San Francisco’s proposed new recycling program would include an app to help residents find drop-off sites and receive payment. (Shutterstock)

State agency approves SF’s pilot recycling program, but launch date uncertain

Relief in sight for small businesses mandated to redeem bottles or pay fines

San Francisco’s long-awaited proposal for a unique, app-enabled recycling program was approved by a state agency last month.

The program would relieve small businesses of the mandate to redeem bottles and cans — only a launch date still remains uncertain. But as the wait continues, the clock is ticking. The City can only operate the pilot program until July 2022.

Amid a wave of closures of standalone recycling operations or those operated by grocery stores, driven in part by neighbor complaints, San Francisco’s small businesses have been left to shoulder the burden of accepting recycling under the state’s laws. If an area is deemed “unserved” by CalRecycle, California’s Department of Resources Recycling and Recovery, then businesses selling beverages in bottles and cans in that area must pay a daily fine of $100 or accept bottles and cans, leading to a number of complications for small businesses.

The closures also leave few places for people to actually return the bottle and cans to redeem them for the California Refund Value of five or ten cents, which consumers pay as part of the cost when buying the drinks.

In 2017, a state law introduced by state Sen. Scott Wiener was passed by state legislators that allowed up to five pilot recycling programs throughout the state that would satisfy the requirements of CalRecycle, lifting the mandate on small retailers.

The Department of the Environment put together a pilot proposal and CalRecycle announced last month it approved San Francisco’s program along with another pilot in Culver City, in Southern California. The agency could approve three more.

“California takes consumer redemption convenience very seriously, and these local pilot programs are tailored to address community needs like high rent costs and profit declines due to volatile scrap markets,” CalRecycle Acting Director Ken DaRosa said in a statement last month.

Under the state’s recycling laws, known as the Bottle Bill, a convenience zone is a half-mile radius circle around a large store, a business with gross annual sales of at least $2 million, that sells redeemable bottles and cans. These zones must be “served,” which is achieved through a large recycling facility. Otherwise retailers face fines.

“Once pilot programs commence, all convenience zones within the program area will be considered served, relieving [California Redemption Value] retailers of their obligation to either redeem containers in-store or pay a $100-per-day fee,” CalRecycle said in last month’s statement. “San Francisco currently has 59 unserved convenience zones with 622 CRV beverage retailers operating within those zones.”

Wiener’s law was followed by Assemblymember Phil Ting’s Assembly Bill 54, which was adopted last year and provides $5 million in funding for the pilot programs.

Ting introduced the bill a month after rePlanet shuttered 284 of its remaining recycling centers in the state, about 20 percent of the redemption centers California.

CalRecycle established the rules for distributing the AB 54 funds in December 2019, setting an initial limit per pilot program of $1 million. CalRecycle previously awarded San Francisco $500,000 for the pilot program last year from a separate pool of money, its Beverage Container Recycling Grant Program.

But the news is not everything small business owners are likely hoping for since the wait continues.

The Department of Environment said Friday that they don’t have a specific time frame for launching the pilot program and won’t until after they apply for the grant and get the result.

Charles Sheehan, spokesperson for the Department of Environment, said that they have not yet applied for the grant funding but “we plan to do so sometime in the next 1-2 months.”

As for how for how the pandemic COVID-19, the disease caused by the coronavirus, might impact the plan, that remains uncertain.

“How much we secure and when those funds will be disbursed to us will definitely affect our launch timeframe,” Sheehan said Friday. “But without a launch timeframe, it’s difficult to assess what the impact of the coronavirus will be on our schedule. And again, without a launch timeframe, it’s also difficult to assess how this might affect program operations.”

To serve all the unserved convenience zones would cost between $3.5 million and $4 million, and The City’s application said it would phase service in.

“This has been a long drawn out process and merchants are getting letters now that their exemption is being revoked,” said Small Business Commissioner Miriam Zouzounis, whose family owns a corner store in the South of Market area. “We previously had to send in verification to the state that the business was indeed collecting cans and bottles.”

Sheehan said that “in general, we have not been in control of the timeline.”

“We’ve been operating based on the directives and deadlines that the state has issued for a program that they are creating from scratch as well,” he said.

He also noted that the application process to apply for launching a pilot was available in late April. The City applied in August.

The Pilot

San Francisco’s pilot recycling program primarily involves bag-drop operations, in which a truck and trailer will go to sites such as parking lots on an advanced schedule.

“Consumers will use specially designed bar-code labelled bags to carry their bottles and cans,” Sheehan said. “These bags will be placed in the secure bag drop receptacle on the trailer. Each bag will have a unique electronic signature for that individual consumer. A staff person will be at each site to assist. There will not be un-attended bins for drop-off.”

The program is a partnership between The City and three groups, the recycler Our Planet at 445 Bayshore in the Bayview and Bernal Heights area, San Francisco Conservation Corp, a job training program for youth, and the San Francisco CRV Convenience Alliance, a new nonprofit whose members include grocery stores, such as Rainbow Grocery Co-op, Whole Foods, Trader Joe’s, Costco and Safeway, according to the application.

The nonprofit was established last year and it also trademarked “BottleBank,” which will serve as the official name of the program.

The pilot proposes to use a smartphone app that can help people locate the times and places for the bag drop offs and also to receive payment for the returned cans and bottles electronically within 72 hours.

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