Waste Management Committee Newsletter - American Bar Association

Vol. 9, No. 2
MESSAGE FROM THE
NEWSLETTER VICE CHAIRS
Theodore Hadzi-Antich
Co-Vice Chair, Newsletters
Andrew M. Kenefick
Co-Vice Chair, Newsletters
akenefick@wm.com
We are happy to offer this newsletter regarding the
latest and greatest developments in the world of waste.
The selections herein may be viewed as a five-course
meal. We begin with a short appetizer comprised of
welcoming words from Tom Bruen, our committee
membership vice chair, followed by a bouillon
comprised of a message from Stephen Mossman, our
committee chair, after which we serve the main course
prepared by Polly McNeill and David Wiley, regarding
an important case from the Washington State Supreme
Court dealing with municipal franchises for the
collection of construction and demolition wastes. The
vegetable of the day is a review of greenhouse gas
emission reduction projects at smaller landfills, offered
by our own resident chef Michael McLaughlin. We
conclude the meal with a desert of delectable words
setting forth issues involving the disposal of waste
electronic equipment, authored by our guest chef,
Heather Drayton. Bon Appetit’!
1
TO OUR COMMITTEE MEMBERS
Tom Bruen
Vice Chair, Membership
tbruen@sbcglobal.net
July 2008
Welcome to the Waste Management Committee!
The Waste Management committee provides a
network of lawyers whose interests include
developments in the solid waste and hazardous waste
management field. Our committee has developed an
active program for this year, including the distribution
of committee newsletters, “Quick Teleconferences”
where warranted by significant developments, and the
committee’s submittal to the Section’s The Year in
Review.
We encourage other ABA members, other Section
members, and other committee members who are not
members of the Waste Management Committee to visit
our Web site at http://www.abanet.org/environ/
committees/solidwaste/, participate with us, and join.
Remember, any member of the Section can join up to
five committees without additional charge. Also, if you
are a member, please check with your colleagues who
are not members of the Waste Management
Committee and encourage them to join us.

Waste Management
Committee Newsletter
Vol. 9, No. 2, July 2008
Theodore Hadzi-Antich and
Andrew M. Kenefick, Vice Chairs
In this issue:
Message from the Vice Chairs
Theodore Hadzi-Antich and
Andrew M. Kenefick ........................... 1
To Our Committee Members
Thomas M. Bruen.............................. 1
Message from the Chair
Stephen D. Mossman ....................... 2
Washington State Supreme Court Upholds
Municipal Franchises for Collection of
Construction and Demolition Wastes
Polly L. McNeill and David W. Wiley . 4
Greenhouse Gas Emission Projects at
Smaller Landfills
Michael W. McLaughlin, P.E. ............ 5
Waste Disposal of Electronic Equipment
Heather Drayton ................................ 9
© Copyright 2008. American Bar Association. All
rights reserved. The views expressed herein have
not been approved by the ABA House of Delegates
or the Board of Governors and, accordingly should
not be construed as representing the policy of the
ABA.
This newsletter is a publication of the ABA Section
of Environment, Energy, and Resources, and
reports on the activities of the committee. All
persons interested in joining the Section or one of
its committees should contact the Section of
Environment, Energy, and Resources, American
Bar Association, 321 N. Clark St., Chicago, IL
60654.
2
MESSAGE FROM THE CHAIR
Stephen D. Mossman
Chair, Waste Management Committee
SDM@MattsonRicketts.com
As my two-year stint as chair of the Waste
Management Committee (after serving three years as a
committee vice chair) draws to a close, I would like to
briefly reflect on the committee’s activities.
2007 and 2008 have been exciting years in the field of
waste management law. I would like to briefly list some
of the work that the Waste Management Committee
has accomplished:
In the committee’s last newsletter, the results of
a multiyear project involving a state-by-state
survey of special waste with the State and
Regional Environmental Cooperation
Committee. Vice Chair Mike McLaughlin of
SCS Engineers took the lead on this project
over the years and should be commended for
his dedication in seeing the project completed
and distributed through several mediums.
In 2007, the U.S. Supreme Court heard and
decided the United Haulers case which
dramatically changed the landscape of flow
control of solid waste. The Waste
Management Committee’s home page was the
single most comprehensive source of
information regarding this important decision
posting all amicus and party briefs as well as
detailed analyses of the arguments posed to the
Court.
Immediately following the issuance of the
United Haulers decision, the Waste
Management Committee in cooperation with
the Section’s Constitutional Law Committee
held a Quick Teleconference on the fall out of
the decision. Vice Chair David Biderman of the
National Solid Wastes Management
Association was one of the presenters at the
Teleconference and did an excellent job of
presenting issues posed by the Supreme
Court’s decision.
