Amended  IN  Assembly  June 11, 2024
Amended  IN  Senate  April 12, 2023

CALIFORNIA LEGISLATURE— 2023–2024 REGULAR SESSION

Senate Bill
No. 615

Introduced by Senators Allen and Min

February 15, 2023

An act to repeal and add Article 3 (commencing with Section 42450.5) of Chapter 8 of Part 3 of Division 30 of the Public Resources Code, and to amend Section 11545 of the Vehicle Code, relating to solid waste.


LEGISLATIVE COUNSEL'S DIGEST


SB 615, as amended, Allen. Vehicle traction batteries.
Existing law requires the Secretary for Environmental Protection to convene the Lithium-Ion Car Battery Recycling Advisory Group to review, and advise the Legislature on, policies pertaining to the recovery and recycling of lithium-ion vehicle batteries sold with motor vehicles in the state. Existing law also requires the advisory group to submit policy recommendations to the Legislature aimed at ensuring that as close to 100% as possible of lithium-ion vehicle batteries in the state are reused or recycled at end-of-life in a safe and cost-effective manner.
This bill would repeal those requirements. The bill would instead require vehicle traction batteries, as defined, in the state to be recovered and reused, recovered, when possible, reused, repaired, repurposed, or remanufactured and eventually recycled at the end of their useful life in a motor vehicle or any other application. life, as provided. The bill would also require a vehicle manufacturer, dealer, automobile dismantler, automotive repair dealer, and nonvehicle secondary user battery supplier, as defined, to be responsible for for, among other duties, ensuring the responsible end-of-life management of a vehicle traction battery once it is removed from a vehicle or other application to which the vehicle traction battery has been used. The bill would make a vehicle or battery manufacturer responsible used, and for collecting a stranded battery, as defined, and repurposing the battery, if possible, but would require the manufacturer to ensure the battery is recycled if it cannot be reused. The bill would require, by January 1, 2025, a battery supplier, as described, to be responsible for the development of a core exchange program for replacing a battery, module, or cell removed from a vehicle, as specified. The bill would also require a battery supplier to annually submit a report to the Department of Toxic Substances Control, as provided. The bill would require a qualified facility, as defined, buying removed batteries to submit a report containing specified information to the department and would require specified entities that remove a battery from a vehicle that is still in service to participate in the core exchange program. The bill would make a secondary user that purchases a battery that was removed from a vehicle responsible for ensuring the battery is sent to a qualified facility at the end of the battery’s useful life and reporting specified information to the department. The bill would include a related statement of legislative findings and declarations and a statement of policy regarding end-of-life management of vehicle traction batteries. for which they were the battery supplier and fully fund the cost of collection. The bill would impose related duties on a secondary user, as defined, and a secondary handler, as defined, including, among other duties, ensuring responsible end-of-life management for a battery or returning a vehicle traction battery to the battery supplier, and reporting information regarding the sale, transfer, or receipt of a vehicle traction battery, module, or cell to the Department of Resources Recycling and Recovery (CalRecycle), as provided. The bill would require battery suppliers to join a producer responsibility organization, or PRO, and would require the PRO to develop and submit to CalRecycle and to the Department of Toxic Substances Control (DTSC) a complete orphaned battery management plan in a form and manner determined by the department for approval, approval in part, or disapproval, as specified. The bill would require the orphaned battery management plan to be designed to provide for the collection, transportation, recycling, and safe and proper management of orphaned vehicle traction batteries and any of their associated components in the state, as provided.
This bill would require the PRO to pay all administrative and operating costs associated with establishing and implementing the plan and to review the plan at least every 5 years. The bill would require the PRO to pay each department’s actual and reasonable regulatory costs to implement and enforce the provisions of the bill. The bill would establish the Vehicle Traction Battery Recovery Fund in the State Treasury and would require the department to deposit all moneys received from the PRO into fund, as specified. Moneys in the fund would be available, upon appropriation by the Legislature, to implement and enforce the provisions of the bill. The bill would require the department to post on its internet website the plan and a list identifying the participating battery suppliers, as provided. The bill would provide that all reports and records provided to the department pursuant to these provisions be provided under penalty of perjury. By expanding the scope of crimes, the bill would impose a state-mandated local program. The bill would restrict public access to certain information collected for the purpose of administering this program.
This bill would authorize the department to impose civil penalties of up to $50,000 per day for a violation of the requirements of the bill, or up to $100,000 per day if the violation is intentional or knowing. The bill would establish the Vehicle Traction Battery Recovery Penalty Account in the Vehicle Traction Battery Recovery Fund for the deposit of all penalties collected and make the moneys in the account available, upon appropriation by the Legislature, for specified purposes.
Existing law, until January 1, 2025, requires the Department of Motor Vehicles to collaborate with the California Department of Tax and Fee Administration, the California Environmental Protection Agency, the DTSC, the State Water Resources Control Board, CalRecycle, and the State Air Resources Board to review and coordinate enforcement and compliance activity related to unlicensed and unregulated automobile dismantling, including resulting tax evasion, environmental impacts, and public health impacts.
This bill would extend the operation of that law indefinitely.
Existing constitutional provisions require that a statute that limits the right of access to the meetings of public bodies or the writings of public officials and agencies be adopted with findings demonstrating the interest protected by the limitation and the need for protecting that interest.
This bill would make legislative findings to that effect.
The California Constitution requires the state to reimburse local agencies and school districts for certain costs mandated by the state. Statutory provisions establish procedures for making that reimbursement.
This bill would provide that no reimbursement is required by this act for a specified reason.
Vote: MAJORITY   Appropriation: NO   Fiscal Committee: YES   Local Program: NOYES  

The people of the State of California do enact as follows:


SECTION 1.

