WSR 07-15-037

PROPOSED RULES

DEPARTMENT OF ECOLOGY


[ Order 07-05 -- Filed July 12, 2007, 4:20 p.m. ]

     Original Notice.

     Preproposal statement of inquiry was filed as WSR 07-04-055.

     Title of Rule and Other Identifying Information: Chapter 173-900 WAC, Electronic product recycling program and the following sections from the dangerous waste regulations, WAC 173-303-040 Definitions and 173-303-071 Excluded categories of waste.

     Hearing Location(s): Washington State Department of Labor and Industries, 15 West Yakima Avenue, Suite 100, Yakima, WA, on August 21, 2007, at 1:30 p.m.; and at Washington State Department of Ecology, Northwest Regional Office, 3190 160th Avenue S.E., Bellevue, WA, on August 23, 2007, at 1:30 p.m.

     Date of Intended Adoption: September 26, 2007.

     Submit Written Comments to: Jay Shepard, Department of Ecology, Solid Waste and Financial Assistance Program, P.O. Box 47600, Olympia, WA 98504-7600, e-mail WA-recycles-electronics@ecy.wa.gov, fax (360) 407-6102, by 5:00 p.m., August 30, 2007.

     Assistance for Persons with Disabilities: Contact Michelle Payne, voice (360) 407-6109, TTY (360) 407-6006.

     Purpose of the Proposal and Its Anticipated Effects, Including Any Changes in Existing Rules: The rule proposal includes the following amendments to chapter 173-900 WAC:

• Electronic product recycling plan content and submission requirements;
• Performance standards for electronic product processors used directly by plan operators, collectors and transporters;
• Recycling service level standards;
• Reporting processes and requirements for plan operators, local governments, local communities, processors, collectors and transporters;
• Registration requirements and process for processors;
• Collector standards;
• Process for establishing return share and equivalent share of responsibility for manufacturers;
• A sampling methodology to be used by all plan operators to provide ecology data to establish return shares;
• Requirements for the materials management and finance authority;
• Warnings, penalties, and violations, associated with these requirements; and
• Other requirements necessary to implement chapter 70.95N RCW.
     The rule proposal includes the following amendments to chapter 173-303 WAC:

• Amendments to include an exemption for cathode ray tubes (CRTs) in televisions and monitors from chapter 173-303 WAC if the requirements are met.

     Statutory Authority for Adoption: Chapter 70.95N RCW, Electronic product recycling; chapter 70.105 RCW, Hazardous waste management; and chapter 70.105D RCW, Hazardous waste cleanup -- Model Toxics Control Act.

     Statute Being Implemented: Chapter 70.95N RCW, Electronic product recycling.

     Rule is not necessitated by federal law, federal or state court decision.

     Name of Proponent: Department of ecology, governmental.

     Name of Agency Personnel Responsible for Drafting: Jay Shepard, Lacey, Washington, (360) 407-7040; Implementation and Enforcement: Peter Lyon, Lacey, Washington, (360) 407-6107.

     A small business economic impact statement has been prepared under chapter 19.85 RCW.

Small Business Economic Impact Statement

     Conclusion: Based on research and analysis required by the Regulatory Fairness Act (RCW 19.85.011), ecology has determined that the proposed amendments to chapter 173-900 WAC have a disproportionate impact on small business. Therefore, we must include cost-minimizing features in the rule where it is legal and feasible to do so.

     Note to readers: This proposed rule is unusual in that it transfers the cost of disposal from Washington citizens, businesses, and government bodies to manufacturers of TVs, computers, and monitors. There is a net income effect for Washington businesses.

     Purpose of this Analysis: The Washington state department of ecology (ecology) is proposing to amend the electronic product recycling program rule, chapter 173-900 WAC. The Regulatory Fairness Act (RCW 19.85.011) requires ecology to show we have considered the impacts of the rule on small businesses in comparison to large businesses. This report provides the results of these analyses and shows the potential impacts associated with the proposed rule.

Background


     2004 Recommendations to Legislature: At the request of Washington lawmakers in 2004, ecology and the solid waste advisory committee (SWAC) developed recommendations for how the state can implement and finance a program to collect, recycle, and reuse electronic products. Ecology and the SWAC worked with these representatives: Electronic product manufacturers, electronic product retailers and waste haulers, electronics recyclers, charities, cities, counties, environmental organizations, public interest organizations, and other interested parties.

     2006 Electronic Product Recycling Law: Based on the 2004 recommendations from ecology and the SWAC, Washington lawmakers approved a new law - chapter 70.95N RCW, Electronic product recycling, that became effective July 1, 2006.

     This new law requires computer and television manufacturers to provide consumer-convenient recycling of their covered electronic products throughout our state.

     The rule defines covered electronic products (CEPs) as computers (including portable or laptop computers), televisions, and computer monitors used by households, charities, school districts, small businesses, or small governments, located in Washington. Manufacturers must make these services available to these groups by January 1, 2009.

     Reason for this Rule Proposal: There are toxic substances in CEPs that can come out of them when they are thrown away in a landfill. Because of this, many landfills and transfer stations across the state have started to reject CEPs to prevent the contamination. This has caused a rapid increase in the number of CEPs coming into recyclers to over 22 million pounds1 per year.

     Ecology estimates that between 2003 and 2010 the number of obsolete CEPs in Washington state will be:

&sqbul; 4.5 million personal computers,
&sqbul; 3.5 million CRT monitors, and
&sqbul; 1.5 million flat panel monitors.
     Ecology expects the amount of recycled CEPs to increase to 56.5 million pounds after we implement the proposed rule.2 This rule proposal will also allow recyclers to treat CEPs that come from households (small quantities) separate from those that come from businesses (large quantities). Without this rule, recyclers would have to merge the waste streams and they would be required, under the dangerous waste rule, to treat all of them as dangerous waste.

     This rule proposal will also take advantage of a federal exemption for CRTs allowed to the states and will allow recycling of CRTs to continue and increase.

     Without this rule, recycling will be an increased financial burden on Washington citizens and landfills. This rule implements the law and the law transfers the cost of recycling CEPs to the companies that manufacture the CEPs. The law and the rule provide a net savings for Washington.

     Scope of Analysis: This analysis covers the first twenty years of program costs including the costs of Phase 1 and Phase 2 of this rule-making process. The analysis covers both capital and annual costs. Capital costs are annualized on a twenty-year basis.

Comparison of the Current and Proposed Rules


     Current Rule Requirements: Ecology is writing the rule in two phases. For Phase 1 of the rule making ecology adopted rules that:

&sqbul; Require manufacturers, collectors, and transporters of CEPs to register with ecology.
&sqbul; Sets a fee structure and payment schedule for manufacturers.
&sqbul; Require mandatory brand labeling of all CEPs.
     Description of Proposed Changes: For Phase 2 of the rule making ecology is proposing to adopt the rest of the requirements of the new law. This includes: Recycling plan submittal, plan review and content, program implementation, return share and equivalent share calculations, direct processor registration and standards, registration and performance standards for collectors and transporters, exemption from the dangerous waste rule for recycled CRTs.

     Baseline for Analysis: The law, chapter 70.95N RCW, Electronic product recycling, and the existing electronic product recycling rule (chapter 173-900 WAC) and the existing dangerous waste rule (chapter 173-303 WAC) form the baseline for this analysis. Existing federal and state laws and rules regarding disposal of solid waste, dangerous waste, and electronics also form part of the baseline.

     Law - Chapter 70.95N RCW, Electronic product recycling: The law includes many detailed requirements. Most of the rule is drawn word for word from the law.

     Existing rule - Chapter 173-900 WAC: The existing rule outlines the definitions for words within the rule, registration process for manufacturers, transporters, and collectors; and administrative fees.

     Existing dangerous waste rule - Chapter 173-303 WAC: The current dangerous waste rule would require generators to designate CEPs as dangerous waste if they are large quantity generators.

     Analysis of Compliance Costs for Business: This small business economic impact statement (SBEIS) is atypical in that the total costs to all the affected sectors are going to be borne by the plans and the manufacturers who are members of the plans. Therefore, for each major requirement in the proposed rule the total costs are calculated. The plans will be responsible for paying for their total return share. Therefore, this SBEIS uses the return shares for each manufacturer multiplied by the total cost to estimate the cost per employee for small and large business. A more typical measure is provided for one small company that is no longer going to continue processing.

     Costs for Collectors: Ecology analyzed the cost for collectors based on the assumption that there are eighty-eight collection sites throughout Washington state. The law requires there must be at least one service in each county of the state as well as in cities with a population of greater than ten thousand.

     Collection facilities reported they would need the plans to pay them at the rate of $0.26 per pound for their collections. It is not clear what rates the plans will negotiate with their collectors.

     This rule proposal will not allow collection facilities to charge for drop offs or to disassemble the CEPs for recycling. This will be lost revenue for these facilities. Therefore, collection facilities also reported how much revenue they currently get from the fees for taking the CEPs ($4.6 million) and the sales of parts and recyclable materials ($630,000). This means they are actually requesting an increase of $10.1 million from the plans over what they currently receive to offset this loss (see below).

     Staffing Collection Site During Operating Hours: Only one collection site reported they had an honor system for dropping off CEPs. All other facilities staff their collection sites during operating hours. However, this one facility recently decreased its hours of operation instead of adding more staff. They therefore meet the requirement without added costs.

     Storage Facilities: Ecology requires every collection site to have enclosed storage areas that are protected from the weather and have impervious floors or they must place the CEPs in a container designed to reduce the risk of contamination from glass and other fine solids from the CEPs. Currently, about 7% of collection sites do not have this type of storage area. Ecology estimates it will cost those facilities a total of $31,000 to install the proper type of storage.

     Annual Registration: Ecology estimates it will cost collectors about $95 each to submit their annual registration using the electronic registration process. This is a total of about $8,000 for all facilities.