Vice Chair David Biderman was also a key
presenter at the 2007 Annual Conference on

Environmental Law in Keystone, Colorado,
appearing on a panel discussing waste
management issues with his focus on the
pending United Haulers case.
The Section’s The Year in Review is one of
the most important reference materials for
energy, environment, and resources
practitioners. The Waste Management
Committee made timely and comprehensive
submissions to The Year in Review in both
2006 and 2007 authored by former Vice Chair
Ashley Brown Duffie and current Vice Chair
Brian Collins who deserve special credit for
getting their work done at a very inopportune
time (right after the New Year).
The committee’s membership rolls are at 197.
Membership Vice Chair Tom Bruen should be
commended for maintaining and expanding the
committee membership.
The committee issued newsletters in May and
November 2007, along with this edition. Ted
Hadzi-Antich for two years along with Ashley
Duffie Brown and Andrew Kenefick have ably
served as vice chairs for newsletter which I can
tell you from past experience may be the most
time consuming of vice chair duties.
Vice Chair Matt Klein accepted the challenge
to serve as vice chair for Public Service and
has endeavored to find suitable projects.
Finally, a special thank you to all vice chairs of
the committee (past and present) for their
dedication and hard work. You will meet many
of the vice chair through their contributions to
this newsletter or you can check them out on
our committee’s home page at: http://www.
abanet.org/environ/committees/solidwaste/.
Each of the vice chairs along with other
committee members made important
contributions to our success.
Thank you to the membership and leadership of the
Waste Management Committee. May you all continue
to be involved in this important area of the law.
3
AMERICAN BAR ASSOCIATION
SECTION OF ENVIRONMENT,
ENERGY, AND RESOURCES
Calendar of Section Events
ABA Annual Meeting
Aug. 7-12, 2008
New York, New York
16th Section Fall Meeting
Sept. 17-20, 2008
Phoenix, Arizona
The Basic Practice Series
Sept. 19-20, 2008
Phoenix, Arizona
Interdisciplinary Solutions to
Instream Flow Problems
Oct. 7-9, 2008
San Antonio, Texas
(Cosponsored with the Instream Flow
Council)
23rd Annual Petroleum Refining
and Marketing Roundtable
Oct. 15, 2008
Austin, Texas
(In conjunction with the 31st Annual
ABA Forum on Franchising)
27th Annual Water Law Conference
Feb. 19-20, 2009
San Diego, California
38th Conference on Environmental
Law
March 12-15, 2009
Keystone, Colorado
For more information, see the
Section Web site at
www.abanet.org/environ or

WASHINGTON STATE SUPREME COURT
UPHOLDS MUNICIPAL FRANCHISES FOR
COLLECTION OF CONSTRUCTION
AND DEMOLITION WASTES
Polly L. McNeill
Summit Law Group
Seattle, Washington
pollym@SummitLaw.com
David W. Wiley
Williams Kastner
Seattle, Washington
dwiley@williamskastner.com
In February 2008, the Washington State Supreme
Court affirmed the broad powers of local government
to regulate solid waste handling, including the right to
contract for collection of construction and demolition
debris. In Joseph Ventenbergs et al. v. City of
Seattle, Waste Management and Rabanco, et al.,
____ Wn.2d. ____, 178 P.3d. 960 (2008), plaintiffs
claimed their constitutional rights to engage in a
selected livelihood were infringed by exclusive city
contracts entered into between Seattle and two
national waste companies. The 6-3 decision from the
Washington Supreme Court upheld the city’s authority
to exercise its police powers and the logical extension
of that authority to prohibit other private parties from
collecting demolition and construction debris from job
sites.
Background
In Washington, solid waste collection is regulated.
Cities can establish a municipal utility or enter into
contracts with private parties to perform the service.
In all other cases, the business is regulated by the state
utility commission. Private solid waste haulers must
have either a certificate of public convenience and
necessity from the state, or a municipal contract.
In 2001, the City of Seattle asserted jurisdiction over
collection of solid waste from commercial
establishments, and negotiated contracts with the two
private companies that had historically performed the
service under the utility commission’s oversight, Waste
4
Management and Allied Waste. Seattle had long used
private contractors for collecting from residences, and
probably for that reason the definition of “City Waste”
in the municipal code excluded “Construction,
Demolition and Landclearing Waste” (CDL). Yet the
exclusive collection rights granted to the private haulers
under the commercial contracts included CDL. So, in
2002, when the city learned that other companies were
illegally collecting debris from construction job sites, it
amended its local ordinance to clarify that the definition
of “City Waste” included CDL waste. The city then
sent notices to unauthorized haulers, informing them
that it was unlawful for anyone other than the two
contractors to haul “City Waste”—including CDL—
through the streets of Seattle.
