HF 872 (LSB 2758HZ (1) 89)

HOUSE FILE 872

BY  COMMITTEE ON WAYS AND MEANS

(SUCCESSOR TO HF 814)
(SUCCESSOR TO HSB 252)

A BILL FOR

An Act relating to the redemption of beverage containers, providing civil penalties, and including effective date provisions.
BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF IOWA:

    Section 1.  Section 455C.1, subsections 1 and 6, Code 2021, are 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.
   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. 2.  Section 455C.1, Code 2021, 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. 3.  Section 455C.2, Code 2021, 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 a 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.  In addition to the refund value provided in subsection 1 of this section, a participating dealer, 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 that is one cent 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. 4.  Section 455C.3, subsections 1, 2, and 4, Code 2021, 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 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. 5.  Section 455C.4, Code 2021, 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 dealer agent, 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 dealer enters a contract with a dealer agent or redemption center who will accept beverage containers on the dealer’s behalf.  A dealer may only enter a contract with a redemption center under this subsection if the dealer’s place of business is in a county with a population of more than thirty thousand and within ten miles of the redemption center or if the dealer’s place of business is in a county with a population of thirty thousand or fewer and within fifteen miles of the redemption center.
   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 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 dealer agent from a dealer outside the geographic territory served by the manufacturer or distributor.
    Sec. 6.  Section 455C.5, subsection 1, Code 2021, 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. 7.  Section 455C.6, subsections 1, 2, and 5, Code 2021, 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 Written notice of the operation of a 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. 8.  Section 455C.6, subsections 3 and 4, Code 2021, are amended by striking the subsections.
    Sec. 9.  Section 455C.12, subsections 2 and 3, Code 2021, 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, dealer agent, 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, dealer agent, 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. 10.  Section 455C.12, Code 2021, 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 that shall be established, assessed, and collected in the same manner as provided in section 455B.109, but shall not exceed two thousand five hundred dollars. Any civil penalty collected under this chapter shall be deposited in the general fund of the state.
    Sec. 11.  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 the 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. 12.  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. 13.  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 or the provisions of this chapter or any rules adopted or permit or order issued pursuant to this chapter.
   2.  Any person who violates an order issued pursuant to section 455C.12A shall be subject to a civil penalty, not to exceed two thousand five hundred dollars for each day of such violation.
    Sec. 14.  Section 455C.13, Code 2021, is amended to read as follows:
   455C.13  Distributors’ agreements authorized.
   1.  A distributor, dealer, or 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 collection or disposal of empty beverage containers shall not be deemed to interfere with the refund value pursuant to section 455C.2. A contract shall not authorize a person to offer and pay a refund value of less than five cents.
    Sec. 15.  Section 455C.14, subsection 1, Code 2021, 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. 16.  REPEAL.  Sections 455C.7 and 455C.10, Code 2021, are repealed.
    Sec. 17.  EFFECTIVE DATE.  This Act takes effect July 1, 2023.
EXPLANATION
The inclusion of this explanation does not constitute agreement with
the explanation’s substance by the members of the general assembly.
   Under current law, a consumer may return an empty beverage container upon which a refund value has been paid to a dealer or a redemption center. When a distributor collects empty beverage containers from a dealer, dealer agent, or redemption center, the distributor reimburses the dealer, dealer agent, or redemption center the refund value plus a 1-cent handling fee for each empty beverage container. Current law also allows any person to establish a redemption center that serves a dealer if it is approved by the department of natural resources. Any person can also establish an unapproved redemption center.
   Under this bill, a dealer may choose to not accept beverage containers if the dealer enters into a contract with a dealer agent or redemption center who will accept beverage containers on the dealer’s behalf. A dealer may only enter such contract with a redemption center if the dealer’s place of business is in a county with a population of more than 30,000 and within 10 miles of the redemption center or if the dealer’s place of business is in a county with a population of 30,000 or fewer and within 15 miles of the redemption center. 
   The bill amends the definition of “dealer agent” so that a dealer agent is not limited to soliciting or picking up empty beverage containers from a dealer. The bill allows a person to establish a redemption center by providing notice to the department. The bill also requires each beverage container to have a registered universal product code in a format required by the department. 
   The bill creates civil enforcement procedures and penalties for a violation of the provisions of the bill, including a civil penalty of up to $2,500. 
   The bill makes numerous changes throughout Code chapter 455C to change instances of “dealer” to “participating dealer”, remove obsolete language, and stylistically and grammatically update the Code chapter.
   The bill takes effect July 1, 2023.