Welcome to RCC

Manitoba's Household Hazardous Waste Stewardship

RCC appreciates the opportunity to comment on the Proposed Hazardous or Prescribed Household Material Stewardship Regulation and the draft guideline for industry stewards for Hazardous or Prescribed Household Material Stewardship Regulation, as brought forward by Manitoba Conservation for consultation.

Retailers, as the sellers of designated products and the touch point for both consumers and manufacturers, have a significant stake in the development of stewardship programs. Currently, RCC's members are active participants in over 30 such programs across the country, and will be called upon to expand their role as new ones are developed.

Indeed, retailers support the principles of waste diversion as a whole and look forward to working together with other key stakeholders in creating a successful industry-led household hazardous waste (HHW) stewardship program for Manitoba. The following represents the initial thoughts of retailers, which may be added to and/or refined as further discussion and consultation takes place.

Definition of a Steward
The proposed Regulation defines a "steward of designated material" as:

(a) the first person who, in the course of business in Manitoba, supplies designated material to another person; or
(b) a person who, in the course of business in Manitoba, uses a designated material obtained in a supply transaction outside of Manitoba.

By limiting the steward definition to only the "first seller" or "first importer" of designated products, a disproportionate amount of the stewardship obligations will fall to retailers since they will largely be the first importer of designated products into the province.

RCC recommends that a new bullet be added to the definition to include brand owners as designated stewards with respect to all household hazardous waste.

Program Management
The proposed Regulation is based on the principles of Extended Producer Responsibility and shifts the responsibility for management of household hazardous waste from the existing government-run stewardship program to industry leadership. RCC supports industry-led stewardship programs and supports the government's intention to transfer management from government to industry by allowing affected industry stewards to develop and implement an HHW stewardship program for Manitoba.

Program Materials
The proposed list of HHW, as contained in section (2) of the proposed Regulation, is extensive and covers a large range of product categories. RCC and its members believe that in order to develop a successful program, it is important to limit the list of products designated for diversion.

In that light, retailers generally feel that for the launch of a waste diversion program for HHW, the list of products should be limited. As such, RCC recommends a phased-in approach for the program beginning with paint. By scheduling a manageable number of products, an Industry Funding Organization (IFO) will be able to successfully implement a waste diversion program, where additional products can be included in the future. To this end, the IFO should be authorized to conduct an annual review to determine if and when other products should be added to the program. However, it is important that the IFO be allowed to determine the rate at which products would be added to the existing waste diversion program.

Furthermore, by phasing and limiting the list of products designated for diversion it simplifies the program which may help consumers more readily understand and accept it, and hence encourage their participation.

Automotive Batteries
The proposed Regulation includes a category for "automotive lead-acid batteries". RCC respectfully requests clarification on how this Regulation will impact product stewardship programs already in existence for designated materials under the regulation, such as for automotive batteries. Retailers have voluntary take-back programs for automotive batteries in place and as such, any program plan for HHW needs to incorporate and recognize such programs.

Pesticides
The Regulation does not currently distinguish between hazardous and non-hazardous products such as pesticides, which is inconsistent with the practice of other provinces. In British Columbia's Recycling Regulation and Ontario's proposed Municipal Hazardous or Special Waste Program Plan, only hazardous pesticides are included; while non-hazardous pesticides have been explicitly excluded.

Currently, the definition used in the Schedule of the proposed Regulation states that "Control products, as defined in the Pest Control Products Act (Canada), that are registered under the Act and required to be labeled with the product class designation "Domestic."

RCC recommends that the above definition be expanded so that is harmonized with the definition used in British Columbia's regulation. Therefore, the definition should also state that the pesticide product category consists of control products registered under the Act that display on the label the symbol for the signal word "Poison"; and further, that the product category does not include the following:

• insect repellents;
• sanitizers and disinfectants;
• pet products;
• unpackaged products or products not ordinarily sold to, used or purchased by a consumer without repackaging.

Empty Containers
Given that the draft Regulation is quite broad, it is unclear how empty containers will be managed under the proposed HHW program.

RCC is concerned that including batteries in the proposed Regulation may duplicate current efforts in the marketplace to divert batteries from landfill, and may also cause confusion among stewards as it relates to the proposed Hazardous or Prescribed Household Material Stewardship Regulation, which Manitoba Conservation recently released for consultation.

RCC has been working with Green Manitoba officials and other stakeholders over the past year on the province's proposal to release regulations designating Printed Paper and Packaging (PPP) materials under the Waste Reduction and Prevention (WRAP) Act, which would see the development of a PPP waste diversion program for the province. Under the proposed regulation (not yet released for public consultation) the PPP program would accept empty containers. As such, RCC is concerned that retailers could be subject to duplication of responsibility, reporting and payment under the two proposed programs for the same product category.

As such, RCC recommends that section 1(3) of the proposed regulation be amended to (additions bolded and underlined):

This regulation does not apply to a container as defined in the Used Oil, Oil Filters and Containers Stewardship Regulation, Manitoba Regulation 86/97, or that is described in the Packaging and Printed Paper Stewardship Regulation, Manitoba Regulation xx/yy.