Represented by the Institute for Justice’s legal
department, two smaller companies sued the city, a
trucking company (owned by Josef Ventenberg), and a
contractor who used the unauthorized hauler (owned
by Ronald Haider). They claimed that the city’s actions
violated the privileges and immunities clause of the
Washington state constitution in that it impermissibly
bestowed benefits on the two private contractors for
no good reason.
The Washington State Supreme Court acknowledged
the city’s broad discretion in acting under its police
powers. It held that the city’s decision to contract only
with the two companies in the collection of “City
Waste” was reasonable, and that the city did not act
improperly in limiting collection of CDL to those two
businesses or otherwise violate any state constitutional
provisions.
Analysis
Ventenbergs is consistent with other recent state
supreme court decisions in the western United States
honoring the rights of local government to control solid
waste handling, including Douglas Disposal, Inc. v.
Wee Haul, LLC, 170 P.3d. 508 (2007), WL3287566,
where the Nevada Supreme Court, in reversing a
lower court order, upheld the right of a municipality to
exclusively contract via franchise for the collection and
transportation of construction waste and disposal
within the county, and found the ordinance enacting the

franchise consistent with the county’s police powers
and constitutional under the dormant interstate
commerce clause. The Nevada court decision is also in
accord with the Idaho Supreme Court decision in
Plummer v. City of Fruitland, et al., 139 id. 810, 87
P.3d. 297 (2004), where the Idaho Court, on
rehearing, ruled that under the state constitution, Idaho
municipalities’ granting of exclusive solid waste
franchises was constitutional and not in violation of
other Idaho laws, including antitrust statutes, where the
city was properly exercising its police power in
regulating the collection of solid waste.
The Washington court in Ventenbergs did not add
much to the debate about whether CDL should be
treated differently from putrescible waste materials.
The Supreme Court recognized that CDL debris is part
of the waste stream subject to local government police
powers. However, the court relied on the fact that the
state statutory definition of “solid waste” specifically
includes CDL debris and did not otherwise rule on
plaintiffs’ argument that differences between the two
kinds of waste materials are legally significant. The
dissent suggested that there might be merit to the
argument, and in a footnote the majority deferred the
question, stating only, “Should the legislature decide to
remove CDL from the definition of solid waste, then
perhaps we could find a distinction.”
Although the Ventenbergs decision merely adds to the
bulk of jurisprudence respecting the scope of local
government’s police powers, it may ultimately be
relevant to the other frequently-litigated issue of flow
control. One of plaintiffs’ claims was that the city had
impermissibly favored the two contractors in violation
of the privileges and immunities clause of the state
constitution. The majority of the Washington Supreme
Court concluded that the right to a job in solid waste
collection is not a “fundamental right” protected by the
Washington constitution because the type of
employment sought is not private: the power to
regulate solid waste collection is vested entirely with
the Washington legislature and local government, and
there is no fundamental right to provide governmental
services. This holding triggered the lengthy dissent,
which addressed state constitutional issues not
particularly pertinent to the broader implications of the
Ventenbergs decision in the context of solid waste.
5
The authors represented before the Supreme Court
the private haulers holding contracts with the City
of Seattle. Ms. McNeill represented Waste
Management of Washington, Inc., and Mr. Wiley
represented Rabanco, Ltd.
GREENHOUSE GAS EMISSION
REDUCTION PROJECTS AT
SMALLER LANDFILLS
Michael W. McLaughlin, P.E.
Senior Vice President, SCS Engineers
Reston, Virginia
mmclaughlin@scsengineers.com
Introduction
Historically, smaller landfills have not had the same
level of attention and opportunities as larger landfills to
develop projects to productively utilize the landfill gas
(LFG). With the emergence of the tidal wave of
interest in climate change and specifically how
voluntary control of LFG can contribute to greenhouse
gas (GHG) reductions, smaller public and private
landfills suddenly have a myriad of project
development options. Because the smaller landfills are
typically not required to collect LFG, they can make an
easier claim that any collection efforts for the purpose
of GHG emissions reductions are truly voluntary and
thus “additional.”
This article will lay out the potential options available to
smaller landfills in the United States for voluntary GHG
reduction projects, and summarize financial
considerations. Briefly, a landfill can produce GHG
reduction credits by installing a gas collection and
destruction (flare) system that is not otherwise required
by law or by “business as usual.” Such credits have
value on the voluntary market now in the United
States, and may have even greater value if and when a
mandatory “cap and trade” program is implemented
either regionally or nationally.
