Carpet stewardship program establishment

1.1 A bill for an act​ 1.2 relating to environment; establishing carpet stewardship program; proposing coding​ 1.3 for new law in Minnesota Statutes, chapter 115A.​ 1.4 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA:​ 1.5 Section 1. [115A.143] CARPET STEWARDSHIP PROGRAM ESTABLISHMENT;​ 1.6 PRODUCER PARTICIPATION REQUIRED.​ 1.7 Subdivision 1. Establishment. A carpet stewardship program is established to reduce​ 1.8 carpet-related waste generation by promoting the collection and recycling of discarded​ 1.9 carpet.​ 1.10 Subd. 2. Producer participation required. Beginning January 1, 2022, a producer may​ 1.11 not sell carpet in this state unless the producer is in compliance with the requirements of​ 1.12 sections 115A.143 to 115A.1455.​ 1.13 Subd. 3. Fee adjustment. It is the intent of the legislature that the stewardship assessment​ 1.14 be an amount sufficient to generate adequate revenue to implement the stewardship plan​ 1.15 and to meet the recycling rate goals set forth in the plan. The commissioner must adjust the​ 1.16 stewardship assessment as needed to accomplish this goal. Adjustments are exempt from​ 1.17 the rulemaking provisions of chapter 14, and section 14.386 does not apply.​ 1.18 Sec. 2. [115A.1435] DEFINITIONS.​ 1.19 For purposes of sections 115A.143 to 115A.1455, the following terms have the meanings​ 1.20 given:​ 1​Sec. 2.​ 21-01612 as introduced​01/28/21 REVISOR CKM/NB​ SENATE​ STATE OF MINNESOTA​ S.F. No. 1171​NINETY-SECOND SESSION​ (SENATE AUTHORS: WEBER)​ OFFICIAL STATUS​D-PG​DATE​ Introduction and first reading​02/18/2021​ Referred to Environment and Natural Resources Policy and Legacy Finance​ 2.1 (1) "brand" means a name, symbol, word, or mark that identifies the carpet, rather than​ 2.2 the carpet's components, and attributes the product to the owner or licensee of the brand as​ 2.3 the producer;​ 2.4 (2) "carpet" means a manufactured article that is primarily constructed of a top visible​ 2.5 surface of synthetic face fibers, yarns, or tufts attached to a backing system derived from​ 2.6 synthetic or natural materials and that is affixed or placed on the floor or walking surface​ 2.7 of a commercial or residential building as a decorative or functional building interior or​ 2.8 exterior feature. Carpet includes broadloom carpet, modular carpet tiles, and artificial turf.​ 2.9 Carpet does not include handmade rugs, area rugs, or mats;​ 2.10 (3) "carpet installer" means a person who removes discarded carpet in the course of​ 2.11 installing carpet or replacing the discarded carpet with a different type of flooring;​ 2.12 (4) "clearinghouse" means the carpet stewardship clearinghouse established under section​ 2.13 115A.144;​ 2.14 (5) "collection site" means a site at which discarded carpet is accepted for collection and​ 2.15 transfer to a recycler and whose owner or operator has notified the clearinghouse that the​ 2.16 site accepts discarded carpet for this purpose;​ 2.17 (6) "discarded carpet" means carpet that is no longer used for the carpet's manufactured​ 2.18 purpose;​ 2.19 (7) "distributor" means a person who buys or otherwise acquires carpet from another​ 2.20 source and sells or offers to sell that carpet to a retailer in this state;​ 2.21 (8) "producer" means a person that:​ 2.22 (i) has legal ownership of the brand, brand name, or cobrand of carpet sold in the state;​ 2.23 (ii) imports carpet branded by a producer that meets item (i) when the producer has no​ 2.24 physical presence in the United States;​ 2.25 (iii) if items (i) and (ii) do not apply, makes unbranded carpet that is sold in the state;​ 2.26 or​ 2.27 (iv) sells carpet at wholesale or retail, does not have legal ownership of the brand, and​ 2.28 elects to fulfill the responsibilities of the producer for the carpet by certifying that election​ 2.29 in writing to the commissioner;​ 2.30 (9) "recycler" means a person engaged in the business of recycling;​ 2.31 (10) "recycling" means the process by which discarded carpet is processed and returned​ 2.32 to the market in the form of raw materials or products. For purposes of quantifying the​ 2​Sec. 2.