[Senate Hearing 109-988]
[From the U.S. Government Publishing Office]



                                                        S. Hrg. 109-988
 
                            ELECTRONIC WASTE

=======================================================================

                                HEARING

                               BEFORE THE

                            SUBCOMMITTEE ON
                     SUPERFUND AND WASTE MANAGEMENT

                                 of the

                              COMMITTEE ON
                      ENVIRONMENT AND PUBLIC WORKS
                          UNITED STATES SENATE

                       ONE HUNDRED NINTH CONGRESS

                             FIRST SESSION

                               __________

                             JULY 26, 2005

                               __________

  Printed for the use of the Committee on Environment and Public Works


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                               __________

               COMMITTEE ON ENVIRONMENT AND PUBLIC WORKS

                       ONE HUNDRED NINTH CONGRESS

                             FIRST SESSION

                  JAMES M. INHOFE, Oklahoma, Chairman
JOHN W. WARNER, Virginia             JAMES M. JEFFORDS, Vermont
CHRISTOPHER S. BOND, Missouri        MAX BAUCUS, Montana
GEORGE V. VOINOVICH, Ohio            JOSEPH I. LIEBERMAN, Connecticut
LINCOLN CHAFEE, Rhode Island         BARBARA BOXER, California
LISA MURKOWSKI, Alaska               THOMAS R. CARPER, Delaware
JOHN THUNE, South Dakota             HILLARY RODHAM CLINTON, New York
JIM DeMINT, South Carolina           FRANK R. LAUTENBERG, New Jersey
JOHNNY ISAKSON, Georgia              BARACK OBAMA, Illinois
DAVID VITTER, Louisiana
                Andrew Wheeler, Majority Staff Director
                 Ken Connolly, Minority Staff Director
                                 ------                                

             Subcommittee on Superfund and Waste Management

                   JOHN THUNE, South Dakota, Chairman

JOHN W. WARNER, Virginia             BARBARA BOXER, California
CHRISTOPHER S. BOND, Missouri        MAX BAUCUS, Montana
JOHNNY ISAKSON, Georgia              FRANK R. LAUTENBERG, New Jersey


                            C O N T E N T S

                              ----------                              
                                                                   Page

                             JULY 26, 2005
                           OPENING STATEMENTS

Boxer, Hon. Barbara, U.S. Senator from the State of California...     3
Inhofe, Hon. James M., U.S. Senator from the State of Oklahoma...     2
Jeffords, Hon. James M., U.S. Senator from the State of Vermont..     5
Lautenberg, Hon. Frank R., U.S. Senator from the State of New 
  Jersey, prepared statement.....................................    42
Thune, Hon. John, U.S. Senator from the State of South Dakota....     1

                               WITNESSES

Davis, Sheila, executive director, Silicon Valley Toxics 
  Coalition......................................................    27
    Prepared statement...........................................    87
    Responses to additional questions from:
        Senator Boxer............................................    93
        Senator Jeffords.........................................    88
        Senator Lautenberg.......................................    92
Dunne, Thomas P., Acting Assistant Administrator, Office of Solid 
  Waste and Emergency Response, U.S. Environmental Protection 
  Agency.........................................................    14
    Prepared statement...........................................    46
    Responses to additional questions from:
        Senator Boxer............................................    50
        Senator Inhofe...........................................    49
        Senator Jeffords.........................................    54
        Senator Lautenberg.......................................    54
Goss, Richard, director of Environmental Affairs, Electronic 
  Industries 
  Alliance.......................................................    33
    Prepared statement...........................................   113
    Responses to additional questions from:
        Senator Boxer............................................   118
        Senator Inhofe...........................................   114
        Senator Jeffords.........................................   116
Hickle, Garth T., principal planner, Minnesota Office of 
  Environmental 
  Assistance.....................................................    18
    Prepared statement...........................................    67
    Responses to additional questions from:
        Senator Boxer............................................    85
        Senator Jeffords.........................................    85
        Senator Lautenberg.......................................    87
Slesinger, Scott, vice president for Government Affairs, 
  Environmental Technology Council...............................    32
    Prepared statement...........................................   102
    Responses to additional questions from:
        Senator Boxer............................................   111
        Senator Jeffords.........................................   109
        Senator Lautenberg.......................................   112
Stephenson, John B., Director, Natural Resources and Environment, 
  U.S. Government Accountability Office..........................    16
    Prepared statement...........................................    54
    Responses to additional questions from:
        Senator Boxer............................................    65
        Senator Inhofe...........................................    65
        Senator Jeffords.........................................    66
        Senator Lautenberg.......................................    66
Talent, Hon. James, U.S. Senator from the State of Missouri......     9
    Prepared statement...........................................    44
Thompson, Hon. Mike, U.S. Representative from the State of 
  California.....................................................    10
    Prepared statement...........................................    45
Vitelli, Michael, senior vice president, Consumer Electronics and 
  Product Management, Best Buy Company, Inc......................    29
    Prepared statement...........................................    95
    Responses to additional questions from:
        Senator Boxer............................................   102
        Senator Inhofe...........................................   101
        Senator Jeffords.........................................   101
Wyden, Hon. Ron, U.S. Senator from the State of Oregon...........     8
    Prepared statement...........................................    43

                          ADDITIONAL MATERIAL

Letter, from Gallagher, Dawn R., Commissioner, Maine Department 
  of Environmental Protection to Senators Thune and Boxer........   163
Report, SB20, Determination of regulated elements in discarded 
  laptop computers, LCD monitors, Plasma TVs and LCD TVs.........   164
Statements:
    Basel Action Network, Seattle, WA............................   124
    Cassel, Scott, executive director, Product Stewardship 
      Institute, Inc.............................................   161
    Consumer Electronics Association.............................   130
    Isaac, David, director, Government and Public Policy on 
      Behalf of Hewlett--Packard Company (HP)....................   118
    Retail Industry Leaders Association..........................   123
    Sheehan, Bill, Ph.D., director, Product Policy Institute.....   132


                            ELECTRONIC WASTE

                              ----------                              


                         TUESDAY, JULY 26, 2005

                               U.S. Senate,
         Committee on Environment and Public Works,
            Subcommittee on Superfund and Waste Management,
                                                    Washington, DC.
    The subcommittee met, pursuant to notice, at 2:30 p.m. in 
room 406, Senate Dirksen Building, Hon. John Thune (chairman of 
the subcommittee) presiding.
    Present: Senators Thune, Inhofe, Boxer and Jeffords.

