House Bill 934 (Printer's No.…

                                     House Bill 934 (Printer's No. 1100),
                                    Responses to Concerns Raised by the
                                  Pennsylvania Waste Industries Association

BACKGROUND

    ·    The Professional Recycles of Pennsylvania (PROP) and the Pennsylvania Waste
         Industries Association (PWIA) share many common goals, particularly in connection
         with the goal of comprehensive and integrated waste management for all Pennsylvanians.
         On rare occasions like HB 934 and the issue of county fees to support local programs, we
         sometimes respectfully disagree on some of the details of how to get there.

PROP'S RESPONSES TO PWIA

    ·    PWIA Concern: Act 101 of 1988 established a $2 per ton statewide trash tax to provide
         funds to pay for establishing and building an infrastructure for recycling and other solid
         waste programs in Pennsylvania. Only certain municipalities in densely populated
         communities are required to establish and maintain mandatory curbside recycling, where
         transportation efficiencies enhance the economic success of these programs. Counties
         have no mandatory recycling obligations under Act 101. All county recycling
         programs are voluntary.

              o PROP's Response: Counties have considerable legal responsibility regarding
                waste planning within their borders, despite having no direct "recycling"
                responsibilities under Act 101. These include the assurance of waste disposal
                capacity and the facilitation of recycling required by the Act.

    ·    PWIA Concern: Since the passage of Act 101, 46 counties imposed fees on waste
         disposal or waste haulers, ranging from 25 cents per ton to $7 per ton. Among other
         things, these fees were used to subsidize and voluntarily expand recycling programs that
         were unable to pay their own way. In some cases, the fees were used for purposes
         unrelated to recycling or waste management.

              o PROP's Response: There are many things undertaken by county and local
                government that do not "pay their own way" but have been done because a need
                has been identified or the constituents have called for the services. Like other
                environmental protection services, these county sponsored activities have been
                identified to be in the best interests of the county's residents.



PROP Responses to PWIA Concerns
    ·    PWIA Concern: H.B. 934 would perpetuate local government inefficiencies. H.B 934
         provides no PA DEP oversight into how these new fees are spent, nor does it provide any
         annual auditing requirement for counties to establish that the intended uses are in fact met
         and the recycling objectives attained.

              o PROP's Response: On the contrary, county-based programs have generally
                been much more efficient than the fragmented local government programs that
                too often plague Pennsylvania. Beyond these more efficient programs
                coordinated or run by counties by choice, the Commonwealth has provided grants
                to pay for 50% of Household Hazardous Waste programs and the expenses of a
                county recycling coordinator. Counties have also had the capital costs of
                composting and recycling facilities funded where these services could not be
                provided by the private sector. All of those programs are rigorously overseen by
                the Department of Environmental Protection (DEP) and all require a
                considerable commitment from the counties.
              o PROP's Response: Counties and their authorities have also filled voids that the
                private sector has been unable to fill. When the private sector has been unable to
                provide services, especially in sparsely populated areas, the public sector has had
                to provide those services. This is the same reason that a number of counties have
                developed their own facilities, as is the case in many other states in the US.

    ·    PWIA Concern: Before the Commonwealth Court cases that invalidated County
         Administrative Fees (Pennsylvania Independent Waste Haulers Association, et al. v.
         County of Northumberland, et al., Commw. Ct. Nos. 473 and 500 C.D. 2005; and IESI
         PA Bethlehem Landfill Corporation, et al. v. County of Lehigh, et al., Commw. Ct. Nos.
         1214 and 1724 C.D. 2005), total fees in all 67 counties totaled $8.5 million per year.
         Assuming all counties opt to collect these new fees, the new fees generated by H.B. 934
         would total $60 million per year, a 7 times increase.

              o PROP's Response: There is no indication that there would be a stampede of
                counties implementing fees that did not already have fees. Several counties
                have no significant solid waste or recycling programs, have not levied fees and
                would seem highly unlikely to have a need for fees in the future. These include
                counties with small populations and those that chose not to accept grant money
                for special programs. Additionally, those with their own disposal facilities
                generate funds for other programs through their waste tip fees (which are
                intended to fund their entire comprehensive program).

    ·    PWIA Concern: PWIA is opposed to legislation authorizing additional county and/or
         municipal fees or taxes on the waste industry to fund recycling:

              o Such legislation would send the wrong message--that recycling needs to be
                permanently subsidized by government. PWIA and its members continue to
                increase the volumes of recyclable materials collected and are working hard to
                develop opportunities for market-driven, private-sector recycling. Successful
                recycling can and must become financially self-sustainable.

