2005 California Public Resources Code Sections 14570-14576 CHAPTER 6. RETURNS

14570.  Every dealer shall post a clear and conspicuous sign of at
least 10 inches by 15 inches at each public entrance to the dealer's
place of business, which specifies one of the following:
   (a) The name and address, as provided by the department, of at
least the certified recycling center, location, or locations, nearest
to the dealer, which redeems all types of empty beverage containers
at one location during at least 30 hours per week with a minimum of
five hours of operation occurring during periods other than from
Monday to Friday, from 9 a.m. to 5 p.m., and the toll-free telephone
number established by the department for the purpose of disseminating
information regarding beverage container recycling opportunities.
   (b) One of the following procedures for redeeming beverage
containers is available, pursuant to Section 14571.6:
   (1) Beverage containers may be redeemed at all open cash registers
within this place of business.
   (2) Beverage containers may be redeemed at one specific location
on the dealer's premises which is identified on the sign.
14571.  (a) Except as otherwise provided in this chapter, there
shall be at least one certified recycling center or location within
every convenience zone which accepts and pays the refund value, if
any, at one location for all types of empty beverage containers and
is open for business during at least 30 hours per week with a minimum
of five hours of operation occurring during periods other than from
Monday to Friday, from 9 a.m. to 5 p.m.
   (b) (1) Notwithstanding subdivision (a), the department may
require a certified recycling center to operate 15 of its 30 hours of
operation other than during 9 a.m. to 5 p.m.
   (2) Notwithstanding subdivision (a) and paragraph (1), the
department may certify a recycling center that will operate less than
30 hours per week, if all of the following conditions are met:
   (A) The recycling center is in a rural region.  For purposes of
this subparagraph, "rural region" means a nonurban area identified by
the department on an annual basis using Farmers Home Loan
Administration criteria.  Those criteria include, but are not limited
to, places, open country, cities, towns, or census designated places
with populations that are less than 10,000 persons.  The department
may designate an area with a population of between 10,000 and 50,000
persons as a rural region, unless the area is identified as part of,
or associated with, an urban area, as determined by the department on
an individual basis.
   (B) The recycling center agrees to post a sign indicating the
location of the nearest recycling center which is open at least 30
hours per week and which will accept all material types.
   (C) The needs of the community and the goals of this division will
be best served by certification of the operation as a recycling
center.
   (c) Before establishing operating hours for a certified recycling
center pursuant to subdivision (b), the department shall make a
determination that this action is necessary to further the goals of
this division and that the proposed operating hours will not
significantly decrease the ability of consumers to conveniently
return beverage containers for the refund value to a certified
recycling center redeeming all material types.
   (d) For purposes of this section, if the recycling center is
staffed and is not a reverse vending machine, a center is "open for
business" if all of the following requirements are met:
   (1) An employee of the certified recycling center or location is
present during the hours of operation and available to the public to
accept containers and to pay the refund values.
   (2) In addition to the sign specified in subdivision (h), a sign
having a minimum size of two feet by two feet is posted at the
certified recycling center or location indicating that the center or
location is open.  Where allowed by local zoning requirements or
where zoning restrictions apply, the sign shall be of the maximum
allowable size.
   (3) The prices paid, by weight or per container, are posted at the
location.
   (e) Except as provided in subdivision (f), for the purpose of this
section, if the recycling center consists of reverse vending
machines or other unmanned automated equipment, the center is "open
for business" if the equipment is properly functioning, accepting all
types of empty beverage containers at the recycling location, and
paying posted refund values no less than the minimums required by
this division.
   (f) If a recycling center consists of reverse vending machines or
other automated equipment, the recycling center is "open for business"
if the equipment is properly functioning, and accepting all types of
empty beverage containers at one physical recycling location within
the recycling location.
   (g) Whenever a recycling center which is a reverse vending machine
is not "open for business" during the 30 hours of operation required
and posted pursuant to this section and Section 14570, the dealer
which is hosting the reverse vending machine at its place of business
shall redeem all empty beverage container types at all open cash
registers or one designated location in the store, as specified on
the sign required pursuant to subdivision (h).
   (h) In addition to the sign specified in paragraph (2) of
subdivision (d), each reverse vending machine shall be posted with a
clear and conspicuous sign on or near the reverse vending machine
which states that beverage containers may be redeemed by the host
dealer if the machine is nonoperational at any time during the
required 30 hours of operation, pursuant to subdivision (g).  The
department shall determine the size and location of the sign and the
message required to be printed on the sign.
14571.1.  On or before February 1, 1990, and on or before January 1,
annually thereafter, the department shall, on a statewide basis,
designate all convenience zones as of that date, including
convenience zones in underserved areas, and shall prepare a map or
maps showing these convenience zones.
14571.2.  The department shall continuously assist dealers and
recyclers to establish certified recycling locations within each
convenience zone.  This assistance includes, but is not limited to,
providing information to companies and organizations interested in
operating recycling in the convenience zone; providing dealers with
names of prospective recyclers for the convenience zone and providing
recyclers with the names of dealers in need of a recycler for a
convenience zone; providing dealers and recyclers with information on
grants, advertising funds, and other resources available; and
providing recyclers with advice regarding appearance and image of the
recycling center and the efficient handling and transportation of
recycled beverage containers.