Shared Responsibility
RCC and its members recognize that waste is a societal issue, and as such, we all share a responsibility in the management of used or leftover products.

While we recognize and commend the government's shift towards an extended producer responsibility approach it's important to recognize that the success of the program is dependent on recognizing that industry and municipalities have a shared responsibility in the management of waste. A shared responsibility approach — cost and/or functional split - requires fair and equal incentives that promote cost effective and administratively efficient programs in which costs and/or functions are shared between industry and municipalities.

Such shared responsibility approaches are already in place in other provincial product stewardship programs, including Ontario and Quebec.

Program Plan Development and Implementation Timing
When deciding upon the actual start date for these programs, RCC and its members recommend that retailers be provided with adequate time for program plan development and program plan implementation.

The proposed Regulation does not propose a schedule for program plan development or implementation. However, section (10) of the guideline states that "a program plan must be submitted for approval by the Minister within the time frame to be set in the regulation."

RCC recommends that the Regulation be amended to include a section on timing as follows:

A program plan for Hazardous or Prescribed Household Material must be submitted for approval to the Minister within 12 months of the date this Regulation comes into force. Following that, the plan must be implemented within 12 months from date the Minister approves the Hazardous or Prescribed Household Material waste stewardship program plan.

Retailers have expressed concerns in other jurisdictions with the extraordinarily quick pace that governments have allocated for the development of product stewardship programs. Retailers require ample time and opportunity to fully digest any program plan, budget for it, and take the necessary steps to prepare their respective organizations for compliance with the program. This is compounded by the fact that retailers are engaged in the development of other stewardship programs, which can leave them resource challenged.

Industrial, Commercial and Institutional Waste
It is unclear if the proposed Regulation is limited to only residential waste or if it could also include waste generated by the Industrial, Commercial and Institutional (IC&I) sector. While the name of the Regulation only references "household" materials, IC&I is not clearly exempted from the scope of the program.

As a general principle, with respect to whether the proposed HHW stewardship program should include used or leftover packaging and product disposed as municipal waste or whether materials sold into the IC&I sector should be included; RCC and its members feel that if proof of disposal of IC&I waste at the retailer's expense is provided, that waste should be exempt.

As such, RCC recommends that the Regulation be amended to clearly exempt IC&I waste from the scope of the proposed HHW program.

Harmonization
Inter-provincial harmonization of product stewardship programs is a fundamental concern for the retail sector. The need for regulation to encourage harmonization with other provinces cannot be overstated. Approaches to product stewardship across Canada are far from consistent and increasingly place national retailers in the position of having to comply with a patchwork of requirements across the country. Implementing different programs in every province has proven to be costly and administratively burdensome for retailers; and as such, harmonization must be entrenched as a foundation of product stewardship programs.

RCC strongly recommends that Manitoba Conservation harmonize its HHW stewardship program, where feasible, with existing HHW stewardship programs. A number of other provinces have implemented stewardship programs for specific elements of hazardous or special waste including British Columbia, Saskatchewan, Nova Scotia and Quebec for paint; and British Columbia and Prince Edward Island for batteries.

Collection
Section 4(2)(c) of the proposed Regulation requires that the plan for an HHW program include a provision for "a province-wide, convenient collection system for waste material without user fees at the point of collection."

RCC and its members understand the importance of ensuring that consumers have reasonable access to collection points, particularly in remote areas. An issue of concern, however, is that one method that is consistently proposed to achieve this objective is a return-to-retail collection system.

RCC has reviewed the issues arising if retail stores acted as collection points for used or leftover consumer products and packaging. These issues include:

• Lack of space to store used products;
• Need for renovations to accommodate returns (additional ventilation, closed rooms, racking etc.)
• Need to hire additional staff to handle incoming used products;
• Need for specialized staff training to handle incoming used products;
• Employee and customer health and safety associated with handling and storing used products;
• Store insurance coverage;
• Store fire code compliance;
• Store municipal by-law compliance;
• Administrative costs; and,
• Breach of lease provisions.

Accordingly, RCC and its members do not support any legislated or regulatory requirements that used or leftover consumer products and packaging be returned-to-retail.

That being said, occasionally some retailers and their suppliers may operate specialized take-back events for used or leftover consumer products. Any product stewardship program should recognize these voluntary programs and allow retailers the flexibility to operate them.

Program Funding
RCC is pleased that the proposed Regulation is silent on the management of steward fees as RCC and its members do not support any legislated or regulatory requirement that retailers bury the eco-fee within the final selling price of the product.

Typically, costs for product stewardship programs are funded by an environmental levy or eco-fee associated with a product, and financing these eco-fees for post-consumer material recovery and recycling presents challenges to all retailers. Some stewardship programs have been designed to require retailers to bury the eco-fee within the final selling price of a product, thereby, hiding the costs from consumers. As each retail operation is different, retailers require the flexibility to cover recycling program costs in a manner that minimizes the financial and administrative impact on their business.