 The Legislature hereby finds and declares all of the following:
(a) As the State of California continues its commitment to decarbonizing the on-road transportation sector and as electric vehicles become more cost-competitive and popular with consumers, the state will see an increase in the number of vehicle traction batteries.
(b) Vehicle traction batteries that are no longer useful in vehicles can be repurposed for another application, remanufactured, or recycled. Given the growth expected in California’s electric vehicle market, the value inherent in the material used to manufacture vehicle batteries, and the potential hazard posed by these batteries if handled improperly, California has an interest in creating a coherent state policy designed to ensure all vehicle traction batteries are reused, repurposed, remanufactured, and eventually recycled.
(c) In 2018, the Legislature passed and the governor Governor signed AB 2832, calling for the formation of an advisory group of experts to develop policy recommendations aimed at ensuring that as close to 100 percent as possible of electric vehicle traction batteries in the state are reused or recycled at end-of-life in a safe and cost-effective manner. The advisory group published a report in March of 2022 summarizing their work, detailing barriers and opportunities for improving management of these batteries, and presenting policies designed to further the already-developing circular economy, avoid adverse impacts to public health and the environment, and at to keep these batteries out of the waste stream.
(d) One key recommendation of the advisory group was to create a program which would require those involved in the production and use of electric vehicle traction batteries to take responsibility for the end-of-life of the product. The report articulated different approaches to accomplishing this goal and underscored the need to define which entities should be responsible for coordinating and covering the costs associated with management of the batteries when those costs present a burden for the vehicle owner and the need to mitigate barriers that currently inhibit the reuse, repurposing, and recycling of these batteries.

SEC. 2.

 (a) It is the policy of the State of California that in situations when a vehicle traction battery reaches the end of its life and cannot be reused in another vehicle or repurposed, it shall be sent to a qualified repurposer, remanufacturer, recycler, or sorting facility to be recycled.
(b) It is further the policy of the State of California that any program designed to ensure proper end-of-life management of vehicle traction batteries first strives to reuse batteries when possible. When that is not possible, the program shall strive to repurpose or remanufacture the battery for a different application. When neither is possible, the program shall ensure the batteries are recycled. Disposal of these batteries should be discouraged and ultimately eliminated in support of achieving a circular economy.

SEC. 3.

 Article 3 (commencing with Section 42450.5) of Chapter 8 of Part 3 of Division 30 of the Public Resources Code is repealed.

SEC. 4.

 Article 3 (commencing with Section 42450.5) is added to Chapter 8 of Part 3 of Division 30 of the Public Resources Code, to read:
Article  3. Vehicle Traction Batteries

42450.5.
 For purposes of this article, the following definitions apply:
(a) “Automobile dismantler” has the same definition as in Section 220 of the Vehicle Code.
(b) “Automotive repair dealer” has the same definition as subdivision (a) of Section 9880.1 of the Business and Professions Code.

(c)“Battery supplier” includes, but is not limited to, a vehicle manufacturer who sells or distributes motor vehicles containing a vehicle traction battery, a manufacturer who sells or distributes vehicle traction batteries, or a secondary handler. For purposes of this article, a secondary handler or remanufacturer selling a battery removed from a vehicle to be used as a replacement battery in another vehicle is a battery supplier.

(c)  “Battery cell” means the basic electrochemical unit of a battery and that consists of a cathode, an anode, and an electrolyte and is used to store and release electrical energy.
(d) “Battery management plan” or “plan” means a plan developed by the PRO pursuant to Section 42450.10.
(e) “Battery supplier” means all of the following:
(1) A person, including a vehicle manufacturer licensed pursuant to Section 11701 of the Vehicle Code, a vehicle traction battery manufacturer, or a vehicle traction battery remanufacturer who manufactures a vehicle traction battery and who sells, offers for sale, or distributes a vehicle traction battery in or into the state under the person’s own name or brand.
(2) If there is no vehicle manufacturer licensed pursuant to Section 11701 of the Vehicle Code, or no other person in the state who is the battery supplier for purposes of paragraph (1), the battery supplier is the owner or licensee of a brand or trademark under which the battery is sold or distributed into the state, whether or not the trademark is registered. For purposes of this subdivision, an exclusive licensee is a person holding the exclusive right to use a trademark or brand in the state in connection with the manufacture, sale, or distribution for sale in or into the state of the battery.
(3) If there is no person in the state who is the battery supplier for purposes of paragraph (1) or (2), the battery supplier is the person that imports the battery into the state for sale, distribution, or installation.
(4) If there is no other person in the state who is the battery supplier for the purpose of paragraph (1), (2), or (3), the battery supplier is the distributor, retailer, dealer, or wholesaler who sells the battery in or into the state.
(5) For purposes of this article, the sale of a battery shall be deemed to occur in the state if the battery, or the vehicle containing the battery, is delivered to a licensed dealer, as defined in Section 285 of the Vehicle Code, or to the consumer in the state.
(6) “Battery supplier” does not include a secondary handler who sells, offers for sale, or distributes a battery in or into the state in an unaltered condition.
(f) “Brand” means a name, symbol, word, or mark that identifies a vehicle traction battery rather than its components, and attributes the vehicle traction battery to the owner or licensee of the brand as the battery supplier.

(d)

(g) “Dealer” has the same definition as in Section 285 of the Vehicle Code.

(e)

(h) “Department” means the Department of Toxic Substances Control. Resources Recycling and Recovery.
(i) “DTSC” means the Department of Toxic Substances Control.

(f)

(j) “Motor vehicle” has the same definition as in Section 415 of the Vehicle Code.

(g)

(k) “Nonvehicle secondary user” means a business or entity that has repurposed a vehicle traction battery to another application, other than as a traction battery in a vehicle.

(h)

(l) “Orphaned battery” means a battery for which the owner or manufacturer cannot be identified. the battery supplier owner or manufacturer cannot be identified or is no longer doing business.
(m) “Producer responsibility organization” or “PRO” means the nonprofit organization created or appointed by battery suppliers, and approved by the department, to develop and implement the orphaned battery management plan.

