Minnesota Senate Bill 3577 (2024) - (Failed)

Covered material is packaging and paper products introduced in the state. Covered materials type means a singular and specific type of covered material that can be categorized based on distinguishing chemical or physical properties, including properties that allow for a covered materials type to be aggregated into a commonly defined discrete commodity category for purposes of reuse, recycling, or composting, and based on similar uses in the form of a product or package.

Food packaging means products supplied to or purchased by a consumer for the express purpose of facilitating the storage, service, or consumption of food or beverages, including plates, wraps, cups, bowls, boxes, utensils, straws, lids, bags, foil, hinged or lidded containers, or similar containers that are sold to a retailer or a food establishment, regardless of whether the item is used to prepackage food or beverages for resale, filled on site with food or beverages ordered by a customer, or resold as is.

Paper products include product made primarily from wood pulp or other cellulosic fibers.

Bound books and unsafe or unsanitary paper products are exempt.

For paper products, including magazines, newspapers, catalogs, telephone directories, or similar publications, the producer is the publisher. For other paper products the producer follows the tiered definition approach shared with packaging. The producer is the person that manufactures the paper product under the manufacturers own brand.

For other products (not paper) sold physically in store, the producer is the person that manufactures the product if the product is sold in packaging under the manufacturers own brand or sold in packaging that lacks brand identification.

For remote sale or distribution, the producer is the person that manufactures the packaged product if the packaging is used to directly protect, or indirectly contain the product and if the packaging is used to directly protect or contain the product and no additional packaging is used to ship the product, the producer is the person that manufactures the packaged product.

If the paper product is manufactured by a person other than the brand owner, the producer is the licensee.

If the product is manufactured by a person other than the brand owner, the producer is the licensee of a brand or trademark under which the packaged product is sold.

For remote sale or distribution, the producer is the person that packages and ships the product or group of products if the packaging is used to ship the product or group of products to a consumer.

If there is no brand or licensee of the paper product located in the United States, the producer is the person that imports the item into the US.

If there is no brand or licensee in the US, the producer is the person who imports the packaged product into the US.

For remote sale or distribution, for all other packaging, the producer is the first person to distribute the packaged product in the state.

Producer does not include a person that annually sells, offers for sale, distributes, or imports into the state less than 1 ton of material and has a global gross revenue of less than $2 million for the most recent fiscal year.

An individual producer who represents at least five percent of the market share of covered materials sold into this state by weight, or by the relevant unit of measurement may elect to operate independently under this act instead of with a producer responsibility organization.

Producers are required to join a PRO or comply individually.

One or more producers may elect to operate independently. If more than one PRO is established, the producers and PROs must establish a coordinating body and process.

The Producer responsibility organization is a nonprofit corporation that is tax exempt under chapter 501(c)(3) of the federal​ Internal Revenue Code.

Producers must to ensure statewide coverage of and access to the program, including access to collection services for covered materials on the recyclable materials list at no cost to all single-family residences, multifamily residences, and political subdivisions arranging for collection of recyclable
materials from public places and reimburse materials recovery facilities and composting facilities for the costs of processing covered materials generated from all single-family residences, multifamily residences, public places, and commercial, industrial, and institutional facilities in the state.

The plan must include proposed reimbursement formulas and schedules for service providers who elect to participate in collection, processing, and transportation.

The plan must include education and outreach activities.

A PRO must submit an annual fee to the commissioner. Beginning October 1, 2028 and annually thereafter the commissioner must notify PROs the amount of the fee (commissioner's estimate of the costs required to perform the duties to administer, implement, and enforce the act).

The plan must include infrastructure improvements like funding for equipment or facilities in which covered materials are prepared for recycling, composting, or reuse, technical assistance to a producer, or the expansion or strengthening of demand for and use of covered materials by responsible markets in the state or region.

The PRO must collect an annual fee based on the total amount of covered products each producer sells, on a per-unit basis like ton, item or other measurement.

Fees must incentivize materials and design attributes that reduce the environmental impacts and human health impacts of covered materials.

The fee system must incentivize increasing the proportion of post-consumer recycled content in covered materials.