14571.3.  (a) The department shall continuously assist any certified
recycler to achieve greater service to the public in an economical
and cost-effective manner.  This assistance shall include, but not be
limited to, advice on all of the following:
   (1) Methods to enhance public participation in recycling.
   (2) The most beneficial location, siting, and image of a recycling
location.
   (3) Methods to reduce costs and optimize efficiencies of existing
resources.
   (b) The department shall conduct regular, unannounced inspections
of certified recycling centers for the purpose of determining that
the requirements of this division are satisfied.  The department
shall assess civil penalties pursuant to Section 14591.1 for
violations at certified recycling centers.
14571.4.  (a) (1) The department shall certify one operator to
establish the Pacific Beach Mobile Recycling Program that
incorporates all convenience zones in the Pacific Beach area of San
Diego County.
   (2) For the purposes of this section, "the Pacific Beach area of
San Diego County" means the area designated in the Pacific Beach
Community Plan.
   (b) Notwithstanding Sections 14570 and 14571, all convenience
zones within the Pacific Beach area of San Diego County shall be
considered served if both of the following conditions are met:
   (1) The recycling center operator meets all of the following
conditions:
   (A) The center is open for business at least once each week at a
number of locations equal to the number of convenience zones in the
Pacific Beach area of San Diego County as determined by the
department annually, three of which are within existing convenience
zones in the Pacific Beach area of San Diego County.
   (B) The center is open for business at least eight hours per day
at each location.
   (C) The center agrees to accept, and pay the refund value for, all
eligible beverage container types.
   (D) The center is certified by the department for operation in the
number of locations equal to the number of convenience zones in the
Pacific Beach area of San Diego County, as determined by the
department.
   (2) All dealers within the Pacific Beach area of San Diego County
post a clear and conspicuous sign of at least 10 inches by 15 inches
at each public entrance to the dealer's place of business, indicating
the location, hours, and day of operation for each recycling
location within the Pacific Beach area.
   (c) A recycling center operator approved by the department, that
meets the conditions prescribed in paragraphs (1) and (2) of
subdivision (b), shall be designated a certified recycling center and
shall be eligible to apply for handling fees pursuant to Section
14585 and to receive from processors the amounts specified in
subdivision (a) of Section 14573.5 for refund values, administrative
costs, and processing payments.
   (d) If the department determines that it is necessary to adopt or
revise regulations to implement this section, the regulations shall
be adopted or revised as emergency regulations.  The Office of
Administrative Law shall consider these emergency regulations to be
necessary for the immediate preservation of the public peace, health,
and safety, and the general welfare for the purposes of Section
11349.6 of the Government Code.  Notwithstanding the 120-day period
provided for in subdivision (e) of Section 11346.1 of the Government
Code, the emergency regulations shall be repealed 180 days from the
effective date of the regulations.
14571.6.  In any convenience zone where no recycling location has
been established which satisfies the requirements of Section 14571,
and in any convenience zone which has exceeded the 60-day period for
the establishment of a recycling center pursuant to Section 14571.7,
all dealers within that zone shall, until a recycling location has
been established in that zone, do one of the following:
   (a) Submit to the department an affidavit form provided by the
department stating that all of the following standards are being met
by the dealer:
   (1) The dealer redeems all empty beverage container types at all
open cash registers or one designated location on the dealer's
premises, during all hours that the dealer is open for business.
   (2) The dealer has posted signs which meet the size and location
requirements specified in subdivision (b) of Section 14570, and which
conform to paragraph (2) of that subdivision.
   (3) The dealer is delivering, or having delivered, all empty
beverage containers received from the public to a certified recycling
center or processor for recycling.
   (b) Pay to the department for deposit in the fund the sum of one
hundred dollars ($100) per day until a recycling location is
established or until the standards for redemption specified in
subdivision (a) are met.
14571.7.  (a) Except as provided in subdivision (b), in any
convenience zone where a recycling location or locations were
initially established, but where the location or locations cease to
operate in accordance with Section 14571, on or before August 1,
1990, and in any convenience zone designated after January 1, 1990,
the department shall notify all dealers within that convenience zone
that a recycling location is required to be established within 60
days.  If, within 30 days of the notification, no recycling location
has been established which satisfies the requirements of Section
14571, the department shall notify all dealers within that zone, and
one or more dealers within that zone shall establish, or cause to be
established, a recycling location.
   (b) In any convenience zone where a recycling location or
locations were initially established, but where the location or
locations cease to operate in accordance with Section 14571, on or
after August 1, 1990, or the convenience zone is to be established
after October 1, 1990, the department shall determine, pursuant to
Section 14571.8, if the convenience zone is eligible for an
exemption.  If the convenience zone meets all of the requirements for
an exemption pursuant to Section 14571.8, the department shall grant
one exemption.  If the department determines that a convenience zone
is not eligible for an exemption pursuant to subdivision (a) and
Section 14571.8, the department shall notify all dealers  within that
convenience zone that a recycling location is required to be
established within 60 days.  If, within 30 days of the notification,
no recycling location has been established which satisfies the
requirements of Section 14571, the department shall notify all
dealers within that zone, and one or more dealers within that zone
shall establish, or cause to be established, a recycling location.
