85R2586 JRR-F
	By: Anderson of Dallas	H.B. No. 1874

	A BILL TO BE ENTITLED
	AN ACT
	relating to a program for the recycling of certain household
	batteries; authorizing a fee; providing civil and administrative
	penalties.
	BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
	SECTION 1.  Chapter 361, Health and Safety Code, is amended
	by adding Subchapter P to read as follows:
	SUBCHAPTER P. HOUSEHOLD BATTERY RECYCLING PROGRAM
	Sec. 361.471.  DEFINITIONS. In this subchapter:
	(1)  "Brand" means a name, symbol, word, or traceable
	mark that identifies a covered battery and attributes the covered
	battery to the owner or licensee of the brand as the producer.
	(2)  "Covered battery" means a battery or
	battery-containing product described by Section 361.472(a).
	(3)  "Discarded covered battery" means a covered
	battery that a user discarded or intends to discard, abandon, or
	send for recycling.
	(4)  "Producer" means one of the following with regard
	to a covered battery that is sold or offered for sale in this state:
	(A)  a person that manufactures a covered battery
	and sells or offers for sale that covered battery in this state
	under the person's own name or brand;
	(B)  a person other than a person described by
	Paragraph (A) that owns or licenses a trademark or brand under which
	a covered battery is sold or offered for sale whether or not the
	trademark is registered; or
	(C)  a person other than a person described by
	Paragraph (A) or (B), including a wholesaler or retailer, that
	imports a covered battery into this state for sale.
	(5)  "Recycling" means any process in which discarded
	covered batteries, components, and by-products are transformed
	into new usable or marketable materials in a manner in which the
	original products may lose their identity. The term does not
	include the use of incineration for energy recovery.
	(6)  "Retailer" means a person that offers covered
	batteries for sale at retail in this state through any means,
	including remote offerings such as sales outlets, catalogs, or an
	Internet website.
	(7)  "Stewardship organization" means an organization
	appointed by two or more producers to act as an agent on behalf of
	the producers to design, submit, implement, and administer a
	stewardship program under this subchapter.
	(8)  "Stewardship program" means a program described by
	Section 361.475.
	(9)  "Wholesaler" means a person that offers for sale
	in this state, other than a retail sale, covered batteries intended
	for retail sale.
	Sec. 361.472.  APPLICABILITY. (a) This subchapter applies
	to:
	(1)  a non-rechargeable battery with a battery size of
	4.5-volt, 9-volt, D, C, AA, AAA, AAAA, or A23;
	(2)  a product that contains or is packed with a battery
	described by Subdivision (1);
	(3)  a battery that:
	(A)  is one or more voltaic or galvanic cells
	electrically connected to produce electric energy and designed to
	be recharged and that weighs less than five kilograms; or
	(B)  is a battery pack designed to be recharged,
	that weighs less than five kilograms, and that is designed to
	provide less than 40 volts direct current; and
	(4)  a product that contains or is packed with a battery
	described by Subdivision (3).
	(b)  This subchapter does not apply to:
	(1)  a product described by Subsection (a)(2) or (4)
	from which the battery is not easily removed or is not intended or
	designed to be removed, other than by the manufacturer;
	(2)  a medical device that is a device as defined by 21
	U.S.C. Section 321(h) or a drug as defined by 21 U.S.C. Section
	321(g), if the device or drug or the battery included in the device
	or drug:
	(A)  must be treated as infectious waste when the
	device, drug, or battery is discarded; or
	(B)  is medically contaminated; or
	(3)  a battery described by Subsection (a)(3) that:
	(A)  is not easily removed or is not intended or
	designed to be removed from a product described by Subsection
	(a)(4), other than by the manufacturer;
	(B)  contains electrolyte as a free liquid; or
	(C)  employs lead-acid technology, unless the
	battery:
	(i)  is sealed;
	(ii)  contains no liquid electrolyte; and
	(iii)  is intended by its manufacturer to
	power a handheld device or to provide uninterrupted backup
	electrical power protection for stationary consumer products or
	stationary office equipment.
