SB 61-ELECTRONIC DEVICE RECYCLING  4:25:41 PM CHAIR GIESSEL reconvened the meeting and announced the consideration of SENATE BILL NO. 61 "An Act relating to an electronic product stewardship program; relating to collection, recycling, and disposal of electronic equipment; establishing the electronics recycling advisory council; and providing for an effective date." 4:26:10 PM LOUIE FLORA, Staff, Senator Löki Tobin, Alaska State Legislature, Juneau, Alaska, presented SB 61 on behalf of the sponsor. He paraphrased the sponsor statement: [Original punctuation provided.] SB 61   Sponsor Statement  Senate Bill 61 creates a manufacturer-funded system for collecting and recycling electronic devices. Flat- screen televisions, computer monitors, and other electronic devices have grown integral to modern life, business, and education. With ever more devices, there is a growing problem of electronic waste in Alaska. 4:27:01 PM MR. FLORA continued to paraphrase the sponsor statement for SB 61: SB 61 introduces the practice of product stewardship for electronic devices sold in Alaska. Product stewardship is where the manufacturer of an electronic device assumes financial responsibility on a life- cycle basis for that device. Manufacturers allocate funding to cover collection and recycling activities. These costs are currently borne by communities, non- profit organizations, Tribes, and businesses. Electronic waste associated with human health risks includes lead used in the cathode ray tubes found in computer and TV screens, cadmium used in rechargeable computer batteries, contacts and switches, and mercury used in the liquid crystal displays of mobile phones and flat screen computer monitors as well as in switches, batteries, and fluorescent lamps. These components are especially problematic in rural Alaska where community landfills are often unlined, allowing harmful chemicals to be released into local waters. Landfill fires that include electronic devices can cause smoke inhalation hazards in communities. 4:27:13 PM MR. FLORA continued to paraphrase the sponsor statement for SB 61: If SB 61 passes, Alaska will join half the states in the nation, Canada, and many other countries in having a product stewardship law. Under SB 61 a manufacturer offering electronic devices covered under this bill for sale in Alaska would register with the Department of Environmental Conservation and allocate funding for the collection and recycling of devices proportional to the volume of their sales. Manufacturers would register individually or join a clearinghouse that specializes in implementing these programs and dividing the costs of the program among manufacturers. This will create a funding stream to cover the costs of collection, transportation and recycling which is currently funded by a mix of grants and local tax revenue. SB 61 was developed by the Alaska Solid Waste Task Force. Stakeholders in the task force include the Alaska Native Tribal Health Consortium, the Alaska Department of Environmental Conservation, Kawerak Incorporated, and Zender Environmental. A product stewardship policy for electronic devices is supported by the Alaska Federation of Natives, the Alaska Municipal League, the Solid Waste Association of North America as well as numerous Alaska communities, organizations, and businesses. 4:28:10 PM SENATOR HUGHES quoted from a letter by the Consumer Technology Association saying SB 61 "would establish the broadest, most cumbersome and likely most costly electronics recycling program in the US". She asked whether SB 61 included requirements that were not present in other states and Canada with similar legislation. 4:28:43 PM MR. FLORA said the concept and language of SB 61 was drafted looking at the requirements in the other states that have it in place, and picking the model that looked like it would be the best application for our unique circumstances in Alaska. He acknowledged receipt of the recent letter and a similar letter last year from the Consumer Technology Association and said there were points raised that would be addressed in a future committee substitute for SB 61, for example the recommendation that microwave ovens were not appropriate for this program. He highlighted that Senate Bill 61 would establish an advisory group to consider plans submitted by manufacturers and make recommendations. He said the advisory committee included two seats for manufacturers and retailers, allowing them the opportunity to have a voice in the process of creating the program. 4:29:56 PM SENATOR HUGHES said that while she desired proper recycling, she was concerned about the impact [of SB 61] on Alaskans. She said a small state like Alaska with its population of less than three quarters of a million risked losing manufacturing businesses by telling them what to do. She said if our little state tells developers and innovators what they must do, big companies like Microsoft will pull out negatively impacting Alaska. 4:31:08 PM SENATOR MYERS concurred and added that a lot of people in Alaska buy things online. He said a lot of stuff comes from not only outside the state, but outside the country. He asked how the state would hold manufacturers feet to the fire when items are not being sold at a brick-and-mortar store in-state. 4:31:47 PM MR. FLORA answered that SB 61 would require any manufacturer selling product in Alaska to register with the Department of Environmental Conservation (DEC). They would register their product by weight so DEC can determine the proportional amount that they would pay as a registration fee. He said [DEC] would establish protocols for the products coming into Alaska, regardless of where it's coming from. The advisory group would also be reviewing DECs plan as well. He said the 13-member advisory group with industry experts from across the state would bring their experience from the rural communities of what products had been put into landfills or collection sites. He acknowledged that it might take a couple years to really get a handle on the amount, but that would be handled through the advisory committee process. MR. FLORA said there were three subject matter experts with experience across the country available online to fill in blanks. 