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Study Sessiontps�GA�og COUNCIL AGENDA REPORT DATE: APRIL 29, 2013 TO: MAYOR AND TOWN COUNCIL FROM: GREG LARSON, TOWN MANAGER MEETING DATE: 5/6/13 STUDY SESSION SUBJECT: DISCUSSION AND DIRECTION ON THE REGULATION OF SINGLE -USE CARRYOUT BAGS AND EXPANDED POLYSTYRENE RECOMMENDATION: 1. Authorize staff to draft and present an ordinance for the regulation of single -use carryout bags. 2. Direct staff to schedule consideration of an Expanded Polystyrene (EPS) Ordinance in early 2014. BACKGROUND: In July 2012, the Town of Los Gatos adopted a sustainability plan that outlined the Town's existing greenhouse gas emissions (GHG) inventory, identified GHG reduction targets, and established GHG reduction measures to be implemented in order to meet those reduction targets. Waste reduction efforts in the Solid Waste category identified the adoption of an ordinance to ban the use of plastic bags in Los Gatos (SW -8). The purpose of this study session is to discuss the Council's interest in proceeding with the adoption of such an ordinance, as well as consideration of a related regulation of Expanded Polystyrene containers. DISCUSSION: The Need for Regulation of Single -Use Plastic Bags The use of single -use carry out bags contributes to negative environmental impacts on air quality, biological resources, greenhouse gas emissions and water quality, and contributes to the increase of litter in storm drains, creeks, the bay and the ocean. In October 2009, the Santa Clara County Recycling and Waste Reduction Commission (RWRC), a commission composed of ten elected officials who represent the range of local government solid waste PREPARED BY: Christina Gilmore, Assistant to the Town Manage I1n yk Reviewed by: _E�AAssistant Town Manager _Town Attorney NA\MGR\AdminWorkPiles\2013 Council Reports \Town Council Report- Plastic Bags.docx PAGE 2 MAYOR AND TOWN COUNCIL SUBJECT: REUSABLE BAG AND EPS ORDINANCE APRIL 29, 2013 system users and perspectives, recommended that all jurisdictions in the County establish a ban on plastic single -use, carry -out bags and a mandatory charge on paper carry -out bags at retail stores, excluding restaurants and fast -food establishments. In June 2011, the Santa Clara County Cities Association supported this recommendation. Environmental consultants have estimated that 531 plastic bags are used per person annually in Los Gatos. Adopting a single -use bag ordinance would potentially eliminate nearly 16 million plastic bags annually, which would assist in meeting the Town's goal for Solid Waste reduction, as outlined within the Town's Sustainability Plan. Regional and State Efforts In September 2011, San Mateo County undertook an Environmental Impact Report (EIR) to examine the potential impacts of regulating the use of plastic bags and develop a proposed ordinance for regional adoption. The Town of Los Gatos and 23 cities in both San Mateo and Santa Clara counties, who were also considering a single use ban ordinance, were invited to participate in a regional approach to the EIR analysis. Municipalities in Santa Clara County who participated in this EIR process included Los Gatos, Milpitas, Cupertino, Los Altos, Campbell and Mountain View. The objectives of the proposed ordinance were: 1. Reduce the amount of single -use bags in trash loads; 2. Reduce the environmental impacts related to single -use plastic carryout bags; 3. Deter the use of paper bags by customers in the respective jurisdictions; 4. Promote a shift toward the use of reusable carryout bags by retail customers in the respective jurisdictions; and 5. Avoid litter and the associated adverse impacts to the stormwater systems, aesthetics and the marine environment. Acting as the lead agency, the County of San Mateo prepared and released an EIR in June 2012, with the participating municipalities acting as responsible agencies. A Final EIR was released in August 2012 and was certified by the San Mateo County Board of Supervisors in October 2012. Other cities have also adopted or are considering adopting an ordinance, including Palo Alto, San Jose, Mountain View, Sunnyvale, Los Altos, Cupertino and Campbell. Current proposed state legislation regarding single -use carryout bags includes SB 405, authored by Senator Padilla and AB 158 authored by Assembly Member Levine. Each bill seeks to prohibit stores that have a specified amount of dollar sales or retail floor space from providing a single -use carryout bag to a customer. The bills would also require stores to meet other specified requirements regarding providing recycled paper bags, compostable bags, or reusable grocery bags to customers. Both AB 158 and SB 405 are currently being heard in Committee, and if passed, would require retail establishments that meet these criteria to comply with the law as of January 1, 2015, After July 1, 2016, these prohibitions would additionally be imposed on convenience food stores, foodmarts, and certain other specified stores. PAGE 3 MAYOR AND TOWN COUNCIL SUBJECT: REUSABLE BAG AND EPS ORDINANCE APRIL 29, 2013 CEQA Findings Environmental Impacts The Final Program EIR estimates the volume of current plastic bag usage within the Study Area at 546 million bags per year, including Los Gatos at approximately 16 million. With the proposed ordinance in effect, it is anticipated that 95 percent of that volume would be replaced by a combination of paper (30 percent) and reusable (65 percent) bags, leaving 5 