  OPENING STATEMENT OF HON. JOHN THUNE, U.S. SENATOR FROM THE 
                     STATE OF SOUTH DAKOTA

    Senator Thune. The hearing will come to order.
    I want to welcome our panelists and say good afternoon.
    We are here this afternoon to hear testimony from various 
stakeholders concerning an issue that has been receiving an 
increased amount of attention as various States begin to 
grapple with the disposal of obsolete, electronic devices. Not 
only is the topic new to this committee but it also marks my 
first hearing as subcommittee chairman. As this hearing gets 
underway, I want to thank my fellow subcommittee members for 
joining me today and look forward to working with them in the 
future regarding this and other issues under our subcommittee's 
purview.
    According to the Consumer Electronics Association, 
Americans own some 2 billion electronic products, about 24 
products per household. Though e-waste constitutes less than 
1.5 percent of municipal solid waste, it is piling up at three 
times the rate of other household trash according to the EPA. 
Like many American families, I am sure that there are a 
majority of folks in the hearing room today who have older 
televisions or computers sitting around their homes because 
they just don't know what to do with them.
    While some interest groups claim that electronic waste such 
as TVs, computers and computer monitors pose a significant risk 
to human health due to the presence of toxins such as lead, 
mercury and cadmium, I look forward to hearing more from the 
EPA and other witnesses about the risk if any that electronics 
pose to the general public when disposed of in municipal 
landfills.
    While it is currently possible for older electronics to be 
recycled in hopes of recovering precious metals such as gold, 
copper, aluminum and platinum, the latest estimates from the 
Environmental Protection Agency show that consumers only 
recycle roughly 10 percent of all electronics. The remaining 90 
percent of used consumer electronics are in storage, disposed 
of in landfills or incinerators or exported for reuse or 
recycling.
    I also look forward to hearing from our third panel which 
represents various stakeholders from the retail, manufacturing, 
recycling and environmental sectors. Particularly, I am 
interested in learning more about what each of our witnesses 
think of the emerging patchwork of States' e-waste initiatives 
and what it means to not only the future of collection and 
recycling but also what impact the differing State e-waste 
initiatives mean to the U.S. economy and the competitive 
position of the U.S. electronics industry.
    Before turning to our first panel, I would like to 
recognize Senator Boxer, the Ranking Member of our subcommittee 
for her opening statement. As many of you may know, California 
has placed a ban on electronics from the landfill and has 
created its own statewide program regarding e-waste. As I 
discovered in preparation for this hearing, it seems this issue 
is very similar to layers of an onion, the more you learn, the 
more complex it becomes.
    I would be happy to yield to the Senator from California, 
Senator Boxer.
    Senator Boxer. Thank you so much, Senator, for holding this 
hearing and I am very grateful to our colleagues on our first 
panel and look forward to their remarks.
    I would like to read an opening statement. It will last 
around 5 minutes. Is that OK?
    Senator Thune. That is fine.
    Senator Boxer. I see that the chairman of the full 
committee is here. I am very happy to see you, Senator.
    Senator Inhofe. Would you mind yielding to me for just a 
moment?
    Senator Boxer. No, I would not mind.
    Senator Inhofe. Thank you, Senator Boxer.
    We are this close to finishing up our highway bill.
    Senator Boxer. I had that feeling when I looked at your 
face.

 OPENING STATEMENT OF HON. JAMES M. INHOFE, U.S. SENATOR FROM 
                     THE STATE OF OKLAHOMA

    Senator Inhofe. So I cannot spend a lot of time here but I 
wanted to come by and just briefly say, first of all, 
congratulations to Senator Thune. This is your first 
chairmanship and your first meeting of your chairmanship and 
there is no more important subcommittee than the one you have. 
Being the home of the most devastating of all superfund sites, 
Tar Creek, it is one I am very sensitive to the issues before 
this committee.
    I would say this is a very significant issue and you are 
diving into a very complicated issue at this time. I know that 
you and Senator Boxer will be able to handle this. I applaud 
both of you for giving it your attention.
    I would ask unanimous consent that my formal statement be 
made a part of the record at this point.
    Senator Thune. Without objection.
    Senator Inhofe. Thank you.
    [The prepared statement of Senator Inhofe follows:]
       Statement of Hon. James M. Inhofe, U.S. Senator from the 
                           State of Oklahoma
    I would like to take a moment to congratulate Subcommittee Chairman 
Thune on his first hearing. Senator Thune has already demonstrated a 
great ability to consider legislation and balance the interests of 
diverse groups of stakeholders. I am confident that as Chairman of the 
Subcommittee on Superfund and Waste Management, he will lead on several 
important issues facing our Nation.
    I must say, Mr. Chairman, you are certainly diving right into a big 
issue with today's hearing. The issue of electronics waste and 
recycling has become one that a lot of people talk about but have had 
difficulty in defining what the problems are much less potential 
solutions.
    Various interest groups and European Nations have been pushing for 
laws restricting electronics waste and require recycling. A handful of 
States have passed or are contemplating legislation that adopts 
differing regulatory approaches.
    Enacting environmental regulations cost money, and the subject of 
funding various e-waste and recycling programs is one of the bedrock 
issues of today's hearing. In reviewing the various approaches and 
responses from individual stakeholders one thing is clear: the issue of 
electronics waste and recycling has tremendous impacts on the 
competitiveness of companies.
    The electronics industry is one of the most price sensitive, and 
shifting compliance costs may have serious consequences that could 
jeopardize a business's future. Congress should take care in proposing 
laws that may pick winners and losers.
    Upon assuming the Chairmanship of the Environment Committee I 
pledged to focus on well grounded science as a benchmark for 
regulations. In applying that standard here, I am concerned with 
considering the best approach given the potential benefits versus the 
costs.
    To my knowledge, EPA is unaware of a single instance where toxins 
from electronics have leeched from a landfill. I am not suggesting that 
people must be injured before Congress or the Agency should act, 
however, I firmly believe that regulations should not be imposed for 
the sake of imposing regulations based upon the precautionary 
principle.
    Further, Americans enjoy their electronics and domestic businesses 
have prospered as a result. However, dictating technology or increasing 
the costs of popular consumer goods based on circumstances still being 
studied may have a stifling effect on the highly competitive and global 
electronics sector.
    This is the first hearing the Environment and Public Works 
Committee has ever held on electronics waste and the first hearing for 
Subcommittee Chairman Thune. I am confident that he will review and 
balance all of the points of view in considering this very complex 
issue. I look forward to working with him.

    Senator Thune. We thank the chairman for joining us and the 
best of luck with the Highway bill, something in which we are 
all very interested.
    Senator Boxer. Thank you.
    Senator Inhofe, get it done. I know you will get it done. 
If anyone can do this, you can.
    Senator Inhofe. Thank you.

OPENING STATEMENT OF HON. BARBARA BOXER, U.S. SENATOR FROM THE 
                      STATE OF CALIFORNIA

    Senator Boxer. Each day more than 3,000 tons of electronic 
products are discarded. Every year, 50 million computers become 
obsolete. This waste from electronic products makes up an ever-
increasing share of our Nation's total amount of solid waste. 
Even though it is going to be complicated, Mr. Chairman, I 
think you have struck a nerve because this is an important 
issue for us to get a handle on.
    This electronic waste is not like normal food scraps that 
every American throws out. Waste from electronic products can 
be very toxic. Let me use TVs as an example. There are an 
estimated 287 million analog TVs in our Country. Each TV like 
each computer monitor contains an average of 4 pounds of lead. 
If you do the math, you are talking about a lot of lead.
    We are quickly moving into the digital age and many people 
in the very near future will switch to digital TV sets. I serve 
on the Commerce Committee where we are looking at that issue, 
the move to digital and how to make it go faster. Over time, if 
90 percent of the analog TVs are thrown out, our landfills 
could be burdened with more than 1 billion pounds of lead, just 
from TVs.
    Lead is not the only hazardous substance from electronic 
products. Electronic waste also contains heavy metals which my 
colleague has talked about, cadmium, arsenic and mercury. 
Unless disposed of properly, these substances can damage almost 
every system in the human body. We know about these products 
and we know about these heavy metals.
    Municipal landfills are meant to hold trash, not extremely 
toxic material. Hazardous substances from crushed glass and 
other electronic debris can leak from landfills and threaten 
the nearby groundwater. The toxic substances in electronic 
wastes are known or suspected of causing cancer and birth 
defects. We know that lead can lower the IQs of children and 
damage their hearing. The toxic waste in these products can 
also damage the lungs, the liver, the kidneys and injure the 
human endocrine, cardiac, skeletal and nervous systems.
    As my colleague from South Dakota, the chairman of this 
subcommittee pointed out, California has been one of the 
leading States in dealing with the problem, perhaps because we 
have a high concern for environment and also because we have 
such a large tech industry and frankly, a tech industry that 
has really been aware and sensitive to these problems.
    Whatever the reason, California encourages recycling of e-
products. The State has established a fee-based system that 
promotes the collection and recycling of cathode ray tubes. The 
State has also banned the disposal of cathode ray tubes in 
municipal landfills recognizing that many facilities may not be 
able to protect human health from toxins that can leach from 
such landfills. California has also established a program that 
requires retailers to take back cell phones for recycling.
    I look forward to hearing from all of our witnesses 
starting with our esteemed colleagues and from people who are 
in California and other States trying to deal with this. 
Unfortunately, throughout most of the Country, the steps that 
California has taken have not been taken and much of this 
dangerous waste ends up in municipal landfills or is even 
shipped overseas for someone else to deal with our problems.
    I think it is really important. This is a silent problem 
and we can't let these wastes silently seep into our drinking 
water supplies and then suddenly note an outbreak of some 
horrible problem with our children who as you know I always say 
are our most vulnerable, pregnant women, infants and children. 
That is kind of the place where we see it first. We cannot wait 
that long, Mr. Chairman. So my deepest thanks go to you for 
this hearing and I hope we can meet these challenges in a 
bipartisan way.
    Thank you.
    [The prepared statement of Senator Boxer follows:]

