with existing recycl ing education materials and services pr ovided 12 thr oughout the state; and 13 (3) Be designed to help the state achieve the minimum collection rate and 14 minimum recy cling rate targets established in the final plan under section 260.1 166 and HB 3504 21 15 r educe levels and impacts of inbound contamination fr om cover ed materials at 16 materials recovery facilities and compost facilities. 17 3. The organization shall consult with the advisory board and other entities 18 pr oviding recyc ling education in the state on the development and distribution of 19 education outreac h services and materials. The organization shall contract with service 20 pr oviders, local governments, and nonpr ofit organizations to conduct r ecycling 21 education and outre ach services under the education and outre ach pr ogram 2 2 developed under subsection 1 of this section. 23 4. The organization shall develop a pr oposed methodology for evaluating and 24 r eporting on the effectiveness of the education and outr each progr am. 260.1 172. 1. Beginning July 1, 2029, a prod ucer shall not sell or distribute any 2 pr oducts that use cover ed materials in the state unless the pr oducer is participating in 3 the prog ram or , on or after January 1, 2029, except as set forth in the final plan or any 4 other plan appr oved by the dire ctor under sections 260.1 160 to 260.1 188. A prod ucer 5 shall r eport the data necessary to meet its plan obligations and shall use pr orated 6 national data if state-specific data is not available or feasible to generate. 7 2. (1) On January 1, 2033, and every January first ther eafter , a nonpr ofit 8 organization may req uest that the dir ector designate the nonpro fit organization as an 9 additional pr oducer r esponsibility organization. 10 (2) The direc tor may designate a nonprofi t organization as an additional 11 pr oducer res ponsibility organization if the dir ector , in coordination with the advisory 12 board, determines that the designation of the additional prod ucer res ponsibility 13 organization is necessary to: 14 (a) Increas e re cycling rates; 15 (b) Expand recycl ing services to cover ed entities that are not covered under the 16 final plan; or 17 (c) Pr ovide recycl ing services for a specific type of covere d material. 18 (3) If the direc tor designates an additional pr oducer responsibi lity organization 19 under paragraph (b) of subdivision (2) of this subsection, the additional prod ucer 20 r esponsibility organization shall submit a coordination plan to the dir ector for appr oval 21 in accordance with the rules pro mulgated. Wi thin one hundr ed twenty days after the 22 designation of the first additional pr oducer r esponsibility organization, the dir ector 23 shall pr omulgate by rule standards and requi rem ents for a coordination plan and for 24 coordination between the organization and any additional pr oducer res ponsibility 25 organizations designated by the dire ctor . A coordination plan appr oved or order ed by 26 the dir ector shall be implemented by the organization and any additional prod ucer 27 r esponsibility organizations designated by the dir ector . If the coordination plan HB 3504 22 28 conflicts with the final plan or any other plan appr oved by the dir ector under sections 29 260.1 160 to 260.1 188, the pr ovisions of the coordination plan prev ail. A coordination 30 plan appr oved or order ed by the dir ector is valid until r evoked or until a new 31 coordination plan is appr oved or order ed by the dir ector . 32 3. The dir ector , the advisory board, the organization, an additional prod ucer 33 r esponsibility organization, and any other person administering a plan appr oved by the 34 dir ector under sections 260.1 160 to 260.1 188: 35 (1) Shall keep confidential any prop rietary information pro vided by a pr oducer; 36 and 37 (2) Shall not include any pro prietary information pr ovided by a pr oducer in the 38 plan pro posal, the amended plan prop osal, the final plan, any other plan appr oved by 39 the dir ector under sections 260.1 160 to 260.1 188, or any amendment to the final plan or 40 other plan appr oved by the direc tor under sections 260.1 160 to 260.1 188. 41 4. (1) The prog ram and any other plan appr oved by the dir ector under sections 42 260.1 160 to 260.1 188 shall comply with any fir e, solid waste, or other r elevant 43 ordinances or re solutions adopted by a local government and with applicable state and 44 federal laws. 45 (2) Notwithstanding any law to the contrary , a local government is not r equir ed 46 to prov ide recycli ng services under the prog ram or any other plan appr oved by the 47 dir ector under sections 260.1 160 to 260.1 188. T o the extent that a local government 48 elects to pr ovide r ecycling services under the prog ram or any other plan appr oved by 49 the dir ector under sections 260.1 160 to 260.1 188, the organization, additional prod ucer 50 r esponsibility organization, or other person r esponsible for administering a plan 51 appr oved by the dir ector under sections 260.1 160 to 260.1 188 shall rei mburse the local 52 government for those recycli ng services and the final plan or any other plan appr oved 53 by the direc tor under sections 260.1 160 to 260.1 188. 