14571.8.  (a) No lease entered into by a dealer after January 1,
1987, may contain a leasehold restriction that prohibits or results
in the prohibition of the establishment of a recycling location.
   (b) The director may grant an exemption from the requirements of
Section 14571 for an individual convenience zone only after the
department solicits public testimony on whether or not to provide an
exemption from Section 14571.  The solicitation process shall be
designed by the department to ensure that operators of recycling
centers, dealers, and members of the public in the jurisdiction
affected by the proposed exemption are aware of the proposed
exemption.  After evaluation of the testimony and any field review
conducted, the department shall base a decision to exempt a
convenience zone on one, or any combination, of the following
factors:
   (1) The exemption will not significantly decrease the ability of
consumers to conveniently return beverage containers for the refund
value to a certified recycling center redeeming all material types.
   (2) Except as provided in paragraph (5), the nearest certified
recycling center is within a reasonable distance of the convenience
zone being considered from exemption.
   (3) The convenience zone is in the area of a curbside recycling
program that meets the criteria specified in Section 14509.5.
   (4) The requirements of Section 14571 cannot be met in a
particular convenience zone due to local zoning or the dealer's
leasehold restrictions for leases in effect on January 1, 1987, and
the local zoning or leasehold restrictions are not within the
authority of the department and the dealer.  However, any lease
executed after January 1, 1987, shall meet the requirements specified
in subdivision (a).
   (5) The convenience zone has redeemed less than 60,000 containers
per month for the prior 12 months and, notwithstanding paragraph (2),
a certified recycling center is located within one mile of the
convenience zone that is the subject of the exemption.
   (c) The department shall review each convenience zone in which a
certified recycling center was not located on January 1, 1996, to
determine the eligibility of the convenience zone under the exemption
criteria specified in subdivision (b).
   (d) The total number of exemptions granted by the director under
this section shall not exceed 35 percent of the total number of
convenience zones identified pursuant to this section.
   (e) The department may, on its own motion, or upon petition by any
interested person, revoke a convenience zone exemption if either of
the following occurs:
   (1) The condition or conditions that caused the convenience zone
to be exempt no longer exists, and the department determines that the
criteria for an exemption specified in this section are not
presently applicable to the convenience zone.
   (2) The department determines that the convenience zone exemption
was granted due to an administrative error.
   (f) If an exemption is revoked and a recycling center is not
certified and operational in the convenience zone, the department
shall, within 10 days of the date of the decision to revoke, serve
all dealers in the convenience zone with the notice specified in
subdivision (a) of Section 14571.7.
   (g) An exemption shall not be revoked when a recycling center
becomes certified and operational within an exempt convenience zone
unless either of the events specified in paragraphs (1) and (2) of
subdivision  (e) occurs.
14572.  (a) Except as provided in subdivision (b), a certified
recycling center shall accept from any consumer or dropoff or
collection program any empty beverage container, and shall pay to the
consumer or dropoff or collection program the refund value of the
beverage container.  The center may pay the refund value based on the
weight of returned containers.
   (b) Any recycling center or processor which was in existence on
January 1, 1986, and which refused, as of January 1, 1986, to accept
at a particular location a certain type of empty beverage container
may continue to refuse to accept at the location the type or types of
empty beverage containers that the recycling center or processor
refused to accept as of January 1, 1986.  Any certified recycling
center which refuses, pursuant to this subdivision, to accept a
certain type or types of empty beverage containers is not eligible to
receive handling fees unless the center agrees to accept all types
of empty beverage containers and is a supermarket site.  This
subdivision does not preclude the certified recycling center from
receiving a handling fee for beverage containers redeemed at
supermarket sites which do accept all types of containers.
   (c) The department shall develop procedures by which recycling
centers and processors which meet the criteria of subdivision (b) may
recertify to change the material types accepted.
   (d) (1) Only a certified recycling center may pay the refund value
to consumers or dropoff or collection programs.  No person shall pay
a noncertified recycler for empty beverage containers an amount
which exceeds the current scrap value for each container type, which
shall be determined in the following manner:
   (A) For a plastic or glass beverage container, the current scrap
value shall be determined by the department.
   (B) For an aluminum beverage container, the current scrap value
shall be not greater than the amount paid to the processor for that
aluminum beverage container, on the date the container was purchased,
by the location of end use, as defined in the regulations of the
department.
   (2) No person may receive or retain, for empty beverage containers
which come from out of state, any refund values, processing
payments, or administrative fees for which a claim is made to the
department against the fund.
   (3) Paragraph (1) does not affect curbside programs under contract
with cities or counties.
14572.5.  A certified recycling center, other than a reverse vending
machine, shall accept from any consumer or any dropoff or collection
program and pay the applicable deposit for any refillable empty beer
and other malt beverage container.  The certified recycling center
shall return, or cause to be returned, the refillable beer and other
malt beverage container to the beer and other malt beverage
distributor or any willing purchaser, who shall then pay the deposit
to the center.  The beer and other malt beverage distributor or other
purchaser shall also negotiate a handling fee with the recycling
center for the return of these containers.
14573.  (a) The department shall pay to a processor, for every empty
beverage container received by the processor from a certified
recycling center, curbside program, or dropoff or collection program,
upon presentation of a completed processor invoice accompanied by a
shipping report from the supplier of the material, in the form
adopted by the department, the sum of all of the following amounts:
   (1) The refund value.