        Statement of Hon. Barbara Boxer, U.S. Senator from the 
                          State of California

    Good afternoon Mr. Chairman.
    I would like to thank you for holding a subcommittee hearing on 
such an important topic.
    Each day, more than 3,000 tons of electronic products are 
discarded. Every year, 50 million computers become obsolete. This waste 
from electronic products makes up an ever-increasing share of our 
Nation's total amount of solid waste. But, this electronic waste is not 
like the normal food scraps that every American throws out. Waste from 
electronic products can be very toxic.
    Let me use TVs as an example. There are an estimated 287 million 
analog TVs in our country. Each TV, like each computer monitor, 
contains an average of four pounds of lead. We are quickly moving into 
the digital age in TV. And, many people in the very near future will 
switch to digital TV sets. Over time, if 90 percent of the analog TVs 
are thrown out, our landfills could be burdened with more than 1 
billion pounds of lead, just from TVs.
    Lead is not the only hazardous substance from electronic products. 
Electronic waste also contains heavy metals such as cadmium, arsenic, 
and mercury.
    Unless disposed of properly, these substances can damage almost 
every system in the human body.
    Municipal landfills are meant to hold trash, not extremely toxic 
material. Hazardous substances from crushed glass and other electronic 
debris can leak from landfills and threaten nearby groundwater.
    The toxic substances in electronic waste are known or suspected of 
causing cancer and birth defects. We know that lead can lower the IQs 
of children and damage their hearing. The toxic waste in these products 
can also damage the lungs, liver, and kidneys and injure the human 
endocrine, cardiac, skeletal, and nervous systems.
    California has been one of the leading States in dealing with the 
problem--perhaps because we have such a high concern for our 
environment, perhaps because we have such a large tech industry, or 
perhaps both. Whatever the reason, California encourages recycling of 
electronic products.
    The state has established a fee-based system that promotes the 
collection and recycling of cathode ray tubes. The state has also 
banned the disposal of cathode ray tubes in municipal landfills, 
recognizing that many facilities may not be able to protect human 
health from toxins that can leach from such landfills.
    California has also established a program that requires retailers 
to take back cell phones for recycling.
    I look forward to hearing from one of our witnesses today, Ms. 
Sheila Davis, Executive Director of the Silicon Valley Toxics 
Coalition, and other witnesses about the recycling program in 
California and other States.
    Unfortunately, throughout most of the country, these steps have not 
been taken and much of this dangerous waste ends up in municipal 
landfills or is shipped overseas.
    We must not ship our problems to other countries or allow them to 
silently seep into our drinking water supplies. We must meet the 
challenge before us.

    Senator Thune. Thank you, Senator Boxer.
    We have been joined by the Ranking Member of the full 
committee, Senator Jeffords from Vermont. Would you like to 
make an opening statement, Senator Jeffords?

OPENING STATEMENT OF HON. JAMES M. JEFFORDS, U.S. SENATOR FROM 
                      THE STATE OF VERMONT

    Senator Jeffords. Yes, I would.
    Thank you, Mr. Chairman, for holding this general oversight 
hearing for electronic waste.
    Computers, televisions and other electronic products have 
enriched our lives in a multitude of ways. They have also 
created a new problem, how to appropriately manage these 
products once they reach the end of their useful life. The 
sheer volume of electronic waste is staggering. Each year an 
estimated 220 tons of computers and other electronic wastes are 
dumped in landfills or incinerated in the United States.
    It is estimated that almost 50 million computers and 
monitors and approximately 20 million televisions became 
obsolete in the year 2003. The challenge of properly managing 
this much scrap is compounded by the presence of harmful 
toxins. EPA confirms that electronic scrap often qualifies as 
``hazardous waste'' because it fails the Agency's toxicity 
test.
    Each computer and the monitor contain an average of 4 to 8 
pounds of lead, making computer monitors and televisions the 
greatest source of lead in municipal waste. The greatest source 
of mercury in these landfills is from batteries, switches and 
printed wiring boards. Likewise, the leading source of cadmium 
is the rechargeable nickel-cadmium battery found in the top 
computers.
    From a resource conservation perspective, it is far better 
to reuse and recycle these materials rather than discarding 
them. For instance, the U.S. Geological Survey reports that 1 
metric ton of computer scrap contains more gold than 17 tons of 
ore and much lower levels of harmful elements common to ores 
such as arsenic, mercury and sulfur.
    However, in 2003, only 10 percent of consumer electronics 
were recycled in the United States. The remaining 90 percent 
were stored, disposed of in landfills or incinerators or 
exported for use and recycling.
    In the absence of a national solution, a patchwork of 
differing State requirements is emerging. Four States have 
banned landfill disposal by cathode ray tubes and three States 
have passed electronic waste legislation; 26 other States 
reportedly are considering electronic waste legislation.
    Some retailers and manufacturers have created voluntarily 
recycling programs to deal with the problem. This patchwork of 
State regulation and limited industry involvement is not 
sufficient to address the expected growth in electronic waste. 
There is also concern that it could place unnecessary costs on 
U.S. manufacturers if forced to comply with these inconsistent 
State regulations.
    For these reasons, a national program is needed to provide 
incentives for the greater collection and proper recycling of 
electronic waste. The key question is how to finance the 
development of the infrastructure needed to address this 
looming problem. A variety of options have been proposed 
ranging from an advanced recovery fee on the sale of new 
equipment to a requirement that manufacturers take back their 
own equipment.
    Senators Wyden and Talent have suggested an innovative 
alternative approach that uses tax incentives to encourage 
greater recycling. I was pleased to work with Senator Wyden in 
a similar recycling tax incentive in the Senator Energy bill. 
That provision would create a 15 percent tax credit for the 
purpose of equipment used to process or sort recycled materials 
including electronic waste. While modest, this provision is a 
first step toward building an electronic waste recycling 
infrastructure.
    I look forward to hearing the expert testimony today from 
the EPA, industry and other interested stakeholders and their 
views on how to develop, fund and administer a national 
electronic waste recycling program. I hope to be able to work 
with you and other members of the subcommittee on bipartisan 
legislation that would help build the infrastructure to 
mitigate the environmental impacts from electronic waste 
disposal and to maximize the resource recovery to be gained by 
greater electronic waste recycling.
    Thank you.
    [The prepared statement of Senator Jeffords follows:]

      Statement of Hon. James M. Jeffords, U.S. Senator from the 
                            State of Vermont