(i)

(n) “Qualified facility” means a qualified recycler or secondary user of a battery.
(o) (1) “Qualified recycler” means an entity or facility that does both of the following:
(A) Collects, sorts, separates, and refines the elemental components of end-of-life traction batteries or battery materials and refines the elemental components back to usable battery chemicals that include, but are not limited to, nickel sulfates, cobalt sulfate, and lithium salts.
(B) Abides by all applicable federal, state, and local laws.
(2) The term “qualified recycler” does not include entities or facilities that are only engaged in the collection or logistics of moving materials for recycling, facilities that are only shredding batteries for shipment to other recyclers or refiners, or household hazardous waste collection facilities and solid waste enterprises that are only engaged in the collection and transportation of vehicle traction batteries for subsequent reuse, processing, recycling, or disposal.
(p) (1) “Recycle” or “recycling” means the process of collecting, sorting, cleansing, treating, and reconstituting materials that would otherwise ultimately be disposed of onto land or into water or the atmosphere, and returning them to, or maintaining them within, the economic mainstream in the form of recovered material for new, reused, or reconstituted products, that meet the quality standards necessary to be used in the marketplace.
(2) “Recycle” or “recycling” does not include any of the following:
(A) Combustion.
(B) Incineration.
(C) Energy generation.
(D) Fuel production.
(E) Other forms of disposal.

(j)

(q) “Remanufacturing” means the process of refurbishing battery modules or packs to as good or better quality and performance levels through the replacement of worn or deteriorated components and recertifying them to original manufacturer specifications.

(k)

(r) “Repurposing” means the process of refurbishing vehicle traction battery components or packs to fulfill a different use than what was originally intended, such as secondary use.
(s) “Repair” means the process of fixing or replacing components of the battery to restore the battery to operational condition.

(l)

(t) “Secondary handler” means any entity, other than the vehicle manufacturer, that removes a battery from a vehicle. manufacturer or a secondary user, that takes possession of a battery removed from an electric vehicle or that removes a battery from a vehicle for purposes, including, but not limited to, repair, remanufacturing, and recycling.

(m)

(u) “Secondary user” means an entity that repurposes a battery to fulfill a different use than what was originally intended.

(n)

(v) “Stranded battery” means a vehicle traction battery in which the costs associated with recycling the battery present a burden for the owner of the vehicle or an entity that has removed the battery from the vehicle. This also includes batteries for which an owner cannot be identified.

(o)

(w) “Vehicle manufacturer” has the same definition as in Section 672 of the Vehicle Code.

(p)

(x) “Vehicle traction battery” or “battery” means an advanced battery technology used as a traction battery to propel a motor vehicle. vehicle that is required to be registered pursuant to Chapter 1 (commencing with Section 4000) of Division 3 of the Vehicle Code, including the individual components and cells that comprise a battery pack. This definition does not include a “lead-acid battery,” as defined in subdivision (f) of Section 25215.1 of the Health and Safety Code.

42450.6.
 All vehicle traction batteries in the state shall be recovered and reused, repurposed, or remanufactured and eventually when possible, be reused, repaired, repurposed, or remanufactured and all vehicle traction batteries shall eventually be recycled at the end of their useful life in a motor vehicle or any other application, life, as provided in this article.

42450.7.

(a)(1)A vehicle manufacturer, dealer, automobile dismantler, automotive repair dealer, and nonvehicle secondary user shall be responsible for ensuring the responsible end-of-life management of a vehicle traction battery once it is removed from a vehicle or other application to which the vehicle traction battery has been used.

(2)If a battery is removed from a vehicle that is still in service, while the battery is still under warranty, the vehicle manufacturer is solely responsible for ensuring responsible end-of-life management of the battery pursuant to state and federal law.

(b)The vehicle or battery manufacturer is responsible for collecting a stranded battery, if that battery can be traced to the manufacturer, and for repurposing the battery, if possible, but shall ensure the battery is recycled if it cannot be reused.

(c)By January 1, 2025, a battery supplier that sells or distributes vehicle traction batteries in or into California is responsible for the following:

(1)(A)The development of a core exchange program for replacing a battery, module, or cell removed from a vehicle. This program shall include proper tracking and recordkeeping for any battery, module, or cell removed from a vehicle and for a replacement battery, module, or cell. The tracking system shall include a unique identifier for each battery. The unique identifier shall be consistent with any applicable regulations adopted by the State Air Resources Board on or after January 1, 2023, that govern labeling requirements for batteries.

(B)The program shall include two options: a refundable core exchange deposit, or, in lieu of a refundable core exchange deposit, an option for a battery supplier and buyer to enter into a contractual agreement to ensure the removed battery is returned or sent to a qualified facility.

(C)The program shall require a battery supplier to collect from a buyer a minimum deposit set to ensure batteries are returned. A deposit may be waived if the battery supplier has documentation that the buyer has shipped the removed battery to the supplier or to a qualified facility prior to the replacement battery being shipped.

(D)A battery supplier that collects a deposit that is not refunded to the buyer shall hold the funds in escrow to be used to fund the collection and recycling of orphaned or stranded batteries.

(E)In lieu of a core exchange deposit, a battery supplier may enter into a contractual agreement with a buyer to ensure removed batteries are returned or sent to a qualified facility. If a battery is not either returned or sent to a qualified facility within the timeframe established in the contract, the supplier shall charge, and the buyer shall pay, the minimum deposit set by the supplier. If the removed battery is still not returned, the supplier shall hold the deposit in escrow to be used to fund the collection and recycling of orphaned or stranded batteries.

(2)Annually submitting a report to the department containing the date of sale of the battery, the name of the entity to which a replacement battery was sold, and the battery’s unique identifier and state of health. The report shall also include the date the battery removed by the buyer was received by the supplier or a qualified facility and the removed battery’s unique identifier and state of health. For batteries collected by the supplier, the report shall indicate when the battery was sent to a qualified facility and the qualified facility to which it was sent.

(d)A qualified facility buying removed batteries shall submit a report to the department detailing the date the battery was purchased, including the battery’s unique identifier, as described in subparagraph (A) of paragraph (1) of subdivision (c), and indicate if the battery was reused, repurposed, or recycled.

(e)A dealer, automobile dismantler, automotive repair dealer, nonvehicle secondary user, or recycler that removes a battery from a vehicle that is still in service shall participate in the core exchange program established by the battery supplier and shall be responsible for either returning a removed battery to the battery supplier or sending it to a qualified facility.

(f)A secondary user that purchases a battery that was removed from a vehicle is responsible for ensuring the battery is sent to a qualified facility at the end of the battery’s useful life and shall report to the department the date on which the battery was sent and the qualified facility to which the battery was sent.