PROP Responses to PWIA Concerns
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              o PROP's Response: Is recycling any different from waste collection and
                disposal? Waste services are not free to anyone and enjoy the occasional subsidy
                when a public need (like a safe access highway to a landfill) is identified.
                Similarly, subsidies have been maintained for recycling and composting because
                the legislature has identified a public benefit of fewer landfills and lower resource
                and energy consumption to make things from virgin feed stocks.

THESE ARE NOT NEW FEES:

    ·    PWIA Concern: The municipal waste disposal industry in Pennsylvania currently pays
         an unprecedented $7.25 per ton in fees:

                  Act 101 Recycling Fee:               $   2.00
                  Host Municipal Benefit Fee:          $   1.00 (minimum)
                  Environmental Stewardship Fees:      $   4.25
                                                       $   7.25

              o PROP's Response: PROP agrees that fees should be for waste and recycling
                programs. The county fee, unlike the Environmental Stewardship Fee, will by law
                go toward recycling and waste management programs. PROP actually requested
                the bill provision that requires that the money be placed in a dedicated fund or
                account to guarantee that it not be diverted to other programs or the county
                General Fund.

    ·    PWIA Concern: H.B. 934 would authorize an increase in new fees by $60 million per
         year, a 125% increase to Pennsylvania consumers:

                  Act 101 Recycling Fee:              $ 2.00
                  Host Municipal Benefit Fee:         $ 1.00 (minimum)
                  Environmental Stewardship Fees:     $ 4.25
                  NEW County Administrative Fee:      $ 4.00
                                                      $11.25 (not $13.25 per PWIA)
              o PROP's Response: These fees are not new fees, will not be levied by every
                county, and the $4 is the upper limit, not a mandate. Of the counties that have
                these fees, many have had them since the early nineties. Further, during the last
                year, following the court ruling suspending the fees, there is no indication that
                waste bills have been decreased in response to the fee not being collected.

RECYCLING AND SUBSIDIES:

    ·    PWIA Concern: The legislature never envisioned nor intended that municipal recycling
         programs established by Act 101 of 1988 would be subsidized indefinitely. The
         legislature reiterated this position in Act 175 of 2002, by declaring that recycling
         programs established under Act 101 were expected to become "financially self-
         sufficient" and until such time were to be supported by "restructuring the allocation of
         available recycling grants."


PROP Responses to PWIA Concerns
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              o PROP's Response: PROP has stated before and continues to be supportive of
                discussions to "restructure the allocation of recycling grants." PROP has, in
                fact, stated the importance of a long-term and comprehensive funding plan to
                address the complete waste and recycling strategy for the next several decades.

    ·    PWIA Concern: Adding an additional $4.00 tax to subsidize county recycling programs
         defeats the long standing legislative goal that recycling in Pennsylvania become self
         sufficient.

              o PROP's Response: This fee is levied locally and goes directly to local programs
                desired by local constituents.


H.B. 934 WOULD RESULT IN UNFAIR COMPETITION:
    ·    PWIA Concern: The private sector is recycling. The waste industry, and PWIA
         members in particular, are leaders in recycling and in some instances partner with
         manufacturers to take back items such as electronics in order to keep them out of
         landfills. This amendment will create a competitive advantage to counties to compete
         with and supplant private sector recycling.

              o PROP's Response: We support partnerships and have no desire to supplant
                private sector efforts. That is why PROP has strongly advocated that the waste
                industry have a seat at the table through advisory committees or solid waste
                authorities to discuss how this money is to be spent. PROP insisted that language
                be included in the legislation.

WHY NOW?

    ·    PWIA Concern: Raw materials (office paper, corrugated, news #8, glass, steel and
         aluminum) are at all time highs. From January 2006 to September 2007:
              o   Hard mixed paper is up 157% to $90.00/ton.
              o   Corrugated is up 150% to $135.00/ton.
              o   Sorted office paper is up 117% to $195.00/ton.
              o   News #8 is up 58% to $120.00/ton.
              o   Bi-metal tin is up 39% to $209.00/ton.
              o   Aluminum is up 7% to $1,781.00/ton.

              o PROP's Response: Yet despite this healthy marketplace, more than half the
                recyclable material in Pennsylvania is trashed. This is testimony to the two sided
                coin that recycling is. We have done a great deal but still have much to do.
                Counties should and could be a key partner in this effort, just like the private
                sector. Reasonable funding for reasonable and successful programs will benefit
                all the stakeholders in this industry.




PROP Responses to PWIA Concerns
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