    Mr. Chairman, thank you for holding this general oversight hearing 
on electronic waste.
    Computers, televisions and other electronic products have enriched 
our lives in a multitude of ways. They have also created a new problem: 
how to properly manage these products once they reach the end of their 
useful life.
    The sheer volume of electronic waste is staggering. Each year, an 
estimated 220 tons of computers and other electronic waste are dumped 
in landfills or incinerated in the United States. It is estimated that 
almost 50 million computers and monitors and approximately 20 million 
televisions became obsolete in 2003.
    The challenge of properly managing this much scrap is compounded by 
the presence of harmful toxins. EPA confirms that electronic scrap 
often qualifies as ``hazardous waste'' because it fails the Agency's 
toxicity test. Each computer and monitor contains an average of 4 to 8 
pounds of lead, making computer monitors and televisions the greatest 
source of lead in municipal landfills. The greatest source of mercury 
in these landfills is from batteries, switches, and printed wiring 
boards. Likewise, the leading source of cadmium is from rechargeable 
nickel-cadmium batteries found in laptop computers.
    From a resource conservation perspective, it is far better to reuse 
and recycle these materials rather than discard them. For instance, the 
U.S. Geological Survey reports that 1 metric ton of computer scrap 
contains more gold than 17 tons of ore and much lower levels of harmful 
elements common to ores, such as arsenic, mercury, and sulfur. However, 
in 2003, only 10 percent of consumer electronics were recycled in the 
United States. The remaining 90 percent were stored, disposed of in 
landfills or incinerators, or exported for reuse or recycling.
    In the absence of a national solution, a patchwork of differing 
State requirements is emerging. Four States have banned landfill 
disposal of cathode ray tubes and three States have passed electronic 
waste legislation. Twenty six other States reportedly are considering 
electronic waste legislation. Some retailers and manufacturers have 
created voluntary recycling programs to deal with this problem. This 
patchwork of State regulation and limited industry involvement is not 
sufficient to address the expected growth in electronic waste. I'm also 
concerned that it could place unnecessary costs on U.S. manufacturers 
if forced to comply with inconsistent State regulations.
    For these reasons, a national program is needed to provide 
incentives for the greater collection and proper recycling of 
electronic waste. The key question is how to finance the development of 
the infrastructure needed to address this looming problem. A variety of 
options have been proposed, ranging from an advance recovery fee on the 
sale of new equipment to a requirement that manufacturers take back 
their own equipment. Senators Wyden and Talent have suggested an 
innovative alternative approach that uses tax incentives to encourage 
greater recycling.
    I was pleased to work with Senator Wyden on a similar recycling tax 
incentive in the Senate Energy bill. The provision would create a 15 
percent tax credit for the purchase of equipment used to process or 
sort recycled materials, including electronic waste. While modest, this 
provision is a first step toward building an electronic waste recycling 
infrastructure.
    I look forward to hearing the expert testimony today from EPA, 
industry and other interested stakeholders on their views on how to 
develop, fund, and administer a national electronic waste recycling 
program. I hope to be able to work with you and other members of this 
subcommittee on bipartisan legislation that would help build the 
infrastructure to mitigate the environmental impacts from electronic 
waste disposal and to maximize the resource recovery to be gained by 
greater electronic waste recycling.

    Senator Thune. I thank the Senator from Vermont.
    I want to recognize our panel of distinguished colleagues. 
When Senators Wyden and Talent first approached me about doing 
a hearing on e-waste, I had to figure out exactly what it was 
they were referring to. I had heard of e-mail and e-commerce 
and I guess it makes sense that we have e-waste. It is an issue 
that I think more and more people in this Country can now 
identify with. There are a lot of us that it becomes very 
personal when you have a computer that is outdated and can't 
figure out what to do with it. Frankly, there is a patchwork of 
different State initiatives out there.
    I had the conversation with some of our colleagues on the 
House side who had a hearing on this recently and said, we have 
a lot discussed about the problem, but we didn't have much come 
out in the form of solutions. I am hopeful that on the Senate 
side, you will have something more in the form of solutions.
    Senators Wyden and Talent have introduced legislation that 
is a tax credit proposal. I want to give them great credit for 
taking the initiative to come up with something that attempts 
to provide incentives for people to figure out how to use and 
recycle many of these products.
    We will hear as well from our colleague from the House 
side, Mike Thompson as well, but I want to start first with our 
Senate colleagues. Senator Wyden, Senator Talent informs me 
that you are the real guy spearheading this so you get to go 
first. We would love to hear from you.

  STATEMENT OF HON. RON WYDEN, U.S. SENATOR FROM THE STATE OF 
                             OREGON

    Senator Wyden. We are a bipartisan team and I will just 
tell you that we are supposed to be discouraging gratuitous 
filibusters around here, so if I could just have my statement 
put in the record, let me perhaps make a few comments. Then I 
will turn it over to our friend, Jim Talent.
    This really is a day of firsts and congratulations to you 
on your first hearing. This is the first time we have ever had 
a hearing on electronic trash, No. 1. Second, we have never had 
a bipartisan bill before and third, this is really a first in 
terms of a different approach. Senator Boxer is dead right, our 
States have done a variety of work in this area and have tried 
to be innovative.
    It has always involved one of two things, either up front 
fees which I think will hurt consumers and make it hard to get 
them interested or slapping manufacturers with more taxes. 
Senator Talent and I have said that there really is an interest 
in jump starting a national approach. We use a tax credit 
approach, $8 per unit tax credit for companies that recycle 
significant numbers of display screens, a $15 tax credit for 
consumers.
    The first question is how do you do something like this 
when you have a big deficit. We have said that we would 
envision doing something like this for about 3 years to try to 
jump start a national policy in this area. It seems to me that 
if we don't, what we are going to do is see States and 
localities put in place a crazy quilt of laws and regulations 
which we will eventually have to try to sort out.
    Senator Jeffords and I have talked about it for years. We 
did get a baby step in the right direction in terms of the tax 
credit for e-waste recycling equipment in the Senate bill and 
we are optimistic that will be signed by the President.
    Senator Talent and I do think what is important now is that 
there is a national interest in terms of recycling electronic 
trash and not just sort of sitting around and waiting for this 
kind of hazardous stew of toxic e-waste to accumulate in 
landfills across the Country.
    The last point that I would make, and Senator Boxer touched 
on this as well, is with respect to digital television, that on 
a bipartisan basis in the Senate we have finally begun to look 
at ways to ensure that we are always advancing the next set of 
technology. In effect, what you use one year is going to be 
obsolete the next and people will, in effect, be looking at 
that new round of products. So this problem is only going to 
grow exponentially.
    I was really struck by the story a few days ago in the New 
York Times that talked about computers being so infected with 
spyware and adware that they are on life support and rather 
than try to debug computers, people essentially chuck them. 
Nobody really talked about spyware and adware very long ago. 
Senator Boxer, myself, Senator Burns and others have been 
working on this but the fact of the matter is that was a 
problem nobody envisioned just a few years ago and now all of a 
sudden the New York Times is running front page stories on why 
people are chucking their computers because they can't debug 
their system and will just say what the heck, let us get the 
next one.
    We are very hopeful that on a bipartisan basis we can work 
to put less e-waste in the landfills and more in the recycling 
bin. We acknowledge the good work that is being done by States 
and localities around the Country but it is the view of Senator 
Talent and myself that if we don't get a national policy in 
place, particularly to jump start the effort to come up with a 
uniform set of incentives, 4 or 5 years down the road, we are 
essentially going to be trying to wade through another kind of 
morass. In that case, it will be a hodgepodge of inconsistent 
rules and regulations and our work will be that much more 
difficult.
    We thank you for the chance to come and work with you and 
Senator Boxer and Senator Jeffords on this.
    Senator Thune. Thank you, Senator Wyden, for your testimony 
and for your thoughtful approach and looking beyond just 
identifying and defining the problem but actually coming up 
with something tangible, specific proposal that would help 
address it.
    We will yield to your colleague, Senator Talent.