54 (3) A local government that receives rei mbursement funds fr om the organization 55 shall use such funds for the local government's r ecycling pr ogram. 56 5. The organization, any additional pr oducer res ponsibility organization, and 57 any person administering a plan appr oved by the dir ector under sections 260.1 160 to 58 260.1 188 shall cause to be conducted an annual financial audit of the progra m or any 59 other plan appr oved by the dir ector under sections 260.1 160 to 260.1 188 by an 60 independent third-party auditor . The audit shall include a detailed list of the pr ogram's 61 or plan's costs and reve nues fr om the prod ucer responsibil ity dues. 62 6. Notwithstanding any law to the contrary , the organization and any additional 63 pr oducer res ponsibility organization shall not be consider ed a state-sponsore d or state- HB 3504 23 64 owned entity . Employees of the organization and any additional prod ucer res ponsibility 65 organization shall not be consider ed employees of the state. 66 7. The organization, any additional pr oducer res ponsibility organization, and 67 any person administering a plan appr oved by the dir ector under sections 260.1 160 to 68 260.1 188 shall pr eserve all books and record s in accordance with state and federal laws 69 and be open to inspection by the department at any time. 260.1 174. 1. (1) Except as set forth in a plan appr oved by the dir ector under 2 sections 260.1 160 to 260.1 188 on or after January 1, 2033, by a date determined by the 3 organization that is no later than January 1, 2030, and annually ther eafter by a date 4 determined by the organization, a pr oducer shall pay pr oducer r esponsibility dues to 5 the organization based on the funding mechanism described in the plan prop osal under 6 section 260.1 166. 7 (2) A prod ucer shall make all documents and recor ds relat ed to the calculation 8 and payment of producer r esponsibility dues, r ecycling rates, collection rates, 9 postconsumer -r ecycled-content rates, and any other materials necessary for the 10 dir ector to determine compliance with sections 260.1 160 to 260.1 188 available for 11 inspection by the dir ector . In connection with enforci ng a violation by a pr oducer under 12 section 260.1 176, the dire ctor shall requ est in writing that the producer pr ovide any 13 such documents or r ecords to the direc tor . 14 (3) The organization, any additional pr oducer responsibi lity organization, and 15 any person administering a plan appr oved by the dir ector under sections 260.1 160 to 16 260.1 188 shall maintain all documents and r ecords necessary for the direc tor to 17 determine compliance with sections 260.1 160 to 260.1 188 and submit any such 18 documents and record s to the dir ector upon a requ est by the dir ector under this 19 subsection. 20 (4) By January 1, 2030, and each year ther eafter , the director shall develop an 21 ecomodulation bonus schedule that is designed to redu ce the pr oducer res ponsibility 22 dues of pr oducers that meet certain benchmarks established by the dir ector by rule. 23 The dir ector shall consult with the organization and the advisory board in developing 24 the ecomodulation bonus schedule. The organization shall redu ce the prod ucer 25 r esponsibility dues of prod ucers in accordance with the ecomodulation bonus schedule 26 developed by the direc tor . 27 2. (1) Befor e April first of the second year of the prog ram's implementation, and 28 by April first each year ther eafter , the organization shall submit a re port to the advisory 29 board describing the pr ogr ess of the pr ogram. Wi thin two years after the 3 0 implementation of the final plan or any updated plan prop osals submitted to the 31 advisory board under section 260.1 166 the report shall also include an evaluation of the HB 3504 24 32 impacts of the exemptions described in section 260.1 182 on the performance of the 33 pr ogram and the pr oducer res ponsibility dues schedule. The advisory board shall 34 r eview the repo rt and forward the r eport to the dir ector . The advisory board shall also 35 r eview any pr oposed amendments to the final plan and any updates to the minimum 36 r ecyclable list and forward the amendments and updates to the dir ector with its 37 r ecommendation for appr oval or rejection . The director shall post the report on the 38 department's website. The progra m repo rt shall include the following information fr om 39 the prece ding calendar year: 40 (a) A detailed description of the pr ogr ess toward each element of the final plan 41 as described in subsection 4 of section 260.1 166; 42 (b) A list of all the pr oducers, brands, and cover ed materials covered by the final 43 plan; 44 (c) A list of pr oducers that ar e not participating in the pr ogram and any 45 pr oducers that shall be out of compliance with one or mor e obligations imposed by 46 sections 260.1 160 to 260.1 188; 47 (d) The total weight of the covered materials that pr