​ 21-01612 as introduced​01/28/21 REVISOR CKM/NB​ 3.1 amount of discarded carpet that is recycled, only the weight of the end product of the​ 3.2 recycling process is considered. Recycling does not include energy recovery, energy​ 3.3 generation by means of combusting discarded carpet, or disposal or use of discarded carpet​ 3.4 within the permitted boundaries of a municipal solid waste landfill unit;​ 3.5 (11) "recycling rate" means the percentage of discarded carpet that is recycled. The​ 3.6 recycling rate is calculated by dividing the amount of discarded carpet that is collected and​ 3.7 recycled by the total amount of discarded carpet generated over a program year. To determine​ 3.8 the annual recycling rates required under the program, the amount of discarded carpet​ 3.9 generated must be calculated using a standard recognized methodology based on annual​ 3.10 sales, replacement rate, and the average weight of carpet and must be approved by the​ 3.11 commissioner;​ 3.12 (12) "retailer" means any person who offers carpet for sale at retail in this state;​ 3.13 (13) "sale" or "sell" means a transfer of title to carpet for consideration, including a​ 3.14 remote sale conducted through a sales outlet, catalog, website, or similar electronic means.​ 3.15 Sale or sell includes a lease through which carpet is provided to a consumer by a producer,​ 3.16 distributor, or retailer;​ 3.17 (14) "stewardship assessment" means the following, as applicable, for each square foot​ 3.18 of carpet sold in this state:​ 3.19 (i) four cents for polypropylene carpet, wool carpet, and carpet with a uniform face fiber​ 3.20 made with either nylon 6 or nylon 6,6; and​ 3.21 (ii) six cents for carpet made from polyethylene terephthalate, carpet made from​ 3.22 polytrimethylene terephthalate, and carpet with a nonuniform face fiber, which is​ 3.23 manufactured with multiple polymer types, fiber types, or both, in the face of the constructed​ 3.24 material;​ 3.25 (15) "stewardship assessment account" means an account established by the clearinghouse​ 3.26 in a bank chartered in Minnesota for the purposes of section 115A.1455; and​ 3.27 (16) "stewardship plan" means the current plan, and any amendments, approved by the​ 3.28 agency under section 115A.1445, subdivision 2.​ 3.29 Sec. 3. [115A.144] CARPET STEWARDSHIP CLEARINGHOUSE.​ 3.30 Subdivision 1. Establishment. The commissioner must incorporate a carpet stewardship​ 3.31 clearinghouse as a nonprofit corporation to administer the carpet stewardship program​ 3.32 established under section 115A.143.​ 3​Sec. 3.​ 21-01612 as introduced​01/28/21 REVISOR CKM/NB​ 4.1 Subd. 2. Members. The commissioner must appoint 11 members to serve on the board​ 4.2 of the clearinghouse as follows:​ 4.3 (1) one representative of a statewide association representing retailers;​ 4.4 (2) two representatives of producers;​ 4.5 (3) two representatives of recyclers;​ 4.6 (4) one representative of statewide associations representing waste disposal companies;​ 4.7 (5) one representative of an environmental organization;​ 4.8 (6) one representative of county or municipal waste management programs;​ 4.9 (7) two representatives of companies that use discarded carpet to manufacture products​ 4.10 other than new carpet; and​ 4.11 (8) one representative of carpet installers.​ 4.12 Subd. 3. Terms; vacancies. A member must serve on the board of the clearinghouse at​ 4.13 the pleasure of the commissioner, or until a successor is appointed. Vacancies shall be filled​ 4.14 by the commissioner.​ 4.15 Subd. 4. Compensation.Members of the clearinghouse shall serve without compensation​ 4.16 but must be reimbursed for travel expenses from the stewardship assessment account.​ 4.17 Subd. 5. Staff. The clearinghouse may hire a director and staff and may organize itself​ 4.18 into committees to implement sections 115A.143 to 115A.1455. Staff must be compensated​ 4.19 from the stewardship assessment account.