	Sec. 361.473.  EXEMPTION FOR CERTAIN BATTERY-CONTAINING
	PRODUCTS. (a) In this section:
	(1)  "Primary battery" means a battery described by
	Section 361.472(a)(1) or (3).
	(2)  "Primary battery-containing product" means a
	battery-containing product described by Section 361.472(a)(2) or
	(4).
	(b)  A person that manufactures, sells, offers for sale, or
	imports a primary battery-containing product in this state is not
	considered a producer of a covered battery for purposes of this
	subchapter if, not later than the 45th day after the date of receipt
	of a request from the commission or a producer or stewardship
	organization that is implementing a stewardship program approved by
	the commission under Section 361.475, the person verifies to the
	requestor that the person only uses primary batteries supplied by a
	producer that is:
	(1)  implementing a stewardship program approved by the
	commission under Section 361.475; or
	(2)  a member of a stewardship organization
	implementing a stewardship program approved by the commission under
	Section 361.475.
	(c)  A producer or stewardship organization that is
	implementing a stewardship program that covers the primary battery
	contained in a primary battery-containing product of a person that
	is not considered a producer under Subsection (b) may list the
	person as a participant in the stewardship program implemented by
	the producer or stewardship organization, as applicable.
	Sec. 361.474.  SALES PROHIBITED. (a) A producer of a
	covered battery may not sell, offer for sale, or deliver to a
	retailer for subsequent sale a covered battery unless the producer
	or the stewardship organization in which the producer is
	participating implements a stewardship program approved by the
	commission under Section 361.475, provided that a producer of a
	covered battery may sell, offer for sale, or deliver to a retailer
	for subsequent sale a covered battery that:
	(1)  was manufactured before September 1, 2017; or
	(2)  is delivered, not later than September 1, 2027,
	under a contract for the purchase of covered batteries that was
	executed before September 1, 2017.
	(b)  A retailer or wholesaler may not sell or offer for sale a
	covered battery unless the producer of the covered battery is
	implementing a stewardship program approved by the commission under
	Section 361.475 or is a member of a stewardship organization
	implementing a stewardship program approved by the commission under
	Section 361.475, provided that a retailer or wholesaler may sell or
	offer for sale a covered battery that:
	(1)  was manufactured before September 1, 2017; or
	(2)  is delivered, not later than September 1, 2027, to
	the retailer or wholesaler under a contract for the purchase of
	covered batteries that was executed before September 1, 2017.
	Sec. 361.475.  STEWARDSHIP PROGRAM; COMMISSION APPROVAL OF
	PROGRAM. (a) A producer of a covered battery that sells, offers
	for sale, or delivers to a retailer for a subsequent sale a covered
	battery in this state shall, individually or as part of a
	stewardship organization, implement a stewardship program approved
	by the commission that:
	(1)  in each council of government region of this
	state, provides for the collection of covered batteries from
	consumers at no cost to consumers; and
	(2)  prohibits a producer from refusing to collect a
	covered battery based on the brand or producer of the covered
	battery.
	(b)  A stewardship program submitted to the commission for
	approval must include:
	(1)  the fee prescribed by the commission under
	Subsection (e);
	(2)  a list of all producers participating in the
	program and the brands of covered batteries subject to the program;
	(3)  a description of the method that will be used to
	responsibly manage discarded covered batteries to ensure, to the
	extent economically and technically feasible, that the components
	of the discarded covered batteries are recycled or otherwise
	managed responsibly;
	(4)  a description of the manner in which the program
	will use existing covered battery collection points;
	(5)  an education and outreach program and a
	description of:
	(A)  the outreach procedures that will be used to
	provide notice of the program to businesses, retailers,
	wholesalers, haulers, local governmental entities, and the public;
	and
	(B)  planned public educational activities that,
	at a minimum, notify the public:
	(i)  that there is a free collection program
	for all covered batteries; and
	(ii)  of the location of collection points
	and how to access the collection program;
	(6)  a collection rate performance goal for the brands
	of covered batteries subject to the program; and
	(7)  if the program is submitted by a stewardship
	organization or a producer that does not operate a physical retail
	location in this state, a description of how the program will
	provide convenient, free, statewide collection opportunities for
	discarded covered batteries.