percent or 27.6 million plastic bags still used each year at retail establishments exempt from the ordinance. The Final EIR identifies and analyzes the potential environmental impacts of such a shift in bag usage as follows: Air Quality: (1) A beneficial impact associated with a reduction in emissions due to a reduction in the total number of plastic bags manufactured; and (2) a less- than - significant impact associated with an increase in emissions resulting from increased truck trips to deliver recycled paper and reusable carry- out bags to local retailers. Biological Resources: A beneficial impact associated with a reduction in the amount of single -use plastic bags entering the coastal and bay habitat as litter. Greenhouse Gas (GHG) Emissions: A less- than - significant impact associated with increased GHG emissions due to an increase in the manufacturing of single -use paper bags. Hydrology/Water Quality: (1) A beneficial impact associated with a reduction in the amount of litter and waste entering storm drains; and (2) a less - than - significant impact due to an increase in the use of chemicals associated with an increase in production of recyclable paper bags. Utilities and Service Systems: (1) A less- than - significant impact due to increased water usage resulting from the washing of reusable bags; (2) a less- than - significant impact due to increased wastewater generation resulting from the washing of reusable bags; and (3) a less - than - significant impact due to an increase in solid waste generation resulting from increased usage of paper bags. None of the impacts require mitigation because they are all either beneficial or less than significant. Ordinance Framework Los Gatos' proposed ordinance would closely resemble the model regional ordinance. The ordinance would apply to any commercial establishment that sells perishable or nonperishable goods, including, but not limited to, clothing, food, and personal items, directly to the customer; and is located with or doing business within the geographical limits of the Town of Los Gatos. The ordinance would not apply to any commercial establishments within the unincorporated islands within Los Gatos and would have the following components: 1. Prohibit the free distribution of single -use carryout paper and plastic bags; 2. Require retail establishments to charge customers for recycled paper bags and reusable bags at the point of sale. The minimum charge would be ten cents ($0.10) per paper bag until December 31, 2014; 3. Increase the minimum charge to twenty -five cents ($0.25) per paper bag on or after January 1, 2015; PAGE 4 MAYOR AND TOWN COUNCIL SUBJECT: REUSABLE BAG AND EPS ORDINANCE APRIL 29, 2013 4. Exempt customers participating in Supplemental Food Programs from having to pay for carryout bags; 5. Allow retailers to provide protective plastic bags, without handles, intended to segregate produce, raw meat and prescription drugs, for their customers at no cost; and 6. Take effect on January 1, 2014. If the Council would like to alter any of these components, additional EIR analysis may be necessary. Potential Issues The Final Program EIR included a public comment period, and comments from the public were included within the report. The most common issues that were raised in opposition to this proposed ordinance were concerns related to the $0.10 and $0.25 cost for the purchase of reusable bags posing an undue economic impact for consumers and retailers; the perceived negative health impacts of reusing reusable bags (becoming dirty and harboring bacteria such as E.Coli); and the opinion that many people reuse plastic bags to line their trash bins or use them to pick up dog waste. There is also a plastic bag industry group called Save the Plastic Bag Coalition whose membership includes companies and individuals engaged in the manufacture and distribution of plastic carryout bags and polyethylene reusable bags who oppose reusable bag ordinances. An additional concern that may be raised by retailers is having to pay a sales tax on the surcharge for reusable bags. The State Board of Equalization issued a special notice stating that due to the charge being imposed by the local jurisdiction upon the customer, not the retailer; the charge is not included in the retailer's gross receipts and would not be subject to a sales tax or use tax. Given the widespread trend toward restrictions on single -use plastic bags in many counties and jurisdictions throughout California and proposed legislation that is currently making its way through the State Legislature, staff is recommending that the Council proceed with a discussion for a proposed reusable bag ordinance, although some of the above concerns may be voiced during the public process. Public Outreach Should the Town Council choose to move ahead with this proposed ordinance, staff proposes a public outreach plan through the Town's website; the Los Gatos Chamber of Commerce; the Los Gatos Weekly Times; the Los Gatos Patch, and informational stakeholder meetings with retailers and residents. A more detailed outreach plan and schedule will be submitted to Council following the direction to proceed. Proposed Expanded Polystyrene (EPS) Ordinance Expanded polystyrene (EPS) foam is a major pollutant in creeks and waterways that flow to the Bay and beyond. Unlike other items that litter the waterways, polystyrene easily breaks into tiny pieces that can be mistaken for food and ingested by aquatic