   (2) Two and one-half percent of the refund value for
administrative costs.
   (3) The processing payment established pursuant to Section 14575.
   (b) The department shall make the payment required in subdivision
(a) within two working days of the date that the department is
notified of the delivery or within the time determined by the
department to be necessary and adequate.  If the payment is not made
by the Controller to the certified processor within 20 working days
of receipt of the claims schedule, the Controller shall pay the
processor interest at the current prime lending rate for any period
in excess of these 20 working days.
14573.5.  (a) Except as provided in Section 14573.6, a processor
shall pay to a certified recycling center, dropoff or collection
program, or curbside program, for all types of empty beverage
containers, by type of beverage container, received by the processor
from a recycling center, curbside program, or dropoff or collection
program, upon receipt by the certified processor of a shipping report
from the supplier of the material, in the form adopted by the
regulations adopted by the department, the sum of all of the
following amounts:
   (1) The refund value.
   (2) Three-fourths of 1 percent of the refund value for
administrative costs.
   (3) The processing payment established pursuant to Section 14575.
   (b) The processor shall make the payment required in subdivision
(a) within two working days of the date that the processor receives
these empty beverage containers, or within the time which the
department determines to be necessary and adequate.  Under the
procedures authorized by the department, the department may authorize
a certified recycling center to cancel containers, and a certified
processor may authorize a certified recycling center to cancel
containers on behalf of the certified processor.
   (c) If the department has set up an accounts receivable procedure
or other procedure for seeking the payment of money improperly
obtained by a certified recycling center from the fund, the
department may reimburse the processor for its payments to that
certified recycling center.
14573.51.  (a) Notwithstanding any other provision of this division,
recycling centers and processors shall not pay curbside programs
more than the applicable statewide average curbside commingled rate
unless the curbside program has received an individual commingled
rate from the department pursuant to subdivision (b).
   (b) The department may establish a procedure whereby the operators
of curbside programs may apply for an individual commingled rate for
any material or types with or without a statewide commingled rate,
including, but not limited to, glass, aluminum, bimetal, or any of
the individual plastic resin types or combination of resin types
identified by resin identification codes under Section 18015.  These
procedures shall require, at a minimum, all of the following:
   (1) The individual rate shall be valid for no more than one year
from the date the individual rate is authorized.
   (2) The methodology used by the operator of the curbside program
to determine the commingled rate shall be approved by the department,
in advance.
   (c) Curbside programs that have acquired an individual commingled
rate, pursuant to this section, shall not be surveyed by the
department to determine the statewide average curbside commingled
rate during the period the individual commingled rate is effective.
   (d) The department may enter into a contract for the services
required to implement the amendments to this section made by the act
of the first half of the 2003-04 Regular Session of the Legislature
amending this section.  The department may not expend more than two
hundred fifty thousand dollars ($250,000) for each year of the
contract.  The contract shall be paid only from revenues derived from
redemption payments and processing fees paid on plastic beverage
containers displaying the resin identification code "3," "4," "5,"
"6," or "7" pursuant to Section 18015.  If the department determines
that insufficient funds will be available from these revenues, after
refund values are paid to processors and the reduction is made in the
processing fee pursuant to subdivision (f) of Section 14575 for
these containers, the department may determine not to calculate a
commingled rate pursuant to subdivision (b).
14573.6.  No dropoff or collection program shall pay any refund
value to the consumer, and a dropoff or collection program is not
eligible to receive any sum paid pursuant to Section 14573 or 14573.5
for administrative costs.
14573.7.  Notwithstanding Sections 14573 and 14573.5, the department
may require a recycling center, pursuant to a prepayment review
taken pursuant to subdivision (a) of Section 14552, to submit
consumer transaction logs and consumer transaction receipts as
support documentation for shipping reports submitted to processors.
The department may, pursuant to this section, authorize a processor
to withhold refund value payments to a recycling center. The
department may suspend the certification of a recycling center
without a hearing if the recycling center fails to comply with the
documental submittal requirements of this section, upon providing
notice of these requirements.  The recycling center which is the
subject of the suspension may then request a hearing on the
suspension, but the request for a hearing shall not stay the
suspension.  A hearing requested pursuant to this section shall be
conducted in accordance with Chapter 5 (commencing with Section
11500) of Part 1 of Division 3 of Title 2 of the Government Code.
14574.  (a) (1) A distributor of beverage containers shall pay to
the department the redemption payment for every beverage container,
other than a refillable beverage container, sold or transferred to a
dealer, less 1 percent for the distributor's administrative costs.
   (2) The payment made by a distributor shall be made not later than
the last day of the third month following the sale. The distributor
shall make the payment in the form and manner that the department
prescribes.
   (b) (1) Notwithstanding subdivision (a), if a distributor displays
a pattern of operation in compliance with this division and the
regulations adopted pursuant to this division, to the satisfaction of
the department, the distributor may make a single annual payment of
redemption payments, if the distributor meets either of the following
requirements:
   (A) If the redemption payment and refund value is not increased
pursuant to paragraph (3) of subdivision (a) of Section 14560, the
distributor's projected redemption payment for a calendar year totals
less than fifty thousand dollars ($50,000).