     Registration Updates: The rule requires collectors to notify ecology within fourteen days when there is a change to the information provided with their registration. Ecology estimates, on average, that each collector will have about five registration updates each year. If ecology assumes a cost of $50 per hour3 and thirty minutes to submit these changes, ecology estimates a total of $9,400 a year for collector registration updates.

     Documentation of CEPs: Ecology requires that the plans must collect data on what county each CEP comes from and then provide this information to ecology. For this analysis ecology assumes this cost will accrue to the plans via activity undertaken at the collection sites. Ecology expects it will cost an average of $9,000 per site and a total cost of $795,000 for all facilities to meet this requirement.

     Posting Information at Collection Sites: Recycling plans are required to provide information to collectors for them to post in a visible location at their sites. This is to inform covered entities of how and where CEPs received into the program are recycled. The cost of this is minimal.

     Lost Revenue from Charges to drop off CEPs: When ecology implements this rule, collection sites will no longer be allowed to charge consumers for dropping off unwanted CEPs. This will affect 88% of the collectors that currently charge to take CEPs. Prices now range from: $5.00-$19.00 or $0.35-$1.00/lb for monitors and $0.40/lb for laptops and $20 and up for televisions. This is a loss of $56,500 per year, per facility, and total of $4.6 million.

     Lost Revenue from Foregone Sales of Recycled Components: This rule will require collectors to stop stripping components from CEPs for recycling to participate in the program. 40% of these collectors currently do this. Ecology estimates a $20,000 loss for each of these collectors and a total of about $630,000. The income is not lost to Washington because the rule transfers this income from the collectors to the processors.

     Plan Participation: The plans will hire and pay the collectors to do their collections for them. Thus, a cost to the collectors will become a cost to the plan. Collection sites will be reimbursed to participate in a plan; the respondents estimated that they want to be reimbursed $0.26/lb. With an estimate of one million units weighing 56.5 million pounds to be collected in the first year, ecology expects the total reimbursement the collectors will ask for, including the income transfer, will be $14.6 million.

     Note that it is unlikely that the collectors will be able to extract this much from the plans. The plans will be unwilling to pay over $.50 per pound for collection, transport, and processing because that is all they would have to pay if they collect too little. Thus, the collectors will have to share the $.50 per pound with the transporters and processors. Further, once a plan has collected and processed its share of CEPs they will be unwilling to pay more than $.45 because that is all that they will be reimbursed by the other plans. In practice what this limit means is that this estimated $14.6 million cost will have to come down to under $11.5 million in order to meet the maximum rate that the plans will be willing to pay. Since this is the maximum that the plans would be willing to pay, given the lowest possible costs of transport and recycling, ecology assumes that this will be the cost.

     Costs for Transporters: The plans will hire transporters to move CEPs from collection sites to processing. Therefore, costs to the transporters will become costs to the plans. Ecology surveyed transporters and found that very few companies plan on transporting electronics. Additionally, those that were planning on this type of transport found it hard to estimate how much per pound they would have to be reimbursed to participate in a plan.

     In another approach, the Washington utilities and transportation commission estimated that it would cost between $70 and $83 per hour to transport electronics, an average of $76.50/hour and therefore $1.28/minute.

     Ecology then estimated the distance from each of the eighty-eight mandatory collection sites to the closest of eight cities with known processors; this was then doubled to account for a roundtrip. The average roundtrip distance from a collection site to the nearest processor was one hundred fourteen miles, or one hundred thirty-eight minutes.4 Multiplying the one hundred thirty-eight minutes/roundtrip by $1.28/minute gave an average cost of $176.50/trip.

     According to the three surveys ecology did receive, the respondents estimated an average load of 11,833 pounds per truck load. Dividing the average per trip ($176.50) by the average weight per trip (11,833 pounds) gave a reimbursement of $0.02 per pound for transporting electronics. Ecology estimates that transporters will transport over one million units weighing 56.5 million pounds, for a total cost of $1.1 million.

     Costs for Processors: The plans will hire processors to recycle materials for them. Therefore costs to the processors will become costs to the plans.

     Ecology surveyed processors. Most processors currently working in Washington do more than simple processing. They offer collection or transportation services too.

     There are three sets of costs which require analysis.

• The first is the cost of continuing the processing operation as they have in the past.
• The second is the incremental added costs of meeting requirements that are new for the processor.
• The third is foregone revenue for activities that the processor may be giving up if they do not get a contract with a plan.
     Ecology estimated the cost of continuing operations based on current charges. Survey results5 indicate a wide range of charges for processing. The reported costs range from $0.43 per pound for one company that collects, transports, and processes down to $0.16 per pound for another company that only does partial processing but will not continue to process under the proposed rule.

     Facilities that collect and process have a different cost for collection than most collectors. If you subtract the collector costs above from their collection and processing costs, the cost runs into negative territory. They are open for business for other reasons such as repair, reuse, refurbishing, or sales of new items. Therefore, their marginal cost per unit of collection is lower and there are no costs for transportation. This makes it difficult to decide what portion of their costs to attribute to the processing activity alone. Because of this, ecology took their cost for collection and processing and subtracted out the $0.02 per pound for transportation and then divided the remainder of the costs for these facilities in half, arbitrarily splitting the remaining cost between collection and processing. This produced a range from $0.11 to $0.22 per pound and an average cost of $0.207 per pound for processing.

     The potential for export of CEPs to China provides the cap on costs against which most of these companies compete. The estimated cost for transporting to, and processing in, China is about $0.23 per pound. The existing costs above are just within this limit.

     Most processors already do most of the items required in the proposed rule. However, the rule does add new requirements for direct processors and some of these requirements were not included in the above costs for some of the processors.

     For each processor the potential compliance cost is different. The items of concern included costs for: Registration, reporting, sampling, environmental health and safety management systems, buying scales, more space to operate their business.

     These costs did not apply to every processor but produced a range of added costs from $0.018 to $0.05 per pound with an average cost of $0.019. When we add this to the $0.207 above, the cost rises to $0.226 per pound.

     There is a limit to what the processors can charge the plans. This cost comes close to matching the cost of transporting to, and processing in, China. Given this some plans may ship to China. Thus, not all the new or existing flow of business will come to the American processors. This does not affect the cost of the program here in Washington but may affect the unquantified cost of contamination affecting China.

     Existing processors report twenty-two million pounds of recycled CEPs. Ecology has extrapolated from the pounds reported by the smaller processors to an estimated five additional collector/processors that may exist in repair shops. This would bring the total pounds currently being processed to twenty-three million. The current cost of processing these pounds is about $5.3 million ($.226/lb). Ecology believes this is less than half of the total pounds of CEPs that will be processed under the rule. The estimated total pounds of recycling under the rule are expected to be 56.5 million. The cost of processing these pounds is about $12.8 million.

     These costs are comparable to costs reported by other states.6

     Table 1

Cost Data from Other States
State Collectors Transporters Recyclers All
California $0.20 $0.28 $0.48
Maine $0.12 $0.06 $0.19 $0.37
Minnesota $0.17 $0.05 $0.04 $0.27
Maryland:

Computers only

 $0.05

     One processor does not expect to be able to comply with one of the components of the processor standards. They will therefore be unable to obtain a contract and this will cause a loss of approximately $50,000.

     Costs for Sampling: RCW 70.95N.110 requires statistically significant sampling to determine the percentage return share by brand name. The plans are required to do the sampling with an independent third party or an ecology staff member. The proposed rule includes the following:

&sqbul; Ecology will develop a quarterly schedule for when sampling is done at the facilities of direct processors used by plans.
&sqbul; Plans will incur costs for sampling and they must make sure that the processor's staff or their own supplemental staff are available to perform sampling with minimal disruption to normal operations.
&sqbul; A third party, selected from an ecology-approved list, will observe sampling.
     Sample allocation and days: The total necessary number of samples per year to get a 95% confidence interval and a 0.005 significance level is 10,070 units. Ecology assumes that four plans will be conducting sampling, and that six processors may handle material for plans.7 Based on the proposed sampling method the total required days of sampling to get the sample size will be one hundred eight days each year.

     Staff labor costs: Ecology assumes a sampling crew of five members will be required for each sampling day, including one manager and four staff.

     Mean wage in Washington for first line supervisors/managers: $22.29/hr8

     Employer cost for benefits, management: $13.43/hr

     Total: $35.72/hr

     Mean wage in Washington for material movers, hand: $12.39/hr9

     Employer cost for benefits, material moving: $7.31/hr

     Total: $19.70/hr

     Total crew cost is $114.60 per hour. Thus the total labor cost per 8-hour sampling day is $916.80 per day. The cost of one hundred eight sampling days is $99,014.40 annually.

     Third party labor costs: Plans will also need to employ one third-party observer per sampling day. Ecology expects the plans will compensate this person similarly to a professional statistician.

     Mean wage in Washington for statisticians: $31.55/hr10

     Employer cost for benefits, professional: $13.43/hr

     Total: $44.98/hr

     The total labor cost per sampling day for third-party observers is $359.84 per day. The cost of one hundred eight sampling days is $38,862.72 per year.

     Equipment costs: Conducting sampling will require specialized equipment, including:

• Scale (registered with department of licensing, four hundred pound capacity) - $1500.
• Dollies or other appropriate equipment for moving units - $500.
• Programmable (wireless) bar code readers, printers, stickers - $1000.
• Computer capable of running a sampling database program provided by ecology - $700.
• Digital camera for photographing unidentifiable units - $200.
• Maintenance and replacement costs after the first year - 10% per year.
     Each plan will be required to supply equipment. Since these are sunk costs for each contractor, ecology will estimate total costs assuming four plans must purchase and maintain equipment. Total annualized11 equipment costs are $875 each year per plan, or a total of $3500 each year.

     Total sampling costs: $141,000 per year.