STATEMENT OF HON. JAMES TALENT, U.S. SENATOR FROM THE STATE OF 
                            MISSOURI

    Senator Talent. When Senator Wyden approached me about 
this, I really thought he had a good idea. I am happy to be his 
wing man on this idea.
    I don't want to talk a long time about the problem because 
I think we all understand that. I do think it is important to 
keep in mind that if we don't do something we are really going 
to be overwhelmed by this. Everyone just needs to think of 
their own buying habits and their family's buying habits and 
think of the number of old computers and TVs that we are 
accumulating. We are going to start running out of rooms in our 
attics, garages and basements and have to get rid of them.
    I think the advantage of this approach is that it will 
provide a boost through the Tax Code for creation across the 
Country of a recycling system that will be uniform in the sense 
that this is a national incentive, it may adapt a little bit 
from place to place and we can get this into place. Consumers 
can get used to dealing with it, can see the benefits they get 
from it. Once that is in place, it will be easier for us to 
move to a different system of financing it if we want to do 
that.
    The problem with collecting up-front fees is the hassle 
with it, the resentment people have and they don't know really 
what they are getting for the money they are paying. They are 
going to pay it whether you hit them directly or hit the 
manufacturer, it will get passed through to them. This way we 
get a system going and people can see it is working and get 
satisfied with it. Then we can figure out longer term how you 
want to finance it.
    I really like this idea, although obviously the 
subcommittee and the committee are going to have to work on 
this and massage this a lot because we have introduced this as 
kind of a starting point but we understand there is a ways to 
go with it.
    Senator Thune. Senator Talent.
    We are also joined this afternoon by Congressman Mike 
Thompson from the State of California, a colleague from the 
House side who is also keenly interested in this issue. 
Congressman Thompson, we would love to hear from you.

  STATEMENT OF HON. MIKE THOMPSON, REPRESENTATIVE IN CONGRESS 
                  FROM THE STATE OF CALIFORNIA

    Mr. Thompson. Thank you.
    Congratulations on your first subcommittee hearing. I am 
glad to be a part of it.
    I would like to go a step further than my two friends and 
Senate colleagues. I would like to suggest we make this a 
bicameral as well as a bipartisan solution.
    I first introduced legislation 3 or 4 years ago on this 
issue trying to raise the profile because as everyone has 
recognized, it is a very serious problem. I will admit that my 
solution, my bill has the up-front fee, a point of sale fee. 
The idea was to get some startup money and let EPA take that 
money and spend it in the form of grants to anyone, public or 
private sector, who came up with a good program to deal with 
this problem.
    For the record, please know that I am not married to that 
solution. I just think it is important that first, everybody 
recognizes the problem and then we all sit down and figure out 
the solution.
    There are proponents for both the point of sale fee, there 
are proponents for the tax approach. There is also a new 
suggestion that we combine them and start with a point of sale 
collection so we can get the program started and then move to a 
tax type of solution to get it going and then as I think 
Senator Wyden said, phase it out altogether once it got up and 
going, but it is a problem.
    You mentioned the landfill problem, the public safety 
problem with the heavy metals going into the environment and 
some folks are taking these components overseas and 
disassembling them with child labor and discarding the bad 
stuff into the environment somewhere else but exposing kids to 
the problem. You mentioned the storage problem and said you 
have been confronted with this. Everybody is confronted with 
this.
    The life expectancy of a computer today is so short that we 
out use their abilities and stick them in a closet someplace. I 
have had business people tell me that they actually have 
warehouse space in their businesses designated for storage for 
these computers because they have no place to put them.
    The issue of States, I think Senator Jeffords mentioned 
there are three States, Maryland, Maine and California that 
already have programs. There are 26 other States currently 
considering legislation to put a program on the books. This 
could create such a mess not only for consumers but for 
manufacturers and for retailers as well.
    All of this is just a bit more pressure that I believe 
should bring us to figure out the solution. In the House, we 
started a bipartisan working group with four of us who have 
taken this on as a major priority. Of the four of us, I think 
there are two or three who have bills but we would very much 
like to extend it, as I mentioned, make it a bicameral issue 
and figure out what that solution will be because hopefully we 
can move away from the issue of e-waste which suggests that 
this is waste we dispose of and move it toward e-scrap which 
may suggest that we can reuse or recycle these, or at least 
dispose of them in a proper manner.
    I commend you for having this hearing and hopefully we can 
all come together and figure out what the solution is. Anyone 
who is at all honest will admit there is a problem. As 
mentioned before, the difficulty is finding that solution. I 
hope I am able to be a part of figuring that out.
    Thank you, Mr. Chairman. I have a statement I will submit.
    Senator Thune. Without objection, we will have that placed 
in the record and again, thank you for your leadership on the 
House side on this issue. Frankly, I guess I am somewhat 
surprised it hasn't been dealt with sooner. There are 
stockpiles of computers, televisions and all kinds of 
electronic devices out there I am sure piling up in peoples' 
homes, garages and other places. So it is very timely and 
important that we get into this issue today.
    We don't want to keep you all very long, but a question for 
Senators Talent and Wyden. On your legislation, why is it that 
you give the tax credit to ``certified'' recyclers?
    Senator Wyden. I think whenever you are trying to use 
scarce resources, particularly in the Tax Code I saw what a 
battle it was just to get the incentive for the purchase of 
equipment, you have to draw the line somewhere. We thought that 
made the most sense in terms of scarce dollars.
    Senator Talent and I were saying, there would be a variety 
of ways to complement our bill. Say you wanted to have 
diminimus up front kind of charge so people had some skin in 
the game in terms of recycling, something like that could be 
looked at. We essentially made the definition because we 
thought that was the best use of scarce dollars.
    Senator Talent. There have been a lot of incidents of 
illegal dumps and recycling centers around the Country, 
basically fraudulent outfits that advertise themselves as 
recycling centers and take the computers, get some money from 
people and dump it. We had an incident of that in Missouri. So 
the idea here is to have some kind of a process where you can 
certify that the recycling center is up to standards before 
they are eligible for the tax credit. That is the most obvious 
way of doing it.
    Senator Thune. Senator Boxer?
    Senator Boxer. I would commend you on that. It is really 
key because otherwise we will have these little businesses 
spring up which, as you say, are just a front to collect some 
money and don't do the job. So thank you for that.
    Senator Wyden, since you, according to Jim Talent, came up 
with this idea of the tax credit first, do we know because we 
have these deficits, what the cost will be here because we are 
going to lose money from the Treasury, so what does this add to 
the deficit?
    Senator Wyden. We think it might be $300 million to $400 
million. We obviously have to kind of crunch the numbers in 
terms of how much recycling would be done. There will obviously 
be definitions and the like, but it strikes me, and this is the 
heart of what we are trying to do, we are not saying put a tax 
credit in place in perpetuity. We are saying look at it for a 
relatively short period of time and we think if you even capped 
it somewhere in the vicinity of $300-$400 million, you could 
with a sharp pencil say that would be a good investment.
    Senator Boxer. I want to ask the whole panel a question. I 
sometimes think we under estimate the people out there. People 
hate taxes, let us face it, but if they know there is a 
dedicated tax, a dedicated fee, they feel very differently 
about it, at least the calls that I read. So if it was $2 a 
product and plus you did a tax credit in combination, are you 
willing to look at that with us because I fear if it is $300 
million to $400 million a year, you are talking real bucks over 
time. We just don't have it, so I am just wondering if you 
would be willing to work with us.
    As Mike Thompson said, and he is a very pragmatic 
legislator, maybe there is a way we could do some combination 
thing where the consumers pay but not to a point where they are 
upset about it. For example, the airport fee, a lot of people 
were scared after 9/11, how can we ask people to pay a security 
fee? Let me just tell you, people in California who travel 
across the Country all the time are happy to do it if they know 
it is going for security.
    If this was drawn in such a way, would you be open to 
working with us? I even know if Senator Thune is interested in 
this. I am just saying for myself, I think the more avenues we 
have to explore so we don't come to our colleagues with a big 
hole in the deficit.
    Senator Talent. If I was in your position, the position of 
the Ranking Member, I wouldn't rule out anything. My own sense 
of it is that you are right, that if people have an assurance 
they know what the money is going for and have assurance it is 
taking care of a real problem, they would be more open to that. 
The question is how do you give them that assurance, how do you 
get a system up and running first.
    You are also right, I think, in believing people may be 
ahead of us on this issue because everybody has to deal with 
this. Every time you walk by one of the old computers in your 
garage or something, you say to yourself, what am I going to do 
with that, it is just taking up space.
    I think this is a basis for discussion and we would like to 
continue being a part of it. I was saying to Senator Wyden I 
see the stirrings of an E-Waste Caucus here beginning on a 
bicameral basis.
    Senator Boxer. Yes.
    Senator Wyden. I think that is a very good point. It was 
just our concern that if you are trying to build this ethic to 
recycle these electronic products rather than chuck them, you 
just want to make sure that the first thing people don't see is 
a huge batch of new taxes. I think if it is an effort where the 
Federal Government is going to be a partner in trying to set up 
the national infrastructure and say to people, we want you to 
have some skin in the game too, there will be some charges, I 
think something like that ought to be on the table.
    Senator Boxer. Thanks.
    Senator Thune. Senator Jeffords?
    Senator Jeffords. What about some way that we could get 
money put into whatever we were using and then a refund to get 
people to buy it back?
    Senator Wyden. Probably too logical for government. I think 
all those kinds of things ought to be on the table as well. Jim 
touched on this at the outset. You have to figure out a way as 
people begin to get acclimated to these kinds of priorities and 
say look at all this stuff we are going to have, you have to 
make sure that it is user friendly and there isn't a lot of 
confusion about how it is set up. I think that is attractive 
too.
    Senator Talent. The only concern I would have and I am sure 
your other panels will have a lot of comments on these various 
alternatives, we ought to try and set it up so the system is as 
simple as possible so the incentive is consumer buys and 
consumer takes to the recycling center rather than takes back 
to a store and they then take to a recycling center. I wouldn't 
rule out anything at this stage.
    It is music to my ears to hear there is resolution on the 
part of the leaders of the committee to address the problem. I 
think this hearing is a good first start. I hope you take these 
ideas and put them all together in a bill. The longer we take 
to do something, I think we are all in agreement, the harder it 
is going to be when we finally do something.
    Senator Jeffords. Thank you.
    Senator Thune. One final question. You ended up at $15 on 
your individual and $8 for a small business. How did you come 
up with the number?
    Senator Wyden. You can see, Chairman Thune, the list of 
people that endorsed the legislation. We essentially pulled 
together this environmental and industry coalition. For 
example, the $8 credit should go to companies that recycle at 
least a significant number of screens, again because you are 
trying to draw the line. Certified recyclers are going to be 
the priority in terms of focal point for entering the system.
    The credit for the companies was built on the idea there 
should be a significant number of display screens or computer 
systems that a company used per year but this was a judgment 
essentially that we came to by talking to that support group, 
the coalition of consumers and business leaders. If we are 
lucky to go that kind of route, we ought to be consulting with 
them more to try to refine what is that target point that will 
make it attractive for people to do this and incorporate some 
of the ideas that we touched on here about whether individuals 
ought to have to pay something.
    Senator Thune. Very good. Thank you all very much.
    We have heard from our first panel on some proposals. Thank 
you Senators, thank you, Congressman Thompson. We will call our 
second panel. We will have an opportunity to hear from EPA and 
others if there is a problem out there that needs to be 
addressed. We look forward to hearing their testimony.
    I want to welcome our second panel. As part of that panel, 
we have Thomas Dunne, Acting Assistant Administrator, Office of 
Solid Waste and Emergency Response, U.S. Environmental 
Protection Agency; John Stephenson, Director, Natural Resources 
and Environment, U.S. Government and Accountability Office; and 
Garth Hickle, principal planner, Minnesota Office of 
Environmental Assistance, one of the four States that I think 
has taken steps or put in place some sort of comprehensive 
approach to dealing with the issue of electronic waste.
    We will start on my left with Administrator Dunne.
    Before we begin, let me say we are going to adhere to the 
5-minute rule. So if you will confine your oral remarks to 5 
minutes and any additional information you want to present, we 
will make sure it gets put into the record.