oducers used for pr oducts 48 that ar e sold or distributed in the state; 49 (e) The total amount of pro ducer res ponsibility dues collected under the 50 pr ogram, including an annual schedule of pr oducer r esponsibility dues assessed by 51 weight for each type of covered material and any annual incr eases or decr eases in the 52 dues schedule and the reas ons for these adjustments; 53 (f) The total weight of each type of covered material that is collected and 54 r ecycled under the prog ram, with the data brok en down by: 55 a. Means of collection, including by curbside service or dr op-off center or other 56 means; 57 b. The number of covered entities, by type and by county , serviced thr ough 58 curbside collection; 59 c. The method used to handle the collected cover ed material; and 60 d. Geographic area ; 61 (g) The recyc ling rate, collection rate, and postconsumer -r ecycled-content rate 62 for each type of cover ed material and a description of the organization's pr ocess in 63 achieving the minimum rate targets set forth in the final plan under subsection 4 of 64 section 260.1 166; 65 (h) The rate schedules for r eimbursement to service pr oviders, any pro posed 66 adjustments to the rate schedules, and a summary of any disputes arising between the 67 organization and service pr oviders concerning rates and how the disputes wer e 68 addr essed; HB 3504 25 69 (i) A summary of the education and outr each efforts implemented in accordance 70 with section 260.1 170, including: 71 a. Samples of any materials distributed; and 72 b. A description of the methodology used and the res ults of the evaluation 73 conducted under section 260.1 170; 74 (j) A list of the names, locations, and hours of operation for curbside services, 75 dr op-off centers, and other entities accepting or collecting covered materials under the 76 pr ogram; 77 (k) A description of the organization's efforts to ensur e that cover ed materials 78 have been r esponsibly managed and deliver ed to res ponsible end markets under the 79 pr ogram; 80 (l) A list of the re cycling end markets of any covered materials, and, if the 81 cover ed materials are pro cessed thr ough a method other than mechanical recycl ing, the 82 list shall include: 83 a. A description of how the method shall affect the ability to recycl e the cover ed 84 material into feedstock for the manufactur e of new pro ducts; 85 b. A description of how the method shall incr ease the types and amounts of 86 r ecycled plastic for food and pharmaceutical-grade packaging and applications; 87 c. A description of any applicable state and federal air , water , and waste 88 permitting compliance r equir ements for the method; and 89 d. An analysis of the envir onmental impacts of the method compar ed to the 90 envir onmental impacts of incineration of solid waste in landfills; 91 (m) A copy of an independent third party's repo rt auditing the prog ram under 92 subsection 5 of section 260.1 172; 93 (n) A description of the status of res erve funds, an assessment of the adequacy of 94 those funds to cover pro gram costs, and a description of how any pr ogram shortfalls 95 shall be addr essed; 96 (o) Any amendments to the final plan in accordance with section 260.1 166; 97 (p) Any updates to the minimum recy clable list in accordance with section 98 260.1 168; and 99 (q) A description of the advisory board's feedback on any amendments to the 100 final plan under section 260.1 166. 101 (2) Befor e April first of the second year of any plan appr oved by the dir ector 102 under sections 260.1 160 to 260.1 188 that is not the final plan, and by April first each 103 year ther eafter , an additional pr oducer r esponsibility organization or other person 104 r esponsible for administering a plan appr oved by the dir ector under sections 260.1 160 105 to 260.1 188 shall submit a re port to the advisory board describing the pr ogress of the HB 3504 26 106 plan. The re port shall include the information described in this subsection, as 107 applicable, fr om the pr eceding calendar year . The advisory board shall r eview the 108 r eport and forward the report to the dir ector . The advisory board shall also revi ew any 109 pr oposed amendments to the plan and forward the amendments to the dir ector with its 110 r ecommendation for appr oval or rejection . The director shall post the report on the 111 department's website. 112 (3) The dir ector shall annually compile the res ults of the rep orts r eceived under 113 this subsection into a general rep ort describing the pr ogr ess of the progra m and any 114 other plans appr oved by the dir ector under sections 260.1 160 to 260.1 188. The dir ector 115 shall include the department's activities and expenses that wer e reim bursed under 116 section 260.1 186 in the general repor t. Additionally , at least every thr ee years starting in 117 2028, the dir ector shall include in the general report the outcome of the consumer cost 118 impact revi ew conducted by the department under this subsection. The dir ector shall 119 post the re port on the department's website and submit the repor t to the governor and 120 shall annually present the general repo rt to the general assembly . 