The U.S. voluntary market can be further classified into
two major market segments, the Chicago Climate
Exchange (CCX) and the Over the Counter (OTC)

market. To date, most, if not all U.S. carbon
transactions have taken place in the voluntary markets,
with 23.7 million tonnes of carbon dioxide equivalent
(CO2e) transacted in 2006, almost 200 percent
increase over 2005 levels. Of the 23.7 million tonnes
CO2e transacted, the OTC market accounted for
about 13.4 million tonnes and the CCX accounted for
the remaining 10.3 million tonnes. The CCX traded
22.9 million tonnes of CO2e in 2007. The OTC
market also probably saw a doubling or tripling of
volume in 2007 (K. Hamilton, R. Bayon, G. Turner,
D. Higgins, “State of the Voluntary Carbon Markets
2007: Picking up Steam.”).
Voluntary markets trade in units called Verified
Emissions Reductions (VERs). A VER is a metric
tonne of CO2e. However, voluntary markets use
multiple standards (protocols) for qualifying or
measuring credits, and GHG credits derived under
different standards may have fundamental differences
(e.g., eligibility of the project, monitoring and
verification requirements, price).
How Markets Regard LFG Projects
Landfills emit LFG-containing about 50 percent
methane, and methane is a potent GHG. GHG potency
is estimated in terms of its Global Warming Potential,
which combines the heat retention characteristics of
different gases over a particular time horizon. Under
most protocols, each tonne of methane emitted by a
landfill is the equivalent of 21 tonnes of CO 2 . Because
it is relatively easy to measure actual reductions in
methane emissions from landfills that install collection
and flaring systems, theses sorts of projects are
considered high quality GHG emission reduction
projects.
The markets are looking for landfills with the following
general characteristics:
The landfill (or active cell) is not required to
have a LFG collection system by law (e.g., by
EPA’s New Source Performance Standards
(NSPS, 40 C.F.R. 60 Subpart www), or
similar state or local requirements).
NSPS requires that if a landfill has a design
capacity of more than 2.5 million tonnes, it
is required periodically to calculate its
6
emissions of non-methane organic
compounds (NMOCs) using any of
several methods. If the landfill calculates its
annual NMOC emissions are no more than
50 tonnes, the landfill is not subject to
NSPS and thus it might be able to generate
GHG credits. Under current regulations, if
the landfill calculates annual emissions of
more than 50 tonnes, then it has 30 months
to install a gas collection and control
system (but it can generate GHG credits
for up to 30 months after the failed test if
an “early capture” gas collection and
control system is installed).
The landfill can demonstrate clear ownership
rights to the environmental attributes of the
emissions reductions from the destruction of
methane.
Any existing active LFG collection systems
must be voluntarily and recently installed. The
CCX Standard, for example, allows an inservice
date for an active LFG system of after
Jan. 1, 1999. The most attractive landfills are
those with no active LFG collection system.
Those developing these projects (i.e., investing the
capital for the LFG systems) are looking for some
additional characteristics:
Good landfill geometry to extract LFG
efficiently—deeper is better.
Sufficient waste in place (greater than
1,000,000 tonnes in place).
Appropriate waste composition and age—
fresher is better.
Good landfill management practices, with no
evidence of extensive leachate issues in the
waste mass.
The markets favor landfill projects where a valid
argument that the GHG reduction credits generated by
the landfill are indeed additional. Additionally was
succinctly defined by Clean Air Cool Planet as follows:
Emissions reductions are “additional” if they occur
because of the incentives associated with the
existence of GHG markets. A variety of
additionality “tests” have been proposed, but at its
root demonstrating additionality means showing
that the emissions reductions being used as offsets

are not “business as usual,” the concept that
without the development of the GHG project,
these reductions in GHG would not have otherwise
occurred.
Clean Air Cool Planet, “A Consumers Guide to Retail
Carbon Offset Providers,” Dec. 2006.
Opportunities for Landfills in the Voluntary
Markets—CCX
The CCX is the most visible voluntary market in the
United States. The CCX functions as its own
“regulated” market, where its emitting members make
a voluntary, but legally binding commitment to meet
annual GHG emission reduction targets. Those
members who reduce below the targets have surplus
allowances to sell or bank, while those who emit above
the targets comply by purchasing allowances
(www.chicagoclimatex.com/content.jsf?id=821).
Allowances can be traded for the period 2003-2010.