 STATEMENT OF THOMAS P. DUNNE, ACTING ASSISTANT ADMINISTRATOR, 
      OFFICE OF SOLID WASTE AND EMERGENCY RESPONSE, U.S. 
                ENVIRONMENTAL PROTECTION AGENCY

    Mr. Dunne. Good afternoon.
    As you said, my name is Tom Dunne, and I am the Acting 
Assistant Administrator for EPA's Office of Solid Waste and 
Emergency Response. I am pleased to appear today to discuss how 
EPA is addressing electronic issues including management, reuse 
and recycling. I will summarize my testimony but ask the 
written statement be submitted for the record.
    Senator Thune. Without objection.
    Mr. Dunne. EPA believes that more emphasis needs to be 
placed on conservation and recovery in the Resource 
Conservation and Recovery Act known as RCRA. To that end, EPA 
launched a Resource Conservation Challenge in the year 2002. 
Arguably, the best way to manage waste is to eliminate it by 
designing products and processes that minimize waste, by 
collecting waste products and reusing them and by using input 
materials more efficiently.
    EPA has been involved with the improvement of electronics 
design and recovery for a number of years. This involvement was 
prompted by several EPA concerns including the increased growth 
of electronic wastes, the potential for exposure to substances 
of concern contained in some discarded electronics if they were 
not properly managed and the lack of a convenient, affordable, 
electronics reuse and recycling infrastructure.
    Electronic waste is an increasing portion of the municipal 
solid waste stream, although it contributes less than 2 percent 
of municipal solid waste. EPA estimates that in 2003, 
approximately 10 percent of consumer electronics was dismantled 
and recycled domestically. The remaining 90 percent of 
discarded consumer electronics was stored, reused or 
refurbished, exported or disposed of in landfills or 
incinerators.
    Discarded electronic products contain a number of 
substances that cause concern if improperly managed, including 
lead from cathode ray tubes and mercury in flat panel displays. 
While used electronic products do not pose a human health or 
environmental threat at this time, it makes good sense to reuse 
and recycle these products to bring about better materials 
management, create more jobs and economic activity and to 
promote greater resource conservation.
    EPA is currently engaged in a series of partnerships with 
manufacturers, retailers, recyclers, State and local 
governments, non-profit organizations and other Federal 
agencies to encourage the improved design of electronic 
products, help develop an infrastructure for the collection and 
reuse and recycling of discarded electronics and to encourage 
the environmentally safe recycling of used electronics.
    For example, EPA funded and participated in a process with 
electronic manufacturers, government technology purchasers and 
other organizations to develop the electronic product 
environmental assessment tool called EPEAT. EPEAT will help 
large technology purchasers identify electronic products that 
are designed in a more environmentally friendly manner and it 
is expected that EPEAT will be operating in 2006 when 
manufacturers who meet their criteria will be able to certify 
their products.
    The initial electronic products eligible for EPEAT 
certification will be desktop computers, laptops and monitors. 
In addition, EPA has entered into a voluntary partnership with 
a number of electronic manufacturers, retailers and State and 
local governments to develop the Plug-In To eCycling. The aim 
of this initiative is to raise the public awareness of 
electronics recycling and to increase recycling opportunities.
    In the first 2 years of the initiative, more than 45 
million pounds of unwanted electronic products were recycled by 
Plug-In partners. Further, EPA launched several pilot projects 
last year with manufacturers, retailers and local governments 
to provide consumer electronics recycling. The pilots resulted 
in more than 11 million pounds of reused electronics and were 
collected in retail stores including New England area Staples, 
Seattle area Good Guys and all of the Office Depot locations.
    EPA has also partnered with the Federal Environmental 
Executive and several other Federal agencies to launch the 
Federal Electronics Challenge or FEC. The U.S. Federal 
Government is the largest bulk purchaser of electronics 
products in the world. In fiscal year 2005, the Federal 
Government will invest roughly $60 billion in information 
technology equipment and services. That represents about 7 
percent of worldwide purchases. Therefore, it is fitting that 
the Federal Government lead by example.
    The FEC is a voluntary partnership of Federal agencies that 
have committed to develop a more sustainable environmental 
stewardship of electronic products. Twelve Federal agencies 
have signed a Memorandum of Understanding on electronics 
management which will help increase reuse and recycling. These 
agencies represent roughly 83 percent of the Government's 
information technology purchasing power.
    Finally, EPA continues to work with a wide range of 
stakeholders to further encourage the reuse and recycling of 
electronic products. Last spring, the agency hosted a national 
electronics meeting attended by representatives from industry, 
government and non-profit organizations to discuss electronics 
management issues.
    As a result of these meetings, a collaborative strategy is 
being developed that included the development of a 
certification program for electronic recyclers, a development 
of a nationwide electronics recycling data repository and 
piloting a private, multi-state organization to help support 
electronics recycling in the Pacific Northwest.
    Mr. Chairman, that concludes my summary of some of the 
efforts to encourage electronics management, reuse and 
recycling and certainly, I would be happy to answer any 
questions you or other subcommittee members may have.
    Senator Thune. Next is Mr. Stephenson from the Government 
and Accountability Office which has prepared an analysis of 
this subject at least in draft form. I was one of the 
requesters of that as was Senator Boxer. I understand you will 
be coming out with a final draft some time this fall. I 
appreciate the work you have put into it already in terms of 
finding out the state of play out there with respect to this 
issue and some of the things being proposed.
    Mr. Stephenson.