42450.7.
 (a) A battery supplier shall do the following:
(1) Ensure the responsible end-of-life management of a vehicle traction battery once it is removed from a vehicle or other application to which the vehicle traction battery has been used and for which no other entity is ensuring responsible end-of-life management.
(2) Adhere to the battery management hierarchy set forth in subdivision (b) of Section 42450.8 for any vehicle traction batteries in their possession to the extent feasible.
(3) Report information regarding the sale, transfer, or receipt of a vehicle traction battery, module, or cell to the department pursuant to subdivision (d) of Section 42450.8. This shall include the initial sale or delivery of a vehicle traction battery into the state, either within a vehicle or separately.
(4) Collect any stranded battery for which they were the battery supplier and fully fund the cost of that collection. A battery supplier may require a second handler in possession of a stranded battery and the vehicle from which the battery was removed to replace the battery back into the vehicle and send the vehicle back to the battery supplier. The secondary handler sending back a vehicle is entitled to a payment that is equal to the price the secondary handler paid for the vehicle and any transportation costs associated with returning the vehicle.
(5) Ensure battery state of health data that is easily interpretable is accessible to secondary handlers and secondary users, either while the battery is inside the vehicle or once it has been removed.
(b) If a battery is removed from a vehicle that is still in service, while the battery is still under warranty, the vehicle manufacturer is solely responsible for ensuring responsible end-of-life management of the battery pursuant to state and federal laws.
(c) A secondary user shall do all of the following:
(1) Adhere to the battery management hierarchy set forth in subdivision (b) of Section 42450.8 to the extent feasible.
(2) If the battery has been removed from the secondary application to which the vehicle traction battery has been used and is at the end of its useful life, either ensure responsible end-of-life management for a battery or return a vehicle traction battery to the battery supplier.
(3) Report information regarding the sale, transfer, or receipt of a vehicle traction battery, module, or cell to the department pursuant to subdivision (d) of Section 42450.8.
(d) A secondary handler in possession of a battery that has been removed from the vehicle shall:
(1) Adhere to the battery management hierarchy set forth in subdivision (b) of Section 42450.8 to the extent feasible.
(2) Ensure responsible end-of-life management of the battery, send the battery to a qualified facility, or return the battery to a battery supplier. If the battery supplier requires a stranded battery to be returned within the vehicle from which it was removed, the secondary handler shall return the vehicle and is entitled to reimbursement of the full cost of purchasing the vehicle and any transportation costs associated with returning the vehicle.
(3) Report information regarding the sale, transfer, or receipt of a vehicle traction battery, module, or cell to the department pursuant to subdivision (d) of Section 42450.8.
(e) A qualified facility that takes possession of a battery that has been removed from a vehicle shall report to the department pursuant to subdivision (d) of Section 42450.8.
(f) For the purposes of this section, “responsible end-of-life management” means ensuring a vehicle traction battery that cannot be repaired, reused, remanufactured, or repurposed is sent to a qualified recycler pursuant to the battery management hierarchy set forth in subdivision (b) of Section 42450.8.

42450.8.
 (a) The department, acting in accordance with Article 1 (commencing with Section 11340) to Article 8 (commencing with Section 11350), inclusive, of the Administrative Procedure Act, as set forth in Chapter 3.5 (commencing with Section 11340) of Part 1 of Division 3 of Title 2 of the Government Code, shall, in coordination with the Department of Toxic Substance Control where applicable, adopt regulations to implement and enforce this article with an effective date no later than July 1, 2027.
(b) The regulations developed pursuant to this section shall encourage adherence to a battery management hierarchy which prioritizes, in descending order, the following:
(1) The remanufacturing, repair, or reuse of batteries when possible.
(2) The repurposing of batteries, when reuse is not possible.
(3) The responsible recycling of batteries when remanufacturing, repairing, or repurposing is not possible.
(c) The department and the DTSC shall jointly determine a process for approving the PRO plan and any other information submitted in compliance with this article to ensure each department retains oversight commensurate with its jurisdiction and authority and minimizes the cost and burden to battery suppliers.
(d) The department, in coordination with the DTSC, shall establish a method and form for PROs, battery suppliers, secondary users, secondary handlers, and qualified facilities to report the sale, transfer, or receipt of a vehicle traction battery, module, or cell. This shall include the initial sale or delivery of a vehicle traction battery into the state, either within a vehicle or separately.
(1) The reporting system shall include vehicle traction batteries and any related components shipped out of the state and exported to other countries.
(2) The reporting system shall include a unique identifier for each battery. The unique identifier shall be consistent with any applicable regulations adopted by the State Air Resources Board on or after January 1, 2023, that govern labeling requirements for batteries.
(3) The reports shall include the date the battery was sold, transferred, or received, the name of the entity selling or transferring the battery, and the name of the entity receiving it, the battery’s unique identifier and state of health, and whether the battery will be repaired, reused, remanufactured, repurposed, or recycled.
(e) Annually, the department shall publicly post on the department’s internet website aggregated data on the disposition of batteries removed from vehicles, including data on the number of batteries sold or distributed for reuse, remanufacturing, repurposing, and recycling. The department shall not disclose proprietary or confidential information.
(f) On or before January 1, 2026, the department shall approve one PRO that meets the requirements of this article.

42450.9.
 (a) No later than 30 days after the effective date of the regulations adopted pursuant to Section 42450.8, each battery supplier shall provide to the department, in a form and manner established by the department, the battery supplier’s contact information, including their name, physical and mailing address, email address, and telephone number; and a list of vehicle traction batteries and brands of vehicle traction batteries that the battery supplier sells, distributes for sale, imports for sale, or offers for sale in or into the state.
(b) A battery supplier shall update the list described in subdivision (a) and provide the updated list to the department on or before January 15 of each year, within 30 days of changes to the list, and upon request of the department.
(c) No later than 90 days after the department approves a PRO pursuant to Section 42450.10, each battery supplier shall join and register with the PRO for the purposes of fulfilling reporting requirements and implementing an orphaned battery management plan, in accordance with the procedures and requirements established by that PRO and shall comply with the procedures and requirements established by the PRO.
(d) (1) Upon approval of a plan pursuant to Section 42450.10, a battery supplier may not sell, offer for sale, import, or distribute a vehicle traction battery in the state unless both the following are met:
(A) The battery supplier is a participant in the PRO.
(B) The vehicle traction battery has been reported to the department pursuant to subdivision (d) of Section 42450.8.
(2) If an entity does not meet the definition of a battery supplier and is not subject to this article but, at any point, meets the definition of a battery supplier, the entity shall join the PRO and comply with the requirements of this article prior to beginning to sell, offer for sale, import, or distribute vehicle traction batteries in the state.
(e) A battery supplier is not in compliance with this article and is subject to penalties pursuant to Section 42450.20 if, commencing two years from the effective date of regulations adopted pursuant to Section 42450.8, a vehicle traction battery sold or offered for sale by the battery supplier is not accounted for in the reports to the department made pursuant to subdivision (d) of Section 42450.8.