​ 4.20 Subd. 6. Duties. The clearinghouse's duties include:​ 4.21 (1) preparing and implementing the stewardship plan and any necessary amendments​ 4.22 to the plan according to section 115A.1445;​ 4.23 (2) negotiating and executing agreements that provide for collecting, transporting, and​ 4.24 recycling discarded carpet in this state. The agreements may provide for these activities to​ 4.25 be undertaken voluntarily or for compensation through funds made available from the​ 4.26 stewardship assessment account. Nothing in this section shall be construed to require a​ 4.27 person to enter into an agreement with the clearinghouse in order to serve as a collection​ 4.28 site;​ 4.29 (3) by April 1, 2023, and every year thereafter, submitting an annual report to the​ 4.30 commissioner that describes the extent to which the goals, activities, and financial​ 4​Sec. 3.​ 21-01612 as introduced​01/28/21 REVISOR CKM/NB​ 5.1 assumptions described in the stewardship plan were achieved during the previous calendar​ 5.2 year. Each report must include summary information about:​ 5.3 (i) how much carpet was sold, collected, recycled, and otherwise disposed of, broken​ 5.4 down by region;​ 5.5 (ii) the number and location of collection sites;​ 5.6 (iii) program revenue, expenditures, and financial activities; and​ 5.7 (iv) any other information requested by the commissioner;​ 5.8 (4) using money in the stewardship assessment account according to section 115A.1455;​ 5.9 (5) notifying the commissioner and the chairs and ranking minority members of the​ 5.10 legislative committees with jurisdiction over environment finance if the stewardship​ 5.11 assessments collected during a calendar year substantially exceed or fall below the amount​ 5.12 required to adequately fund the carpet stewardship program;​ 5.13 (6) keeping the commissioner informed of the current list of collection sites;​ 5.14 (7) notifying the commissioner of violations of sections 115A.143 to 115A.1455 so that​ 5.15 the commissioner can remedy violations using the agency's authority under sections 115.071​ 5.16 and 116.072; and​ 5.17 (8) performing any other action requested by the commissioner.​ 5.18 EFFECTIVE DATE. This section is effective the day following final enactment.​ 5.19 Sec. 4. [115A.1445] STEWARDSHIP PLAN.​ 5.20 Subdivision 1. Submission of plan; contents. By July 1, 2022, and every three years​ 5.21 thereafter, the clearinghouse must submit to the commissioner a carpet stewardship plan​ 5.22 that:​ 5.23 (1) covers a three-year period beginning on January 1 of the year following the year in​ 5.24 which the plan is due;​ 5.25 (2) includes a certification that the carpet stewardship program will provide for recycling​ 5.26 all discarded carpet collected at collection sites, regardless of type, producer, or constituent​ 5.27 components;​ 5.28 (3) includes contact information for each individual representing the clearinghouse;​ 5.29 (4) designates a program manager responsible for administering the program in this​ 5.30 state;​ 5​Sec. 4.​ 21-01612 as introduced​01/28/21 REVISOR CKM/NB​ 6.1 (5) lists all producers participating in, or expected to participate in, the carpet stewardship​ 6.2 program;​ 6.3 (6) lists all brands participating in, or expected to participate in, the carpet stewardship​ 6.4 program;​ 6.5 (7) describes the methods by which discarded carpet will be collected and transported​ 6.6 to recyclers in this state;​ 6.7 (8) explains how the carpet stewardship program will ensure that collection sites are​ 6.8 placed in all counties with a population density of greater than or equal to 100 individuals​ 6.9 per square mile by January 1, 2022, and all counties with a population density of greater​ 6.10 than or equal to 50 individuals per square mile for 2025 and thereafter;​ 6.11 (9) beginning with the plan due on July 1, 2024, estimates the cost of making collection​ 6.12 sites available in every county;​ 6.13 (10) explains how the clearinghouse will monitor, evaluate, and maintain the carpet​ 6.14 stewardship program;​ 6.15 (11) lists the name and business location of every collector, transporter, and recycler​ 6.16 that will manage discarded carpet under the