HF 2534 (LSB 5256HV (1) 88)

HOUSE FILE 2534

BY  COMMITTEE ON STATE GOVERNMENT

(SUCCESSOR TO HSB 507)

A BILL FOR

An Act relating to the applicability of beverage container control provisions, handling fees, and acceptance of beverage containers, making penalties applicable, and providing effective date provisions.
BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF IOWA:

    Section 1.  Section 455C.1, subsection 1, Code 2020, is amended to read as follows:
   1.  “Beverage” means wine as defined in section 123.3, subsection 54, alcoholic liquor as defined in section 123.3, subsection 5, beer as defined in section 123.3, subsection 7, high alcoholic content beer as defined in section 123.3, subsection 22, canned cocktail as defined in section 123.3, subsection 11, mineral water, soda water, and similar carbonated soft drinks in liquid form and intended for human consumption.
    Sec. 2.  Section 455C.1, subsection 6, Code 2020, is amended to read as follows:
   6.  “Dealer agent” means a person who solicits or picks up empty beverage containers from a dealer for the purpose of returning the empty beverage containers to a distributor or manufacturer.
    Sec. 3.  Section 455C.1, Code 2020, is amended by adding the following new subsection:
   NEW SUBSECTION.  12A.  “Participating dealer” means a dealer who accepts the return of empty beverage containers from a consumer.
    Sec. 4.  Section 455C.2, Code 2020, is amended to read as follows:
   455C.2  Refund values.
   1.  A refund value of not less than five cents shall be paid by the consumer on each beverage container sold in this state by a dealer for consumption off the premises. Upon return of the empty beverage container upon which a refund value has been paid to the participating dealer or person operating a redemption center and acceptance of the empty beverage container by the participating dealer or person operating a redemption center, the participating dealer or person operating a redemption center shall immediately return the amount of the refund value to the consumer.  Upon return of the empty beverage container on which a refund value has been paid to a dealer agent, the dealer agent shall return the amount of the refund value to the consumer within a reasonable time.
   2.  Upon delivery of beverages from a distributor to a dealer, the dealer shall pay a one-cent handling fee per container to the distributor.  In addition to the refund value provided in subsection 1 of this section, a participating dealer, dealer agent, or person operating a redemption center who redeems empty beverage containers or a dealer agent shall be reimbursed by the distributor required to accept the empty beverage containers an amount which a handling fee that is one cent two cents per container. A participating dealer, dealer agent, or person operating a redemption center may compact empty metal beverage containers with the approval of the distributor required to accept the containers.
    Sec. 5.  Section 455C.3, subsections 1, 2, and 4, Code 2020, are amended to read as follows:
   1.  A participating dealer shall not refuse to accept from a consumer any empty beverage container of the kind, size and brand sold by the participating dealer, or refuse to pay to the consumer the refund value of a beverage container as provided under section 455C.2.
   2.  A distributor shall accept and pick up from a participating dealer served by the distributor or a redemption center for a dealer served by the distributor at least weekly, or when the distributor delivers the beverage product if deliveries are less frequent than weekly, any empty beverage container of the kind, size, and brand sold by the distributor, and shall pay to the participating dealer or person operating a redemption center the refund value of a beverage container and the reimbursement as provided under section 455C.2 within one week following pickup of the containers or when the participating dealer or redemption center normally pays the distributor for the deposit on beverage products purchased from the distributor if less frequent than weekly. A distributor or employee or agent of a distributor is not in violation of this subsection if a redemption center is closed when the distributor attempts to make a regular delivery or a regular pickup of empty beverage containers. This subsection does not apply to a distributor selling alcoholic liquor to the alcoholic beverages division of the department of commerce.
   4.  A distributor shall accept from a dealer agent any empty beverage container of the kind, size, and brand sold by the distributor and which that was picked up by the dealer agent from a participating dealer within the geographic territory served by the distributor and the distributor shall pay the dealer agent the refund value of the empty beverage container and the reimbursement as provided in section 455C.2.
    Sec. 6.  Section 455C.4, Code 2020, is amended to read as follows:
   455C.4  Refusal to accept containers.
   1.  Except as provided in section 455C.5, subsection 3, a participating dealer, a person operating a redemption center, a distributor, or a manufacturer may refuse to accept any empty beverage container which that does not have stated on it a refund value as provided under section 455C.2.
   2.  A dealer may refuse to accept and to pay the refund value of any empty beverage container if the place of business of the dealer and the kind and brand of empty beverage containers are included in an order of the department approving a redemption center under section 455C.6 after providing notice to the department and if the place of business of the dealer is located within a ten-mile radius of a redemption center or dealer agent.
   3.  A dealer or a distributor may refuse to accept and to pay the refund value of an empty wine or alcoholic liquor container which is marked to indicate that it was sold by a state liquor store. The alcoholic beverages division shall not reimburse a dealer or a distributor the refund value on an empty wine or alcoholic liquor container which is marked to indicate that the container was sold by a state liquor store.
   4.  3.  A class “E” liquor control licensee may refuse to accept and to pay the refund value on an empty alcoholic liquor container from a participating dealer or a redemption center or from a person acting on behalf of or who has received empty alcoholic liquor containers from a participating dealer or a redemption center.
   5.  4.  A manufacturer or distributor may refuse to accept and to pay the refund value and reimbursement as provided in section 455C.2 on any empty beverage container that was picked up by a participating dealer agent from a dealer outside the geographic territory served by the manufacturer or distributor.
    Sec. 7.  Section 455C.5, subsection 1, Code 2020, is amended to read as follows:
   1.  Each beverage container sold or offered for sale in this state by a dealer shall clearly indicate the refund value of the container by embossing or by a stamp, label, or other method securely affixed to the container, the refund value of the container. The department shall specify, by rule, the minimum size of the refund value indication on the beverage containers and require registration of the universal product code for each beverage container in a format required by the department.
    Sec. 8.  Section 455C.6, subsections 1, 2, and 5, Code 2020, are amended to read as follows:
   1.  To facilitate the return of empty beverage containers and to serve dealers of beverages, any person may establish a redemption center, subject to the approval of the department, at which consumers may return empty beverage containers and receive payment of the refund value of such beverage containers.
   2.  An application for approval of a A person operating a redemption center shall file written notice of the operation of the redemption center shall be filed with the department. The application notice shall state the name and address of the person responsible for the establishment and operation of the redemption center, the kind and brand names of the beverage containers which will be accepted at the redemption center, and the names and addresses of the dealers to be served by the redemption center. The application notice shall contain such other information as the director may reasonably require.
   5.  All approved redemption centers shall meet applicable health standards.
    Sec. 9.  Section 455C.6, subsections 3 and 4, Code 2020, are amended by striking the subsections.
    Sec. 10.  Section 455C.12, subsections 2 and 3, Code 2020, are amended to read as follows:
   2.  A distributor who collects or attempts to collect a refund value on an empty beverage container when the distributor has paid the refund value on the container to a participating dealer, redemption center, or consumer is guilty of a fraudulent practice.
   3.  Any person who does any of the following acts is guilty of a fraudulent practice:
   a.  Collects or attempts to collect the refund value on the container a second time, with the knowledge that the refund value has once been paid by the distributor to a participating dealer, redemption center, or consumer.
   b.  Manufactures, sells, possesses, or applies a false or counterfeit label or indication which that shows or purports to show a refund value for a beverage container, with intent to use the false or counterfeit label or indication.
   c.  Collects or attempts to collect a refund value on a container with the use of a false or counterfeit label or indication showing a refund value, knowing the label or indication to be false or counterfeit.
    Sec. 11.  Section 455C.12, Code 2020, is amended by adding the following new subsection:
   NEW SUBSECTION.  6.  A person who violates any provision of this chapter shall be subject to a civil penalty of two thousand five hundred dollars per violation, which shall be assessed and collected in the same manner as provided in section 455B.109. Any civil penalty collected shall be deposited in the general fund of the state.
    Sec. 12.  NEW SECTION.  455C.12A  Administrative enforcement —— compliance orders.
   The director may issue any order necessary to secure compliance with or prevent a violation of the provisions of this chapter or any rule adopted or permit or order issued pursuant to this chapter. The person to whom such compliance order is issued may cause to be commenced a contested case within the meaning of chapter 17A by filing within thirty days a notice of appeal to the commission. On appeal, the commission may affirm, modify, or vacate the order of the director.
    Sec. 13.  NEW SECTION.  455C.12B  Judicial review.
   Judicial review of any order or other action of the commission or director may be sought in accordance with the terms of chapter 17A. Notwithstanding the terms of chapter 17A, petitions for judicial review may be filed in the district court of the county in which the alleged offense was committed.
    Sec. 14.  NEW SECTION.  455C.12C  Civil actions for compliance —— penalties.
   1.  The attorney general, on request of the department, shall institute any legal proceedings necessary to obtain compliance with an order of the commission or the director, including proceedings for a temporary injunction, or prosecuting any person for a violation of an order of the commission or the director, the provisions of this chapter, or any rules adopted or permit or order issued pursuant to this chapter.
   2.  Any person who violates any order issued pursuant to section 455C.12A shall be subject to a civil penalty not to exceed ten thousand dollars for each day of such violation.
    Sec. 15.  Section 455C.13, Code 2020, is amended to read as follows:
   455C.13  Distributors’ agreements authorized.
   1.  A distributor, dealer, or person operating a redemption center may enter into a contract or agreement with any other distributor, manufacturer, or person for the purpose of collecting or paying the refund value on, or disposing of, beverage containers as provided in this chapter.
   2.  For purposes of this chapter, any contracts entered into pursuant to this section for the collecting or disposal of empty beverage containers shall not be deemed to interfere with the refund value pursuant to section 455C.2.
    Sec. 16.  Section 455C.14, subsection 1, Code 2020, is amended to read as follows:
   1.  If the refund value indication required under section 455C.5 on an empty nonrefillable metal beverage container is readable but the redemption of the container is lawfully refused by a participating dealer or person operating a redemption center under other sections of this chapter or rules adopted pursuant to these sections, the container shall be accepted and the refund value paid to a consumer as provided in this section. Each beer distributor selling nonrefillable metal beverage containers in this state shall provide individually or collectively by contract or agreement with a dealer, person operating a redemption center or another person, at least one facility in the county seat of each county where refused empty nonrefillable metal beverage containers having a readable refund value indication as required by this chapter are accepted and redeemed. In cities having a population of twenty-five thousand or more, the number of the facilities provided shall be one for each twenty-five thousand population or a fractional part of that population.
    Sec. 17.  REPEAL.  Sections 455C.7 and 455C.10, Code 2020, are repealed.
    Sec. 18.  EFFECTIVE DATE.  This Act takes effect July 1, 2021.
EXPLANATION
The inclusion of this explanation does not constitute agreement with

