Consumer advocates had raised concerns the fund wouldn’t have enough money to cover greater recycling rates and upcoming reforms.
By Camille Von Kaenel, POLITICO
SACRAMENTO, Calif. — California officials told lawmakers on Thursday they repaid a $100 million loan they took from a state fund meant to pay for bottle recycling infrastructure amid concerns the fund wouldn’t have enough money to cover increased recycling rates and upcoming reforms.
What happened: Department of Finance analyst Christian Beltran said at a Senate budget subcommittee hearing that the state repaid the loan from CalRecycle’s Beverage Container Recycling Fund “a few days ago” in order to maintain its ability to subsidize recycling.
He also said DOF is considering striking another proposed loan from the fund in this year’s budget proposal in order to preserve funding for CalRecycle.
The loan to the state’s General Fund last year was under the condition that it not significantly affect the program, he said: “The administration is required to make payments back from the general fund back to BCRF in the case that there is significant program impacts that are projected as a result of the loan.”
Reaction: Lawmakers chided Finance Department officials at the hearing. “This was money that was collected from consumers for the purposes of improving recycling rates,” said Senate Environmental Quality Committee Chair Ben Allen, a Democrat from Santa Monica.
Why this matters: The Department of Finance’s repayment is a step toward righting the troubled and underperforming bottle redemption program, which collects fees from the purchase of containers made of glass, tin and other metals to reimburse recycling centers, which have been closing around the state due to low revenues.
One of the reasons the fund is facing additional strain is because recycling is picking back up after the pandemic. A one percent increase in redemption rates requires an increased payout of $13 million per month, said CalRecycle Director Rachel Machi Wagoner, who is stepping down next week. “We do feel that the fund is being depleted at a faster rate than it previously was in the last couple of years.”
She said another reason is because a 2022 law, SB 1013, would require significant and costly reforms to the program starting in 2025, including additional grants and more beverage containers available for redemption.
Consumer Watchdog had raised concerns the reforms would be slowed if the fund did not have enough money. “Today is a good day for recycling,” said the group’s president, Jamie Court, after the budget hearing.
What’s next: Wagoner told lawmakers CalRecycle would start taking grant applications for new automated recycling centers in the summer.
