Illinois General Assembly - Full Text of SB3692
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Full Text of SB3692  102nd General Assembly




State of Illinois
2021 and 2022


Introduced 1/21/2022, by Sen. Linda Holmes


New Act

    Creates the Paint Stewardship Act. Contains the findings of the General Assembly. Provides that manufacturers of architectural paint sold at retail in the State or representative organizations shall submit to the Director of the Environmental Protection Agency a plan for the establishment of a postconsumer paint stewardship program. Requires the program to meet specified requirements. Provides that manufacturers or retailers shall not sell or offer for sale architectural paint to any person in the State unless the manufacturer of a paint brand or representative organization is implementing an approved paint stewardship plan. Prohibits the incineration of leftover architectural paint collected pursuant to an approved paint stewardship plan. Provides that manufacturers or representative organizations shall submit reports with specified requirements. Provides that manufacturers or representative organizations participating in a postconsumer paint stewardship program shall not be liable for any claim of a violation of antitrust, restraint of trade, unfair trade practice, or other anticompetitive conduct arising from conduct undertaken in accordance with the program. Provides administrative and oversight fees to be paid to the Agency. Provides that manufacturers or representative organizations shall implement the postconsumer paint collection plan within 6 months of the date that the program plan is approved. Contains provisions regarding postconsumer paint from households and small businesses. Contains other provisions.

LRB102 22934 CPF 32088 b





SB3692LRB102 22934 CPF 32088 b

1    AN ACT concerning safety.
2    Be it enacted by the People of the State of Illinois,
3represented in the General Assembly:
4    Section 1. Short title. This Act may be cited as the Paint
5Stewardship Act.
6    Section 5. Findings. The General Assembly finds that:
7    (1) Leftover architectural paints present significant
8waste management issues for counties and municipalities.
9Managing the end-of-life of architectural paint can be costly
10and present environmental, health, and safety risks if not
11properly managed.
12    (2) Nationally, an estimated 10% of architectural paint
13purchased by consumers is leftover. Current governmental
14programs collect only a fraction of the potential leftover
15paint for proper reuse, recycling, or disposal. In northern
16Illinois, there are only 4 permanent household hazard waste
17facilities and these facilities do not typically accept latex
18paint, the most common paint purchased by consumers.
19    (3) It is in the best interest of this State for paint
20manufacturers to assume responsibility for development and
21implementation of a cost-effective paint stewardship program
22that will: educate consumers on strategies to reduce the
23generation of leftover paint; provide opportunities to reuse



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1leftover paint; and collect, transport, and process leftover
2paint for end-of-life management, including reuse, recycling,
3energy recovery, and disposal. Requiring paint manufacturers
4to assume responsibility for the collection, recycling, reuse,
5transportation, and disposal of leftover paint will provide
6more opportunities for consumers to properly manage their
7leftover paint, provide fiscal relief for this State and local
8governments in managing leftover paint, keep paint out of the
9waste stream, and conserve natural resources.
10    (4) Similar architectural paint stewardship programs are
11currently operating in 9 jurisdictions and are successfully
12diverting a significant portion of the collected paint waste
13from landfills. These paint stewardship programs are saving
14counties and municipalities the cost of managing paint waste
15and have been successful at recycling leftover paint into
16recycled paint products as well as other products. For
17instance, in the state of Oregon, 64% of the latex paint
18collected in the 2019-2020 fiscal year was recycled into paint
19products; and, in Minnesota, 48% of the latex paint collected
20during the same time period was reused or recycled into paint
21products. Given the lack of access to architectural paint
22collection programs in Illinois, especially for leftover latex
23architectural paint, and the demonstrated ability of the paint
24industry to collect and recycle a substantial portion of
25leftover architectural paint, this legislation is necessary.
26It will create a statewide program that diverts a significant



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1portion of paint waste from landfills and facilitates
2recycling of leftover paint into paint and other products.
3    (5) Establishing a paint stewardship program in Illinois
4will create jobs as the marketplace adjusts to the needs of a
5robust program that requires transporters and processors.
6Certain infrastructure already exists in the State and the
7program may attract additional resources.
8    (6) Legislation is needed to establish this program in
9part because of the risk of antitrust lawsuits. The program
10involves activities by competitors in the paint industry and
11may affect the costs or prices of those competitors. As
12construed by the courts, the antitrust laws impose severe
13constraints on concerted action by competitors that affect
14costs or prices. Absent State legislation, participation in
15this program would entail an unacceptable risk of class action
16lawsuits. The risk can be mitigated by legislation that would
17bar application of federal antitrust law under the "state
18action" doctrine. Under that doctrine, federal antitrust law
19does not apply to conduct that is (1) undertaken pursuant to a
20clearly expressed and affirmatively articulated state policy
21to displace or limit competition, and (2) actively supervised
22by the State.
23    (7) To ensure that this defense will be available to
24protect participants in the program, it is important for State
25legislation to be specific about the conduct it is authorizing
26and to express clearly that the State is authorizing that