the explanation’s substance by the members of the general assembly.
   This bill relates to the beverage containers control law, also known as the bottle bill.
   Current law limits beverage containers subject to beverage containers control deposit and refund provisions to any sealed glass, plastic, or metal bottle, can, jar, or carton holding wine, alcoholic liquor, beer, mineral water, soda water, and carbonated soft drinks. When a distributor sells beverages in eligible containers to a dealer, the distributor charges 5 cents per eligible container to the sale price. When a dealer sells beverages in eligible containers to a consumer, the dealer charges the 5-cent deposit on each beverage container. A consumer can take eligible beverage containers to a dealer, dealer agent, or a redemption center and receive a 5-cent refund for every eligible beverage container that the consumer returns. A distributor collects eligible containers from a dealer, dealer agent, or redemption center, at which time the distributor pays the dealer, dealer agent, or redemption center 5 cents per eligible container plus a handling fee of an additional 1 cent per empty container.
   The bill adds high alcoholic content beer and canned cocktails to the definition of “beverage”. The bill creates a definition for “participating dealer”. The bill requires any dealer to pay a 1-cent handling fee to a distributor upon delivery of beverages and increases the handling fee that a participating dealer, dealer agent, or redemption center will charge a distributor from 1 cent to 2 cents. The bill requires a participating dealer to accept and pay the refund value of any beverage container, except as currently provided by law. The bill requires a participating dealer or a redemption center to immediately return the refund value to a consumer upon the return and acceptance of a beverage container for which the refund value has been paid. However, a dealer agent shall return the refund value to a consumer within a reasonable time for the return of a beverage container for which the refund value has been paid. A dealer can choose to not be a participating dealer by providing notice to the department of natural resources and only if the place of business of the dealer is within a 10-mile radius of a redemption center or dealer agent. The bill requires the registration of the universal product code for each beverage container in a format provided by the department. The bill requires a redemption center to file a notice with the department but does not require the department to grant approval for any redemption centers. The bill removes provisions of Code chapter 455C that relate to the department’s authority to approve redemption centers. The bill also allows a dealer or person operating a redemption center to enter into contracts or agreements for the collection or disposal of beverage containers.
   The bill authorizes the department to establish a civil penalty of $2,500 for a violation of any provision of Code chapter 455C. The bill allows the department to issue compliance orders, subject to judicial review, that may be enforced by the attorney general’s office. A violation of a compliance order is subject to a fine of not more than $10,000 per day per violation.
   The bill takes effect July 1, 2021.