The CCX has its own standard, including a
methodology for LFG destruction projects. It has
developed its own trading unit, a Carbon Financial
Instrument® (CFI®). About 9 percent of the CFI®
transactions on CCX have been landfill methane
projects (www.chicagoclimatex.com/offsets/
projectReport.jsf).
The CCX has a highly transparent financial transaction
system with excellent information available on-line
regarding price and volume of its CFI®s. Landfills with
older legacy voluntary LFG collection systems may
find the CCX protocol particularly attractive given the
early in-service (on or after Jan. 1, 1999) and the
ability to sell vintage credits (2003 and later).
Landfill owners will most likely be required to join as
full members. However, landfill owners (e.g. private
owners, waste authorities) with no other major carbon
emissions can join as Offset Providers at significantly
lower fees. There are also lower fees for municipalities
with smaller landfill projects. In 2007, membership fees
were approximately $5,000 to join and $5,000 per
year annual fee. Transaction fees are about $0.14/
tonne.
7
A landfill considering joining CCX and selling its GHG
reduction credits on the CCX, should consider the
following advantages and disadvantages:
Advantages
Transparent Internet based trading
platform for CFI® contracts.
Relatively easy registration and verification
process.
Able to sell older GHG credit vintages.
Earliest in-service date for a LFG
collection system of all standards.
Disadvantages
May require a contractual obligation to
reduce GHG emissions reductions by the
seller (This may be an advantage to those
entities that wish to show a commitment to
measurable GHG reductions).
Lack of transparency of the CFI® and its
underlying asset. CFI®s are a commodity
—a mixture of high quality actual GHG
emission reduction projects and more
dubious projects. Buyers cannot obtain
detailed information on the underlying
GHG reduction project. Buyers may be
able to obtain underlying asset information
after the sale.
High membership and transaction costs.
Potentially lower pricing when compared
to OTC.
Cannot sell forward w/o GHG reduction
obligations.
A methane potency multiplier of 18.25 vs.
21 for most other voluntary standards.
Opportunities for Landfills in the Voluntary
Markets—OTC
The OTC market offers one of the most promising
areas for a landfill to sell its GHG credits. The OTC
market is highly flexible and dynamic to address
changing market demands by buyers and sellers. The
U.S. OTC market is made up of OTC Market
Participants who directly enter into agreements with
landfills. OTC Market Participants include BlueSource,
Ecosecurities, GE-AES Greenhouse Gas Services,
Evolution Markets, NatSource, Environmental
Elements, Carbon Capital Partners, and First
Environment.

OTC Market Participants may structure GHG deals
with landfills in any of several ways:
Carbon Asset Developer—Provide all capital
to install and/or expand a LFG collection and
destruction system and to monitor and verify
the GHG credits generated, and sell the
verified GHG credits to qualified buyers over
the life of the project. In return, the landfill gets
an LFG collection system “for nothing,” and
potentially may also receive a portion of the
revenues from the GHG credit sales.
Purchase the GHG Credits—The landfill
provides the capital to install and/or expand a
LFG collection and destruction system while
the OTC Market Participant would purchase
the GHG credits for a mutually agreed pricing
structure and duration.
Hybrid—OTC Market Participants and landfill
form a joint venture, both provide investment
capital, and both share in the risks and
rewards.
Brokers—Match up interested buyers with
sellers of the GHG credits generated under a
landfill project for a fee.
The amount of risk a landfill wants to assume (including
the amount of capital it wants to put at risk) will
determine what structure is most attractive.
While the OTC market is highly flexible, it also lacks
standardization and interchangeability. Multiple
standards (protocols) are used, creating different
project eligibility requirements, monitoring and
validation requirements, and unique values for VERs
from a particular standard and project type.
The most commonly used standards or protocols in the
OTC market include:
Voluntary Carbon Standard 2007
California Climate Action Registry
GE-AES Greenhouse Gas Services
USEPA Climate Leaders
Environmental Resources Trust
A landfill considering the OTC voluntary markets to
sell its GHG reduction credits may want to consider
the following advantages and disadvantages:
8
Advantages
Flexible, relatively easy due diligence and
verification process.
Generally higher prices paid for tonnes of
CO2e when compared to CCX,
particularly for landfill methane reduction
projects.
Low transaction costs.
No requirements of seller to reduce GHG
emissions footprint.
Can sell GHG credits forward.
Carbon Asset Developers will provide
investment capital.
Disadvantages
Lack of transparency of the OTC market
transactions. No clear market price.
Lack of standardization, leading to unique
GHG credits (VERs) and pricing..
Cannot usually sell older GHG credit
vintages.