program;​ 6.17 (12) sets program recycling rate goals for the percentage of discarded carpet produced​ 6.18 in this state that will be collected and recycled during each year of the plan. The recycling​ 6.19 rate goal must be no less than 15 percent for 2024, 20 percent for 2025 and 2026, 30 percent​ 6.20 for 2027 and 2028, 40 percent for 2029 and 2030, and 50 percent for 2031 and subsequent​ 6.21 years. The methodology used to develop the goals must be included in the plan and goals​ 6.22 must take into consideration:​ 6.23 (i) the most recent collection data from this and other states;​ 6.24 (ii) the estimated amount of discarded carpet disposed of annually; and​ 6.25 (iii) the weight of discarded carpet that is expected to be available for collection annually;​ 6.26 (13) describes the state of markets for discarded carpet and products made from recycled​ 6.27 discarded carpet and what, if any, markets need further development in order to improve​ 6.28 the success of the carpet stewardship program;​ 6.29 (14) explains the funding structure of the carpet stewardship program, including the​ 6.30 administrative, operational, and capital costs of the plan and the cost of payments to carpet​ 6.31 collectors, transporters, recyclers, and end-use markets;​ 6.32 (15) explains annual revenue and expense projections for the program;​ 6​Sec. 4.​ 21-01612 as introduced​01/28/21 REVISOR CKM/NB​ 7.1 (16) explains how clearinghouse activities will be independently audited on an annual​ 7.2 basis;​ 7.3 (17) includes copies of educational materials that will be used to:​ 7.4 (i) train operators of collection sites on how to properly collect discarded carpet and​ 7.5 eliminate contamination;​ 7.6 (ii) train carpet installers on how to properly manage discarded carpet so that it can be​ 7.7 collected and recycled; and​ 7.8 (iii) inform retail purchasers of carpet about options available through the carpet​ 7.9 stewardship program for handling discarded carpet and about the importance of recycling;​ 7.10 (18) explains how the clearinghouse will coordinate with carpet stewardship programs​ 7.11 in other jurisdictions; and​ 7.12 (19) includes any other information requested by the commissioner.​ 7.13 Subd. 2. Review and approval of plan and plan amendments. Within 90 days of​ 7.14 receiving the stewardship plan or an amendment to a stewardship plan, the commissioner​ 7.15 must review the plan or plan amendment and approve the plan if it complies with the​ 7.16 requirements of this section or reject it if it does not. The commissioner must notify the​ 7.17 clearinghouse in writing of a decision under this subdivision, and the reasons for the decision,​ 7.18 within 14 days. If a plan or plan amendment is rejected, the clearinghouse must submit a​ 7.19 revised plan or plan amendment to the commissioner within 60 days of receipt of the rejection​ 7.20 notice. A plan or plan amendment may not take effect until approved under this subdivision.​ 7.21 Sec. 5. [115A.145] DUTIES OF PRODUCERS, RETAILERS, INSTALLERS,​ 7.22 COLLECTION SITES, RECYCLERS, AND AGENCY.​ 7.23 Subdivision 1. Producer duties. Beginning January 1, 2022, a producer must:​ 7.24 (1) remit to the clearinghouse on a quarterly basis the applicable stewardship assessment​ 7.25 for all carpet sold in this state, information about which must be considered private and​ 7.26 proprietary information;​ 7.27 (2) provide to retail purchasers of carpet the educational materials described in the​ 7.28 stewardship plan; and​ 7.29 (3) annually register as a producer with the agency.​ 7.30 Subd. 2. Retailer duties. Beginning January 1, 2022, a retailer must provide the​ 7.31 educational materials described in the stewardship plan to retail purchasers of carpet.​ 7​Sec. 5.​ 21-01612 as introduced​01/28/21 REVISOR CKM/NB​ 8.1 Subd. 3. Installer duties. (a) Beginning January 1, 2025, a carpet installer who removes​ 8.2 or uninstalls discarded carpet in Hennepin, Ramsey, Anoka, Washington, or Dakota County​ 8.3 must dispose of the discarded carpet by taking it to a collection site in accordance with the​ 8.4 stewardship plan.