   (B) If the redemption payment and refund value is increased
pursuant to paragraph (3) of subdivision (a) of Section 14560, the
distributor's projected redemption payment for a calendar year totals
less than seventy-five thousand dollars ($75,000).
   (2) An annual redemption payment made pursuant to this subdivision
is due and payable on or before February 1 for every beverage
container sold or transferred by the distributor to a dealer in the
previous calendar year.
   (3) A distributor shall notify the department of its intent to
make an annual redemption payment pursuant to this subdivision on or
before January 31 of the calendar year for which the payment will be
due.
14575.  (a) If any type of empty beverage container with a refund
value established pursuant to Section 14560 has a scrap value less
than the cost of recycling, the department shall, on January 1, 2000,
and on or before January 1 annually thereafter, establish a
processing fee and a processing payment for the container by the type
of the material of the container.
   (b) The processing payment shall be at least equal to the
difference between the scrap value offered to a statistically
significant sample of recyclers by willing purchasers, and except for
the initial calculation made pursuant to subdivision (d), the sum of
both of the following:
   (1) The actual cost for certified recycling centers, excluding
centers receiving a handling fee, of receiving, handling, storing,
transporting, and maintaining equipment for each container sold for
recycling or, only if the container is not recyclable, the actual
cost of disposal, calculated pursuant to subdivision (c). The
department shall determine the statewide weighted average cost to
recycle each beverage container type, which shall serve as the actual
recycling costs for purposes of paragraphs (2) and (3) of
subdivision (c), by conducting a survey of the costs of a
statistically significant sample of certified recycling centers,
excluding those recycling centers receiving a handling fee, for
receiving, handling, storing, transporting, and maintaining
equipment.
   (2) A reasonable financial return for recycling centers.
   (c) The department shall base the processing payment pursuant to
this section upon all of the following:
   (1) The department shall use the average scrap values paid to
recyclers between October 1, 2001, and September 30, 2002, for the
2003 calculation and the same 12-month period directly preceding the
year in which the processing fee is calculated for any subsequent
calculation.
   (2) To calculate the 2003 processing payments, the department
shall use the recycling costs for certified recycling centers used to
calculate the January 1, 2002, processing payments.
   (3) For calculating processing payments that will be in effect on
and after January 1, 2004, the department shall determine the actual
costs for certified recycling centers, every second year, pursuant to
paragraph (1) of subdivision (b). The department shall adjust the
recycling costs annually to reflect changes in the cost of living, as
measured by the Bureau of Labor Statistics of the United States
Department of Labor or a successor agency of the United States
government.
   (d) Notwithstanding paragraph (1) of subdivision (b) and
subdivision (c), for the purpose of setting the cost for recycling
non polyethylene terephthalate (non-PET) plastic containers by
certified recycling centers to determine the processing payment for
those containers, the department shall use a recycling cost of six
hundred forty-two dollars and sixty-nine cents ($642.69) per ton for
the January 1, 2002, calculation of the processing payment.
   (e) Except as specified in subdivision (f), the actual processing
fee paid by a beverage manufacturer shall equal 65 percent of the
processing payment calculated pursuant to subdivision (b).
   (f) The department, consistent with Section 14581 and subject to
the availability of funds, shall reduce the processing fee paid by
beverage manufacturers by expending funds in each material processing
fee account, in the following manner:
   (1) The processing fee in effect on January 1, 2004, shall be
equal to the following amounts:
   (A) For a container type that was subject to this division on
January 1, 1999, 12 percent of the processing payment if the
recycling rate of that container type was equal to, or greater than,
60 percent for the 1999 calendar year.
   (B) For a container type that was not subject to this division on
January 1, 1999, 12 percent of the processing payment, if the
recycling rate of that container type was equal to, or greater than,
60 percent for the 2001 calendar year.
   (C) For a container type that was not subject to this division on
January 1, 1999, 15 percent of the processing payment if the
recycling rate for that container type was equal to, or greater than,
45 percent, but less than 60 percent for the 2001 calendar year.
   (D) For a container type that was not subject to this division on
January 1, 1999, 20 percent of the processing payment if the
recycling rate for that container type was equal to, or greater than,
30 percent, but less than 45 percent, for the 2001 calendar year.
   (2) On January 1, 2005, and annually thereafter, the processing
fee shall equal the following amounts:
   (A) Ten percent of the processing payment for a container type
with a recycling rate equal to or greater than 75 percent.
   (B) Eleven percent of the processing payment for a container type
with a recycling rate equal to or greater than 65 percent, but less
than 75 percent.
   (C) Twelve percent of the processing payment for a container type
with a recycling rate equal to or greater than 60 percent, but less
than 65 percent.
   (D) Thirteen percent of the processing payment for a container
type with a recycling rate equal to or greater than 55 percent, but
less than 60 percent.
   (E) Fourteen percent of the processing payment for a container
type with a recycling rate equal to or greater than 50 percent, but
less than 55 percent.
   (F) Fifteen percent of the processing payment for a container type
with a recycling rate equal to or greater than 45 percent, but less
than 50 percent.
   (G) Eighteen percent of the processing payment for a container
type with a recycling rate equal to or greater than 40 percent, but
less than 45 percent.
   (H) Twenty percent of the processing payment for a container type
with a recycling rate equal to or greater than 30 percent, but less
than 40 percent.