Because OTC Market Participants are
highly sophisticated, public entities may
require outside assistance and a more
diligent review.
Pubic entities may require a pubic RFP
process.
Prices for GHG Credits
The CCX has CFI® pricing history available. From an
average price in 2006 of $3.50, prices fell to an
average of $3.00 for 2007, with a price of only $1.60
at the end of 2007. Since February of 2008, the price
of CFI®s have increased sharply, driven by significant
market volume. As this article goes to press, the value
of a CFI® on CCX is $6.40.
The OTC market transaction information is far less
available, as most transaction details are not made
public. The 2006 volume weighted average price for
VERs in the OTC market was $4.1 per tonne CO2e,
ranging widely from $0.45 to $45 per tonne CO2e.
The highest prices paid were for high quality projects
with verifiable attributes, such as landfill and coal mine
methane based GHG reduction projects. K. Hamilton,
R. Bayon, G. Turner, D. Higgins, “State of the
Voluntary Carbon Markets 2007: Picking up Steam.”

Landfill Gas to Energy Considerations
Some Landfill GHG Reduction Projects may have the
additional possibility of incorporating a landfill gas-toenergy
(LFGE) project, such as a LFG-fired electric
generation project or a LFG direct use project (e.g.
fire boilers). Both of these projects are, for most
standards, approved methods of methane destruction
and are thus eligible to generate GHG credits. The
additional revenues generated from GHG credits can
make borderline LFGE projects successful. With
regard to electricity generation, additional GHG credits
can be earned for the displacement of more carbon
intense forms of electricity generation. The conditions
under which Renewable Energy Credits (RECs) and
GHG credits can be taken is beyond he scope of this
article, but should be carefully addressed during
negotiations to avoid double counting.
Conclusions
Smaller landfills now find themselves at the epicenter of
interest surrounding climate change and specifically
how voluntary control of LFG can contribute to GHG
reductions. These publicly and privately held landfills
have several project development options. Lawyers
advising landfill clients would be well advised to
become familiar with this emerging market.
My colleague Jim Michelsen contributed to this
article, which is based upon a paper he presented
at the Solid Waste Association of North America
(SWANA) LFG Symposium in Houston earlier this
year.
COMMITTEE COMMITTEE ONLINE
ONLINE
Visit the Waste Management Committee
Web page at: www.abanet.org/environ/
committees/solidwaste/.
Back issues of the newsletter can be found
at: http://www.abanet.org/environ/committees/solidwaste/newsletter/archives/.
9
Introduction
WASTE DISPOSAL OF
ELECTRONIC EQUIPMENT
Heather Drayton
J.D., Hofstra Law School
Technological innovation continues to decrease the
lifespan of electronics, resulting in an increase in the
quantity of electronic waste, which is now the nation’s
fastest growing category of solid waste, growing at a
rate three times that of other usual municipal wastes.
Significantly, regulatory mandates unrelated to
environmental matters will increase the volume of
electronic waste. For instance, the Federal
Communications Commission (FCC) requires all new
televisions to be equipped with technology for
receiving digital signals. This phase out will result in
500 million outdated devices that likely will be
disposed in a landfill or recycled. In addition,
according to Greenpeace, Microsoft’s launch of the
Windows Vista operating system will render over half
of the world’s computers obsolete because they will
not have the basic system requirements to operate
Vista.
Americans recycle only ten to fifteen percent of their
electronic waste. The small proportion of consumers
that do recycle endure inconvenient drop off locations
and recycler disposal fees.
Recycling electronic waste may be profitable overseas,
where labor is inexpensive partially due to lack of
environmental and worker safety regulations. However,
entering the recycling market is cost prohibitive in the
United States. Environmental Protection Agency (EPA)
officials estimate the value of materials recovered is
between $1 and $2.50 while the cost to recycle a
desktop computer is about $15. As a result, recyclers
may well choose to send electronic product overseas
for disassembly and processing, both labor intensive
undertakings. Eventually, disassembled parts may find
their way back into the United States in undesirable
forms. A study at Ohio’s Ashland University found that
lead-containing electronic waste is finding its way into
consumer products such as children’s toys made in
China.

This article discusses regulatory approaches for dealing
with the problematic issue of electronic waste recycling
and disposal.
Federal Electronic Waste Disposal Scheme
Current Federal Approach: Product
Stewardship
Federal regulations do not adequately address
electronic waste disposal. The Resource Conservation
Recovery Act (RCRA) regulates disposal of hazardous
substances, but RCRA’s exceptions usually do not
regulate electronic waste. Rather, RCRA allows likely
electronic waste disposers (small quantity generators
and household waste producers) to escape regulation.