​ 8.5 (b) Beginning January 1, 2028, a carpet installer who removes or uninstalls discarded​ 8.6 carpet in Sherburne, Wright, Carver, Scott, or Olmsted County must dispose of the discarded​ 8.7 carpet by taking it to a collection site in accordance with the stewardship plan.​ 8.8 Subd. 4. Agency duties. The commissioner must:​ 8.9 (1) post on the agency website a current list of producers registered with the agency​ 8.10 according to subdivision 1 and a current list of collection sites identified under section​ 8.11 115A.144, subdivision 6, clause (6);​ 8.12 (2) post the stewardship plan on the agency website;​ 8.13 (3) post to the agency website a copy of all annual accounting reports received according​ 8.14 to section 115A.144, subdivision 6, clause (4); and​ 8.15 (4) monitor and oversee the clearinghouse's implementation of the stewardship plan and​ 8.16 require specific actions when needed to comply with the plan or with sections 115A.143 to​ 8.17 115A.1455.​ 8.18 Subd. 5. Collection site duties. (a) Beginning January 1, 2022, a collection site must:​ 8.19 (1) ensure that discarded carpet accepted at the collection site is stored in a manner and​ 8.20 location that allows the carpet to remain dry at all times and in containers that are free of​ 8.21 all waste other than discarded carpet;​ 8.22 (2) allow each recycler to which the collection site transfers discarded carpet to house​ 8.23 a container approved by the recycler on site for acceptance and pickup by the recycler; and​ 8.24 (3) for a collection site located at a waste transfer, waste disposal, or recycling facility​ 8.25 permitted by the agency, charge the person transferring the discarded carpet to the collection​ 8.26 site the customary and proprietary collection and disposal fees.​ 8.27 (b) A collection site may not charge a recycler a fee for removal and transfer of discarded​ 8.28 carpet from the collection site.​ 8.29 Subd. 6. Recycler duties. Beginning January 1, 2022, a recycler must remove discarded​ 8.30 carpet from a container approved by the recycler under subdivision 5, paragraph (a), clause​ 8.31 (2), within three days of being notified by a collection site that the container is full.​ 8​Sec. 5.​ 21-01612 as introduced​01/28/21 REVISOR CKM/NB​ 9.1 Sec. 6. [115A.1455] STEWARDSHIP ASSESSMENT ACCOUNT.​ 9.2 Subdivision 1. Mandatory duties and uses. With respect to the stewardship assessment​ 9.3 account, the clearinghouse must:​ 9.4 (1) hire an independent professional accounting firm to annually review and verify the​ 9.5 accuracy of the amount of stewardship assessments remitted to the clearinghouse by​ 9.6 producers according to section 115A.145, subdivision 1;​ 9.7 (2) deposit stewardship assessment revenue received pursuant to section 115A.145,​ 9.8 subdivision 1, in the stewardship assessment account;​ 9.9 (3) beginning January 1, 2023, pay the agency an annual fee from the stewardship​ 9.10 assessment account to cover the agency's costs of carpet stewardship program oversight.​ 9.11 The amount of the fee is the lesser of two percent of the total amount of stewardship​ 9.12 assessments collected during the prior calendar year, or $300,000;​ 9.13 (4) upon repeal of sections 115A.143 to 115A.1455, remit the balance of the stewardship​ 9.14 assessment account to the commissioner for deposit in the remediation fund established​ 9.15 under section 116.155; and​ 9.16 (5) authorize other expenditures from the account as authorized by sections 115A.143​ 9.17 to 115A.1455.​ 9.18 Subd. 2. Permissive uses. The clearinghouse may use money in the stewardship​ 9.19 assessment account:​ 9.20 (1) to reimburse the reasonable costs of a collection site to adapt the site for discarded​ 9.21 carpet collection, including but not limited to onetime costs for constructing the needed​ 9.22 structure to make collecting discarded carpet safe and convenient; and​ 9.23 (2) to pay a collection site $20 per ton for all discarded carpet collected and transferred​ 9.24 to a recycler according to sections 115A.143 to 115A.1455.​ 9​Sec. 6.​ 21-01612 as introduced​01/28/21 REVISOR CKM/NB​