The fees must incentivize increasing the amount of covered materials managed in a reuse system and prioritize reuse by charging covered materials that are managed through a reuse system only once, upon initial entry into the marketplace.

The fee system must incentivize reducing the amount of packaging per individual covered material that is necessary to efficiently deliver a product without damage or spoilage without reducing its ability to be recycled or reducing the amount of paper used to manufacture individual paper products.

The fee system must incentivize eliminating the presence of toxic substances.

The fee system must incentivize enhancing recyclability or compostability of a covered material.

The fees must incentivize increasing the amount of inputs derived from renewable and sustainable sources.

The commissioner must ensure that performance targets in the stewardship plan approved will result in achievement of the following goals:

By 2033:

1. 65 percent of covered materials by weight sold into the state must be recycled or composted
2. Ten percent of the number of units of packaging sold into the state must be returned

to an established reuse system
3. The weight of covered materials sold in the state must be source reduced by 15
percent, compared to levels identified in the initial needs estimate
4. All covered materials sold, offered for sale, or distributed for sale in this state must
contain at least ten percent post-consumer recycled content, with all covered materials
containing an overall average of at least 30 percent

By 2038:

1. 75 percent of covered materials by weight sold into the state must be recycled or

composted
2. 20 percent of the number of units of packaging sold into the state must be returned
to an established reuse system
3. The weight of covered materials sold in the state must be source reduced by 25
percent, compared to levels identified in the initial needs estimate
4. All covered materials sold, offered for sale, or distributed for sale in this state must
contain at least 30 percent post-consumer recycled content, with all covered products
containing an overall average of at least 50 percent

The commissioner may adjust any goal by no more than five percent, but must submit the proposed adjustment to the advisory board.

The commissioner must establish performance targets based on the needs assessment.

Performance targets must include targets for waste reduction, reuse, recycling, composting, and post-consumer recycled content by covered materials type that are to be achieved by the end of the stewardship plan's term.

Preference must be given to existing facilities, service providers, and accounts in the state for reuse, collection, recycling, and composting of covered materials.

Service providers agreements with the PRO must meet the requirement to maintain or increase the level of convenience or service quality that was provided by service providers before this act.

If a bottle deposit return system is enacted in the​ future, it will be harmonized and ensures that:​ materials covered in that system are exempt or related financial​ obligations are reduced;​ colocation of drop-off facilities and alternative collection sites is maximized;​ education and outreach is integrated between the two programs; and​ waste reduction and reuse strategies are prioritized between the two programs.

By January 1, 2025 and annually thereafter, a PRO must register with the commissioner. This registration includes: contact information, list of member producers and brands, written agreements, list of board members, and the annual fee payment.

The PRO must to submit a stewardship plan to the commissioner by March 1, 2028, and every five
years thereafter.

A producer must ensure all covered materials sold or distributed in the state after January 1, 2032 are capable of being managed by a reuse system, are recyclable, or are compostable and included on the on the recyclables or compostables established list, or included in an approved alternative collection system in a stewardship plan.

After January 1, 2029, no producer may sell or distribute covered materials, either separately​ or when used to package another product, unless the producer operates under a written​ agreement with a producer responsibility organization to operate under an approved​ stewardship plan.

The commissioner must review and approve, deny, or request additional information to the stewardship plan within 90 days of receipt.

By July 1, 2031, and each May 1 thereafter, a producer responsibility organization must submit a written report to the commissioner.

A PRO that fails to meet a performance target within the stewardship plan must, within 90 days of filing an annual report, file an explanation and proposed amendment with the commissioner.

The commissioner must enforce this act. The commissioner may revoke a registration of a producer​ responsibility organization or producer found to have violated this act.

A person that violates or fails to perform a​ duty imposed by this act or any rule adopted thereunder is liable for a civil penalty not to​ exceed $25,000 per day of violation. For a second violation occurring within 12 months of a first violation, a producer responsibility organization or producer is liable for a civil penalty not to exceed $50,000 per violation for each day during which the violation continues. For a third or subsequent violation occurring within 12 months of a prior violation, a producer responsibility organization or producer is liable for a civil penalty not to exceed $100,000 per violation for each day.