   (I) Sixty-five percent of the processing payment for a container
type with a recycling rate less than 30 percent.
   (3) The department shall calculate the recycling rate for purposes
of paragraph (2) based on the 12-month period ending on June 30 that
directly precedes the date of the January 1 processing fee
determination.
   (g) Not more than once every three months, the department may make
an adjustment in the amount of the processing payment established
pursuant to this section notwithstanding any change in the amount of
the processing fee established pursuant to this section, for any
beverage container, if the department makes the following
determinations:
   (1) The statewide scrap value paid by processors for the material
type for the most recent available 12-month period directly preceding
the quarter in which the processing payment is to be adjusted is 5
percent more or 5 percent less than the average scrap value used as
the basis for the processing payment currently in effect.
   (2) Funds are available in the processing fee account for the
material type.
   (3) Adjusting the processing payment is necessary to further the
objectives of this division.
   (h) (1) Except as provided in paragraphs (2) and (3), every
beverage manufacturer shall pay to the department the applicable
processing fee for each container sold or transferred to a
distributor or dealer within 40 days of the sale in the form and in
the manner which the department may prescribe.
   (2) (A) Notwithstanding Section 14506, with respect to the payment
of processing fees for beer and other malt beverages manufactured
outside the state, the beverage manufacturer shall be deemed to be
the person or entity named on the certificate of compliance issued
pursuant to Section 23671 of the Business and Professions Code. If
the department is unable to collect the processing fee from the
person or entity named on the certificate of compliance, the
department shall give written notice by certified mail, return
receipt requested, to that person or entity. The notice shall state
that the processing fee shall be remitted in full within 30 days of
issuance of the notice or the person or entity shall not be permitted
to offer that beverage brand for sale within the state. If the
person or entity fails to remit the processing fee within 30 days of
issuance of the notice, the department shall notify the Department of
Alcoholic Beverage Control that the certificate holder has failed to
comply, and the Department of Alcoholic Beverage Control shall
prohibit the offering for sale of that beverage brand within the
state.
   (B) The department shall enter into a contract with the Department
of Alcoholic Beverage Control, pursuant to Section 14536.5,
concerning the implementation of this paragraph, which shall include
a provision reimbursing the Department of Alcoholic Beverage Control
for its costs incurred in implementing this paragraph.
   (3) (A) Notwithstanding paragraph (1), if a beverage manufacturer
displays a pattern of operation in compliance with this division and
the regulations adopted pursuant to this division, to the
satisfaction of the department, the beverage manufacturer may make a
single annual payment of processing fees, if the beverage
manufacturer meets either of the following conditions:
   (i) If the redemption payment and refund value is not increased
pursuant to paragraph (3) of subdivision (a) of Section 14560, the
beverage manufacturer's projected processing fees for a calendar year
total less than ten thousand dollars ($10,000).
   (ii) If the redemption payment and refund value is increased
pursuant to paragraph (3) of subdivision (a) of Section 14560, the
beverage manufacturer's projected processing fees for a calendar year
total less than fifteen thousand dollars ($15,000).
   (B) An annual processing fee payment made pursuant to this
paragraph is due and payable on or before February 1 for every
beverage container sold or transferred by the beverage manufacturer
to a distributor or dealer in the previous calendar year.
   (C) A beverage manufacturer shall notify the department of its
intent to make an annual processing fee payment pursuant to this
paragraph on or before January 31 of the calendar year for which the
payment will be due.
   (4) The department shall pay the processing payments on redeemed
containers to processors, in the same manner as it pays refund values
pursuant to Sections 14573 and 14573.5. The processor shall pay the
recycling center the entire processing payment representing the
actual costs and financial return incurred by the recycling center,
as specified in subdivision (b).
   (i) When assessing processing fees pursuant to subdivision (a),
the department shall assess the processing fee on each container
sold, as provided in subdivisions (e) and (f), by the type of
material of the container, assuming that every container sold will be
redeemed for recycling, whether or not the container is actually
recycled.
   (j) The container manufacturer, or a designated agent, shall pay
to, or credit, the account of the beverage manufacturer in an amount
equal to the processing fee.
   (k) If, at the end of any calendar year for which glass recycling
rates equal or exceed 45 percent and sufficient surplus funds remain
in the glass processing fee account to make the reduction pursuant to
this subdivision or if, at the end of any calendar year for which
PET recycling rates equal or exceed 45 percent and sufficient surplus
funds remain in the PET processing fee account to make the reduction
pursuant to this subdivision, the department shall use these surplus
funds in the respective processing fee accounts in the following
calendar year to reduce the amount of the processing fee that would
otherwise be due from glass or PET beverage manufacturers pursuant to
this subdivision.
   (1) The department shall reduce the glass or PET processing fee
amount pursuant to this subdivision in addition to any reduction for
which the glass or PET beverage container qualifies under subdivision
(f).
   (2) The department shall determine the processing fee reduction by
dividing two million dollars ($2,000,000) from each processing fee
account by an estimate of the number of containers sold or
transferred to a distributor during the previous calendar year, based
upon the latest available data.
14575.1.  (a) Notwithstanding subdivision (b) of Section 14575, if a
willing purchaser offers to purchase empty PET containers at a
voluntary artificial scrap value that is equal to the processing fee
reduced pursuant to subdivision (f) of Section 14575 when applied to
all containers sold, no processing fee shall be imposed on PET
containers pursuant to Section 14575.
