California Governor Gavin Newsom vetoed AB 1817, delaying mandatory recycled content claims for plastic products, citing economic concerns.
California Governor Gavin Newsom vetoed Assembly Bill 1817 on September 28, 2023, effectively blocking legislation that would have mandated recycled content claims for plastic products sold in the state.
This decision impacts manufacturers, brands, and the recycling industry by removing a key driver for demand in post-consumer recycled plastics, potentially slowing investment in reprocessing infrastructure and creating uncertainty for producers aiming to meet sustainability targets.
California's Recycled Content Claims Bill Stalls Amid Economic Headwinds
AB 1817, authored by Assemblymember Phil Ting, aimed to establish a clear framework for recycled content claims, requiring manufacturers to substantiate percentages of post-consumer recycled material in their plastic products. The bill sought to prevent greenwashing and provide consumers with accurate information, building on California's existing leadership in extended producer responsibility (EPR) and recycled content mandates for specific product categories like beverage containers and plastic trash bags.
- Governor Newsom cited "significant economic headwinds" as the primary reason for his veto.
- The bill proposed that manufacturers verify recycled content claims through third-party auditing and provide public documentation.
- AB 1817’s scope included a broad range of plastic products, moving beyond existing mandates for specific items.
- Environmental advocates and recycling industry groups largely supported the bill, viewing it as crucial for market development.
- The veto occurred during a period of budget surplus concerns for California, despite the state's prior commitment to ambitious environmental goals.
Industry Impact and Regulatory Uncertainty
The veto of AB 1817 introduces regulatory uncertainty for companies operating within California and those supplying the California market. Without a clear legislative framework for recycled content claims, brands face challenges in communicating their sustainability efforts credibly, while recyclers lose a potential market signal for increased material demand. This move could disincentivize private investment in advanced recycling technologies and infrastructure needed to process more complex plastic waste streams. While some companies have voluntarily adopted recycled content goals, the absence of a statewide mandate reduces pressure across the broader industry, potentially impacting material recovery rates for plastics.
What This Means for Recyclers
Recyclers must now recalibrate their expectations regarding legislative drivers for recycled plastic demand in California. The veto signals a cautious approach from the state government on new mandates, particularly those with potential compliance costs for manufacturers. Operators should continue to monitor voluntary corporate commitments and federal initiatives, as these may become the primary demand drivers in the near term. Investment decisions in new plastics reprocessing capacity will likely remain tied to existing, specific mandates and direct supply agreements with brands rather than anticipating broad legislative support for recycled content claims.
