Maine Legislative Document 1541 A (2021) - (Passed)

Packaging material is defined as a material used for the containment, protection, delivery, presentation, or distribution of a product at the time that the product leaves a point of sale with or is received by the consumer of the product.

There are a number of exclusions to the definition of packaging material. These include:

1. Packaging intended to be used for the long-term storage or protection of a durable product for a period of at least 5 years.
2. Beverage containers subject to existing bottle deposit legislation.
3. Containers for architectural paint already covered under an effective stewardship program provided certain performance goals are reached.

Producer is defined as the legal owner of a brand for a product sold, offered for sale, or distributed in the state that uses covered packaging material.

Producer also includes a person who is the sole entity that imports a product that uses covered packaging material into the state when the brand does not have a physical presence in the United States.

Producers are exempt if gross revenue within the state is less than $2 million in the previous year, or if the producer sold, offered for sale, or distributed products containing less than 1 ton of covered packaging material in the previous year.

For the period from one to three years after the effective date of the program contract, producers with less than $5 million in revenue during the previous year are exempt.

Producers are also exempt if they sold, offered for sale, or distributed to retailers or direct to consumers products that were perishable food and that were contained, protected, delivered, presented, or distributed in or using less than 15 tons of packaging material in total.

Producer includes a low-volume producer and a franchisor of a franchise located in the state, but does not include the franchisee operating that franchise.

501(c)(3) registered nonprofit organizations are excluded from the definition of producer.

The state will select a packaging stewardship organization via a competitive bid process. The state will enter into a contract with a packaging stewardship organization to coordinate the packaging stewardship program. However, producers are individually responsible for compliance with the regulation.

The stewardship organization must reimburse local governments for operational costs of managing packaging material including collection, transportation, and processing.

Program funds will be used to reimburse municipalities for operational costs associated with managing packaging material including collection, transportation, and processing.

A portion of program funding will be used for efforts designed to improve recycling education in the state.

Funding will cover administration of the stewardship organization as well as government costs associated with administering and enforcing the stewardship program.

Program funds will be used to support investments in infrastructure.

Low-volume producers may elect to pay a flat fee on a tiered basis in lieu of a material-specific producer payment. Low-volume producer means a producer that sold, offered for sale, or distributed for sale in or into the State products using more than one ton but less than 15 tons of packaging material in total in the previous year.

The state will develop rules, with public input, that determine payment calculations. This must include rules that require the amount of a producer's payment to reflect the costs associated with managing the producer's packaging material.

The rules determining fee calculations must include consideration of modulated fees that encourage certain packaging characteristics, such as reusability and incorporation of recycled content.

Rules determining fee calculation must include criteria to adjust payments in a manner that incentivizes the use of recycled content.

Rules determining fee calculation must include criteria to adjust payments in a manner that incentivizes the reuse of packaging materials.

Rules determining fee calculation must include criteria to adjust payments in a manner that incentivizes design characteristics such as lower toxicity in packaging materials, a reduction in the amount of packaging materials used, and a reduction of litter from packaging material.

Rules determining fee calculation must include criteria to adjust payments in a manner that incentivizes the increased recyclability of packaging material and labeling of packaging material to reduce consumer confusion.

The program goals must include recycling access and collection rate goals for municipalities, overall program and material-specific recycling rate goals, and packaging material litter reduction goals.

The program must include goals supporting an increased reuse by producers of packaging material and an increased amount of post-consumer recycled content in packaging material used by producers.

Material specific recycling rate goals will be set within the program.

The stewardship organization will make investments in education and infrastructure that support the recycling of packaging material in the state. Preference for funding will be given to proposals that promote a circular economy for covered packaging materials and increase access to recycling infrastructure in the state.

No later than 180 days following the effective date of the stewardship organization's contract, a producer may not sell, offer for sale, or distribute for sale in or into the state a product contained, protected, delivered, presented or distributed in or using packaging material if they have not complied with this regulation.

This bill requires potential stewardship organizations to bid for a contract to operate the packaging stewardship program for the state. During the bidding process, bidders will submit a program proposal. The state will review the proposal and enter into a contract that must cover 10 years of operation of the packaging stewardship program.

The state will administer and enforce this regulation and adopt rules to implement, administer, and enforce this regulation.

The state will determine program rules to include the fee schedule, municipal reimbursement provisions, and distribution of funds to support investments in infrastructure and education.

The state will solicit input from interested parties in the development of any draft rules, solicit public comment on the draft rules for a period of at least 30 days, and hold a public hearing on the draft rules.

The stewardship organization must submit an annual report; the timing of that report will be determined during rulemaking.

Funds from the program will be awarded to increase access to recycling infrastructure, improve consumer education regarding recycling and recyclability, and equitably support recycling and education efforts in participating municipalities, particularly in those participating municipalities that have received minimal or no prior funding.

Many program details will be determined during the rulemaking process, which is designed to ensure the consideration of all input from stakeholders. The rulemaking process will define the following: a process for determining producer payments; producer reporting requirements; a process for determining which types of packaging are considered readily recyclable; a process for determining which municipalities are similar municipalities; a process for determining municipal reimbursements; municipal reporting requirements; requirements for the assessment for program performance; methods for performing audits of recycling, solid waste, and litter; a schedule for reporting by the stewardship organization; and a process for reviewing proposed investments for recycling infrastructure and education.

The stewardship organization will be required to solicit and incorporate input from producers, recycling establishments, and participating municipalities during the development of proposals for investments in infrastructure and education, as will be further defined during rulemaking.

Readily recyclable packaging material will be determined on an annual basis by the state through consultation with the stewardship organization and recycling establishments. The rules determining this process must include a transitional period between the time that a type of packaging material is determined to be readily recyclable or to not be readily recyclable.

This bill refers to the definition of recycling used in existing Maine legislation. Recycling means the transforming or remanufacturing of an unwanted product or the unwanted product's components and by-products into usable or marketable materials. The definition does not include landfill disposal, incineration, energy recovery, or energy generation by means of combusting unwanted products, components, and by-products with or without other waste.

A producer or stewardship organization is protected from antitrust liability for actions taken in accordance with this regulation to the extent that the actions are necessary to plan and implement the required packaging stewardship program or alternative collection program.

The stewardship organization must include in their annual report an estimate of the annual greenhouse gas emissions effects in the state associated with the operation of the stewardship program.

The stewardship organization must develop a plan to conduct a statewide recycling needs assessment. The needs assessment will evaluate current funding needs affecting recycling access and availability, the capacity and costs associated with the collection and transportation of recyclable material, the processing capacity, market conditions, and opportunities in the state and regionally for recyclable material, and consumer education needs with respect to recycling and reducing contamination in collected recyclable material.

A producer or group of producers may develop and operate an alternative collection program to collect and manage a type or types of packaging material. A producer that manages a type of packaging material under an approved alternative collection program may wholly or partially offset the producer's payment obligations under the packaging stewardship program with respect to that same type of packaging material only.

The stewardship organization will be required to conduct representative audits of recyclable material processed and sold by facilities in the state and municipal solid waste disposed of or waste littered in the state.