	(c)  Not later than the 30th day after the date of receipt of
	a stewardship program by the commission, including a program that
	is resubmitted under Subsection (d), the commission shall approve
	or disapprove the program. The commission shall approve the program
	if the program demonstrates to the commission's satisfaction that
	the program will comply with the requirements of Subsection (b).
	(d)  If the commission disapproves a stewardship program,
	the commission shall notify the producer or stewardship
	organization in writing of the reasons for disapproval of the
	program. A producer or organization whose program has been
	disapproved by the commission must amend and resubmit the program
	to the commission not later than the 45th day after the date of
	receipt of the notice of disapproval.
	(e)  A producer or stewardship organization must pay an
	application fee in an amount determined by the commission by rule.
	(f)  The commission shall deposit fees collected under this
	section to the credit of the covered battery stewardship account.
	Sec. 361.476.  REPORT. (a) Not later than September 1 of
	each year, a producer or a stewardship organization shall submit to
	the commission a report that includes:
	(1)  a description of the activities carried out under
	the program during the preceding 12 months;
	(2)  the weight of covered batteries collected by the
	producer or the stewardship organization during the preceding 12
	months;
	(3)  the locations for all collection points set up by
	the covered battery producers covered by the program and contact
	information for each location;
	(4)  the manner in which the collected covered
	batteries were sorted, consolidated, and processed; and
	(5)  examples and a description of educational
	materials used to increase collection.
	(b)  When a producer or stewardship organization submits the
	report, the producer or organization shall pay an administrative
	fee in an amount determined by the commission by rule.
	(c)  The commission shall deposit fees collected under this
	section to the credit of the covered battery stewardship account.
	Sec. 361.477.  COVERED BATTERY STEWARDSHIP ACCOUNT.
	(a)  The covered battery stewardship account is an account in the
	general revenue fund that consists of:
	(1)  fees collected under Sections 361.475 and 361.476;
	(2)  administrative penalties collected under
	Subchapter C, Chapter 7, Water Code, for violations of this
	subchapter;
	(3)  civil penalties collected under Subchapter D,
	Chapter 7, Water Code, for violations of this subchapter; and
	(4)  interest earned on the money in the account,
	notwithstanding Section 404.071, Government Code.
	(b)  Money in the account may be appropriated only to the
	commission to implement and administer this subchapter.
	Sec. 361.478.  COMMISSION ORDER. The commission may order a
	producer or stewardship organization to revise the program and to
	take other actions necessary to comply with this subchapter.
	Sec. 361.479.  ENFORCEMENT; DEFENSE. (a)  The commission
	may audit or inspect a producer, stewardship organization,
	retailer, or wholesaler to ensure compliance with this subchapter
	and rules adopted under this subchapter.
	(b)  The commission and the attorney general, as
	appropriate, shall enforce this subchapter and, except as provided
	by Subsections (d) and (e), take enforcement action against a
	producer, stewardship organization, retailer, or wholesaler.
	(c)  The executive director or the attorney general may
	institute a suit under Section 7.032, Water Code, to enjoin an
	activity related to the sale of a covered battery in violation of
	this subchapter.
	(d)  The commission shall issue a warning notice to a person
	on the person's first violation of this subchapter.  The person
	must comply with this subchapter not later than the 60th day after
	the date the warning notice is issued.
	(e)  A retailer or wholesaler who receives a warning notice
	from the commission that the retailer's or wholesaler's inventory
	violates this subchapter because it includes covered batteries from
	a producer that is not in compliance with this subchapter must bring
	the inventory into compliance with this subchapter not later than
	the 60th day after the date the warning notice is issued.