animals. EPS comprises 15% of storm drain litter, according to the California Department of Transportation. PAGE 5 MAYOR AND TOWN COUNCIL SUBJECT: REUSABLE BAG AND EPS ORDINANCE APRIL 29, 2013 Most recently, the topic of appropriate disposal/management of expanded polystyrene has been examined by the RWRC. In February 2012, the RWRC voted to make the following recommendations to the Santa Clara County Cities Association: By July 1, 2013, jurisdictions within Santa Clara County make a decision to adopt an ordinance which would be implemented by July 1, 2014— banning expanded polystyrene food and beverage containers at all food vendors in jurisdictions within Santa Clara County and /or consider adopting an ordinance requiring that all food vendors within the jurisdiction use only containers that are accepted and processed through the jurisdiction's landfill diversion program with the understanding that EPS will not be collected for recycling. m By July 1, 2015 (if this was not undertaken previously) each jurisdiction within Santa Clara County strongly consider a long term plan (with. their franchise agreements in mind) that would require all food vendors within the jurisdiction to use only containers that are accepted and processed through the jurisdiction's landfill diversion program with the understanding that EPS will not be collected for recycling. In FY 2013/14, staff will bring forward a recommendation to the Town Council to pursue an EPS ordinance subsequent to the adoption and implementation of an ordinance for single -use carryout bags. Other cities have also taken steps to adopt ordinances or implement policies that limit the use of EPS, including Cupertino, Gilroy, Morgan Hill, Mountain View, Palo Alto, San Jose, and Sunnyvale. CONCLUSION: The use of plastic bags contributes to a negative environmental impact on air quality, biological resources, greenhouse gas emissions, and water quality. Eliminating or significantly reducing the use of these products will reduce the environmental impacts related to the use of single -use carryout bags, and would promote a shift toward the use of reusable bags. Staff seeks Council direction to move ahead with this ordinance and whether future consideration should be given to the regulation of EPS. ENVIRONMENTAL ASSESSMENT: The EIR for the regional model ordinance has been completed and would be sufficient for the Los Gatos ordinance. If the Council would like to alter any of the components put forth within this report, additional environmental analysis may be necessary. FISCAL IMPACT: The public outreach process will have impacts to the general fund; primarily in the marketing and notification to community stakeholders prior to the ordinance taking effect, but these are anticipated to be one -time costs estimated at $10,000 to $15,000. Attachments: 1. Public comments received from April 30, 2013 through 12:00 p.m, on Thursday, May 2, 2013 THIS PAGE INTENTIONALLY LEFT BLANK From: Time Out <ginger @timeoutclothing.com> Sent: Tuesday, April 30, 2013 5:13 PM To: Council Subject: New Bag Ordinance Hello to all my friends that serve on the Council, and to those of you who don't know me I own Time Out Clothing located at 108 N. Santa Cruz. Well, I generally like to lay low, but I feel that it is time for me to pull out my "soap box" again.... I spoke with the Town Manager and Economic Vitality Director, and briefly the Chamber regarding the "Bag Ordinance" that will be up for discussion this coming Monday night. As a Merchant in town, I would like to take a couple of minutes to offer some points that I hope you consider when discussing this issue. I am hoping to get there this Monday, but I have two other off site requirements next week, and I hate being'away from my family too many nights in a row, but I am going to really try to get there... I understand that the "type" of bag that you are discussing may be very specific, and it may not really apply to all types of bags used by boutiques located in Los Gatos. I will only be able to address my concerns and points, but I will list them.... • We use our bags as much as advertising and marketing as we do function. • We use our bags as our gift wrap also, to cut back on extra boxes and gift wrap. • If we must charge for bags, how do I account for sales tax and reporting for that? Is that a separate line item to the state board of equalization? • I have 3 different size bags, and to say .10 for one and .25 for the other ... I'm thinking all the customers would then want a big bag, which is very $$$ I prefer to give them small when possible, but if they are being charged, they may ask for large size? • I feel like fewer people are asking for bags now, and we have started the re -use reward program with our customers, and is turning out to be fairly successful. • I'm at a point now that we need to reorder some bags soon, and I have to buy in large quantity to keep the cost affordable, and just looking for directions before doing that. • Most important to me .... SHOPLIFTING! When we see people carrying around bags from other towns, we are very suspicious of them .... it makes it very easy to shoplift when carrying large bags, and we have definitely had more than our share of shoplifters in town lately... Happy to discuss further if anyone has any other points or questions. Thanks again for your time! Ginger Rowe Time Out Clothing 108 N. Santa Cruz Ave. Los Gatos, CA 95030 (408)354 -8653 ginger(a�timeoutclothing.com ATTACHMENT 1