     Costs for CEP Recycling Plans: The rule requires that manufacturers participate in a plan and sets up a standard plan.

     The proposed rule will allow manufacturers to opt out of the standard plan if they receive ecology approval to use an independent plan. Ecology assumes that manufacturers will only use an independent plan if it costs less. Therefore, the cost of the standard plan would be the highest cost option.

     The plans must cover the cost of collection, transportation, processing, recycling and sampling for their manufacturers. These costs are included in the sections above. Plans must also submit a plan, pay a fee for review of the plan, do record keeping, participate in public outreach, and submit reports.

     At the time of this writing work on the standard plan has not begun. The costs of the plan, plan review fee, record keeping, public outreach, and reports will be included in a revised SBEIS if they are larger than the place holder estimate below. The plans may have other costs, however, these are not required by the rule. As a place holder ecology assumes these requirements will cost $100,000 per year.

     Registration Costs: Ecology has tried to develop a simple registration process for the transporters, collectors, direct processors, and manufacturers. Ecology estimates it will take between five minutes and two hours for each company to fill out the registration form. If ecology assumes a cost of $50 per hour, then it will cost between $4 and $200 for transporters, collectors, direct processors, and manufacturers to register. Manufacturers who have many brands and collectors running more than one site will need more time to fill out the form. If 200 companies require $75 worth of time to fill out the forms this will cost $15,000.

     Uncertainty and Analysis Results: Ecology Requests Comments on these Costs.

     The following variables probably generate costs that this analysis does not address.

     1. Cost of CEP recycling plan.

     The cost of collection, transportation, processing and recycling dominates all other costs. The cost is highly dependent on the number of pounds and on how competition affects the rates the collectors, transporter[s], and processors charge.

     For the first five years, under the law, the maximum cost that the manufacturers will pay to the collectors, transporters and processors is $.45 per pound because this is the reimbursement rate in the law for plans that don't collect their equivalent share. If the rates they are offered by their collectors, transporters, and processors totals more than $0.50, then they won't collect or process very many CEPs. The range of costs reported by each component of recycling is large. Costs will shift as the market adjusts. The market should be competitive if there are sufficient processors and costs could fall over the first few years. They will also pay $.05 per pound for each pound that they under collecting administrative fees. Given that this will be an 11% increase in their recycling costs, ecology assumes the plans will try to meet their equivalent shares.

     2. Cost of Travel for Sampling: It is unclear where the third-party observers will be traveling to observe sampling activities so we did not estimate this cost.

     Qualitative Costs: Ecology Requests Comments on these Costs.

     The qualitative costs of the rule include the need for many collectors and recyclers to reorganize how they do business. This is an expensive process in terms of both time and effort. For some companies their primary business is to collect and reuse parts and products. These companies also do some of the activities that constitute recycling. A few of these companies will decide to drop the recycling activity and become collectors while the rest will pay for the added requirements in the rule and will become registered direct processors. They are deciding between the added revenue from the plans for collection coupled with the loss of sales of parts for metals extraction versus the additional revenue from plan payments for recycling coupled with the cost of complying with the direct processor requirements. Two companies are trying to figure out what new niche they can fill because they don't expect the plan payments to cover their current costs and they expect they will not be able to continue to dismantle computers in order to sell parts for recycling. One of these companies has decided they will not continue processing but the other is still considering its options.

     In the case of computers, more than one processor has indicated they can sell them for recycling in China for more than they receive for recycling in Washington. Some may choose to do this. As stated earlier, the downstream cost of contaminant releases in China is not known.

     Retailers will have some costs because they need to look at the ecology web site before ordering CEPs to make sure the brand name is listed. At one time, ecology expected there would be some costs because some companies would not list their brands. However, compliance has been good. Retailers with new brands, who previously sold white box CEPs, will be in the program as manufacturers.

     Quantification of Costs and Ratios: The cost of the proposed rule will be covered by manufacturers who are members of plans. The plans may find ways to reduce the costs listed above. Ecology does not know how the plans will bill their members. The costs below assume the plans will bill their manufacturers based on each manufacturers' return share. The ratio of cost per employee was calculated based on public data in Appendix 1.


Comparison of Small and Large Business Cost per Employee
Costs of the Recycling Program Small Business Costs Large Business Costs
Costs to Plan Members $715.84 $0.01
Processors dropping out $16,700

     Actions Taken to Reduce the Impact of the Proposed Rule on Small Business: Ecology considered a variety of approaches and ended with a proposed rule that sticks very closely to the requirements in the law. Most of the costs of this proposed rule are actually a transfer of costs from individuals, landfills, collectors, transporters, and processors to manufacturers. The legislature chose to require the manufacturers to internalize the costs of the recycling program in their overall costs of doing business because it would have the least impact on in-state retailers and their customers. Ecology has provided cost-minimizing features.

     (a) Reducing, modifying, or eliminating substantive regulatory requirements:

• Processor standards evaluated early in the proposed rule development process were very costly. These have been abandoned because most plans would probably have opted to export the waste to the third world for recycling. This could have caused bankruptcies in Washington. The processor standards have been taken from the requirements in the EPA's Responsible Recycling Practices for Electronics Recyclers Facilitator Draft Strawproposal. This proposed rule is the first performance standards for electronic product processors being considered for adoption by rule in the country. By using the EPA voluntary standards we anticipate that other states that follow in Washington's footsteps will adopt similar standards. This will allow Washington's processors to compete in the national market.
• The primary locations for sampling have been shifted from collection sites to processing sites.
• The transporter standards had several costly options, which were considered. As proposed the rule does not add any additional requirements.
• Televisions and monitors would normally designate as dangerous waste. This proposed rule will allow an exemption for processors that dismantle TVs and monitors. These are granted using a federal exclusion and language from 40 C.F.R. 261.4A, 261.39A, 261.40, 261.41, and 260.10.
     (b) Simplifying, reducing, or eliminating record-keeping and reporting requirements:

• The forms for the application process have been simplified. The forms minimize the requirements of duplicate information.
• The companies only have to submit additional information if they are requesting placement in a different tier.
• The tier reassignment process for most small manufacturers is much less stringent than for large businesses. Manufacturers who request to be reassigned from Tier 3 or 4 do not have to provide statistically valid market share data validated by a certified public accountant.
• Ecology has attempted to minimize time and expense for all businesses by striving to allow manufacturers, collectors and transporters to register via the internet and e-mail.
     (c) Reducing the frequency of inspections:

• There is no inspection frequency specified in the proposed rule. The primary activity prescribed in the proposed rule is third-party review of sampling that sets the return share. This activity actually protects smaller companies from entities with sufficient market share to bias the data. Ecology will select third-party sampling contractors, from which the plans can choose. The third party will become accustomed to the logos and this should speed up the sampling if questions arise. One major potential cost of the proposed rule is the possibility of moving costs from one plan to other plans by manipulating the sampling. If any plan controls more than 40% of the return share the potential gain to that plan and cost to its competitors could be over one million per year. Thus the integrity of sampling is critical. The sampling portion of the proposed rule gives the plans and processors only twenty-four hours notice. This should reduce the ability of the individual who controls throughput to the processor to game the system by manipulating the sample which arrives at the plant.
     (d) Delaying compliance timetables:

• This would not help the companies. They need to be listed as manufacturers in order to market their product.
     (e) Reducing or modifying fine schedules for noncompliance:

• Fine schedules are in the RCW. No modification is possible.
     (f) Any other mitigation techniques:

• The tiered fee structure that allows companies that manufacture fewer units to contribute less for the administrative costs of this proposed rule.
     The primary possible cost of this proposed rule for those who are required to comply derives from the $0.45 per pound, which is in the law, and which must be transferred from plans that do not meet their equivalent share to plans that overmeet their equivalent share. It is unlikely that the actual cost of collection, transport, and processing will be this high. Therefore, the transfer payment has the potential to substantially raise the cost of the proposed rule to plans that underperform. By getting the data in immediately after samples are taken adjustments can be made by the plans to assure they meet their targets.

     The Involvement of Small Business in the Development of the Proposed Rule Amendments: Ecology and the solid waste advisory committee consulted with stakeholders to gather information about the possibility of implementing and financing an electronic product collection, recycling, and reuse program. These stakeholders included small and large business that represented covered electronic product manufacturers, covered electronic product retailers, waste haulers, electronics recyclers, and charities. Other stakeholders included cities, counties, environmental organizations, public interest organizations, and other interested parties that have a role or interest in the collection, reuse, and recycling of covered electronic products.

     Ecology has encouraged the participation of all entities in considering the impacts and outcomes of the proposed rules throughout the rule-making process for Phase 1 and Phase 2. Small businesses were represented on the advisory panel that helped to develop this proposed rule. This public process was open to both small and large businesses. Small businesses presented information to the committee. Further input will be encouraged during the public comment period for the proposed rule.

     Ecology requests comments on this SBEIS and any new information that may be of value in decision making.

     The NAICS Codes of Impacted Industries: This table lists the NAICS codes affected by the proposed rule. A more detailed listing by company is in Appendix 1.

     NAICS Codes of Affected Companies

     333293

     333313

     333315

     33411

     334111

     334113

     334119

     334210

     334220

     3343

     334310

     334413

     334419

     334613

     335110

     33993

     339932

     339999

     423410

     423430

     423620

     423990

     443112

     443120

     45211

     452112

     452910

     453310

     541511

     541512

     541519

     541618

     541840

     517110

     518210

     522298

     54511

     5614999

     811212

     811310

     Labor Impacts: This proposed rule is unusual in that it transfers the cost of disposal from Washington citizens, businesses, and government bodies to manufacturers of TVs, computers, and monitors. There is a net income effect for Washington households, governments, and businesses.