121 3. If, based on the annual r eport submitted under subsection 2 of this section, the 122 pr ogram or any other plan appr oved by the director under sections 260.1 160 to 260.1 188 123 is not on track to meet the minimum collection rates, minimum recy cling rates, or 124 minimum postconsumer -r ecycled-content rates set forth in the pr ogram or plan, the 125 dir ector may req uire the organization, with res pect to the pr ogram, or the additional 126 pr oducer res ponsibility organization or other person res ponsible for administering the 127 plan, with r espect to any other plan appr oved by the dire ctor under sections 260.1 160 to 128 260.1 188, to amend its res pective plan under section 260.1 166. 129 4. No less than every thr ee years, starting on January 1, 2032, the department 130 shall conduct a rev iew of consumer cost impacts res ulting fr om the pr ogram, including 131 assessments of incr eased prices for covered materials rela tive to the prices for those 132 materials in other states, as well as local government expenditur es and consumer 133 spending on recy cling services and trash collection and disposal. 260.1 176. 1. If the organization, an additional pr oducer resp onsibility 2 organization, a person administering a plan appr oved by the director under sections 3 260.1 160 to 260.1 188, or a prod ucer violates any portion of sections 260.1 160 to 260.1 188, 4 the organization, additional pr oducer r esponsibility organization, person administering 5 a plan appr oved by the director under sections 260.1 160 to 260.1 188, or prod ucer is 6 liable for an administrative penalty not to exceed: 7 (1) For a first violation, an initial penalty of five thousand dollars for the first 8 day of each violation and one thousand five hundr ed dollars per day for each day the 9 violation continues; HB 3504 27 10 (2) For a second violation committed within twelve months after a prior 11 violation, an initial penalty of ten thousand dollars for the first day of each violation and 12 thr ee thousand dollars per day for each day the violation continues; and 13 (3) For a third or subsequent violation committed within twelve months after 14 two or mor e prior violations, an initial penalty of twenty thousand dollars for the first 15 day of each violation and six thousand dollars per day for each day the violation 16 continues. 17 2. (1) If the organization, an additional pr oducer r esponsibility organization, a 18 person administering a plan appr oved by the dir ector under sections 260.1 160 to 19 260.1 188, or a pr oducer violates any portion of sections 260.1 160 to 260.1 188, the 20 dir ector shall serve by personal service or by certified mail an order that imposes an 21 administrative penalty on the organization, additional pr oducer r esponsibility 2 2 organization, person administering a plan appr oved by the director under sections 23 260.1 160 to 260.1 188, or pro ducer . 24 (2) The organization, additional prod ucer r esponsibility organization, person 25 administering a plan appr oved by the dir ector under sections 260.1 160 to 260.1 188, or 26 pr oducer aggrieved or adversely affected by the direc tor's order may submit a notice of 27 appeal to the administrative hearing commission. The appeal shall be conducted in 28 accordance with the pr ovisions of section 621.250. 29 3. The dir ector may enter into a settlement agreemen t with the organization, 30 additional pr oducer res ponsibility organization, person administering a plan appr oved 31 by the dir ector under sections 260.1 160 to 260.1 188, or pro ducer assessed an 32 administrative penalty under this section. 33 4. The direc tor shall transfer any moneys collected under this section to the state 34 tr easur er , who shall cr edit the moneys as set forth in section 7, Article IX of the 35 Constitution of Missouri. 36 5. Notwithstanding any law to the contrary , nothing in sections 260.1 160 to 37 260.1 188: 38 (1) Creat es a private right of action; or 39 (2) Authorizes enforcem ent of sections 260.1 160 to 260.1 188 against anyone 40 other than the organization, an additional pro ducer res ponsibility organization, a 41 person administering a plan appr oved by the dir ector under sections 260.1 160 to 42 260.1 188, or a prod ucer . 260.1 178. If the progra m or any other plan appr oved by the dir ector under 2 sections 260.1 160 to 260.1 188 engages in an activity performed solely in furtherance of 3 implementing the pr ogram or plan and in compliance with sections 260.1 160 to 4 260.1 188, the activity is not a violation of the antitrust, res traint of trade, and unfair HB 3504 28 5 trade practices provi sions of the Missouri antitrust law under sections 416.01 1 to 6 416.161. 260.1 180. Nothing in sections 260.1 160 to 260.1 188 affects a person's eligibility 2 for any state or local incentive pr ograms for which the person is otherwise eligible. 260.1 182. 