40 C.F.R. § 261.4(b)(1) (2006) (household waste
exclusion); 40 C.F.R. § 261.5(f) (2006) (CESQG). 71
Fed. Reg. 42,928, 42,928-29 (July 28, 2006)
(codified at 40 C.F.R. pts. 9, 260, 261, 271) (cathode
ray tubes and broken cathode ray tubes exclusion).
Even if RCRA did apply to households and small
quantity generators, the implementation and monitoring
costs of applying RCRA to electronic waste may be
overly burdensome and cost prohibitive to the
administration. Keeping RCRA regulations at a
manageable standard was Congress’s and the EPA’s
intent when carving out these exceptions to the Act.
The concept of product stewardship is a voluntary
system utilized by the federal government regarding
electronic waste disposal. Product stewardship occurs
when responsibility for product disposal is shared by
customers, retailers, product manufacturers, local
governments, and volunteer organizations. EPA has
developed several voluntary programs, such as
Electronic Product Environmental Assessment Tool
(EPEAT) for manufacturers. EPEAT rating lists
products by performance level, including bronze, silver,
or gold, based on twenty-three criteria including the
reduction of lead, cadmium, and mercury; design for
end-of-life and end-of-life management; life-cycle
extension; energy conservation; corporate
performance; and packaging. President Bush has
signed executive orders that require federal agencies to
utilize EPEAT when purchasing electronic equipment.
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Congressional bills have been introduced to deal with
these issues. The National Computer Recycling Act
would permit the government to fund grants (through
fees on new computers) to develop electronic waste
recycling programs. Additionally, United States
Senator Ron Wyden (D-Or.) and former Senator Jim
Talent (R-Mo.) introduced S. 510, a bill aimed at
encouraging nationwide electronic waste recycling.
S. 510 would give tax credits to both consumers and
manufactures for recycling electronic waste.
The Patchwork Problem
In the absence of a federally mandated solution to the
electronic waste disposal problem, states are left to
formulate regulations. Industry would prefer a national
regulation rather than the many different state
regulations that are emerging. The patchwork of
policies and their inconsistencies from state to state
create onerous compliance costs. In some cases, it is a
difficult burden to comply with the extreme variations
of the regulations. When faced with two different
standards, manufacturers must comply with both, not
just the stricter standard. Manufacturers may not only
have to comply with the different state programs, but
with different city and county electronic waste disposal
schemes as well. Last year in the United States, fiftyfour
electronic waste bills were proposed, and sixty
were proposed in 2005. One-third of these bills
charged the manufacturer or retailer with the duty to
recycle the electronic waste, and another 15 percent
were electronic waste landfill bans. The transaction
costs of complying with all of these different regulations
can have dramatic effects on the electronics
manufactures, retailers, and the United States
economy.
Specific State Electronic Waste Regulations
Some states have developed legislative approaches to
deal with the issues. Thirteen states have some form of
electronic waste regulation, and several have electronic
waste regulations pending. The states that have
enacted legislation are Arkansas, California,
Connecticut, Maine, Maryland, Massachusetts,
Minnesota, New Hampshire, North Carolina, Oregon,
Rhode Island, Texas, and Washington. Representatives

from Maine and California recently told Congress that,
although those states already have electronic waste
laws, “they could benefit from national leadership.”
This article briefly examine the regulatory approaches
of those two states.
Maine
Maine has a system modeled after the European Union
(EU) approach called Extended Producer
Responsibility (EPR), which requires the manufactures
to pay for electronics recycling costs. The Maine law
represents a partnership between the private sector,
municipal and state entities, and consumers. The state
requires manufacturers to ensure the recycling of their
products. “[L]ocal government is responsible for
collecting the waste equipment; and retailers are
responsible for not selling products of manufacturers
that fail to comply with the program.” The
manufacturer is accountable for the costs of waste
consolidators and processors for all of its electronics
sold in Maine. Manufacturers are also likely
responsible for electronic waste disposal of the
residents of nearby states. There is nothing stopping
non-residents from entering Maine to dispose of their
electronic waste at a reduced cost.
Electronic users in Maine benefit from this EPR
approach. The consumer who used to pay $20 to
recycle his computer prior to the regulation now pays
only $2. However, manufacturers and retailers may be
economically burdened. The electronic waste provision
prohibits the sale of electronics by retailers or
manufacturers not in compliance with regulations in
Maine. If sales in Maine are not sufficient to cover the
costs of disposal, this could take companies out of the
Maine electronics market.