     Ecology used the 1997 OFM input output table to estimate labor impacts.12 The share of the savings from not having to pay for recycling was allocated to each sector based on the share of total output. The share for education was based on the remainder of savings available. Net cost impacts for the proposed rule were included for the additional costs created by the proposed rule. The savings effect combined with the net cost impacts for specific sectors creates a net increase of approximately 343 jobs within Washington. It is likely that this effect is offset elsewhere by losses outside of Washington. This does not include any injection impact from cash flowing to Washington from outside Washington for recycling work done here because it is likely that the prices of electronics will have an offsetting increase over time.


Note: Due to size limitations relating to the filing of documents with the code reviser, this SBEIS does not contain the appendices that further explain ecology's analysis. Additionally, it does not contain the raw data used in this analysis, or all of ecology's analysis of this data. However, this information is being placed in the rule-making file, and is available upon request.

1 Reported recycling total tonnage for CEPs in Washington. Survey data June 2007.

2 It is unclear at this time what the relative share of CEPs from business vs. residences will be. Given that a larger share of the TVs may come from homes, ecology believes at least 45% of the pounds will be residential. However, the share for residences could be much higher.

3 The mean wage in Washington for first line supervisors/managers is $22.29/hr. We assume employer cost for benefits, management: $13.43/hr for a total of $35.72/hr. This is rounded up to $50 to account for collection site overhead. This estimate may be high, however, in a setting where an office may be underutilized overhead per hour that the office is used can be higher than usual.

4 http://ops.fhwa.dot.gov/freight/freight_analysis/perform_meas/fpmtraveltime/index.htm average truck speed on I-5.

5 Only one known processor declined to respond.

6 California data from Form 220A, http://www.ciwmb.ca.gov/Rulemaking/EWaste/Regs061127.doc, and http://www.ciwmb.ca.gov/Electronics/Act2003/Retailer/Fee/. Maine data from Consolodator data and contract information for regions 1 through 4. Minnesota data from http://www.pca.state.mn.us/oea/plugin/ElectronicsReport.pdf.

7 Based on the plans of current processors responding to the survey.

8 Bureau of Labor Statistics.

9 Bureau of Labor Statistics.

10 Bureau of Labor Statistics.

11 Equipment cost is annualized based on a real discount rate of 2.1% and a return on capital of 8%.

12 http://www.ofm.wa.gov/economy/io/default.asp.

     A copy of the statement may be obtained by contacting Jay Shepard, Department of Ecology, Solid Waste and Financial Assistance Program, P.O. Box 47600, Olympia, WA 98504-7600, phone (360) 407-7040, fax (360) 407-6102, e-mail WA-recycles-electronics@ecy.wa.gov.

     A cost-benefit analysis is required under RCW 34.05.328. A preliminary cost-benefit analysis may be obtained by contacting Jay Shepard, Department of Ecology, Solid Waste and Financial Assistance Program, P.O. Box 47600, Olympia, WA 98504-7600, phone (360) 407-7040, fax (360) 407-6102, e-mail WA-recycles-electronics@ecy.wa.gov.

July 11, 2007

Polly Zehm

Deputy Director

OTS-9795.3

PART I

GENERAL REQUIREMENTS
AMENDATORY SECTION(Amending Order 06-07, filed 11/7/06, effective 12/8/06)

WAC 173-900-020   Applicability.   This chapter applies to:

     (1) Any manufacturer, as defined in this chapter.

     (2) The authority or authorized party for a covered electronic product (CEP) recycling plan.

     (3) Any person who collects ((or transports)) covered electronic products (CEPs) in Washington state for a CEP recycling plan approved under this chapter.

     (((3))) (4) Any person who transports covered electronic products (CEPs) in Washington state for a CEP recycling plan approved under this chapter.

     (5) Any person who directly processes covered electronic products (CEPs) for a CEP recycling plan approved under this chapter.

     (6) Any retailer that offers for sale or sells electronic products and covered electronic products (CEPs) in or into Washington state.

     (7) Any local government where covered electronic product (CEP) recycling services are provided.

     (8) Any nonprofit charitable organization that collects covered electronic products (CEPs) in Washington state.

     (9) Any household, charity, school district, small business, or small government (covered entities) that wants to recycle unwanted covered electronic products (CEPs).

[Statutory Authority: Chapter 70.95N RCW. 06-23-040 (Order 06-07), § 173-900-020, filed 11/7/06, effective 12/8/06.]


AMENDATORY SECTION(Amending Order 06-07, filed 11/7/06, effective 12/8/06)

WAC 173-900-030   Definitions.   "Authority" means the Washington materials management and financing authority.

     "Authorized party" means a manufacturer who submits an individual independent plan or the entity authorized to submit an independent plan for more than one manufacturer.

     "Board" means the board of directors of the Washington materials management and financing authority.

     "Brand" means a name used to identify an electronic product in the consumer marketplace which attributes the electronic product to the owner of the name as the manufacturer.

     "Brand label" typically includes but is not limited to name, logos, trademarks, and other visual elements including fonts, color schemes, shapes, symbols, and icons, which, when set in a special typeface or arranged in a particular way, differentiate electronic products by their manufacturers and brand owners.

     "Cathode ray tube" or "CRT" means a vacuum tube, composed primarily of glass, which is the visual or video display component of an electronic device. A used, intact CRT means a CRT whose vacuum has not been released. A used, broken CRT means glass removed from its housing or casing whose vacuum has been released.

     "Certified" means certified by signature on a form or other "hard copy," or by electronic signature or certification by a means implemented and approved by ecology, to be sent by mail or faxed or otherwise submitted to ecology.

     "Collection services" include drop-off collection sites or alternative collection services such as residential at-home pick-up services, curb-side collection, or premium services such as those provided when performing system up-grades at small businesses.

     "Collector" means an entity that is licensed to do business in Washington state and that gathers unwanted covered electronic products from households, small businesses, school districts, small governments, and charities for the purpose of recycling and meets ((minimum standards that may be developed by ecology)) the registration and collector performance standards requirements in Part IV of this chapter.

     "Computer" means a machine, used by one user at a time, designed for manipulating data according to a list of instructions known as a program, and are generally known as desktops, laptops, and portable computers. "Computer" does not include any of the following:

     (a) A machine capable of supporting two or more work stations simultaneously for computing;

     (b) Computer servers marketed to professional users; or

     (c) Retail store terminals or cash registers, used at customer checkout in the retail industry.

     "Contract for services" means an instrument executed by the authority and one or more persons or entities that delineates collection, transportation, processing and recycling services, in whole or in part, that will be provided to the citizens of Washington state within service areas as described in the approved standard plan.

     "Covered electronic product" or "CEP" includes any one of the following four types of products that has been used in Washington state by any covered entity, regardless of original point of purchase:

     (a) Any monitor having a viewable area greater than four inches when measured diagonally;

     (b) A desktop computer;

     (c) A laptop or a portable computer; or

     (d) Any video display device having a viewable area greater than four inches when measured diagonally.

     "Covered electronic product" does not include:

     (a) A motor vehicle or replacement parts for use in motor vehicles or aircraft, or any computer, computer monitor, or television that is contained within, and is not separate from, the motor vehicle or aircraft;

     (b) Monitoring and control instruments or systems;

     (c) Medical devices;

     (d) Products including materials intended for use as ingredients in those products as defined in the federal Food, Drug, and Cosmetic Act (21 U.S.C. Sec. 301 et seq.) or the Virus-Serum-Toxin Act of 1913 (21 U.S.C. Sec. 151 et seq.), and regulations issued under those acts;

     (e) Equipment used in the delivery of patient care in a health care setting;

     (f) A computer, computer monitor, or television that is contained within a clothes washer, clothes dryer, refrigerator, refrigerator and freezer, microwave oven, conventional oven or range, dishwasher, room air conditioner, dehumidifier, or air purifier; automatic teller machines, vending machines or similar business transaction machines; or

     (g) Hand-held portable voice or data devices used for commercial mobile services as defined in 47 U.S.C. Sec. 332 (d)(1).

     "Covered entity" means any household, charity, school district, small business, or small government located in Washington state.

     "Curbside service" means a collection service providing regularly scheduled pickup of covered electronic products from households or other covered entities in quantities generated from households.

     "Desktop" is a computer designed for nonportable use.

     "Direct processor" means a processor contracted with a CEP recycling plan to provide processing services for the plan.

     "Ecology" means the department of ecology.

     "Electronic product" includes any monitor having a viewable area greater than four inches when measured diagonally; a desktop computer; a laptop or portable computer; or any video display device having a viewable area greater than four inches when measured diagonally.

     "Equivalent share" means the weight in pounds of covered electronic products identified for an individual manufacturer as described in this chapter.

     "Existing manufacturers" are those entities whose covered electronic products are offered for sale or sold in or into Washington state, through any sales method, as of ((the effective date of this chapter)) December 8, 2006.

     "Household" means a single detached dwelling unit or a single unit of a multiple dwelling unit and appurtenant structures.

     "Implement" or "plan implementation" means that collection, transportation, processing, and recycling services and other plan requirements are fully operational as described in the approved CEP recycling plan.

     "Independent plan" means a plan for the collection, transportation, processing and recycling of unwanted covered electronic products that is developed, implemented, and financed by an individual manufacturer or by an authorized party.

     "Laptop" is a computer.

     "Manufacturer" means the person who:

     (a) Has legal ownership of the brand, brand-name or cobrand of covered electronic products sold in or into Washington state;

     (b) ((Imports, or sells at retail, electronic products and meets (a) of this subsection; or

     (c))) Imports, or sells at retail an electronic product branded by a manufacturer that meets (a) of this subsection and that manufacturer has no physical presence in the United States of America((.)); or

     (((d) A retailer may elect to register, in lieu of the importer, as the manufacturer when the manufacturer does not have a physical presence in the United States.)) (c) Sells at retail a covered electronic product acquired from an importer that is the manufacturer as described in (b) of this subsection, and elects to register in lieu of the importer.

