Special Focus

California's Rigid Plastic Packaging Container Act: Strict Penalty Provisions

Nov 2003
George G. Misko, Mitzi L. Ng

This past spring, the California Integrated Waste Management Board adopted emergency regulations to clarify the penalty provisions of California's Rigid Plastic Packaging Container Act (RPPC Act). Although pending final approval based on comments filed over the last several months, the regulations are currently in effect, and are being applied now by the CIWMB in active enforcement actions. These new regulations to some extent spell out acts and omissions that will be considered violations of the Act and how a specific penalty will be determined. The regulations also outline factors that may be taken into account to mitigate the penalty.

These penalty provisions, and the underlying requirements of the Rigid Plastic Packaging Container Law, are discussed below.

California's Rigid Plastic Packaging Container Law

Passed in 1991, the Rigid Plastic Packaging Container Act¹ and its implementing regulations require rigid plastic containers sold or offered for sale in California to meet one of the following standards:

• manufactured from 25 percent post-consumer recycled material,
• recycled at a rate of 25 percent (55 percent for rigid plastic packaging containers whose primary material is polyethylene terephthalate (PET)),² or
• reusable, refillable, or source-reduced, as defined by statute.³

The RPPC Act applies to all "manufacturers of products" that are sold or offered for sale in California that are stored inside a rigid plastic packaging container. The "product manufacturer" responsible for compliance is considered to be the actual product manufacturer, the distributor, or the importer as listed on the label, in that order.

The statute defines a "rigid plastic packaging container" as "any plastic package having a relatively inflexible finite shape or form, with a minimum capacity of eight fluid ounces or its equivalent volume and a maximum capacity of five fluid gallons or its equivalent volume, that is capable of maintaining its shape while holding other products, including, but not limited to, bottles, cartons, and other receptacles, for sale or distribution in the state"⁴ -- in other words, a rigid container made of plastic that can hold as little as 8 ounces and as much as 5 gallons. The regulations implementing the RPPC Act further specify that rigid plastic packaging containers --

• Are made entirely of plastic, except for lids, caps, or labels and other additives such as pigments, colorants, fillers, and stabilizers that are an integral part of the plastic polymer;⁵
• Are capable of multiple reclosures, with an attached or unattached lid or cap;⁶
• Are normally used to store a product for seven days or longer (from the time the container is filled).⁷

The Act exempts certain RPPCs from meeting the law's requirements. For example, RPPCs that contain food, drug, cosmetics, medical devices, medical food, and infant formula, as defined under the Federal Food, Drug, and Cosmetic Act, are exempt from the Act's provisions pertaining to recycle content and reuse, although such packaging is still included in determining the plastics recycling rate.⁸ In addition, the Act exempts containers used to hold products regulated by the Federal Insecticide, Fungicide, and Rodenticide Act (FIFRA), hazardous materials that are prohibited from being manufactured with used materials by federal packaging material specifications, or to which recommendations of the United Nations on the transport of dangerous goods are applicable.⁹

The California Integrated Waste Management Board is required to calculate the "all container" recycling rate and the PET recycling rate on an annual basis; both figures are posted on the CIWMB web page, http://www.ciwmb.ca.gov.¹⁰ The overall recycling rate includes a host of different product containers, and may include containers holding laundry detergents, motor oil, foods, cosmetics, and soft drinks.¹¹ The polyethylene terephthalate (or PET) recycling rate captures soda bottles, water, and food containers, although, again, food and cosmetics containers are currently exempt from compliance with recycle content/reuse provisions of the RPPC law.

If the recycling rates for RPPCs do not meet the mandated levels of 25 percent and 55 percent (for PET), the CIWMB may ask product manufacturers to certify compliance with the RPPC statute.¹² Because the Board's calculated annual recycling rates for 1997, 1998, and 1999 fall short of the rates required by statute,¹³ the CIWMB has requested 1,000 randomly selected product manufacturers to certify compliance with the law for these years.¹⁴ The product manufacturers must show that their covered products contain the minimum acceptable recycle content or are reuseable, refillable or source-reduced, or that the products qualify for an exemption or waiver under Cal. Pub. Res. Code §§ 42340 and 42330(c), respectively, and if so, the applicable reasons for the exemption or waiver.¹⁵