42450.10.
 (a) (1) Within 12 months of the effective date of the regulations adopted by the department pursuant to Section 42450.8, the PRO shall develop and submit to the department and to the DTSC a complete orphaned battery management plan, in a form and manner determined by the department.
(2) Within four months of receiving the plan, the DTSC shall review and approve, approve in part, or disapprove of the plan’s components related to safe handling, transportation, and management of the vehicle traction batteries. If the DTSC approves in part or disapproves of any plan components, the DTSC shall notify the PRO of changes needed to achieve plan approval, and the DTSC and PRO shall follow the process outlined in paragraph (3). Within three days of the DTSC approving the plan components, it shall notify the department.
(3) The department shall not approve a plan until it receives approval of the appropriate plan components from the DTSC. Within four months after being notified by the DTSC that it has approved plan components under its jurisdiction, the department shall approve, approve in part, or disapprove the plan. In making a determination pursuant to this section, the department may solicit information from battery suppliers, other agencies or departments, or stakeholders it deems appropriate.
(4) If the department approves the orphaned battery management plan, the PRO shall implement the plan within 90 days after receipt of approval or as otherwise agreed to by the department.
(5) If the department approves in part the orphaned battery management plan, the department shall indicate those portions of the plan that do not comply with the requirements of this article and the rules and regulations adopted pursuant thereto. The PRO shall implement the components of the plan, as approved, within 90 days after receipt of approval or as otherwise agreed to, and submit a revised battery management plan within 30 days after receipt of notification of the approval in order to bring the entire plan into compliance with the requirements of this article and any rules and regulations adopted pursuant thereto. The department shall review and approve, conditionally approve, or disapprove a revised battery management plan within 30 days after receipt of the revised plan.
(6) If the orphaned battery management plan is disapproved, the department shall inform the PRO of the reasons for the disapproval. The PRO shall have 30 days thereafter to submit a revised battery management plan to the department.
(7) If, after one year following receipt by the department of a complete orphaned battery management plan, the department has not approved, approved in part, or disapproved the plan pursuant to this section, the plan shall be deemed to be conditionally approved. A PRO, subject to any modifications required by the department, shall implement a conditionally approved plan within 90 days after the plan has been deemed conditionally approved.
(8) The department may impose additional plan requirements for any portion of an orphaned battery management plan that does not comply with the requirements of this article, and any rules and regulations adopted pursuant thereto, for a plan component that has not been approved pursuant to this section.
(9) The department or the DTSC may review an orphaned battery management plan approved pursuant to this section and recommend modifications thereto at any time upon a finding that the approved orphaned battery management plan, as implemented, is deficient.
(10) Within 90 days after the department’s approval of an orphaned battery management plan submitted in accordance with this article, or any revisions thereto, the department shall post, at a publicly accessible location on its internet website, the plan and a list identifying each of the battery suppliers participating in the plan. A PRO may provide a redacted version of its orphaned battery management plan to the department for the purposes of its posting on the department’s internet website, which removes any proprietary or confidential information.
(b) The PRO shall make an approved plan publicly available except that financial, production, or sales data reported by the PRO to the department for purposes of the California Public Records Act (Division 10 (commencing with Section 7920.000) of Title 1 of the Government Code) shall not be open to public inspection. The department may release financial or sales data in summary form only so the information cannot be attributable to a specific entity.
(c) The PRO shall submit any substantial changes to an approved plan to the department and to DTSC for approval.
(d) In the event that the department or DTSC determines that the PRO no longer meets the requirements of this article or fails to implement or administer an approved plan in a manner that effectuates the purposes of this article, the department or DTSC may revoke its approval of the PRO’s plan and may approve an alternative plan, covering the batteries that were included in the revoked plan.