     "Manufacturers ((who have never sold CEPs)) whose CEPs are not directly sold in or into Washington state" are those entities who have never sold or offered for sale covered electronic products in or into Washington state and whose CEP brand names ((of covered electronic products are represented in the Washington state return share)) are identified on the return share list or their CEPs are returned for recycling by a covered entity.

     "Manufacturers who previously manufactured" are those entities that previously manufactured covered electronic products but no longer do so and whose brand names of CEPs are ((represented in the Washington state return share)) identified on the return share list or their CEPs are returned for recycling by a covered entity.

     "Monitor" is a video display device without a tuner that can display pictures and sound and is used with a computer.

     "New entrant" means:

     (a) A manufacturer of televisions that have been sold in Washington state for less than ten consecutive years; or

     (b) A manufacturer of desktop computers, laptop and portable computers, or computer monitors that have been sold in Washington state for less than five consecutive years;

     (c) However, a manufacturer of both televisions and computers or a manufacturer of both televisions and computer monitors that is deemed a new entrant under either only (a) or (b) of this subsection is ((not)) considered an existing manufacturer and not a new entrant for purposes of this chapter.

     "New manufacturers to Washington state" are those entities whose covered electronic products are offered for sale or sold in or into Washington state for the first time after ((the effective date of this chapter)) December 8, 2006. These manufacturers become existing manufacturers for all program years after participation the first year.

     "Offering for sale" means providing electronic products for purchase, in or into Washington state, regardless of sales method.

     "Orphan product" means a covered electronic product that lacks a manufacturer's brand or for which the manufacturer is no longer in business and has no successor in interest, or is a brand for which ecology cannot identify an owner.

     "Person" means any individual, business, manufacturer, transporter, collector, processor, retailer, charity, nonprofit organization, or government agency.

     "Plan" means a CEP recycling plan.

     "Plan's equivalent share" means the weight in pounds of covered electronic products for which a plan is responsible. A plan's equivalent share is equal to the sum of the equivalent shares of each manufacturer participating in that plan.

     "Plan's return share" means the sum of the return shares of each manufacturer participating in that plan.

     "Portable computer" is a computer.

     "Premium service" means services such as at-location system upgrade services provided to covered entities and at-home pickup services offered to households or any handling requirements imposed by the CEP owner or collector in excess of those required in this chapter. "Premium service" does not include curbside service.

     "Processing facility" means a facility where the processing of CEPs for a plan is conducted by a direct processor.

     "Processing services" means disassembling, dismantling, or shredding electronic products to recover materials contained in the CEPs received from registered collectors or transporters and prepare those materials for reclaiming, reuse, or refurbishment in accordance with processing standards established by this chapter.

     "Processor" means an entity:

     (a) Engaged in disassembling, dismantling, or shredding electronic products to recover materials contained in the electronic products and prepare those materials for reclaiming ((or)), reuse, or refurbishment in new products in accordance with processing standards established by this chapter ((and ecology. A processor may also));

     (b) Prepares materials originating from CEPs for market as a commodity; and

     (c) May salvage ((parts)) components to be used in new or refurbished products.

     "Product type" means one of the following categories: Computer monitors; desktop computers; laptop and portable computers; and televisions.

     "Program" means the collection, transportation, processing and recycling activities conducted to implement an independent plan or the standard plan. Programs can vary for different areas of the state.

     "Program year" means each full calendar year after the program has been initiated.

     "Recycling" means transforming or remanufacturing unwanted electronic products, components, and by-products into usable or marketable materials for use other than landfill disposal or incineration. "Recycling" does not include energy recovery or energy generation by means of combusting unwanted electronic products, components, and by-products with or without other waste. Smelting of electronic materials to recover metals for reuse in conformance with all applicable laws and regulations is not considered disposal or energy recovery.

     "Refurbish" means to repair a used CEP in order to restore or improve it so that it may be used for the same purpose for which it was originally designed.

     "Residual" means leftover materials from processing CEPs that are sent by a processor to a disposal facility.

     "Retailer" means a person who offers covered electronic products for sale at retail through any means including, but not limited to, remote offerings such as sales outlets, catalogs, or the internet, but does not include a sale that is either reused products or a wholesale transaction with a distributor or a retailer.

     "Return share" means the percentage of covered electronic products by weight identified for an individual manufacturer, as determined by ecology.

     "Reuse" means any operation by which an electronic product or a component of a covered electronic product changes ownership and is used, as is, for the same purpose for which it was originally purchased.

     "Sell" or "sold" means an electronic product is purchased regardless of sales method.

     "Small business" means a business employing less than fifty people.

     "Small government" means a city in Washington state with a population less than fifty thousand, a county in Washington state with a population less than one hundred twenty-five thousand, and special purpose districts in Washington state.

     "Standard plan" means the plan for the collection, transportation, processing and recycling of unwanted covered electronic products developed, implemented, and financed by the authority on behalf of manufacturers participating in the authority.

     "Television" is an enclosed video display device with a tuner able to receive and output frequency waves or digital signals to display pictures and sounds.

     "Transporter" means an entity that transports covered electronic products from collection sites or services to processors or other locations for the purpose of recycling, but does not include any entity or person that hauls their own unwanted electronic products.

     "Unwanted electronic product" means a covered electronic product that has been discarded or is intended to be discarded by its owner.

     "White box manufacturer" means a person who manufactured unbranded covered electronic products offered for sale in Washington state within ten consecutive years prior to a program year for televisions or within five consecutive years prior to a program year for desktop computers, laptop or portable computers, or computer monitors.

     "Video display devices" include units capable of presenting images electronically on a screen, with a viewable area greater than four inches when measured diagonally, viewed by the user and may include cathode ray tubes, flat panel computer monitors, plasma displays, liquid crystal displays, rear and front enclosed projection devices, and other similar displays that exist or may be developed. Televisions and monitors are video display devices.

[Statutory Authority: Chapter 70.95N RCW. 06-23-040 (Order 06-07), § 173-900-030, filed 11/7/06, effective 12/8/06.]

PART II

MANUFACTURER REQUIREMENTS
AMENDATORY SECTION(Amending Order 06-07, filed 11/7/06, effective 12/8/06)

WAC 173-900-200   Manufacturers ((registration)) who must register and participate in a CEP recycling plan.   ((Registration:

     (1) A manufacturer is registered under this chapter when:

     (a) Ecology has determined the manufacturer's registration form is complete and accurate; and

     (b) The manufacturer has paid their required administrative fee.

     (2) Registration under this chapter is only for purposes of administering the electronic product recycling program, and does not constitute endorsement by ecology of a particular registrant.

     (3) The following manufacturers must register with ecology:


Type of Manufacturer Initial Registration Due Date
Existing manufacturers Those entities whose CEPs are offered for sale or sold in or into Washington state, as of the effective date of this chapter. On or before January 1, 2007.
New manufacturers to Washington state Those entities whose CEPs are offered for sale or sold in or into Washington state for the first time after the effective date of this chapter. Prior to the offering for sale of their CEPs for sale in/into WA.
Manufacturers who have never sold CEPs Those entities who have never sold or offered for sale covered electronic products in or into Washington state and whose brand names of covered electronic products are represented in the Washington state return share. Within sixty days of ecology sending notice that their brand names were found in the return share.
Manufacturers who previously manufactured Those entities that previously manufactured CEPs but no longer do so and whose brand names of CEPs are represented in the Washington state return share. Within sixty days of ecology sending notice that their brand names were found in the return share.

     (4) Manufacturer registration form: The manufacturer must use the manufacturer registration form provided by ecology which must include all of the following:

     (a) The name, contact, and billing information of the manufacturer;

     (b) The manufacturer's brand names of CEPs, including:

     (i) All brand names sold in Washington state in the past, including "years sold";

     (ii) All brand names currently being sold in Washington state, including the year the manufacturer started using the brand name; and

     (iii) All brand names the manufacturer manufactures but does not have legal ownership of the brand;

     (c) When a word or phrase is used as the label the manufacturer must include that word or phrase and a general description of the ways in which it may appear on the manufacturer's electronic products;

     (d) When a logo, mark, or image is used as a label, the manufacturer must include a graphic representation of the logo or image and a general description of the different ways in which it may appear on the manufacturer's electronic products;

     (e) The method or methods of sale used in or into Washington state;

     (f) Recycling plan participation information; and

     (g) Signature of the responsible individual. The registration form must be signed by the individual responsible for implementing the manufacturer's requirements under this chapter. The signature means the manufacturer has provided accurate and complete information on the form and reviewed their responsibilities under the electronic product recycling program.

     (5) Submitting the registration form: The manufacturer must either submit the:

     (a) Form via e-mail or internet service; or

     (b) Original of the registration form to one of the following addresses:


     For U.S. Postal Service:

     Department of Ecology

     Electronic Product Recycling

     Solid Waste and Financial Assistance Program

     P.O. Box 47600

     Olympia, WA 98504-7600

     Or

     For Courier:

     Department of Ecology

     Electronic Product Recycling

     Solid Waste and Financial Assistance Program

     300 Desmond Drive

     Lacey, WA 98503


     (6) Administrative fee:

     (a) All manufacturers must pay an annual administrative fee to ecology (see WAC 173-900-210 Administrative fee).

     (b) Starting in 2007, ecology will send out billing statements by November 1 of each year to all registered manufacturers. The billing statement will include the amount of the administrative fee owed by the manufacturer.

     (c) New manufacturers must send ecology the required administrative fee so that ecology receives the fee within sixty days of the date on the billing statement.

     (7) Submitting the administrative fee:

     (a) The manufacturer must send ecology the appropriate administrative fee so that ecology receives it no later than January 1 of each calendar year.