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1conduct pursuant to a conscious policy decision to limit the
2unfettered operation of market forces. It is also critical for
3the legislation to provide for active supervision of the
4conduct that might otherwise be subject to antitrust attack.
5In particular, the legislation must provide for active
6supervision of the decisions concerning the assessments that
7will fund the program. A clear articulation of the State's
8purposes and policies and provisions for active State
9supervision of the program will ensure that industry
10participation in the program will not trigger litigation.
11    (8) To ensure that the costs of the program are
12distributed in an equitable and competitively neutral manner,
13the program will be funded through an assessment on each
14container of paint sold in this State. That assessment will be
15sufficient to recover, but not exceed, the costs of sustaining
16the program and will be reviewed and approved by the Illinois
17Environmental Protection Agency. Funds collected through the
18assessment will be used by the representative organization to
19operate and sustain the program.
20    Section 10. Definitions. In this Section:
21    "Agency" means the Environmental Protection Agency.
22    "Architectural paint" means interior and exterior
23architectural coatings sold in containers of 5 gallons or
24less. "Architectural paint" does not include industrial
25original equipment or specialty coatings.



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1    "Collection site" means any location or event at which
2architectural paint is accepted into a postconsumer paint
3collection program pursuant to a postconsumer paint collection
4program plan.
5    "Director" means the director of the Environmental
6Protection Agency.
7    "Environmentally sound management practices" means
8procedures for the collection, storage, transportation, reuse,
9recycling, and disposal of architectural paint to be
10implemented by a manufacturer or representative organization
11or by the manufacturer's or representative organization's
12contracted partners to comply with all applicable federal,
13State, and local laws and any rules, regulations, and
14ordinances for the protection of human health and the
15environment. These procedures shall address adequate record
16keeping, tracking and documenting of the final disposition of
17materials, and appropriate environmental liability coverage
18for the representative organization.
19    "Household waste" has the same meaning as defined in 40
20CFR 261.4(b)(1).
21    "Postconsumer paint" means architectural paint not used
22and no longer wanted by a purchaser.
23    "Manufacturer" means a manufacturer of architectural paint
24who sells, offers for sale, or distributes the architectural
25paint in the State under the manufacturer's own name or brand.
26    "Program" means the postconsumer paint stewardship program



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1established pursuant to Section 15.
2    "Recycling" means a method, technique, or process designed
3to remove any contaminant from waste so as to render the waste
4reusable, or any process by which materials that would
5otherwise be disposed of or discarded are collected,
6separated, or processed and returned to the economic
7mainstream in the form of raw materials or products.
8    "Representative organization" means a nonprofit
9organization established by a manufacturer to implement the
10postconsumer paint stewardship program.
11    "Retailer" means a company that offers architectural paint
12or other allied products for retail sale in the State.
13    "Very small quantity generator" has the same meaning as
14defined in 40 CFR 260.10.
15    Section 15. Paint stewardship program plan.
16    (a) A manufacturer of architectural paint sold at retail
17in the State or a representative organization shall submit to
18the Director a plan for the establishment of a postconsumer
19paint stewardship program. The program shall seek to reduce
20the generation of postconsumer paint, promote its reuse and
21recycling, and manage the waste stream using environmentally
22sound management practices.
23    (b) The plan submitted by the manufacturer or
24representative organization to the Agency under this Section



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1        (1) Provide a list of participating manufacturers and
2    brands covered by the program.
3        (2) Provide information on the architectural paint
4    products covered under the program, such as interior or
5    exterior water-based and oil-based coatings, primers,
6    sealers, or wood coatings.
7        (3) Describe how it will provide for convenient and
8    cost-effective statewide collection of postconsumer
9    architectural paint in the State. The manufacturer or
10    representative organization may coordinate the program
11    with existing household hazardous waste collection
12    infrastructure as is mutually agreeable. A paint retailer
13    may be authorized by the manufacturer or representative
14    organization as a paint collection site if the paint
15    retailer volunteers to act as such, complies with all
16    applicable laws, rules, and regulations, and the retail
17    location is consistent with the maintenance of a
18    cost-effective network of paint collection locations.
19        (4) Establish a goal for the number and geographic
20    distribution of collection sites for postconsumer
21    architectural paint using geographic modeling and the
22    following criteria:
23            (A) at least 90% of State residents shall have a
24        collection site within a 15-mile radius; and
25            (B) one site shall be available for every 50,000
26        residents of an Urbanized Area, as defined by the U.S.