RCC has analysed the consequences of such practices on retailers and identified a number of serious impacts on retailers both large and small:

• Retailers who lease their premises pay more rent: rent is based on gross sales, which increase as prices are increased to cover stewardship program costs. This is a particularly troubling concern for small, local retailers.
• Higher advertising costs are incurred for national or regional retailers who must produce separate production runs with province-specific pricing.
• Some national and regional retailers have information systems that are not easily (or simply cannot be) configured for higher prices in a given province for the same product.
• Product prices in the province may become inflated as a result of the mark-ups that occur along the supply chain.
• Some retailers lose customers to neighbouring jurisdictions where the advertised price of a product is lower because there is not an imbedded eco-fee.
• The program creates an un-level playing field for retailers within a province.

In addition to these concerns, retailers believe that transparency of program costs provides an important opportunity to educate consumers about a stewardship program, and hence encourage their participation.

To be clear, retailers require the flexibility to cover recycling program costs in a manner that minimizes the financial and administrative impact on their business. As stated earlier, RCC and its members do not support any legislated or regulatory requirements that retailers bury the eco-fee within the final selling price of a product.

Cost Containment
Section 4(2)(d) of the draft Regulation states that the plan must include a provision for "a system for the payment of expenditures incurred in the collection, transportation, storage, processing and disposal of waste material in connection with the waste reduction and prevention program." RCC agrees that the management of costs incurred by the program should be left to the discretion of the IFO.

However, in addition to provision (d) of section 4(2), provision (h) requires the stewardship plan to include a condition that "the payment of salaries and other costs of government for the administration and enforcement of this regulation and of the Act as it relates to hazardous or prescribed household material."

RCC does not support section 4(2)(h) of the proposed Regulation as it is inappropriate to require individual stewards to pay for government salaries and "other costs" for the administration of the program. Specific details of what the administrative costs may include should be left to the discretion of the IFO, as outlined in section 4(2)(d).

Requiring the stewardship plan to include a provision for a system of payment for incurred costs is consistent with other provincial jurisdictions; whereas including a provision to compensate government salaries is inconsistent with other jurisdictions.

RCC recommends that clause (h) from section 4(2) be deleted from the draft Regulation.

Program Targets
The proposed Regulation is silent on program targets; however, section (15) of the draft Guideline states that the program plan will propose program targets and performance measures after consultation with stakeholders; that interim targets may be established by the Minister for purposes of plan development; and that acceptable targets and performance measures will be set as part of the written guidelines to be established by the Minister.

While retailers are committed to achieving high levels of diversion from landfill and compliance across product categories, RCC and its members contend that it is premature to identify performance targets in the program criteria at this time. Without comprehensive programs in place, it is impossible to realistically determine how and when different performance targets may be achieved. The program should be operational for at least one year before performance targets are established.

With regards to the examples of performance measures listed in section F of Part II of the guideline, RCC believes that sales data is not an appropriate or relevant measure and should be removed from the draft Guideline.

Promotion and Education
Product stewardship is a shared responsibility and waste diversion programs will only be successful if consumers are aware of the program and see the benefits of participation. Educating consumers on stewardship issues is a fundamental component of any stewardship program. As the touch point for both consumers and manufacturers, retailers are a vital link in the supply chain and are strategically well positioned to assist in educating and increasing awareness among consumers.

Section 3(3) of the proposed Regulation contains a requirement that point-of-sale information be made available to consumers, and the draft Guideline states that retailers are "required to provide information on the stewardship program to the consumer." Furthermore, the guideline specifies that the establishment and administration of point-of-sale information for the program is a requirement that must be included in the stewardship plan.

While RCC agrees that point-of-sale information should be made available to consumers, we believe such educational material be prepared and provided to retailers by the program administrator; it should not be the responsibility of the steward. This will ensure that a uniform message is delivered to consumers and will assist with increasing compliance with the program. This approach is also consistent with existing stewardship programs in other provinces. Furthermore, RCC recommends that the costs for the establishment and administration of the point-of-sale information should be the responsibility of the program administrator, and should be included in the overall cost of the program; which is consistent with other jurisdictions.

Retail Representation
As stated earlier, retailers have a significant stake in the development of effective stewardship programs. In addition to being sellers of designated products, RCC's members are increasingly also product brand owners themselves and are responsible for the end-of-life management of those products and packaging.

Currently, RCC, or a retail representative, is represented on many stewardship boards across the country including Stewardship Ontario, Waste Diversion Ontario, Tire Stewardship British Columbia, Tire Stewardship Manitoba and the Saskatchewan Scrap Tire Board, Saskatchewan Waste Electronic Equipment Program Board, among others.

Given the major role that retailers play in product stewardship, retailers must be involved in program plan development and implementation and must represented in the decision-making bodies related to the proposed Hazardous or Prescribed Household Material Stewardship program.