     (b) The manufacturer must send payment to the following address:


     Department of Ecology

     Electronic Product Recycling Program

     P.O. Box 5128

     Lacey, WA 98509-5128


     (8) Registration review and status: Within five business days of receiving a manufacturer registration form and the required administrative fee, ecology will post the manufacturer's name on a list called "Manufacturer Registration List for the Electronic Product Recycling Program" on ecology's web site. This list will contain the names of manufacturers, their brand names and their registration status. Each manufacturer on the list will be assigned to one of the following registration status categories:

     (a) Pending means ecology has received the appropriate manufacturer's administrative fee and is reviewing the manufacturer's registration form. The manufacturer's CEPs are allowed to be sold or offered for sale in or into Washington state while in "pending" status.

     (i) If the form is complete and accurate, ecology will change the manufacturer's status from "pending" to "in compliance."

     (ii) If the form is not complete and accurate, ecology will send notice, via certified mail, to the manufacturer identifying what corrections and additional information is needed, and requesting a revised form. The manufacturer will have thirty days from receipt of the notice to submit to ecology a revised registration form. If the form is corrected and the required additional information is submitted, ecology will change the manufacturer's status from "pending" to "in compliance."

     (iii) If the form is not corrected, or the required additional information is not submitted, within thirty days, ecology will change the manufacturer's status from "pending" to "in violation."

     (b) Registered or "in compliance" means ecology has reviewed the manufacturer registration form and determined the form is complete and accurate and the manufacturer has paid the required administrative fee. The manufacturer's CEPs are allowed to be sold or offered for sale in or into Washington state.

     (c) In violation means the manufacturer is in violation of this chapter.

     (9) Annual registration: Manufacturers must submit their annual registration renewal form and required administrative fee to ecology no later than January 1 of each calendar year.

     (10) Registration updates: A manufacturer must submit any changes to the information provided in the registration form to ecology within fourteen days of such change.

     (11) Registration violation: As of January 1, 2007, it is a manufacturer violation if either a manufacturer or retailer offers for sale or sells the manufacturer's CEPs in or into Washington state and the manufacturer is not registered as required above. When a manufacturer registration violation occurs:

     (a) Ecology will assign the manufacturer to the "in violation" category on the "Manufacturer Registration List for the Electronic Product Recycling Program";

     (b) The manufacturer's CEPs cannot be sold or offered for sale in Washington state; and

     (c) The manufacturer is subject to penalties under WAC 173-900-600.

     (12) Corrective actions:

     (a) If a manufacturer is in "in violation" status, ecology will not return them to "pending" status while the manufacturer corrects the violations.

     (b) If ecology changes a manufacturer to "in violation" as a result of a violation, then in order to once again be listed as "in compliance" on the "Manufacturer Registration List for the Electronic Product Recycling Program," the manufacturer must:

     (i) Submit their registration form and ecology must determine the form is complete and accurate;

     (ii) Pay their appropriate administrative fee;

     (iii) Correct any other violations; and

     (iv) Pay or settle any penalties due to ecology (WAC 173-900-600).

     (13) Notification to retailers: A manufacturer may notify retailers, in writing, if the manufacturer's CEPs cannot be offered for sale or sold in or into Washington state. A copy of this notice must be supplied to ecology to avoid the registration violation.)) (1) The following manufacturers must register with ecology and participate in a CEP recycling plan:


Type of Manufacturer Initial Registration Due Date Must be Listed as a Plan Participant By:
Existing manufacturers Those entities whose CEPs are offered for sale or sold in or into Washington state, as of December 8, 2006. On or before January 1, 2007. No later than February 1, 2008.
New manufacturers to Washington state Those entities whose CEPs are offered for sale or sold in or into Washington state for the first time after December 8, 2006. Prior to the offering for sale of their CEPs for sale in or into WA. Within thirty days of ecology approving registration.
Manufacturers whose CEPs are not directly sold in or into Washington state If a CEP brand is identified in the Washington state return share list or is returned for recycling by a covered entity, a manufacturer must register even if that manufacturer has never sold or offered for sale the identified brands directly in or into Washington state. Within sixty days of receiving notice from ecology that the manufacturer must register. Within thirty days of ecology approving registration.
Manufacturers who previously manufactured Those entities that previously manufactured CEPs but no longer do so and whose brand names of CEPs are identified in the Washington state return share list or their CEPs are returned for recycling by a covered entity. Within sixty days of receiving notice from ecology that the manufacturer must register. Within thirty days of ecology approving registration.

     (2) A manufacturer is registered under this chapter when:

     (a) Ecology has determined the manufacturer's registration form is complete and accurate; and

     (b) The manufacturer has paid the required administrative fee (see WAC 173-900-280).

     (3) Registration under this chapter is only for purposes of administering the electronic product recycling program, and does not constitute endorsement by ecology of a particular registrant.

     (4) A manufacturer must participate in either the standard plan or, if approved, an independent plan.

     (5) In the event that the plan fails to meet the manufacturers' obligations under this chapter, each manufacturer participating in the plan retains responsibility and liability, including financial liability, for the collection, transportation, processing, and recycling of the manufacturer's equivalent share of CEPs as described in this chapter.

[Statutory Authority: Chapter 70.95N RCW. 06-23-040 (Order 06-07), § 173-900-200, filed 11/7/06, effective 12/8/06.]


NEW SECTION
WAC 173-900-205   Manufacturer's brands of CEPs that can be offered for sale or sold in or into Washington state.   (1) In order for a manufacturer's brands of CEPs to be offered for sale or sold in or into Washington state, the manufacturer's name and brand names must be listed on the "manufacturer registration list" as "in compliance" or "pending" status.

     (2) To be in "in compliance" status a manufacturer must:

     (a) As of January 1, 2007:

     (i) Register annually with ecology;

     (ii) Update registration information if it changes;

     (iii) Label the manufacturer's CEPs with the manufacturer's brand name(s) included in the manufacturer's registration information.

     (b) As of February 1, 2008:

     (i) Register annually with ecology;

     (ii) Update registration information if it changes;

     (iii) Label the CEPs with the manufacturer's brand name(s) included in the manufacturer's registration information; and

     (iv) Participate in a CEP recycling plan approved, or submitted for approval, by ecology.


Manufacturer Status Can the manufacturer's brands of CEPs be offered for sale or sold in or into Washington state? Explanation
Pending Yes "Pending" means ecology has received the manufacturer's registration form and administrative fee and ecology is reviewing the form.
In compliance Yes "In compliance" means ecology has approved the manufacturer's registration, the manufacturer is participating in a plan, and is complying with the requirements in this chapter.
In violation No "In violation" means the manufacturer is in violation of the requirements in this chapter.
Manufacturer's brand name is not on the "manufacturer registration list" No If a manufacturer's brand name is not on the "manufacturer registration list," that brand must not be offered for sale or sold in or into Washington state.
Manufacturer's name is not on the "manufacturer registration list" No If a manufacturer's name is not on the "manufacturer registration list," none of the manufacturer's brands of CEPs can be offered for sale or sold in or into Washington.

[]


AMENDATORY SECTION(Amending Order 06-07, filed 11/7/06, effective 12/8/06)

WAC 173-900-210   ((Administrative fee.)) Required brand labeling for manufacturers.   (1) ((Legislative mandate. The administrative fee covers ecology's administrative costs related to implementing the electronic product recycling program authorized under chapter 70.95N RCW. It does not include the fees for ecology's review of the standard plan or independent plans.

     (2) Data.

     (a) Ecology will use data collected to extrapolate Washington market shares, and to calculate manufacturer unit sales. Ecology will use market share and/or CEP unit sales to assign each manufacturer to an administrative fee tier. Ecology may use any of, or a combination of, the following data:

     (i) Generally available market research data;

     (ii) CEP unit data supplied by manufacturers about brands they manufacture or sell; or

     (iii) CEP unit data supplied by retailers about brands they sell.

     (b) Ecology may put the data directly into the data base. Ecology will aggregate the data in sets of at least three companies for confidentiality when published.

     (3) Distribution:

     (a) Ecology will establish a fee schedule to distribute administrative fees on a sliding scale, based on tiers, that are representative of annual sales of CEPs in Washington state.

     (b) Fees will be distributed to each tier in order to spread costs based on the estimated unit sales given the number of manufacturers and the amount of revenue that needs to be generated to cover ecology's administrative costs.

     (c) Tier 7 will have no fee amount associated with it, but the manufacturers assigned to this tier must still complete the registration form (see WAC 173-900-200).


Tiers Manufacturer's Market Share
Tier 1 5% or greater
Tier 2 1% to < 5%
Tier 3 0.1% to < 1%
Tier 4 0.03% to < 0.1%
Tier 5 0.01% to < 0.03%
Tier 6 0% but < 0.01%
Tier 7 Manufacturers who previously manufactured

     (4) Calculating the administrative fee: Ecology will calculate the tiers based on the combined unit sales of CEPs sold under manufacturer brands as a percentage of the total sales of electronic products sold in or into Washington state.

     (a) Administrative fee tier calculations for program year 2007: For administrative fees due January 1, 2007, ecology will base fees on the amount appropriated in the budget for the electronic product recycling program by the legislature. Year one includes start-up costs and funds the first eighteen months of operations. This amount is four hundred seventy-five thousand dollars.

     (b) Administrative fee tier calculations for program year 2008 and future years:

     (i) For administrative fees due January 1, 2008, and thereafter, ecology will base the fee on the expenditure authority for the electronic product recycling program which for program year 2008 is two hundred twenty-one thousand five hundred dollars.

     (ii) The total administrative fee amount will be adjusted biannually by the FGF as calculated under chapter 43.135 RCW (FeeFGF).

     (5) Tier placement:

     (a) Existing manufacturers: Ecology will place existing manufacturers in the appropriate tier based on data obtained or received by ecology. If ecology has no data, ecology will place the manufacturer in Tier 4.