	(f)  In an enforcement action brought against a producer or
	stewardship organization for a violation of this subchapter, it is
	a defense to the action that the violation occurred as a result of a
	county or municipal regulation that made it substantially
	burdensome for the producer or stewardship organization to
	implement the stewardship program.
	(g)  An administrative or civil penalty collected under
	Subchapter C or D, Chapter 7, Water Code, for a violation of this
	subchapter shall be deposited to the credit of the covered battery
	stewardship account.
	Sec. 361.480.  CIVIL ACTION AGAINST PRODUCER WITH NO
	STEWARDSHIP PROGRAM. (a) Except as provided by Subsection (e), a
	plaintiff stewardship organization may bring a civil action against
	a producer described by Subdivision (2) at any time to recover
	damages described by Subsection (b) if:
	(1)  the plaintiff is a stewardship organization that:
	(A)  is a nonprofit organization or an
	organization exempt from federal income tax under Section 501(a),
	Internal Revenue Code of 1986; and
	(B)  during the implementation of a stewardship
	program approved by the commission under Section 361.475, incurred
	more than $250,000 in costs collecting and recycling discarded
	covered batteries in this state during the preceding calendar year;
	and
	(2)  the producer from which damages are sought was not
	implementing a stewardship program approved by the commission under
	Section 361.475 or a member of a stewardship organization
	implementing a stewardship program approved by the commission under
	Section 361.475 during the period the plaintiff incurred damages
	recoverable under Subsection (b).
	(b)  A court shall award a plaintiff stewardship
	organization that prevails in a civil action under this section
	damages in an amount equal to the sum of:
	(1)  the plaintiff's total costs of collecting and
	recycling discarded covered batteries in this state during the
	period alleged, multiplied by the percentage of discarded covered
	batteries, by weight, for which the defendant is identifiable as
	the producer; and
	(2)  the amount described by Subdivision (1),
	multiplied by the percentage of discarded covered batteries, by
	weight, for which the producer cannot be identified.
	(c)  In addition to an award of damages under Subsection (b),
	the court shall award a plaintiff stewardship organization that
	prevails in a civil action under this section:
	(1)  the plaintiff's litigation costs, including court
	costs and reasonable expenses such as attorney's fees and expert
	witness fees; and
	(2)  exemplary damages in an amount equal to three
	times the amount awarded under Subsection (b).
	(d)  For purposes of Subsection (b), the percentage of
	discarded covered batteries for which the defendant is identifiable
	as the producer and the percentage of discarded covered batteries
	for which the producer cannot be identified must be determined by
	using a sample of not less than 500 pounds of randomly selected
	discarded covered batteries that were collected in this state by
	the plaintiff.
	(e)  A stewardship organization described by Subsection
	(a)(1) may not commence a civil action under this section unless the
	stewardship organization gives written notice stating the amount of
	the claim and the basis for its calculation to each defendant not
	later than the 60th day before the date the action commences.
	(f)  A civil action under this section may be brought against
	one or more defendants.
	Sec. 361.481.  CIVIL ACTION AGAINST PRODUCER PARTICIPATING
	IN APPROVED STEWARDSHIP PROGRAM. (a) In this section:
	(1)  "Allocated share" means the percentage of
	discarded covered batteries, by weight, identified as being the
	responsibility of a producer, as determined by data generated from
	a set of qualifying discarded battery sorts.
	(2)  "Data generated from a set of qualifying discarded
	battery sorts" means the data described by Subsection (e).