 STATEMENT OF JOHN B. STEPHENSON, DIRECTOR, NATURAL RESOURCES 
     AND ENVIRONMENT, U.S. GOVERNMENT ACCOUNTABILITY OFFICE

    Mr. Stephenson. Thank you. It is a pleasure for us to be 
here to discuss our ongoing work for this subcommittee on the 
growing problem of used consumer electronics, primarily 
computers, monitors and televisions but in the future maybe 
other types of consumer electronics.
    As you know, rapid advancements in technologies have led to 
increasing sales in electronics but with this increase comes 
the dilemma of how to manage products that have reached the end 
of their useful lives. Recycling and reuse have great potential 
to help deal with this dilemma but there are also significant 
challenges.
    Today, I will summarize our work to date on one, existing 
information on the volumes of and problems associated with used 
electronics and two, factors affecting the Nation's ability to 
recycle and reuse these electronics.
    To address these issues, we are currently surveying key 
stakeholders including manufacturers, retailers, trade 
associations, recyclers, environmentalists and State and local 
governments. To date, 41 of the 53 surveyed participants have 
responded. We are also visiting States and localities that have 
implemented programs or passed legislation to manage used 
electronics.
    Available estimates strongly suggest that the amount of 
used electronics is large and growing and that if improperly 
managed, can harm the environment and human health. Over 100 
million computers, monitors and televisions become obsolete 
each year and most are probably being stored in places like 
basements, garages and warehouses. So the opportunity is to act 
now.
    The question is what will happen to these units that can be 
recycled and reused but might also be disposed of in landfills 
or exported for recycle or reuse overseas. Standard regulatory 
tests show that some toxic substances with known adverse health 
effects have the potential to leach from discarded electronics 
into landfills.
    As has been mentioned, the CRT tube can contain as much as 
4 to 8 pounds of lead. Some suggest that because modern U.S. 
landfills are designed with liners and other safety 
precautions, leaching into the environment is not a major 
problem. However, about 70 percent of heavy metals in landfills 
currently come from discarded electronics and studies on the 
long term effects are limited.
    In addition, many used electronics end up in countries 
without modern landfills or with considerably less protective 
environmental regulations. Moreover, if these electronics are 
simply discarded in landfills, valuable resources such as 
copper, gold and aluminum are lost for future use.
    For a perspective, the U.S. Geological Survey has reported 
that one metric ton of computer circuit boards contains between 
40 and 800 times the concentration of gold contained in gold 
ore and 30 to 40 times the concentration of copper while 
containing much lower levels of harmful elements common to such 
ores. Despite the clear advantages, less than 10 percent of 
electronic waste is currently being recycled.
    So, what is the problem? The cost along with limited 
regulatory requirements or incentives discourage recycling and 
reuse. Consumers generally have to pay fees ranging from $10-
$27 per unit and drop off their used electronics at often 
inconvenient locations to have their used electronics recycled 
or refurbished for reuse. Such economic factors are compounded 
by Federal regulatory requirements that provide little 
incentive for environmentally preferable management of used 
electronics.
    EPA regulates hazardous waste under the Resource 
Conservation and Recovery Act but lacks the authority to 
require environmentally preferable management of used 
electronics through recycling and reuse or to establish a 
mandatory national approach such as a disposal ban or financing 
schemes. As a result, all of its efforts are voluntary.
    In the absence of a national framework for dealing with 
this problem, a patchwork of potentially conflicting State 
requirements, albeit good in their own right, create some 
problems. Manufacturers in one State, for instance, may have an 
advance recovery fee placed on their products but the same 
manufacturers may have to take back their products and pay for 
recycling in another.
    This patchwork may be placing a substantial burden on 
manufacturers, retailers, recyclers and stakeholders. It is 
worth noting that several European countries have established 
disposal bans and they have been in place for some time and 
that the EU has a financing plan proposal.
    In light of all this activity, it is not surprising that 97 
percent of our survey respondents to date have told us that 
some type of national legislation is needed to deal with this 
growing problem. As we conclude our work, we will be further 
examining ongoing efforts among the States to deal with this 
growing problem, the various legislative solutions that have 
been proposed to create a uniform national approach, and 
options the Federal Government can pursue to encourage 
recycling and reuse of electronics.
    Thank you. That concludes my statement.
    Senator Thune. Thank you.
    Mr. Hickle is with the Minnesota Office of Environmental 
Assistance. We welcome you here today and look forward to your 
testimony.