4:33:14 PM SENATOR DUNBAR described a scenario in which a manufacturer abroad does not intend to sell in the Alaska market, but their product reaches the state through Amazon or another online platform or a secondary market like Ebay. He asked what the manufacturers' proactive duty would be and what power the state would have to track down [manufacturers] across state lines or across international lines. 4:34:08 PM CHAIR GIESSEL asked Mr. Flora to identify the invited experts. MR. FLORA said Lelande Rehard was a former consultant to the Product Stewardship Institute. He deferred Senator Dunbar's question to Mr. Rehard. 4:34:39 PM LELANDE REHARD, Environmental Program Coordinator, City of Columbia, Columbia, Missouri, said the product stewardship approach has been used in many states and [those states] certainly address the issue of products being sold across state lines and online. He said manufacturers register within the state, typically through an organization that helps them meet their obligations and operate the program. That organization assists with the division of the cost of the program, either based on the amount of projected sales going into a given marketplace or on the actual weight of the material being collected, or some formula that combines both. He said ultimately, [the manufacturers] develop a fee schedule allowing them to sell products within the state. MR. REHARD suggested Mr. Klag might speak to enforcement issues for retail sales and online sales. 4:35:57 PM SCOTT KLAG, Consultant, Product Stewardship Institute, Portland, Oregon said there was a tested definition for manufacturer in SB 61 using the same language used in many other states' [legislation], not just for electronics, but for other products. He said this allowed manufacturers to determine who was the responsible party to fulfill the obligations set in legislation. He said it was in the manufacturers' interest to have all the manufacturers that are selling in the state be part of the program and sharing the cost. He noted there were national entities, service providers, that help manufacturers meet their obligations in response to the variety of stewardship laws across the country. 4:37:54 PM SENATOR DUNBAR suggested that large companies or more sophisticated manufacturers would join this coalition and work with this council, but he questioned whether every manufacturer across the whole world would join, or even know they're required to join. He suggested that smaller manufacturers may not realize they have this new duty and or realize their products are being sold in Alaska. 4:38:49 PM MR. KLAG said it was quite common knowledge at this point, particularly in the western part of the states [that these laws exist]. He said there may be very low volume manufacturers that slip through, but that most manufacturers know about these programs and join up. He said [the manufacturers] have very active trade organizations that help distribute this information. 4:38:53 PM CHAIR GIESSEL noted there may be an amendment from Senator Dunbar and she asked Mr. Flora whether he intended to propose a committee substitute. 4:40:06 PM MR. FLORA said the sponsor could assist with amendments as needed. 4:40:16 PM CHAIR GIESSEL asked whether the amendment Senator Dunbar offered could be merged with other amendments or a committee substitute. 4:40:24 PM SENATOR DUNBAR said it was his understanding that his amendment may not be compatible with the committee substitute, but he said he could wait to offer his amendment after the committee substitute was offered. 4:40:42 PM MR. FLORA suggested that he could work with Senator Dunbar on the amendment. 4:40:57 PM SENATOR DUNBAR concurred. 4:41:12 PM CHAIR GIESSEL opened public testimony on SB 61. 4:42:35 PM KATIE REILLY, Vice President, Environmental Affairs and Industry Sustainability, Consumer Technology Association (CTA), Washington, DC, said CTAs members were the manufacturers that would be responsible for delivering an electronic product stewardship program in Alaska under SB 61. She said the industry was committed to ensuring their products were recycled safely and responsibly, but that SB 61 would place a significant burden on electronics manufacturers. She expressed concern about the requirements outlined in SB 61, and about the capacity for the current electronics collection infrastructure within Alaska to safely collect and manage electronics in an environmentally responsible manner. She asserted that manufacturers would bear the responsibility and high cost of establishing infrastructure from scratch. 4:43:52 PM MS. REILLY observed programs developed in other states for which manufacturers leveraged existing collection infrastructure with entities like local governments and nonprofits that already knew how to safely sort, stack, palletize and shrink-wrap electronics for transport. She said annual collection events as described in SB 61 for every community with less than 5500 people, potentially 200 or more collection events throughout the state, may lead to skyrocketing costs for manufacturers, and may be beyond the needs to effectively and efficiently serve the communities of Alaska. 4:44:33 PM MS. REILLY noted that, contrary to prior comments, typically in the US, individual manufacturers kept costs manageable by dictating their own programs, independently or as small groups, versus establishing a producer responsibility organization. She said the language of SB 61 would require producers to participate in a producer responsibility organization, increasing overhead or increasing costs for manufacturers. 4:45:12 PM MS. REILLY further noted requirements in SB 61 for retailers to provide public education information, and she objected to the inclusion of microwave ovens as covered electronic devices as well as undefined battery-containing electronics, possibly toys or small appliances which she said were incompatible with electronics recycling systems. MS. REILLY said CTA would be willing to participate in discussions about the inclusion of e-waste in the overall recycling and solid waste management in Alaska. She emphasized that CTA members were not consulted prior to the introduction of SB 61 but would be responsible for the requirements outlined in the bill, even if they held a seat on the advisory committee. 