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1        Census Bureau, unless otherwise approved by the
2        Director.
3        (5) Describe how postconsumer paint will be managed in
4    an environmentally and economically sound manner using the
5    following strategies and in the following order: reuse,
6    recycling, energy recovery, and disposal. Incineration
7    within the State shall not be utilized.
8        (6) Describe education and outreach efforts to inform
9    consumers about the program. These materials should
10    include:
11            (A) information about collection opportunities for
12        postconsumer paint;
13            (B) information about the fee for the operation of
14        the program that shall be included in the purchase
15        price of all architectural paint sold in the State;
16        and
17            (C) efforts to promote the source reduction,
18        reuse, and recycling of architectural paint.
19        (7) Be reviewed by an independent auditor to assure
20    that any added fee to paint sold in the State as a result
21    of the postconsumer paint stewardship program does not
22    exceed the costs to operate and sustain the program in
23    accordance with sound management practices. The
24    independent auditor shall verify that the amount added to
25    each unit of paint will cover the costs and sustain the
26    postconsumer paint stewardship program.



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1    (c) A manufacturer or representative organization shall
2select the independent auditor under paragraph (7) of
3subsection (b) in consultation with the Agency. The Agency
4shall review the work product of the independent auditor. The
5cost of any work performed by the independent auditor shall be
6funded by the program.
7    (d) Not later than 60 days after submission of the plan
8under this Section, the Director shall make a determination in
9writing whether to approve the plan as submitted or disapprove
10the plan.
11    (e) The Agency shall enforce the plan and may, by rule or
12regulation, establish enforcement procedures. If circumstances
13require an adjustment of the paint stewardship fee, the
14manufacturer or representative organization shall request the
15adjustment by submitting to the Agency a justification for the
16adjustment as well as financial reports to support the
17request, including a 5-year projection of the financial status
18of the organization. The Agency shall review the request to
19determine if the proposed fee adjustment will generate
20revenues sufficient to pay the program expenses, including any
21accumulated debt, and develop a reasonable reserve level
22sufficient to sustain the program. If a decrease in the paint
23fee is requested, the Agency shall review the request to
24determine if the proposed fee adjustment and the resulting
25decreased revenue is sufficient to pay program expenses and
26maintain a reasonable reserve level sufficient to sustain the



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2    (f) No later than the implementation date of the program,
3information regarding the approved plan, the names of
4participating manufacturers, and the brands of architectural
5paint covered by the program shall be posted on the Agency's
6website and on the website of the manufacturer or
7representative organization.
8    (g) Upon implementation of the program, each manufacturer
9shall include in the price of any architectural paint sold to
10retailers and distributors in the State the per container
11amount in the approved program plan. Manufacturers are
12responsible for filing, reporting, and remitting the paint
13stewardship assessment for each container of architectural
14paint to the representative organization. A retailer or
15distributor shall not deduct this amount from the purchase
17    Section 20. Incineration prohibited. No person may
18incinerate leftover architectural paint collected pursuant to
19an approved paint stewardship plan as required by Section 15.
20    Section 25. Plan submission. The plan required by Section
2115 shall be submitted not later than 12 months after the
22authorization of the program is final. The Agency may grant an
23extension of time to submit the plan for good cause.