42450.11.
 (a) The orphaned battery management plan shall be designed to provide for the collection, transportation, recycling, and safe and proper management of orphaned vehicle traction batteries and any of their associated components in the state.
(b) The battery management plan may also, at the request of a battery supplier, be designed to provide for the collection, transportation, recycling, and safe and proper management of vehicle traction batteries for which a participant battery supplier is responsible.
(c) The battery management plan shall adhere to the battery management hierarchy set forth in subdivision (b) of Section 42450.8 to the extent feasible.
(d) The battery management plan shall include the following:
(1) The names and contact information, including email address, telephone number, and mailing and physical address of battery suppliers of products covered by the plan.
(2) A description of the method to establish and administer a means for fully funding the orphaned battery management plan in a manner that equitably distributes a PRO’s costs among battery suppliers that are part of the PRO in a manner that reflects the sales volume and costs of managing the vehicle traction batteries they produce. The methodology shall ensure one participant does not cross-subsidize another participant.
(3) A demonstration that the PRO has adequate financial responsibility and financial controls in place, including fraud prevention measures and an audit schedule, to ensure proper management of funds.
(4) A five-year budget that establishes a funding level sufficient to operate the PRO in a prudent and responsible manner. The budget shall demonstrate how estimated revenues will cover all budgeted costs for each cost category. Budgeted costs shall include, but not be limited to, administrative costs, capital costs, and a reserve.
(A) Administrative costs shall include the department’s and DTSC’s actual and reasonable regulatory costs, which include full personnel costs, to implement and enforce this article, as the criteria for all costs are defined in the regulations pursuant to Section 42450.8. For purposes of this paragraph, implementation begins once the department and DTSC approve a battery management plan, except the department’s administrative costs shall include actual regulatory development costs and other start-up costs incurred prior to plan submittal and approval.
(B) The reserve shall include funds to operate the PRO should there be unexpected events, losses of income, or large unbudgeted expenses. The reserve cost category shall include a reserve level amount description justifying the reserve level amount indicated. The PRO shall maintain reserve funds sufficient to operate the plan for not less than six months. In the event that a new PRO is approved by the department and DTSC, the PRO shall establish its reserve and maintain the required reserve fund balance by the end of the second year of plan operation. In the event the PRO’s plan expires or is revoked, the reserve balance shall be transferred to a successor PRO or a trustee.
(5) A description of how the PRO will provide for any necessary collection system for vehicle traction batteries, including collection sites, and how any necessary collection and transportation will be managed.
(e) In developing an orphaned battery management plan, the PRO may consult with secondary handlers and qualified facilities on collection, transportation, and responsible end-of-life management.
(f) The battery management plan shall include a contingency plan in the event the plan expires or is revoked. The contingency plan shall guarantee that all the contracts, financial data, and any other necessary authority to operate the program shall be vested in a trustee approved by the department. The trustee shall operate the most recently approved plan, subject to the direction of the department, until that time as a new plan is approved. Upon expiration or revocation of the plan, the balance of the PRO’s operating reserves collected shall be transferred to the control of the trustee within five calendar days. All documents, digital records, contracts, and files related to the operation of the plan shall be transferred to the control of the trustee within five calendar days.
(g) The battery management plan shall include a process by which the financial activities of the organization or individual battery suppliers that are related to implementation of the plan will be subject to an independent audit consistent with Generally Accepted Accounting Principles (GAAP). Written certification by an authorized representative of the PRO or battery stewardship organization that, at the time of submission to the department and DTSC, all aspects of the plan are in compliance with all applicable state and federal laws and regulations shall be included.

42450.12.
 (a) The PRO shall review its plan at least every five years after approval by the department and determine whether revisions to the plan are necessary.
(b) If the PRO determines that revisions to the plan are necessary, the PRO shall submit to the department and DTSC a revised plan for review and approval employing the procedures set forth in Section 42450.10. The PRO shall submit the revised plan to the department pursuant to this subdivision at least 12 months prior to the review deadline outlined in subdivision (a) of Section 42450.10. The revised plan shall include a cover letter that summarizes the revisions to the plan.
(c) If the PRO determines that no revisions to the plan are necessary, the PRO shall send a letter to the department and DTSC, 12 months prior to the review deadline outlined in subdivision (a) of Section 42450.10, explaining that the PRO has reviewed the plan and determined that no revisions are needed. The department and DTSC may disapprove the PRO’s determination within 30 days of receipt of the letter if either department concludes that the PRO cannot implement the objectives of this article without revising the plan. In the event either department disapproves the PRO’s determination, that department may indicate to the PRO which sections, at minimum, of the plan need to be revised. The PRO shall submit to the department and DTSC a revised plan, or plan sections, for review and approval, following the procedures set forth in Section 42450.10. The PRO shall submit the revised plan pursuant to this subdivision within 60 days of receipt of disapproval.
(d) The department and DTSC may consult with or submit the revised plan to another state agency or department if it is deemed necessary. The duration of time the department or DTSC takes for this consultation is not included in the time allotted for review pursuant to this section.

42450.13.
 (a) The PRO shall pay all administrative and operating costs associated with establishing and implementing the battery management plan.
(b) The PRO shall establish a method for fully funding the battery management plan in a manner that equitably distributes the plan’s costs among participating battery suppliers that reflects sales volumes, the life of batteries supplied by that battery supplier, and any other related costs. The funding mechanism shall demonstrate adequate funding for all administrative and operational costs of the plan, to be borne by participating battery suppliers, and shall modulate the costs of participating battery supplier’s costs with consideration of the cost of managing their specific vehicle traction batteries according to the approved plan.
(c) Within four months of the effective date of the regulations implementing this article, the department and DTSC shall notify the PRO of the estimated regulatory costs as the criteria for those costs are defined in the regulations adopted pursuant to Section 42450.8, which includes full personnel costs, related to implementing and enforcing this article. This shall include the costs associated with regulation development and other startup activities prior to plan submittal and approval.
(d) The PRO shall, on a schedule determined by the department, pay the department’s actual and reasonable regulatory costs to implement and enforce this article.
(e) (1) The department shall deposit all moneys received from the PRO pursuant to this section into the Vehicle Traction Battery Recovery Fund, which is hereby established in the State Treasury.
(2) Upon appropriation by the Legislature, moneys in the Vehicle Traction Battery Recovery Fund shall be expended to implement and enforce this article, as well as to reimburse any standing loans made from other funds used to finance the regulation and startup costs of the department’s and DTSC activities pursuant to this article.
(3) The money in the Vehicle Traction Battery Recovery Fund shall not be expended for any other purpose.

42450.14.
 (a) The PRO shall keep board minutes, books, and records that clearly reflect the activities and transactions of the PRO.
(b) The PRO shall maintain all records relating to an approved plan for a period of not less than five years.
(c) The department may audit the PRO annually.
(d) Failure of the PRO, or its respective agent who holds records, to produce documents or data that is requested by the department, required to be collected or generated to implement the plan in the form and manner determined by the department, as part of a department audit, or review of a third-party audit, constitutes a violation of this article.

42450.15.
 (a) The PRO, a battery supplier, manufacturer, distributor, retailer, dealer, or importer shall do both of the following:
(1) Upon request, provide the department with reasonable and timely access, as determined by the department, to its facilities and operations, as necessary to determine compliance with this article.
(2) Upon request, within 14 days, provide the department with relevant records, as determined by the department, necessary to determine compliance with this article.
(b) The records required by this article shall be maintained and accessible for five years. All reports and records provided to the department pursuant to this article shall be provided under penalty of perjury.
(c) (1) The department may impose administrative civil penalties pursuant to Section 42450.20 on the PRO, a battery supplier, manufacturer, distributor, retailer, dealer, or importer that fails to provide the department with the access required pursuant to this section.
(2) The department may post a notice on the department’s internet website that is maintained pursuant to Section 42450.19 that a battery supplier that fails to provide the department with access pursuant to this section is no longer in compliance with this article.