4:45:58 PM MS. REILLY said CTA recommended a study by DEC to determine: • the amount of household generated e-waste in Alaska • where E-waste was being generated in the state • the existing collection infrastructure and capabilities throughout Alaska to responsibly manage e-waste MS. REILLY said CTAs overall concern was that SB 61 would add considerable costs to doing business in Alaska. She asserted that manufacturers should not bear the entire cost of establishing a very broad and potentially cumbersome infrastructure to manage e-waste from scratch. She offered to answer questions from the committee. 4:46:39 PM SENATOR DUNBAR referred to product stewardship programs in other parts of the US and asked whether CTA had supported any of those programs in the past or if they opposed them. He asked if there was a program CTA would point to as a model for effective disposal and recycling of e-waste. He highlighted the challenges faced by rural communities regarding the removal of e-waste. 4:47:34 PM MS. REILLY observed that CTA's member companies were legally obligated to support collection and recycling in states that have producer responsibility programs for electronics. In addition, she said many member manufacturers also support voluntary programs for their consumers in the other states around the country that may not have mandated producer responsibility programs for electronics. She said CTA had been active in the development of e-waste producer responsibility programs for decades. She said they were currently more focused on tailoring performance programs to the communities they're trying to serve. 4:48:43 PM MS. REILLY said she did not have a great program or state to point to [as a model] for the fact that Alaska is unique. She reiterated that CTA members would be required under SB 61 to provide once a year collection events for every community with less than 5500 people, more than 200 collection events throughout the state of Alaska in a year. Those would be in addition to required collections for communities larger than 5500. She said collection events were extremely costly to operate and did not necessarily drive the desired volumes of material. 4:49:39 PM MS. REILLY repeated the recommendation that DEC conduct a study to determine the current e-waste conditions in Alaska which would allow CTA to assist in building a better plan specific to the needs of Alaska. 4:50:03 PM MS. REILLY said Hawaii was probably the most comparable in terms of the transportation component of the program and not having certified electronics recycling facilities in the state. She said e-waste in Hawaii was collected and transported via water to the US mainland for recycling at certified electronics recycling facilities. She emphasized that the program had the highest per pound cost to manufacturers [of existing programs], but that the high cost did not include stringent convenience requirements like those outlined in Alaska's proposal, nor the multitude of collection events [specified by SB 61]. She noted that when Hawaii's law was passed, there was an existing e-waste collection infrastructure that manufacturers were able to leverage. She said CTA was unclear about existing collection infrastructure in [Alaska], and whether communities were trained on how to sort and stack and palletize and shrink wrap electronics for safe transport to ultimate recycling. 4:51:19 PM SENATOR DUNBAR asked whether CTA supported Hawaii's adoption and continuation of e-waste management law. He asked which state's mandatory program worked best, regardless of comparability to Alaska. 4:51:46 PM MS. REILLY said she was not employed by CTA when Hawaii passed their law and was not aware of CTA's support or opposition to Hawaii's e-waste law. She said CTA was currently working with Hawaii's Department of Health to reform Hawaii's program to better meet the needs of Hawaii consumers and to meet manufacturers' legal obligations. She said there was not an example of an ideal state program. She said each state was unique with unique needs and suggested developing a program for Alaska's needs as a better approach than trying to adapt another program to fit Alaska's needs. 4:53:08 PM SENATOR KAWASAKI asked whether CTA worked in other countries, for example, Canada. He noted that there were similar programs in the [European Union] EU. 4:53:26 PM MS. REILLY said CTA was a US trade association. She said CTA did some work in Canada, but not in the environmental space. She said there was a trade association in Canada that handled environmental issues for the industry. She said CTA did not do advocacy or work in Canada or the European Union on issues like extended producer responsibility for electronics. 4:54:06 PM CHAIR GIESSEL noted the high costs of selling and recycling [electronic] products. She asked Mr. Rehard whether manufacturers would decide not to sell products in Alaska. 4:54:34 PM MR. REHARD said he had not seen that occur. He said that it was possible that per capita or per pound [e-waste] disposal may be more expensive due to Alaska's unique considerations. He observed that the state population was about 738,000 and said he expected waste generation would be fairly low after the first few years of implementation. He hesitated to speculate about the overall costs of the program and whether it would be a detriment to manufacturers, noting that the costs would be distributed amongst other programs nationally. He argued that manufacturers would not attach their costs directly to selling in Alaska. He suggested that Mr. Klag may have experience with manufacturers pulling out of marketplaces because of these programs. 4:55:42 PM CHAIR GIESSEL invited Mr. Klag to comment. 4:56:03 PM MR. KLAG said he had not experienced that. He noted that there is good infrastructure in Alaska: the back-haul program and communities that were already collecting e-waste. He acknowledged the low population and the absence of a formal process [for e-waste disposal] but suggested that a program such as the one proposed by SB 61 might inspire a producer responsibility organization to form. 4:56:52 PM SENATOR MYERS noted that there was at least one business in Tacoma willing to forward products that other producers will not ship directly to Alaska. 4:57:31 PM CHAIR GIESSEL held SB 61 in committee.