     (b) New manufacturers to Washington state: Ecology will assign these manufacturers to Tier 6 for their initial program year. Ecology will assign these manufacturers to Tier 4 for the second and future program years unless ecology has CEP unit data.

     (c) Manufacturers who have never sold CEPs: Ecology will assign these manufacturers to Tier 6.

     (d) Manufacturers who previously manufactured: Ecology will assign these manufacturers to Tier 7.

     (6) Publication of tier assignment:

     (a) Tiers for fees due January 1, 2007: Ecology will publish the final tier schedule on ecology's web site by November 15, 2006, for fees due January 1, 2007. The tiers will be based on data available to ecology and received from manufacturers and retailers prior to November 9, 2006. When providing data to ecology, manufacturers must meet the requirements of subsection (7)(a) of this section prior to November 9, 2006.

     (b) Tiers for fees due January 1, 2008, and future years: For administrative fees for 2008, and future years, ecology will publish a preliminary tier schedule for review and a final tier schedule.

     (i) Preliminary tier schedule: Ecology will publish the preliminary tier schedule on ecology's web site by September 1 of each calendar year.

     (A) This preliminary tier schedule will include the tiers and a list of manufacturers assigned to each tier.

     (B) Ecology will also publish the estimated total percentage share of the market attributable to each tier and a list of the brand names for each manufacturer, which form the basis for the estimates used in the tier assignment.

     (C) Manufacturers will have until October 1 to submit a request for tier reassignment if they believe they are assigned to the wrong tier. (See subsection (7)(b) of this section.)

     (ii) Final tier schedule: Ecology will publish the agency's final decision on the final tier schedule on ecology's web site by November 1 of each calendar year. This final tier schedule will reflect ecology's evaluation of all available data including but not limited to tier reassignment requests.

     (7) Tier reassignment requests:

     (a) Requests for tier reassignment submitted for fees due January 1, 2007. Manufacturers may request to be assigned to a different tier for fees due January 1, 2007.

     (i) To submit a request for tier reassignment the manufacturer must, on or before November 9, 2006, do one of the following:

     (A) Submit or update their on-line manufacturer registration form. The manufacturer must provide the number of units of CEPs, sold in the prior year, in or into Washington state;

     (B) Send a written letter to ecology including the number of units of CEPs sold in the prior year in or into Washington state; or

     (C) Submit a complete tier request form available on ecology's web site.

     (ii) If CEP unit sales data is provided, ecology will exempt this data from public disclosure in accordance with RCW 42.56.270(13).

     (iii) In addition to submitting information about CEP unit sales as described above, ecology may request that the manufacturer submit the CEP unit sales data in writing certified by a certified public accountant. Ecology may request this if ecology finds the data gives a different market share than the national data collected and/or the information changes the tier assignment distribution.

     (b) Requests for tier reassignment for fees due after January 1, 2007. If submitting a tier reassignment request:

     (i) Existing manufacturers must submit the request on or before October 1 prior to the next billing cycle and must follow the steps in (c) of this subsection.

     (ii) New manufacturers may not submit a tier reassignment request for their first program year. Requests for tier reassignment for future program years must follow the process for existing manufacturers.

     (iii) Manufacturers who have never sold CEPs may request to be assigned to a different tier at any time and must follow the steps in (c) of this subsection.

     (iv) Manufacturers who previously manufactured may request to be assigned to a different tier at any time and must follow the steps in (c) of this subsection.

     (c) Submitting the request: To request tier reassignment, the manufacturer must do one of the following:

     (i) Submit or update their on-line manufacturer registration form. The manufacturer must provide the number of units of CEPs, sold in the prior calendar year, in or into Washington state; or

     (ii) Send a written letter to ecology including the number of units of CEPs, sold in the prior calendar year, in or into Washington state.

     (iii) If CEP unit sales data is provided, ecology will exempt this data from public disclosure in accordance with RCW 42.56.270(13).

     (iv) In addition to submitting information about CEP unit sales as described above, ecology may request that the manufacturer submit the CEP unit sales data in writing certified by a certified public accountant. Ecology may request this if ecology finds the data gives a different market share than the national data collected and/or the information changes the tier assignment distribution.)) Beginning January 1, 2007, no person may sell or offer for sale an electronic product to any person in or into Washington state unless the electronic product is labeled with the manufacturer's brand.

     (2) The label must be permanently affixed and readily visible.

     (3) In-state retailers in possession of unlabeled, or white box, electronic products on January 1, 2007, may exhaust their stock through sales to the public.

[Statutory Authority: Chapter 70.95N RCW. 06-23-040 (Order 06-07), § 173-900-210, filed 11/7/06, effective 12/8/06.]


NEW SECTION
WAC 173-900-215   Initial CEP manufacturer registration.  


     Step 1: Complete the manufacturer registration form.


     (1) CEP manufacturers must use the on-line or paper manufacturer registration form provided by ecology.

     (2) A manufacturer must provide all of the following information to ecology:

     (a) The name, contact, and billing information of the manufacturer;

     (b) The manufacturer's brand names of CEPs, including:

     (i) All brand names sold in Washington state in the past, including the years each brand was sold;

     (ii) All brand names currently being sold in Washington state, including the year the manufacturer started using the brand name;

     (c) All brand names of electronic products for which the registrant assembles but does not have legal ownership of the brand name placed on the product;

     (d) When a word or phrase is used as the label, the manufacturer must include that word or phrase and a general description of the ways in which it may appear on the manufacturer's electronic products;

     (e) When a logo, mark, or image is used as a label, the manufacturer must include either a graphic representation of the logo, mark, or image and a general description of the logo, mark, or image as it appears on the manufacturer's electronic products;

     (f) The method or methods of sale used in or into Washington state; and

     (g) CEP recycling plan participation information.


     Step 2: Submit the manufacturer registration form.


     (3) The individual responsible for implementing the manufacturer's requirements under this chapter must sign the form. The signature means the manufacturer has provided accurate and complete information on the form and reviewed their responsibilities under the electronic product recycling program.

     (4) The manufacturer must submit the form using one of the three options below:

     (a) The on-line registration form;

     (b) The original paper version through the U.S. Postal Service:


     Department of Ecology

     Electronic Product Recycling

     Solid Waste and Financial Assistance Program

     P.O. Box 47600

     Olympia, WA 98504-7600


     (c) The original paper version through a courier:


     Department of Ecology

     Electronic Product Recycling

     Solid Waste and Financial Assistance Program

     300 Desmond Drive

     Lacey, WA 98503


     Step 3: Pay the administrative fee.


     (5) The following manufacturers must pay an annual administrative fee to ecology (see WAC 173-900-280 and ecology's web site for administrative fee schedule):

     (a) Existing manufacturers;

     (b) New manufacturers.

     (6) Starting in 2007, ecology will send out billing statements by November 1 of each year to all registered manufacturers. The billing statement will include the amount of the administrative fee owed by the manufacturer.

     (7) New manufacturers must send ecology the required administrative fee so that ecology receives the fee within sixty days of the date on the billing statement.

     (8) Existing manufacturers must send ecology the appropriate administrative fee so that ecology receives it no later than January 1 of each calendar year.

     (9) The manufacturer must send payment to one of the following addresses:


     For U.S. Postal Service:

    
     Department of Ecology

     Electronic Product Recycling Program

     P.O. Box 5128

     Lacey, WA 98509-5128


     For Courier to:


     Department of Ecology

     Attn: Fiscal Cashiering

     300 Desmond Drive

     Lacey, WA 98503

[]


NEW SECTION
WAC 173-900-220   How manufacturers know if they are registered.  


     Step 1: Ecology review of the manufacturer registration form.


     (1) Within five business days of ecology receiving a manufacturer registration form and the required administrative fee (see WAC 173-900-280), ecology will:

     (a) Place the manufacturer in "pending" status on the "manufacturer registration list"; and

     (b) Place the manufacturer's "currently owned and manufactured" brand names included on the form on the "manufacturer registration list."

     (2) The manufacturer's brands of CEPs included on the "manufacturer registration list" can be sold or offered for sale in or into Washington state.

     (3) Ecology will review the form to decide if the form is complete and accurate.

     (4) If the form is not complete and accurate, or the manufacturer has not paid the required administrative fee, ecology will contact the manufacturer to request one or both of the following:

     (a) A revised form that contains the complete and missing information;

     (b) The unpaid administrative fee.

     (5) The manufacturer must submit the administrative fee and all requested information within thirty days from the day ecology contacted the manufacturer.


     Step 2: Approval or denial of manufacturer registration.


     (6) Approval.

     (a) Approval means that ecology has received the manufacturer's administrative fee and has decided the registration form is complete and accurate.

     (b) If ecology approves the manufacturer's registration:

     (i) Ecology will change the manufacturer's status from "pending" to "in compliance" on the "manufacturer registration list"; and

     (ii) The manufacturer's registered brands of CEPs can be offered for sale or sold in or into Washington state.

     (7) Denial.

     (a) Denial means that ecology either did not receive the administrative fee or ecology has decided the form is not complete and accurate and the manufacturer has not submitted the revised information as requested.

     (b) If ecology denies a manufacturer's registration:

     (ii) Ecology will either change the manufacturer's status from "pending" to "in violation" on the "manufacturer registration list" or remove the manufacturer's name from the list;

     (ii) Ecology will notify the transporter of the denial; and

     (iii) The manufacturer's brands of CEPs are not allowed to be offered for sale or sold in or into Washington state.

[]


NEW SECTION
WAC 173-900-230   Annual manufacturer registration.    (1) After initial registration, to remain registered, manufacturers must submit a registration form and required administrative fee to ecology each year.

     (2) Annual registration is due no later than January 1 of each calendar year for the next program year.