Product manufacturers selected for compliance are required to provide specific information regarding RPPCs used in a given year.¹⁶ Specifically, the product manufacturer must describe the container, the container weight, number of containers sold in California (or U.S.) for each product line, and resin type. For RPPCs that are manufactured from post-consumer recycled material, the manufacturer must indicate both the total weight of the container and the post-consumer resin weight used in the container.¹⁷ For the source reduction option, the manufacturer must indicate the weight before and after source reduction.¹⁸ Finally, if the RPPCs are refilled or reused, the product manufacturer must provide supporting documentation of refill and/or reuse of the RPPCs.¹⁹

The certification process also applies to container manufacturers that supply the rigid plastic packaging containers which hold the products.²⁰ The container manufacturer certification form requires the container manufacturer to provide its contact information and to identify the product manufacturer for whom it is supplying the data.²¹ The container manufacturer must also provide the (1) container description, (2) container weight, (3) number of containers supplied to individual product manufacturer (for each product line), and (4) resin type. In addition, if post consumer resins are used, the container manufacturer must indicate the total weight of the container and the post-consumer resin weight used in the container. If source reduction is used, the container manufacturer must indicate the weight before and after source reduction. Finally, in cases where the product manufacturer also produces the RPPCs, the manufacturer must complete both product manufacturer and container manufacturer certification forms.

CIWMB Proposes to Modify Penalty Provisions of RPPC Act

Violations of the Act can result in both criminal and civil penalties. Criminal violations are punishable by fines of up to $100,000.²² Civil penalties of up to $50,000 per violation are also available.²³

In April 2003, the CIWMB adopted emergency regulations to clarify the existing penalty scheme for noncompliance with the RPPC law.²⁴ The regulations set forth four discrete violations and their corresponding penalties, as follows:

• Product manufacturer did not comply with container requirements. Penalty determined by degree of noncompliance.²⁵ ($5,000-$50,000)
• Product manufacturer did not submit certification by due date. ($1,000-$50,000)
• Product manufacturer did not submit complete or accurate certification by due date. Degree of incompleteness or inaccuracies include, but are not limited to, misreporting exemptions; failure to account for all products; failure to account for subsidiaries and divisions; lack of container manufacturer's verification of number of containers sold or weight of containers; inconsistencies in information from product manufacturer and container manufacturer; lack of signatures; mathematical inaccuracies. ($1,000-$50,000)
• Product manufacturer submitted false or misleading information on certification. (Referral to Attorney General for prosecution for fraud within 30 days of discovery by Board; maximum criminal fine, $100,000).²⁶

Notably, however, the new rules permit the Board or the Administrative Law Judge to consider mitigating factors for any of the above violations. The factors may include:

(1) Impact on diversion and sustainable markets.

(2) Size of company.

(3) Degree of cooperation or noncooperation, including documented efforts to obtain container manufacturer's documentation.

(4) Technological feasibility of compliance.

(5) History of previous compliance.²⁷

According to its Initial Statement of Reasons, the Board proposed the clarified penalty scheme to "ensure that penalties actually imposed are based on the severity and degree of violation, and are appropriately reduced through documentation of the degree of compliance achieved."²⁸ Further, the Board asserts that the penalty regulations clarify what constitutes a violation under the RPPC Act, so that greater compliance with the law may be achieved.²⁹

Emergency regulations were filed with the Secretary of State on June 2, 2003, and a written comment period on the new penalty provisions ended on October 6, 2003.³⁰ The new regulations are in force now, and according the CIWMB, are currently being utilized in some 39 active enforcement actions for failure to comply with the RPPC Act.

 

FOOTNOTES

¹ See CAL. PUB. RES. CODE §§ 42300 et seq.(1997) available at http://www.leginfo.ca.gov.

² "Primary material" is defined as "plastic that composes the greatest weight of the rigid plastic package container." 27 CAL. CODE OF REGS. Tit. 14, § 17944(a)(2)(B).

³ Under the RPPC implementing regulations, a "refillable package" is one that the California Integrated Waste Management Board has "determined is routinely returned to and refilled by the product manufacturer at least five times with the original product held by the package." 27 CAL. CODE OF REGS. Tit. 14, § 17943(b)(27). A "reusable package" is defined as "a rigid plastic packaging container which the Board determines is routinely reused by consumers at least five times to store the original product contained by the package." See id. § 17943(b)(29).