Service agreements with PROs and service providers must establish strong labor standards and work safety practices, including but not limited to safety programs, health benefits, and living wages.

By January 1, 2032, the commissioner must contract with an independent third party to conduct a study of the recycling, composting, and reuse facilities operating in the state including working conditions, wage and benefit levels, and employment levels of minorities and women at said facilities, multifamily buildings and convenience access to recycling, composting, and reuse opportunities, environmental justice, and more.

The initial producer responsibility organization must cover the cost of conducting the study through its annual registration fee and recommended actions identified in the study must be incorporated into the future stewardship plans.

The stewardship plan must assist producers in improving product labels as a means of informing consumers​ about reusing, recycling, composting, and other environmentally sound methods of managing​ covered materials.

The stewardship plan must increase public awareness of how to manage covered materials in an environmentally​ sound manner and how to access reuse, recycling, and composting services, and encourage behavior change to increase participation in reuse, recycling, and​ composting programs.

The board must consult with the commissioner and the PRO on the needs assessment, stewardship plans, and any administration or rule making.

The PRO Advisory Board reviews all programs conducted by the PRO and advises the commissioner and PRO on implementation.

The membership is comprised of:

1. Two members representing manufacturers of covered materials or a statewide or​ national trade association representing those manufacturers
2. Two members representing recycling facilities that manage covered materials
3. One member representing a waste hauler or a statewide association representing waste​ haulers
4. One member representing retailers of covered materials or a statewide trade association​ representing those retailers
5. One member representing a statewide nonprofit environmental organization
6. One member representing a community-based nonprofit environmental justice​ organization
7. One member representing a waste facility that receives covered materials and transfers​ them to another facility for reuse, recycling, or composting
8. One member representing a waste facility that receives source-separated compostable​ materials for composting or a statewide trade association that represents such facilities
9. Two members representing an entity that develops or offers for sale covered materials​ that are designed for reuse and maintained through a reuse system or infrastructure or a​ statewide or national trade association that represents such entities
10. Three members representing organizations of political subdivisions
11. Two members representing other stakeholders or additional members of interests​ represented under clauses (1) to (10) as determined by the commissioner
12. One member representing the commissioner

State legislators or registered lobbyists may not be appointed. The commissioner must appoint members from all regions of the state.

A producer responsibility organization that arranges collection, recycling, composting, or reuse services may engage in anticompetitive conduct to the extent necessary to plan and implement collection, recycling, composting, or reuse systems and is immune from liability under state laws relating to antitrust, restraint of trade, and unfair trade practices.

A person may not charge a point-of-sale or point-of-collection fee for services that are provided under an approved stewardship plan, except that this does not prohibit charging a fee that is:

(1) a deposit made in connection with a product's reuse or recycling that can be redeemed by the consumer
(2) required by a political subdivision to encourage waste reduction, reuse, recycling, or composting.

The commissioner must contract with an independent third party to conduct a needs assesment 18 months before the needs assessment is due. The needs assessment must be completed by December 31, 2026 and every five years thereafter.

By January 1, 2032, the commissioner, in consultation with the commissioners of health and natural resources, must contract with an independent third party to conduct a study to identify the contribution of covered products to litter and water pollution in Minnesota.

By March 1, 2027, and at least every three years thereafter,​ the commissioner must complete a list of covered materials determined to be recyclable or​compostable statewide through systems where covered materials are commingled into a​ recyclables stream and a separate compostables stream.

The list must be provided to all PROs.The commissioner must consult with the​ advisory board, producer responsibility organizations, service providers, political​ subdivisions, and other interested parties. to develop criteria for determining the list. The commissioner may amend the list at any time.

Reusable means capable of reuse.

Reuse means the return of a covered material to the marketplace and the refilling or continued use of the covered material in the marketplace for its original intended purpose without a change in form when the covered material is: intentionally designed and marketed to be used multiple times, designed for durability and maintenance to extend its useful life and reduce demand for new production, supported by adequate logistics and infrastructure that provides convenient access for return for the purpose of refilling or continued use, and compliant with all applicable state and local statutes and rules governing health and safety.