42450.16.
 (a) The PRO shall retain an independent public accountant, certified in the United States, to annually audit the accounting books of the PRO. The department shall review the independent certified public accountant audit for compliance with this article and consistency with the approved plan and annual report, submitted pursuant to this article. After the department conducts its own audit, the department shall notify the PRO of any conduct or practice that does not comply with this article or of any inconsistencies identified in the audit. The PRO may obtain copies of the department’s audit, including proprietary information contained in the department’s audit, upon request. The PRO may withhold from disclosure confidential proprietary information to the extent allowed pursuant to Section 1040 of the Evidence Code and Division 10 (commencing with Section 7920.000) of Title 1 of the Government Code. The items submitted to the department as part of the independent audit shall include all of the following:
(1) Financial statements audited in accordance with Generally Accepted Accounting Principles (GAAP)
(2) An audit of the PRO’s compliance with this article.
(3) An audit of the PRO’s adherence to, execution of, and consistency with its plan.
(b) The PRO shall include the independent audit in its annual report submitted to the department pursuant to Section 42450.16 commencing within 18 months of plan approval by the department. The department shall review the audit for compliance with this article and consistency with the applicable approved plan.

42450.17.
 The PRO shall submit to the department, and make publicly available, an annual report, in a format prescribed by the department, that includes, at minimum, all of the following information for the preceding calendar year, unless otherwise specified:
(a) The PRO’s costs, according to the cost categories established in the plan, and revenues.
(b) A summary of any anticipated changes to allocations in cost categories for the next calendar year.
(c) Any changes to the distribution of participating battery supplier’s costs.
(d) The battery suppliers participating in the plan and an updated list of the names and contact information, including email addresses, telephone numbers, and physical and mailing addresses of the battery suppliers.
(e) An estimate of the quantity of vehicle traction batteries sold in or into the state by the battery suppliers covered by the plan, as determined by the best available commercial data.
(f) A description of methods used to collect, transport, send for remanufacturing, reuse, recycle, and otherwise manage vehicle traction batteries by the PRO.
(g) Recommendations for any future proposed substantial changes to the program that may be submitted for the department’s and DTSC’s approval pursuant to Section 42450.10, if applicable.
(h) Any other information required by regulations adopted pursuant to Section 42450.8.

42450.18.
 (a) No later than 120 days after the date the department receives the annual report submitted by a PRO pursuant to Section 42450.17, the department shall notify the PRO if the annual report is compliant or noncompliant.
(b) If the department determines that the annual report is noncompliant due to failure to meet the requirements of this article, the department may require the resubmittal of the annual report or take enforcement action.
(c) The department may consult with or submit the annual report to another state agency or department if it determines that it is necessary for making a determination of compliance or noncompliance of an annual report. The duration of time the department takes for this consultation is not included in the time allotted to the department for review pursuant to this section.

42450.19.
 (a) Within 12 months of the effective date of the regulations and on or before July 1 of each year thereafter, the department shall publish on the department’s internet website, a list of the names of battery suppliers that are compliant with this article. The department shall list, as appropriate, the reported brands of vehicle traction batteries for each battery supplier.
(b) (1) A retailer, dealer, importer, or distributor shall monitor the department’s internet website to determine if a battery supplier, brand, or vehicle traction battery is in compliance with this article for that brand of battery.
(2) A retailer, dealer, importer, or distributor shall not sell, distribute, offer for sale, or import a vehicle traction battery in or into the state unless the battery supplier of the vehicle traction battery is listed as a compliant battery supplier.
(3) This shall not apply to secondary handlers who return a battery to the vehicle from which it was removed and return that vehicle to its owner after repairs or other maintenance have been completed.
(c) Notwithstanding any other provision of this article, upon identification of a battery supplier that is not participating in an approved orphaned battery management plan, the department shall issue a notice of noncompliance to the battery supplier.
(d) If the department determines a battery supplier is not in compliance with this article, the department shall remove the battery supplier, along with its brands of vehicle traction batteries, from the compliance list.
(e) A battery supplier that is not listed on the department’s internet website that demonstrates compliance with this article before the next list is posted by the department may either be added to the internet website or provide a certification letter from the department stating that the battery supplier of a vehicle traction battery is in compliance with this article.

42450.20.
 (a) A civil penalty up to the following amounts may be administratively imposed by the department on any person who is in violation of any provision of this article:
(1) Fifty thousand dollars ($50,000) per day.
(2) One hundred thousand dollars ($100,000) per day if the violation is intentional or knowing.
(b) In assessing or reviewing the amount of a civil penalty imposed pursuant to subdivision (a) for a violation of this article, the department or the court shall consider all of the following:
(1) The nature and extent of the violation.
(2) The number and severity of the violation or violations.
(3) The economic effect of the penalty on the violator.
(4) Whether the entity in violation took good faith measures to comply with this article and the period of time over which these measures were taken.
(5) The willfulness of the violator’s misconduct.
(6) The deterrent effect that the imposition of the penalty would have on both the violator and the regulated community.
(7) Any other factor that justice may require.
(c) Upon written finding that the PRO, a battery supplier, importer, distributor, or any other party has not met a material requirement of this article, in addition to any other penalties authorized under this article, the department may take one or both of the following actions to ensure compliance with the requirements of this article, after affording the PRO, a battery supplier, importer, distributor, or any other party regulated, an opportunity to respond to or rebut the finding:
(1) Revoke the PRO’s plan approval or require the PRO to resubmit the plan or plan section.
(2) Require additional reporting relating to compliance with the material requirements of this article that were not met.
(d) The department shall deposit all penalties collected pursuant to this section into the Vehicle Traction Battery Recovery Penalty Account, which is hereby established in the Vehicle Traction Battery Recovery Fund. Upon appropriation by the Legislature, moneys in the Vehicle Traction Battery Recovery Penalty Account shall be available for expenditure by the department on activities related to the collection, reuse, and recycling of vehicle traction batteries, grants for related purposes, and the administration and enforcement of this article.
(e) The Administrative Adjudication Bill of Rights, as set forth in Article 6 (commencing with Section 11425.10) of Chapter 4.5 of Part 1 of Division 3 of Title 2 of the Government Code, applies to hearings conducted under this article and mandates minimum due process.