   (b) If a willing purchaser offers to pay a voluntary  artificial
scrap value, the department shall, on a monthly basis, determine
whether the sum of the voluntary artificial scrap value and payments
made from the PET Processing Fee Account pursuant to subdivision (f)
of Section 14575, are equal to, or more than, the recycling cost for
empty PET containers determined pursuant to subdivision (d) of
Section 14575.
   (c) If the department determines that, for any monthly period, the
sum of the voluntary artificial scrap value and payments made from
the PET Processing Fee Account pursuant to subdivision (f) of Section
14575, is less than the recycling cost for empty PET containers,
determined pursuant to Section 14575, the following requirements
shall apply:
   (1) The department shall immediately provide written notification
of the deficiency for that monthly period and the amount of that
deficiency to any willing purchaser.
   (2) A willing purchaser shall correct the deficiency in the next
monthly period by adjusting the voluntary artificial scrap value by
an amount sufficient to equal the recycling cost for empty PET
containers plus the previous monthly period's deficiency.
   (3) If the deficiency and amount in arrears is not corrected
within 30 days of providing written notice to willing purchasers of
empty PET containers, the department shall impose a processing fee
pursuant to Section 14575 which includes any amount necessary,
including any amount in arrears, to cover the cost of recycling empty
PET containers.
   (d) If the department determines that, for  any monthly period,
the sum of the voluntary artificial scrap value and payments made
from the PET Processing Fee Account pursuant to subdivision (f) of
Section 14575, is greater than the recycling cost for empty PET
containers, the department shall do both of the following:
   (1) Immediately provide written notification of the deviation for
that monthly period and the amount of that deviation to any willing
purchaser.
   (2) Provide a credit equal to the amount of the deviation for any
future monthly period wherein the  voluntary artificial scrap value,
and payments made from the PET Processing Fee Account, are less than
the recycling cost of empty PET containers determined pursuant to
subdivision (d) of Section 14575.
   (e) Nothing in this section is intended to affect any litigation
that was pending on January 1, 1996, in which the department is a
party of record.
14575.2.  (a) In order to ensure that only those funds necessary to
cover the net cost of recycling each beverage container sold are paid
by beverage manufacturers, the department shall establish a
processing fee rebate for all beverage containers for which a
processing fee was paid on containers sold between January 1, 2002,
and December 31, 2003.  The amount of the rebate for each container
shall be equal to the difference between the processing fee
established and paid pursuant to Section 14575 as it read on January
1, 2003, and the processing fee established pursuant to paragraph (1)
of subdivision (f) of Section 14575 as it reads on the effective
date of the act adding this section.
   (b) Consistent with Section 14581, and subject to the availability
of funds, the department shall pay a processing fee rebate to
beverage manufacturers on all beverage containers sold between
January 1, 2002, and December 31, 2003, for which the beverage
manufacturer paid a processing fee as determined by the department.
   (c) The department shall pay the processing fee rebate in a form
and manner as it determines.
   (d) The department may not pay the processing fee rebate before
July 1, 2004, or after June 30, 2006.
   (e) The department may deduct from the processing fee rebate any
amount owed to the department by the beverage manufacturer.
   (f) It is the intent of the Legislature that the department
undertake those actions that are in compliance with this chapter and
that reduce processing fees paid by beverage manufacturers consistent
with this section prior to the effective date of the act adding this
subdivision.
14575.5.  (a) The department shall establish a supplemental
processing payment to be paid to a processor.  The processor shall
pay the entire supplemental processing payment to a recycler that
receives processing payments pursuant to Section 14575.  The
department shall determine the supplemental processing payment based
on the volume of redeemed containers that the recycler reports for
each whole month pursuant to subdivision (b), commencing on July 1,
2004, and continuing for a period of 12 consecutive months.
   (1) Consistent with Section 14581 and subject to the availability
of funds, the department shall establish a supplemental processing
payment for glass, PET plastic containers, and HDPE plastic
containers as follows:
   (A) Forty dollars and eighty-six cents ($40.86) for each ton of
glass beverage containers.
   (B) One hundred eighty-two dollars and fifty-four cents ($182.54)
for each ton of PET plastic beverage containers.
   (C) Two hundred twenty-eight dollars and seventy-five cents
($228.75) for each ton of HDPE plastic beverage containers.
   (2) The department may not make a supplemental processing payment
to a recycler for any volume reported for a whole month that is not
within the 12-month consecutive time period established in
subdivision (a).
   (b) A recycler shall report to a processor the volume of redeemed
containers subject to the supplemental processing payments
established pursuant to paragraph (1) of subdivision (a) no later
than the 10th day following the end of the 12-month period
established in subdivision (a).
   (c) The department shall pay the supplemental processing payments
on eligible redeemed containers to processors, in the same manner as
it pays refund values pursuant to Sections 14573 and 14573.5, except
that paragraph (2) of subdivision (a) of Section 14573.5 is not
applicable.  The processor shall pay a recycler the entire
supplemental processing payment as specified in subdivision (a).