Moreover, the statute will force some manufacturers to
leave the Maine market. Manufactures not in
compliance with the law after January 2006 are placed
on a “do not sell list.” Maine retailers are prohibited
(under penalty of law) from selling products made by
non-compliant manufacturers. The threat to place
manufacturers on a “do not sell list” is not an idle one.
As of November 2007, Maine retailers cannot sell
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electronic products from thirty non-compliant
manufacturers.
Other criticisms of Maine’s program target its so-called
“orphan waste” requirement. “Orphan waste” is
defined by statute as electronic devices where the
manufacturer either “can not be identified or is no
longer in business and has no successor in interest.”
Manufacturers must implement and finance a plan both
for the materials that they produce and for “orphan
waste.” Cost of disposal for orphan units is divided
between manufacturers based on a market share
theory. Sorting waste to calculate manufacturer
responsibility is complicated and creates a significant
burden. This will almost certainly add to the “orphan
waste” disposal costs.
California
Unlike Maine, which focuses its regulation on the
producer, California utilizes an Advanced Recovery
Fee (ARF), which focuses on consumers of
electronics. California’s Electronic Waste Recycling
Act of 2003 (EWRA) requires the consumer to pay a
disposal and/or recycling cost at the time they purchase
a covered electronic product. EWRA also requires
state agencies to buy environmentally friendly
electronics. Manufacturers evaluate the costs and
benefits of selling environmentally conscious electronic
products. Based on these considerations, the
manufacturers provide agencies with recommendations
for setting the criteria used in choosing approved
electronics.
The legislature addressed economic goals “to ensure
that any cost associated with the proper management
of covered electronic devices be internalized by the
producers and consumers of covered electronic
devices at or before the point of purchase, and not at
the point of discard.” The legislature further states that
in exchange for the benefit of the convenience of
clearing their homes of electronic waste customers will
pay $6 to $10 more at the time of purchase.
EWRA opponents disagree with the California
legislature. The upfront fee paid by the consumer takes
away the manufacturer’s responsibility for electronic

waste disposal and shifts it to the government. This
shift creates more government administrative burdens
and reduces the incentive for manufacturers to
implement design changes.
The California Manufacturers and Technology
Association, with some credibility, has called the
provision a “job killer.” They fear economic effects will
be so severe that jobs will be negatively affected.
Consumers who want to avoid the California surcharge
can find other places to purchase their computers (such
as neighboring states) or delay or forgo purchase. Thus
ARF starts a chain reaction beginning with decreasing
computer sales which eventually leads to hindering
California’s economy. The California Chamber of
Commerce believes that not only is ARF bad for
consumers, but it puts manufacturers at a disadvantage
with nearby states. California retailers will lose profits if
citizens can purchase electronics online and avoid the
fee. This profit loss could inflict severe damage on
California’s economy.
The economic consequences of California’s ARF
regulation are not all negative. The electronic recycling
business in the area is booming. The biggest recycler in
the state realized over $20 million in revenue in 2006.
In addition to the state payment the recycler receives,
he also gains revenue from the materials sold from the
devices. California paid out $74.6 million in 2005 and
2006 to electronic waste recyclers. This has attracted
additional electronic waste disposal businesses,
suggesting that those already in the industry may be
earning supernormal profits (i.e., a return on capital
greater than what is available in other industries). Since
the implementation of EWRA, the number of recyclers
and collectors has nearly tripled, thereby increasing
competition. To keep profits up despite all of the
competition, collectors hold recycling events to gather
electronic waste. These events lower the transaction
costs to consumers by creating more convenient drop
off locations. When transaction costs are lowered the
consumer is more likely to remove the product from
storage and bring it to the event. Thus, the recyclers
gain revenue.
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Conclusion
Consumers are going to continue disposing of their
electronic waste using the method least costly to them.
In order to encourage recycling and reuse, landfill bans
should be imposed and a financing system should be
developed to encourage recycling.
Economic analysis indicates that all stakeholders,
including government and industry, should collaborate
to develop an environmentally responsible and
economically efficient plan. To avoid the economic
waste that a patchwork system creates, the federal
government should implement an appropriate financing
system. The negotiations should consider the pros and
cons of the approaches used by various states to date.
Ideally, the most efficient regulation will protect the
environment while allowing businesses to operate
profitably within the United States.
Heather Drayton was graduated in May 2008 from
Hofstra Law School.
This article is adapted from “Economic Analysis of
Electronic Waste Disposal Regulations,” published in
36 Hofstra Law Review, 149 (2007). For citations
please refer to the original publication available at
http://law.hofstra.edu/pdf/Academics/Journals/
LawReview/lrv_issues_v36n01_i07.pdf.
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