From: Karl Schoenberger, San Jose Mercury News
Published July 20, 2005 12:00 AM

California Firms Adapt to New Electronic-Waste Recycling Rules

California's pioneering electronic-waste recycling law was as confusing for the big recycling operators as it was for collectors and consumers when it went into force at the beginning of the year.

But after struggling with vague regulations and burdensome red tape during the first six months of operation, recyclers say the system is starting to work. The complicated financial scheme that supports the recycling of hazardous computer monitors and television tubes is generating payments -- if the paperwork is in order.

"I'm not sure I agree with the need for all the regulations, but we're managing within the system and it's working for us," said Steve Skurnac, president of San Jose-based Noranda Recycling, a subsidiary of a Canadian mining company that operates a giant e-waste crunching machine in Roseville. "We haven't had any of our invoices to the state rejected yet."

A lot is riding on the success of the Electronic Waste Recycling Act, signed into law by Gov. Arnold Schwarzenegger in September 2003. The legislation was the first in the nation to attack the scourge of toxic e-waste piling up in America's garages and landfills. More than 3,000 tons of electronics are discarded daily in the United States, and 50 million computers become obsolete every year, according to the U.S. Environmental Protection Agency.

As many as three e-waste bills have been introduced in Congress this term, one similar to California's approach of using retail fees to finance recycling and two others proposing tax incentives to persuade producers to recycle their products. Maine and Maryland passed e-waste laws over the past two years, and legislation has been introduced in more than 20 other states this year. Responding to the rising public interest, the House Committee on Energy and Commerce's subcommittee on Environment and Hazardous Materials has scheduled a hearing on e-waste Wednesday (7/20).

Authors of the California law made a strategic decision to focus on cathode ray tubes, which contain leaded glass and other toxins. The law was amended to include LCD and gas plasma displays, which contain such hazardous material as mercury, cadmium and bromimated flame retardant.

A separate recycling law for cell phones passed the state assembly last year and goes into effect July 1, 2006.

The idea behind the CRT recycling law was that if the infrastructure for collecting fees and paying for the recycling of these items worked, the program could be expanded in the future to cover circuit boards and other kinds of electronic trash.

Under the current scheme, the state collects a $6 to $10 levy on sales of CRT and electronic display products at the retail level. That money goes to the Board of Equalization, which passes it on to the California Integrated Waste Management Board, the agency that manages the program and pays recyclers.

To date, the state has collected $15 million from retail outlets. Recyclers have claimed $6.1 million in fees, and the CIWMB has approved additional payments of about $2 million.

The big challenge in implementing the e-waste law has been gathering the documentation needed to prove that material collected for recycling originated within the state of California, recyclers say. The law forbids payments for e-waste collected from out of state, to make sure the retail fees are used for home-grown waste.

"Companies who collect the monitors are supposed to get the names and address of the people or the business where they got them," said William McGeever, vice president for operations at San Jose-based Asset Services & Liquidation (ASL). "We have to document that every item we recycle is of California origin. Otherwise we can't bill the state and we can't pay the collector."

McGeever said he waited to sign a contract to buy a $500,000 cathode ray tube recycling machine until Schwarzenegger signed the E-waste Recycling Act. ASL's business model depends on collecting large volumes of CRTs to feed into its machine, which handles up to 35,000 pounds of material in one eight-hour shift. The company does much of its own collecting, advertising its free pickup services on KCBS radio, with plans to expand into the Sacramento market.

"Our model is free and convenient services to businesses, schools, local governments and residents," McGeever said.

Because ASL is one of the 38 recyclers approved by the state to participate in the recycling program, he is allowed to bill the Waste Management Board at the rate of 48 cents a pound for the material he processes. Then he passes on 20 cents a pound to state-approved collectors who provide him with CRTs -- and the proper documentation. Recyclers keep the whole 48 cents when they do their own collecting.

"It's moving along. By the end of the year it should all be in place, but there's a lot of paper involved," McGeever said. "It takes two reams of paper to get the paperwork out the door when you submit a claim for services to the state."

Jeff Hunts, supervisor of CIWMB's e-waste recycling program, agrees the program is functioning well after the first six months. Consumers who pay the surcharge at the retail level aren't lodging major complaints. The documentation problems over proving California origin of the material are less an issue now that the more than 260 authorized collectors are learning the rules.

"I think everyone participating is surprised at how well this is working so far," Hunts said. "All trails are pointing in the right direction."

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Source: Knight Ridder/Tribune Business News

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