     (3) The manufacturer must submit the annual registration form using one of the options below:

     (a) Submit the manufacturer's on-line registration form;

     (b) Submitting a paper version through:


     U.S. Postal Service:


     Department of Ecology

     Electronic Product Recycling

     Solid Waste and Financial Assistance Program

     P.O. Box 47600

     Olympia, WA 98504-7600


     Courier Service:


     Department of Ecology

     Electronic Product Recycling

     Solid Waste and Financial Assistance Program

     300 Desmond Drive

     Lacey, WA 98503


     (4) Ecology will review manufacturer registration forms submitted for annual registration under the process described in WAC 173-900-220.

[]


NEW SECTION
WAC 173-900-240   Updates to manufacturer registration.   (1) If there are any changes to the information on the manufacturer's registration approved by ecology, a registered manufacturer must submit an updated form within fourteen days of when any change occurs.

     (2) The manufacturer must submit updates using one of the options below:

     (a) Updating the manufacturer's registration information using the on-line form;

     (b) Submitting a paper version of the form with updated information through:


     U.S. Postal Service to:


     Department of Ecology

     Electronic Product Recycling

     Solid Waste and Financial Assistance Program

     P.O. Box 47600

     Olympia, WA 98504-7600


     Courier Service to:


     Department of Ecology

     Electronic Product Recycling

     Solid Waste and Financial Assistance Program

     300 Desmond Drive

     Lacey, WA 98503


     (3) Ecology will review manufacturer's updated registration forms under the process described in WAC 173-900-220.

[]


NEW SECTION
WAC 173-900-250   Ecology determination of manufacturer compliance.   (1) Beginning January 1, 2007, ecology may inspect any retailer's CEP inventory offered for sale in or into Washington state to determine if the requirements in this chapter are met. If ecology determines a violation has occurred, ecology will document each violation and follow the warning, violations, and penalties procedure in Part II (for manufacturers) and Part VII (for retailers) of this chapter.

     (2) Beginning January 1, 2007, ecology may check any retailer's CEP inventory offered for sale in or into Washington state to determine if brand labeling requirements in WAC 173-900-210 have been met. If ecology determines a violation has occurred, ecology will document each violation and follow the warning, violations, and penalties procedure in Part II (for manufacturers) and Part VII (for retailers) of this chapter.

[]


NEW SECTION
WAC 173-900-255   Manufacturer violations.   (1) A manufacturer is in violation of this chapter when there is a:

     (a) Registration violation;

     (b) Labeling violation;

     (c) Plan violation; or

     (d) Return share violation.


     Manufacturer registration violations:


     (2) A manufacturer is in "registration violation" of this chapter if any of the following occurs:

     (a) The manufacturer does not submit an updated registration form within fourteen days of changes in the registration information.

     (b) A manufacturer offers for sale or sells its brand of CEPs in or into Washington state and:

     (i) The manufacturer's brand is not listed as in "in compliance" or "pending" status on the "manufacturer registration list"; or

     (ii) The manufacturer's brand name is not listed as part of the manufacturer's registration.

     (c) A retailer offers for sale or sells a manufacturer's brand of CEP in or into Washington state and on the date the products were ordered from the manufacturer or their agent:

     (i) The manufacturer's brand was not listed as in "in compliance" or "pending" status on the "manufacturer registration list";

     (ii) The brand name of the CEP was not listed as in "in compliance" or "pending" status on the "manufacturer registration list."

     (3) A manufacturer may notify retailers, in writing, if the manufacturer's brand of CEPs cannot be offered for sale or sold in or into Washington state. The manufacturer must provide ecology a copy of this notice to avoid a registration violation.

     (4) Each unregistered CEP unit offered for sale or sold is a separate violation by the manufacturer.


     Manufacturer labeling violation:


     (5) A manufacturer is in "labeling violation" of this chapter if any of the following occurs:

     (a) The manufacturer offers for sale or sells a manufacturer's electronic product in or into Washington state that does not have a permanently affixed or readily visible label with the manufacturer's brand name.

     (b) A retailer offers for sale or sells the manufacturer's electronic product in or into Washington state that is not labeled with the manufacturer's brand name.

     (6) Each of the manufacturer's unlabeled units offered for sale or sold is a separate violation by the manufacturer.


     Manufacturer plan violation:


     (7) Starting February 1, 2008, a manufacturer is in "plan violation" of this chapter if any of the following occurs, the manufacturer:

     (a) Has not met the manufacturer's financial obligations to its plan; or

     (b) Is not participating in a plan or complying with the manufacturer's responsibilities as described in their ecology approved plan; or

     (c) Is participating in a plan that is not fully implemented and the authority or authorized party has not taken action approved by ecology to correct violations.


     Return share violation:


     (8) It is a "return share violation" when the manufacturer's brands of CEPs are identified on ecology's return share list and:

     (a) Within sixty days of receiving notice from ecology, the manufacturer has not registered with ecology; or

     (b) Within thirty days of registering is not participating in a plan.

[]


NEW SECTION
WAC 173-900-260   Warnings and penalties for manufacturer violations.  


Table 260
Manufacturer Warning and Penalties

Type of Violation Written Warning First Penalty Second and Subsequent Penalties
Registration Violation Warning Letter Up to $1,000 Up to $2,000
Labeling Violation Warning Letter Up to $1,000 Up to $2,000
Plan Violation Warning Letter Up to $10,000 Up to $10,000
Return Share Violation Warning Letter Up to $10,000 plus the percentage of their return share of the costs of operating the standard plan. Up to $10,000 plus the percentage of their return share of the costs of operating the standard plan.

     Warning letter:

     (1) When ecology issues a written warning letter via certified mail, for any violation, the warning will include a copy of the requirements to let the manufacturer know what the manufacturer must do to be in compliance status.

     Penalties:

     (2) First penalties: If the manufacturer does not meet the compliance requirements in the warning letter within thirty days of receipt of the warning, ecology will assess a first penalty, as defined in Table 260 above and do one of the following:

     (a) Change the manufacturer's status to "in violation";

     (b) Add the manufacturer to the "manufacturer registration list" and put them in "in violation."

     (3) Second and subsequent penalties: Ecology will issue second and subsequent penalties as defined in Table 260 no more often than every thirty days for the same violation.

     (4) Ecology will deposit all penalties collected under this section into the electronic products recycling account created under RCW 70.95N.130.

     Appeals:

     (5) Violations and penalties may be appealed to the pollution control hearings board, pursuant to chapter 43.21B RCW.

[]


NEW SECTION
WAC 173-900-270   Corrective actions for manufacturer violations.   (1) If a manufacturer is in "in violation" status, ecology will not return them to "in compliance" status until the manufacturer corrects the violation.


     Corrective actions for manufacturer registration violations:


     (2) To correct a registration violation the manufacturer must:

     (a) Provide evidence that the violation has been corrected; and

     (b) Pay or settle any penalties to ecology.


     Corrective actions for manufacturer labeling violations:


     (3) To correct a labeling violation the manufacturer must:

     (a) Meet the requirements in WAC 173-900-210;

     (b) Correct any other violations; and

     (c) Pay or settle any penalties due to ecology.


     Corrective actions for plan violations:


     (4) To correct a plan violation a manufacturer must:

     (a) Join and participate in an approved plan or a plan currently under review for approval;

     (b) Correct any other violations; and

     (c) Pay or settle any penalties due to ecology.


     Corrective actions for return share violations:


     (5) To correct a return share violation the manufacturer must:

     (a) Join and participate in an approved plan or a plan currently under review for approval;

     (b) Correct any other violations; and

     (c) Pay or settle any penalties due to ecology.

[]


NEW SECTION
WAC 173-900-280   Administrative fee.   (1) Legislative mandate. The administrative fee covers ecology's administrative costs related to implementing the electronic product recycling program authorized under chapter 70.95N RCW. It does not include the fees for ecology's review of the standard plan or independent plans.

     (2) Data.

     (a) Ecology will use data collected to extrapolate Washington market shares, and to calculate manufacturer unit sales. Ecology will use market share and/or CEP unit sales to assign each manufacturer to an administrative fee tier. Ecology may use any of, or a combination of, the following data:

     (i) Generally available market research data;

     (ii) CEP unit sales data supplied by manufacturers for brands they manufacture or sell; or

     (iii) CEP unit sales data supplied by retailers for brands they sell.

     (b) Ecology may put the data directly into the data base. Ecology will aggregate the data in sets of at least three companies for confidentiality when published.

     (3) Distribution:

     (a) Ecology will establish a fee schedule to distribute administrative fees on a sliding scale, based on tiers, that are representative of annual sales of CEPs in Washington state.

     (b) Fees will be distributed to each tier in order to spread costs based on the estimated unit sales given the number of manufacturers and the amount of revenue that needs to be generated to cover ecology's administrative costs.

     (c) Tier 7 will have no fee amount associated with it, but the manufacturers assigned to this tier must still complete the registration form (see WAC 173-900-215) and join a plan.


Tiers Manufacturer's Market Share
Tier 1 5% or greater
Tier 2 1% to < 5%
Tier 3 0.1% to < 1%
Tier 4 0.03% to < 0.1%
Tier 5 0.01% to < 0.03%
Tier 6 < 0.01%
Tier 7 Manufacturers who previously manufactured
Manufacturers whose CEPs are not directly sold in or into Washington state

     (4) Calculating the administrative fee: Ecology will calculate the tiers based on the combined unit sales of CEPs sold under manufacturer brands as a percentage of the total sales of electronic products sold in or into Washington state.

     (a) Administrative fee tier calculations for program year 2007: For administrative fees due January 1, 2007, ecology will base fees on the amount appropriated in the budget for the electronic product recycling program by the legislature. Year one includes start-up costs and it funds the first eighteen months of operations. This amount is four hundred seventy-five thousand dollars.

     (b) Administrative fee tier calculations for program year 2008 and future years:

     (i) For administrative fees due January 1, 2008, and thereafter, ecology will base the fee on the expenditure authority for the electroni