42450.21.
 (a) After the time for judicial review under Section 11523 of the Government Code has expired, the department may apply to the small claims court or superior court, depending on the jurisdictional amount and any other remedy sought, in the county where the penalties, restitution, or other remedy was imposed by the department, for a judgment to collect any unpaid civil penalties or restitution or to enforce any other remedy provided by this article. The application, which shall include a certified copy of the final agency order or decision, shall constitute a sufficient showing to warrant the issuance of the judgment. The court clerk shall enter the judgment immediately in conformity with the application. The judgment so entered shall have the same force and effect as, and shall be subject to, all the provisions of law relating to a judgment in a civil action and may be enforced in the same manner as any other judgment of the court. The court shall make enforcement of the judgment a priority.
(b) If, in the judgment of the director, a person has engaged in or is about to engage in an act, practice, or omission that constitutes, or will constitute, a violation of this article, the Attorney General may, at the request of the director, bring an action in the superior court for an order enjoining the act, practice, or omission. The order may require remedial measures and direct compliance with this article. Upon a showing by the director that the person has engaged in or is about to engage in that act, practice, or omission, the superior court may issue a permanent or temporary injunction, restraining order, or other order, as appropriate.
(c) An action brought by the Attorney General pursuant to this section shall have precedence in respect to the order of trial over all other civil actions not brought by or on behalf of the state, except actions regarding probate bonds.

42450.22.
 (a) Except as provided in subdivision (b), an action that is taken by a battery supplier or producer responsibility organization, is not a violation of the Cartwright Act (Chapter 2 (commencing with Section 16700) of Part 2 of Division 7 of the Business and Professions Code), the Unfair Practices Act (Chapter 4 (commencing with Section 17000) of Part 2 of Division 7 of the Business and Professions Code), or the Unfair Competition Law (Chapter 5 (commencing with Section 17200) of Part 2 of Division 7 of the Business and Professions Code) to the extent the battery supplier or producer responsibility organization, is exercising authority pursuant to this article.
(b) Subdivision (a) applies to all of the following actions taken by a PRO:
(1) The creation, implementation, or management of a plan approved or conditionally approved by the department pursuant to Section 42450.10 and the determination of the types or quantities of vehicle traction batteries recycled or otherwise managed pursuant to a plan.
(2) The determination of the cost and structure of an approved plan.
(3) The establishment, administration, collection, or disbursement of a charge associated with funding the implementation of this article.
(c) Subdivision (a) does not apply to an agreement that does any of the following:
(1) Fixes a price of or for vehicle traction batteries.
(2) Fixes the output or production of vehicle traction batteries.
(3) Restricts the geographic area in which, or customers to whom, vehicle traction batteries will be sold.

SEC. 5.

 Section 11545 of the Vehicle Code is amended to read:

11545.
 (a) The department shall collaborate with the California Department of Tax and Fee Administration, the California Environmental Protection Agency, the Department of Toxic Substances Control, the State Water Resources Control Board, the Department of Resources Recycling and Recovery, and the State Air Resources Board to review and coordinate enforcement and compliance activity related to unlicensed and unregulated automobile dismantling, including resulting tax evasion, environmental impacts, and public health impacts.
(b) The department, along with the agencies listed in subdivision (a), may collaborate with and solicit information from district attorneys, certified unified program agencies, code enforcement agencies, and any other federal, state, or local agencies with jurisdictions over unlicensed and unregulated automobile dismantlers to achieve the purposes of this section.
(c) (1) On or before January 1, 2024, the department, in collaboration with the agencies listed in subdivision (a), shall submit a report to the Legislature including, but not limited to, the following:
(A) The number of unlicensed automobile dismantlers investigated and the number of investigations that resulted in an administrative enforcement action, a civil enforcement action, criminal prosecution, or compliance assistance activity.
(B) The number of unlicensed automobile dismantlers investigated and the number of investigations that resulted in an enforcement action for theft of a catalytic converter or purchase, receipt, possession, or sale of a stolen catalytic convertor.
(C) The number of locations used for unlicensed automobile dismantling that were determined to be a public nuisance and the number of actions taken to enjoin, abate, or prevent the illegal activity from continuing.
(D) Progress made to bring unlicensed automobile dismantlers into compliance through the adoption and implementation of the recommendations from the January 21, 2020, report submitted to the Legislature pursuant to Assembly Bill 1858 of the 2015–16 Regular Session.
(E) Remaining statutory, administrative, or regulatory gaps for investigating and prosecuting unlicensed automobile dismantlers.
(F) Recommendations for additional strategies for bringing unlicensed automobile dismantlers into compliance through compliance assistance, education, training, or other identified methods.
(G) Recommendations for modifying, eliminating, or continuing the coordinated enforcement and compliance activities pursuant to this section.
(2) The report required by this subdivision shall be submitted to the Legislature pursuant to Section 9795 of the Government Code.

(d)This section shall remain in effect only until January 1, 2025, and as of that date is repealed, unless a later enacted statute that is enacted before January 1, 2025, deletes or extends that date.

SEC. 6.

 The Legislature finds and declares that Section 4 of this act, which adds Sections 42450.8 and 42450.10 to the Public Resources Code, imposes a limitation on the public’s right of access to the meetings of public bodies or the writings of public officials and agencies within the meaning of Section 3 of Article I of the California Constitution. Pursuant to that constitutional provision, the Legislature makes the following findings to demonstrate the interest protected by this limitation and the need for protecting that interest:
In order to ensure that the competitive market in the state for the manufacture and sale of vehicle traction batteries is not compromised, it is necessary that confidential or proprietary information collected for the purpose of administering a stewardship program be confidential.

SEC. 7.

 No reimbursement is required by this act pursuant to Section 6 of Article XIII B of the California Constitution because the only costs that may be incurred by a local agency or school district will be incurred because this act creates a new crime or infraction, eliminates a crime or infraction, or changes the penalty for a crime or infraction, within the meaning of Section 17556 of the Government Code, or changes the definition of a crime within the meaning of Section 6 of Article XIII B of the California Constitution.