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1    Section 30. Sale of paint.
2    (a) A manufacturer or retailer shall not sell or offer for
3sale architectural paint to any person in the State unless the
4manufacturer of a paint brand or the manufacturer's
5representative organization is implementing an approved paint
6stewardship plan as required by Section 15.
7    (b) A retailer shall be in compliance with this Act if, on
8the date the architectural paint was offered for sale, the
9retailer's manufacturer is listed on the Agency's website as
10implementing or participating in an approved program or if the
11paint brand is listed on the Agency's website as being
12included in the program.
13    (c) A paint collection site authorized under the
14provisions of this Act shall not charge any additional amount
15for the disposal of paint when it is offered for disposal.
16    (d) No retailer is required to participate in a paint
17stewardship program as a collection site. A retailer may
18participate as a paint collection site on a voluntary basis.
19    (e) Nothing in this Act shall require a retailer to track,
20file, report, submit, or remit a paint stewardship assessment,
21sales data, or any other information on behalf of a
22manufacturer, distributor, or representative organization.
23    Section 35. Liability. A manufacturer or representative
24organization participating in a postconsumer paint stewardship
25program shall not be liable for any claim of a violation of



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1antitrust, restraint of trade, unfair trade practice, or other
2anticompetitive conduct arising from conduct undertaken in
3accordance with the program.
4    Section 40. Annual report. Annually, a manufacturer or
5representative organization shall submit a report to the
6Agency that details the program. The report shall include:
7        (1) a description of the methods used to collect and
8    transport postconsumer paint collected in the State;
9        (2) the volume and type of postconsumer paint
10    collected and a description of the methods used to process
11    the paint, including reuse, recycling, and other methods;
12        (3) samples of educational materials provided to
13    consumers of architectural paint; and
14        (4) the total cost of the program and an independent
15    financial audit. An independent financial auditor shall be
16    chosen by the manufacturer or representative organization.
17    The report or information relating to the report shall be
18    posted on the Agency's website and on the website of the
19    manufacturer or representative organization.
20    Section 45. Annual report submission. A manufacturer or
21representative organization shall submit the first annual
22report detailing the postconsumer paint collection program as
23required by Section 15 to the Director within 14 months
24following implementation of the program, and annually



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1thereafter. The Agency may extend the time for submission of
2the annual report for cause shown.
3    Section 50. Disclosure. Financial, production, or sales
4data reported to the Agency by a manufacturer, retailer, or
5representative organization shall not be subject to
6disclosure, but the Director may release a summary form of the
7data that does not disclose financial, production, or sales
8data of the manufacturer, retailer, or representative
10    Section 55. Program plan submission fee. A manufacturer or
11representative organization submitting a program plan shall
12pay an administrative fee to the Agency at the time of
13submission. The Agency may establish a variable fee based on
14relevant factors, including, but not limited to, the portion
15of architectural paint sold in the State by members of the
16manufacturer or representative organization compared to the
17total amount of architectural paint sold in the State by all
18manufacturers or representative organizations that submit a
20    Section 60. Oversight fee. A manufacturer or
21representative organization operating a stewardship program
22shall pay to the Agency the costs it incurs in overseeing the
23stewardship program. The Agency shall set the fee at an amount



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1that, when paid by every manufacturer or representative
2organization that submits a plan, is adequate to reimburse the
3Agency's full costs of administering this Act. The total
4amount of annual fees collected under this Section must not
5exceed the amount necessary to reimburse costs incurred by the
6Agency to administer this Act.
7    Section 65. Timing of oversight fee. A manufacturer or
8representative organization subject to Section 60 must pay the
9Agency's administrative fee annually. Each year after the
10initial payment, the annual administrative fee may not exceed
115% of the aggregate stewardship fee added to the cost of all
12architectural paint sold by manufacturers in the State for the
13preceding calendar year. The Agency may extend the time for
14payment upon good cause shown.
15    Section 70. Implementation. A manufacturer or
16representative organization shall implement the postconsumer
17paint collection plan within 6 months of the date that the
18program plan is approved. The Agency may extend the date of
19implementation for good cause shown.
20    Section 75. Postconsumer paint from households and small
22    (a) Generators of household waste and very small quantity
23generators are authorized to transport or send their



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1architectural paints to a paint collection site to the extent
2permitted by a postconsumer paint stewardship program approved
3by the Director.
4    (b) Paint collection sites are authorized to collect and
5temporarily store architectural paints generated by persons
6specified in subsection (a), in accordance with the
7requirements of the paint stewardship program, in lieu of any
8otherwise applicable hazardous waste or solid waste laws,
9rules, or regulations.
10    (c) Nothing in this Act shall be construed as restricting
11the collection of architectural paint by a postconsumer paint
12stewardship program where the collection is authorized under
13any otherwise applicable hazardous waste or solid waste laws,
14rules, or regulations.
15    (d) Nothing in this Act shall be construed to affect any
16requirements applicable to facilities that treat, dispose, or
17recycle architectural paint under any otherwise applicable
18hazardous waste or solid waste laws, rules, or regulations.