14576.  (a) From January 1, 2004, to December 31, 2006, inclusive,
the department shall establish a pilot program using supermarket
sites that use both reverse vending machines and staffed recycling
centers to determine whether or not these recycling centers increase
recycling rates and provide greater convenience and ease of use for
consumers.
   (b) The pilot program shall comply with all of the following
criteria:
   (1) The program shall consist of not more than 50 supermarket
sites that represent a valid statistical sampling of the state, as
determined by the department.
   (2) Each dealer where the supermarket site is located certifies to
the department in writing that it has authorized the recycling
center to participate in the pilot program.
   (3) Each supermarket site in the pilot program has at least two
reverse vending machines that accept all types of beverage
containers, except those beverage containers that are labeled with a
"2," as specified in subdivision (a) of Section 18015 and are larger
than three liters.
   (4) The department authorizes each supermarket site, which has
redeemed, as determined by the department, a monthly average volume
of no less than 60,000 empty beverage containers, and no more than
150,000 empty beverage containers for the months between July 1,
2002, and June 30, 2003, inclusive.
   (c) Each supermarket site participating in the pilot program shall
comply with all of the following requirements:
   (1) The supermarket site is inspected by the operator that
participates in the pilot program at least once each day to maintain
and empty the machines and ensure that the site is kept clean.
   (2) The operator of the supermarket site submits monthly service
records to the department within 10 days of the end of each month,
showing the number of complaints per site, if any, and the response
time for each service call.
   (3) (A) The supermarket site is operational at least 95 percent of
operable time.
   (B) For purposes of this paragraph, "operable time" means the
actual operating hours the supermarket site is required to be open
for business each month.  A supermarket site's operating hours shall
be determined consistent with the supermarket's operational hours,
subject to applicable curfew requirements imposed by local ordinance.
   (4) The reverse vending machine at the supermarket site is not
inoperative more than  one day a month, and if that breakdown rate is
exceeded, the supermarket site replaces the reverse vending machine
within three business days.
   (5) The operator of the supermarket site repairs a reverse vending
machine within five business hours  of receiving a complaint by a
consumer, the dealer, or the department that the recycling center is
not operational during operable time.
   (6) The supermarket site provides a receptacle adjacent to the
reverse vending machine for beverage containers that are labeled with
a "2," as specified in subdivision (a) of Section 18015, and that
are larger than three liters.   The operator shall post a sign on the
receptacle indicating the hours of staffed operation in which a
consumer may return the container to the site and receive a
redemption payment.
   (7) The operator of the supermarket site has an attendant present
at the supermarket site a minimum of 20 hours per week, including no
fewer than three hours on a Saturday or a Sunday between the hours of
9 a.m. and 5 p.m. and no fewer than three evening hours between the
hours of 5 p.m. and 9 p.m. during one weekday evening.
   (8) The operator of the supermarket site provides instructions for
use of the reverse vending machine at the supermarket site in
appropriate languages and in pictorial representations demonstrating
how to use the reverse vending machine.
   (9) The operator of the supermarket site maintains a toll-free
telephone number attended by a  live operator during operable time to
answer calls from any person regarding the performance of its
reverse vending machine.
   (10) The operator of the supermarket site posts information
identifying the location of, and directions to, the nearest certified
recycling center that is open for business at least 30 hours per
week and accepts all material types.
   (d) If the department determines that the total volume of beverage
containers redeemed at a supermarket site authorized to participate
in the pilot program decreases by more than 10 percent from the
volume reported for the prior year, the supermarket site shall be
staffed for at least 30 hours per week.
   (e) (1) The department shall monitor the volume of beverage
containers redeemed at each supermarket site participating in the
pilot program at least once every three-month period.
   (2) The department shall conduct an annual review of each
supermarket site participating in the pilot program to determine
overall performance and make operational adjustments.
   (3) The department shall disqualify an individual site from
participation in the pilot program, effective within seven calendar
days of notice provided to the operator, upon a determination that
the continued operation of the supermarket site within the pilot
program does not further the goals of the division.
   (4) The department shall, upon the written request of the dealer
at the supermarket site and within seven calendar days of the request
made by the dealer to the department, disqualify the operator  from
further participation in the pilot program at that supermarket site.
   (f) The department may adopt emergency regulations to implement
this section.  Any emergency regulations, if adopted, shall be
adopted in accordance with Chapter 3.5 (commencing with Section
11340) of Part 1 of Division 3 of Title 2 of the Government Code, and
for the purposes of that chapter, including Section 11349.6 of the
Government Code, the adoption of these regulations is an emergency
and shall be considered by the Office of Administrative Law as
necessary for the immediate preservation of the public peace, health
and safety, and general welfare.
   (g) Notwithstanding Sections 14570 and 14571, a supermarket site
that consists of reverse vending machines is "open for business"
within the meaning of this section if the supermarket site is
approved by the department to participate in the pilot program
pursuant to paragraph (4) of subdivision (b) and the supermarket site
complies with the operating requirements specified in subdivision
(c).
   (h) On or before July 1, 2006, the department shall report to the
Governor and Legislature on the effectiveness of the pilot program
and make recommendations on whether the program should be continued,
expanded, or modified to ensure compliance with this division.
   (i) This section shall remain in effect only until January 1,
2007, and as of that date is repealed, unless a later enacted
statute, that is enacted before January 1, 2007, deletes or extends
that date.