	(3)  "Stewardship program sort goal" means the sum of
	discarded covered batteries, by weight, identified as being the
	responsibility of all producers participating in a stewardship
	program implemented by a plaintiff stewardship organization, as
	determined by data generated from a set of qualifying discarded
	battery sorts, multiplied by:
	(A)  10 percent, if the discarded covered
	batteries are collected on or after September 1, 2018, but before
	September 1, 2021;
	(B)  15 percent, if the discarded covered
	batteries are collected on or after September 1, 2021, but before
	September 1, 2024; or
	(C)  20 percent, if the discarded covered
	batteries are collected on or after September 1, 2024.
	(b)  A plaintiff stewardship organization may bring a civil
	action against a producer described by Subdivision (2) to recover
	damages described by Subsection (c) if:
	(1)  the plaintiff:
	(A)  is a stewardship organization described by
	Section 361.480(a)(1); and
	(B)  collected during the preceding calendar year
	a weight of discarded covered batteries in excess of the
	plaintiff's stewardship program sort goal; and
	(2)  the producer from which damages are sought was
	participating in a stewardship program implemented by a stewardship
	organization other than the plaintiff stewardship organization
	during the period the plaintiff incurred damages recoverable under
	Subsection (c).
	(c)  A court shall award a plaintiff stewardship
	organization that prevails in a civil action under this section
	damages in an amount equal to the plaintiff's total costs of
	collecting and recycling discarded covered batteries in this state
	during the period alleged, multiplied by the defendant's allocated
	share of the weight of discarded covered batteries collected by the
	plaintiff in excess of the plaintiff's stewardship program sort
	goal.
	(d)  In addition to an award of damages under Subsection (c),
	the court may award a plaintiff stewardship organization that
	prevails in a civil action under this section the plaintiff's
	litigation costs, including court costs and reasonable expenses
	such as attorney's fees and expert witness fees, if the court finds
	that the award of litigation costs will serve the interests of
	justice.
	(e)  In a civil action brought under this section, a
	plaintiff stewardship organization's stewardship program sort goal
	and a defendant's allocated share must be determined using the
	total data collected from sorting 500 pounds of discarded covered
	batteries collected at each of not fewer than three locations in
	this state reasonably believed to be representative of the
	population of this state. Generated data must include:
	(1)  the brands of collected discarded covered
	batteries;
	(2)  the weight of each brand collected; and
	(3)  the percentage shares of the total collected
	weight attributable to each identifiable brand and to all discarded
	covered batteries not identifiable by brand.
	(f)  The sorting of discarded covered batteries described by
	Subsection (e):
	(1)  may be undertaken at any time after the plaintiff
	stewardship organization's stewardship program is approved by the
	commission under Section 361.475; and
	(2)  may not take place over a period that exceeds five
	years.
	(g)  A stewardship organization described by Subsection
	(b)(1) may not commence a civil action under this section unless the
	stewardship organization gives written notice stating the amount of
	the claim and the basis for its calculation to each defendant not
	later than the 60th day before the date the action commences.
	(h)  A civil action under this section may be brought against
	one or more defendants.
	SECTION 2.  (a)  Not later than February 1, 2018, the Texas
	Commission on Environmental Quality shall adopt any rules or forms
	needed to implement Subchapter P, Chapter 361, Health and Safety
	Code, as added by this Act.
	(b)  Not later than March 1, 2018, the Texas Commission on
	Environmental Quality shall begin accepting plans seeking approval
	for and approving stewardship programs established under
	Subchapter P, Chapter 361, Health and Safety Code, as added by this
	Act.
	(c)  A producer of covered batteries is not required to
	implement a stewardship program under Subchapter P, Chapter 361,
	Health and Safety Code, as added by this Act, before September 1,
	2018.
	(d)  This Act may not be enforced before September 1, 2018.
	(e)  The first report required by Section 361.476, Health and
	Safety Code, as added by this Act, is due September 1, 2020.
	SECTION 3.  This Act takes effect immediately if it receives
	a vote of two-thirds of all the members elected to each house, as
	provided by Section 39, Article III, Texas Constitution.  If this
	Act does not receive the vote necessary for immediate effect, this
	Act takes effect September 1, 2017.