A "source-reduced container" is defined as a RPPC "for which the manufacturer seeks compliance as of January 1, 1995, whose package weight per unit or use of product has been reduced by 10 percent when compared with the packaging used for that product by the manufacturer from January 1, 1990, to December 31, 1994." Further,

1. If the product held by the container was sold prior to January 1, 1990, the non-source reduced container weight is the average weight of the container during the first 60 days commencing with the first day of sale in multiple jurisdictions in 1990.

2. If the product held by the container was initially sold on or after January 1, 1990, the non-source reduced weight is the average weight of the container during the first 60 days it was introduced for sale in multiple jurisdictions. See 27 CAL. CODE OF REGS. Tit. 14, § 17943(b)(31).

⁴ See CAL. PUB. RES. CODE § 42301(e) (1997).

⁵ See 27 CAL. CODE OF REGS. Tit. 14, § 17943(b)(30)(A).

⁶ See id. § 17943(b)(30)(A).

⁷ See 27 CAL. CODE OF REGS. Tit. 14, § 17943(b)(12)(B). RPPCs do not include blister packaging and clamshells that cannot be reclosed, flexible tubes, service packaging that does not normally store a product for seven days, plastic boxes that have at least one side or attached lids that are not made of plastic, or a blister package that has at least one attached component not made of plastic. See http://www.ciwmb.ca.gov/plastic/RPPC/.

⁸ See 27 CAL. CODE OF REGS. Tit. 14, § 17944.5(a)(2).

⁹ See 27 CAL. CODE OF REGS. Tit. 14, § 17944.5.

¹⁰ According to the CIWMB, the recycling rates for all containers and PET in 2001 are 26.1 percent and 31.8 percent, respectively. See http://www.ciwmb.ca.gov/plastic/RPPC/.

¹¹ Id.

¹²See 27 CAL. CODE OF REGS. Tit. 14, § 17946.

¹³ See http://www.ciwmb.ca.gov/plastic/RPPC/Certification/.

¹⁴ Id. The product manufacturer?s response must be postmarked no later than 90 calendar days from the date on which the Board's request arrived via certified mail. 27 CAL. CODE OF REGS. Tit. 14, § 17946(e).

¹⁵ Id. Specifically, the forms specify and request documentation of the following reasons for a waiver or exemption: "(a) The product is a food, beverage, cosmetic, drug or medical device; (b) the product must comply with the Federal Insecticide, Fungicide, and Rodenticide Act (FIFRA), (c) the product's container must comply with U.S. DOT hazardous material shipping requirements of Title 49 of the Code of Federal Regulation or to which recommendations of the United Nations on the transport of dangerous goods are applicable, and (d) the product or container was first introduced (as defined in Title 14, California Code of Regulations section 17943) and sold in California on [date]." Id.

¹⁶ See e.g., http://www.ciwmb.ca.gov/plastic/RPPC/Certification/Forms/CIWMB649.pdf.

¹⁷ Id.

¹⁸ Id.

¹⁹ Id.

²⁰ See http://www.ciwmb.ca.gov/plastic/RPPC/Certification/.

²¹ See e.g., 2000 Rigid Plastic Packaging Container (RPPC) Container Manufacturer Certification Form, available at http://www.ciwmb.ca.gov/plastic/RPPC/Certification/Forms/CIWMB650.pdf.

²² See 27 CAL. CODE OF REGS. Tit. 14, § 17949(b).

²³ Id.

²⁴ See http://www.ciwmb.ca.gov/plastic/rppc/Enforcement/. Specifically, the rulemaking modifies Article 3, Section 17946 and Article 3, Section 17949 of the California Code of Regulations.

²⁵ Under the new penalty provisions, the degree of noncompliance will be determined by a point system organized by whether the containers are manufactured from post-consumer resin, source-reduced, reused, or refilled. See Draft Regulations, California Code of Regulations, Chapter 4. Resource Conservation Programs, § 17949(d) available at http://www.ciwmb.ca.gov/Rulemaking/RPPCPenalty/ISOR.doc (last updated Oct. 9, 2003).

²⁶ Draft Regulations, California Code of Regulations, Chapter 4. Resource Conservation Programs, available at http://www.ciwmb.ca.gov/Rulemaking/RPPCPenalty/ISOR.doc (last updated Oct. 9, 2003).

²⁷ Id. § 17949(f).

²⁸ See http://www.ciwmb.ca.gov/Rulemaking/RPPCPenalty/ISOR.doc.

²⁹ Id.

³⁰ See http://www.ciwmb.ca.gov/plastic/rppc/Enforcement/.