1. A prod ucer is exempt fr om the r equir ements of sections 260.1 160 to 2 260.1 188 if the prod ucer is: 3 (1) A person with less than five million dollars in real ized gross total r evenue, not 4 including on-premis es alcohol sales, during the prior calendar year; 5 (2) A person that has used less than one ton of cover ed materials for prod ucts 6 sold or distributed within or into the state during the prior calendar year; 7 (3) The state or a local government; 8 (4) A nonpro fit organization; 9 (5) An agricultural employer , as the term is used in chapter 288, regard less of 10 wher e the agricultural employer is located, with less than five million dollars in reali zed 11 gr oss total r evenue in the state fr om consumer sales of agricultural prod ucts sold under 12 the brand name of the farmer , egg pr oducer , gro wer , or individual gr ower cooperative; 13 (6) An individual business operating a ret ail food establishment that is located at 14 a physical business location and that is licensed by local public health agencies, or city or 15 county health departments under the standards adopted by the Missouri department of 16 health and senior services; or 17 (7) A builder , a construction company , or construction contractors. 18 2. The department shall adjust by rule the dollar limitation set forth in 19 subdivision (1) of subsection 1 of this section on July 1, 2027, and on July first of each 20 year ther eafter , based on the per centage incr ease measur ed by the Consumer Price 21 Index for All Urban Consumers for the United States, or its successor index, as defined 22 and officially rec orded by the United States Department of Labor , or its successor 23 agency , for the pr eceding year . 260.1 184. 1. A person shall not charge any kind of point-of-sale or point-of- 2 collection fee to consumers to r ecoup its costs in meeting the obligations of or complying 3 with sections 260.1 160 to 260.1 188. 4 2. Notwithstanding any law to the contrary , a private service pr ovider is not 5 r equir ed to pr ovide r ecycling services under the pro gram or any other plan appr oved by 6 the dir ector under sections 260.1 160 to 260.1 188. 260.1 186. 1. Ther e is her eby cr eated in the state tr easury the "Prod ucer 2 Responsibility Pr ogram for Statewide Recycling Fund", which shall consist of all 3 pr oducer dues collected and transferred to the fund under sections 260.1 160 to 260.1 188 4 and moneys appr opriated to the fund by the general assembly for use by the department HB 3504 29 5 of natural r esources . The organization shall transmit a portion of the prod ucer 6 r esponsibility dues to the state tr easurer for deposit into the fund for purposes of 7 r eimbursing: 8 (1) The department, including the advisory board, for the reas onable costs 9 incurr ed in administering and implementing any portion of sections 260.1 160 to 10 260.1 188; and 11 (2) The department for the reas onable costs incurr ed in enforci ng sections 12 260.1 160 to 260.1 188 as indicated in section 260.1 176. 13 2. (1) By July 1, 2030, the department shall notify the organization of the costs in 14 administering, implementing, and enfor cing sections 260.1 160 to 260.1 188 since August 15 28, 2026; 16 (2) By July first of each year after July 1, 2030, the department shall notify the 17 organization of the costs of administering, implementing, and enfor cing sections 18 260.1 160 to 260.1 188 during the immediately preced ing year; and 19 (3) Upon recei pt of the department's cost accounting, the organization shall 20 transmit to the state tr easurer , for deposit in the fund, an amount of prod ucer 21 r esponsibility dues necessary to r eimburse the department for its costs. 22 3. (1) The state tr easurer shall be custodian of the fund. In accordance with 23 sections 30.170 and 30.180, the state tr easurer may appr ove disbursements. The fund 24 shall be a dedicated fund and, upon appro priation, moneys in this fund shall be used 25 solely for the purposes of sections 260.1 160 to 260.1 188. 26 (2) Notwithstanding the pro visions of section 33.080 to the contrary , any moneys 27 r emaining in the fund at the end of the biennium shall not r evert to the credit of the 28 general reven ue fund. 29 (3) The state tre asurer shall invest moneys in the fund in the same manner as 30 other funds ar e invested. Any interes t and moneys earned on such investments shall be 31 cr edited to the fund. 260.1 188. The dir ector shall pr omulgate all necessary rules and r egulations for 2 the administration of sections 260.1 160 to 260.1 188. Any rule or portion of a rule, as 3 that term is defined in section 536.010, that is creat ed under the authority delegated in 4 this section shall become effective only if it complies with and is subject to all of the 5 pr ovisions of chapter 536 and, if applicable, section 536.028. This section and chapter 6 536 are nonseverable and if any of the powers vested with the general assembly 7 pursuant to chapter 536 to revi ew , to delay the effective date, or to disappr ove and annul HB 3504 30 8 a rule are subsequently held unconstitutional, then the grant of rulemaking authority 9 and any rule prop osed or adopted after August 28, 2026, shall be invalid and void. ✔ HB 3504 31