STATEMENT OF GARTH HICKLE, PRINCIPAL PLANNER, MINNESOTA OFFICE 
                  OF ENVIRONMENTAL ASSISTANCE

    Mr. Hickle. My name is Garth Hickle with the Office of 
Environmental Assistance, a division of the Minnesota Pollution 
Control Agency. Thank you for the opportunity to provide 
testimony today and share Minnesota's experience for the 
management of waste electronics. Given the State, legislative 
and programmatic attention devoted to this issue over the past 
5 years, congressional attention is an important step forward 
to address this complex issue.
    The Office of Environmental Assistance began to address 
this issue in 1995 at the request of our State legislature in 
response to concerns regarding the growing presence of 
discarded electronic products in the waste stream and the 
potential environmental impacts of an electronics disposal. 
While there is debate regarding the actual long term 
environmental impacts from disposing of waste electronics in 
landfills, Minnesota has framed the issue as one of resource 
conservation and the promotion of economic development 
opportunities created by the collection and de-manufacturing of 
old electronic products.
    The environmental benefits, energy savings and job creation 
from promoting waste as a resource have guided our thinking as 
to the rationale for the collection and recycling of waste 
electronics. It is Minnesota's intent to ensure that residents 
have convenient access to collection opportunities and that the 
infrastructure is sufficient to discourage illegal dumping, 
abandonment of collected products and the export of waste 
electronics to nations with less stringent environmental 
standards.
    Since 1997, the OEA has facilitated a number of 
demonstration projects for the collection of waste electronics 
with participation from manufacturers, local government and 
recyclers. Partnerships with individual manufacturers and 
retailers such as Best Buy and Target, both Minnesota-based 
companies, have served to model various collection options and 
assess costs. The OEA has also participated in several efforts 
to bring parties together to implement comprehensive programs 
both at the State and national level.
    We actively participated in the National Electronic Product 
Stewardship Initiative. While NEPSI did not arrive at a 
consensus regarding how a national program should be financed, 
the stakeholders did agree on the need for several important 
elements of a national program, including a broad scope of 
products beyond just televisions and monitors, the need for 
performance goals and funding for local collection activities, 
environmentally sound management standards and a third party 
organization to implement a program.
    The Minnesota Legislature has also considered legislation 
for waste electronics each year since 2002. The proposals have 
ranged from advance recycling fees similar to the program 
enacted by SB-20 in California to the producer responsibility 
approach implemented in Maine. The different business models 
and perspectives within the industry that prevented a national 
approach from emerging from NEPSI have also stymied passage of 
a State program in Minnesota.
    Following the 2004 Minnesota legislative session, the OEA 
initiated another consultation process with significant 
participation from stakeholders to identify expectations for a 
program in Minnesota. The expectations include offering 
convenient collection options for residents that address a 
broad scope of products and track the purchasing and disposal 
habits of consumers utilizing existing infrastructure and 
providing incentives for collection, ensuring accountability 
for collection and recycling by identified parties, promoting 
environmentally sound management and providing incentives for 
design for the environment.
    As well, we identified support in private management to the 
extent possible to reduce government involvement in management 
of the program as a key principle. Last, financing the program 
without relying on end of life fees or local government 
funding. While developed for Minnesota, the expectations listed 
above will also be relevant for a comprehensive national 
program.
    This subcommittee will certainly hear from manufacturers, 
retailers and others on the preference for a national approach 
for business reasons to avoid a patchwork of State programs. A 
Federal approach will also address some of the concerns faced 
by State government grappling with this issue. From the 
perspective of State government and consumers, a Federal 
approach may provide a consistent standard and eliminate 
regional disparities.
    For instance, in 2003 Minnesota enacted a disposal ban for 
cathode ray tube containing products, televisions and computer 
monitors that is now slated for implementation in 2006. This 
ban raised a concern among neighboring States, South Dakota, 
North Dakota, Wisconsin and Iowa that televisions and monitors 
from Minnesota would be transported across Minnesota's border 
for disposal.
    A Federal framework would also eliminate the impact upon 
border sales if, for instance, one State enacted a consumer 
fee-based program while a neighbor State did not. A national 
program might also greatly simplify administrative 
responsibilities such as compliance reporting and public 
education.
    If comprehensive national legislation is contemplated, a 
step Minnesota supports, it is important to consider the 
following: adopting an approach that engages all the players 
along the product chain from manufacturers to local government 
to share responsibility for funding and operating a program and 
such an approach would result in a more effective that provides 
incentives for more environmentally friendly products in the 
future but will not place significant additional burden on 
government.
    Legislation should also contain a financing mechanism that 
recognizes the different business models within the electronics 
industry and provides flexibility to implement tailored 
collection activities. A framework should be established so 
that products can be added or deleted as the technology and 
consumer purchasing habits evolve and finally, adopting 
performance standards and mechanisms for evaluating progress.
    If a comprehensive national program is not adopted, there 
are still several steps the Federal Government could undertake 
to support the collection and recycling of discarded electronic 
products including performing data collection and analysis, 
ensuring a consistent regulatory environment to support reuse 
and recycling of discarded products, developing clear standards 
for environmentally sound management that impose restrictions 
on the export of waste electronics to countries with less 
stringent environmental standards and finally, engaging in 
research and analysis regarding innovative partnerships to 
manage the program.
    It is important to acknowledge that USEPA and others have 
projects underway to address some of these issues. USEPA in 
particular deserves significant recognition for the resources 
and staff that have been devoted to this issue over the past 
several years.
    Thank you for the opportunity to be here today. I look 
forward to addressing any questions you may have.
    Senator Thune. Thank you, Mr. Hickle.
    I will advise my colleagues who are here we will try and 
adhere to 5-minute rounds for us as well and the additional 
questions we have, we can submit for the record.
    Mr. Dunne, I would like to direct a question to you. First, 
because Congress has exempted household waste such as TVs and 
computers from the Hazardous Waste Rules, are there any 
particular concerns that EPA has when it comes to handling this 
particular waste stream?
    Mr. Dunne. You have to be vigilant in terms of what you are 
doing. Even with the exemption, we have to be careful about 
sham recyclers creeping up. Senator Talent mentioned there was 
a case in Missouri and there were some other cases but there 
are always people who will go outside the realm.
    We feel so far based on data that we have, which are not 
necessarily complete, even though a cathode ray tube may not 
meet the TCLP test, it doesn't necessarily create an 
environmental problem as long as the landfill is properly lined 
and has a leachate system in place; they would be able to catch 
it.
    However, I think we have to continue to study this. We have 
a study done by the Solid Waste Association of North America 
that has not been able to trace any concerns so far. They 
represent municipal solid waste organizations in their cities. 
There has been some research and study which we sponsored at 
the University of Florida that so far suggests there is not 
contamination but I do think we don't have enough data in this 
Country to jump to the conclusion that it will never occur. 
Right now, I don't think there is any data that we have seen 
and been able to analyze to say there is an environmental 
problem right now.
    Senator Thune. Are you aware, under existing landfill 
permitting regulations, of any instances in which toxins from 
electronics have led to human exposure?
    Mr. Dunne. I am not aware of any particular case. There 
could be but I am not aware. I want to remind you of something. 
We do have the subtitle (c) part of RCRA and there is a 
structure in place which this committee helped to pass in about 
1976, I believe. It is run by the Federal Government and the 
States. We can always fall back, if there is a hazardous waste 
problem through corrective action under subtitle (c), so we 
couldn't have just a voluntary program without the basis of the 
regulatory program in place right now.
    Senator Thune. Mr. Stephenson, during the course of GAO's 
work, have you come across any estimates as America transitions 
to HDTV about how that might increase the number of televisions 
that could end up in landfills?
    Mr. Stephenson. No, because converter boxes will likely be 
used to make old TVs HDTV compatible, we don't think that there 
will necessarily be a spike in the number of TVs that appear as 
waste. But, you have to remember that even the plasma screens 
that are replacing those old CRT tubes have mercury in them. So 
you have to consider all forms of electronic wastes.
    The real problem is that without a landfill ban, people are 
not incentivized to do anything with their computers. The fact 
that most have done nothing with them sort of exemplifies that. 
It is easy to put an old computer on your curb but if you have 
a landfill ban, you can't do that. We think that should be an 
integral part of any legislation or national program that is 
considered. The States that have landfill bans have 
exponentially more recycling and reuse than those that don't.
    Senator Thune. Did I hear you say, Mr. Dunne, that if there 
was a determination made by EPA that these materials were 
hazardous that under subtitle (c), you would have the authority 
to enact regulations?
    Mr. Dunne. I said that if it is causing contamination in a 
particular landfill, we and the States who run most of the 
program, the operational side, could fall back on subtitle (c). 
It isn't whether there is lead in a material, we know there is 
and there is a significant amount of lead going into landfills. 
That is one of our concerns, the volume of this. That is why we 
are dealing with this as a separate issue rather than straight 
municipal landfills.
    Senator Thune. My time has about expired. I have a question 
I would like to address to Mr. Hickle, but I will yield now to 
the Senator from California.
    Senator Boxer. Mr. Dunne, I thought you said this isn't so 
much of a problem on the cathode ray tubes, so I want to ask 
you a question. Do you agree with this, ``Toxicity 
characteristics of cathode ray tubes above the toxicity 
characteristic regulatory level of 5 mg per liter that is used 
to classify lead containing waste is hazardous''?
    Mr. Dunne. I think so but when you ask it very specifically 
like that, I would have to go back and find out the exact 
answer.
    Senator Boxer. What I read to you was EPA. That is what EPA 
says, that it is a problem.
    Mr. Dunne. I think what you have to do is quantify the 
problem. A tube by itself may have these characteristics, but 
whether or not it presents an environmental problem put into a 
qualified landfill doesn't represent a health or environmental 
problem as far as we know today.
    Senator Boxer. I am confused because in 2002, and I ask 
unanimous consent to place this in the record, EPA makes the 
case that we do this rule.
    [The referenced document not received at the time of 
print.]
    Mr. Dunne. The rule is under development right now, the 
cathode ray tube.
    Senator Boxer. I know that. Do you know when it started to 
be considered? Do you know what year?
    Mr. Dunne. My guess is back in the 1990's.
    Senator Boxer. It was 1998, that is 7 years. Picking up 
from your demeanor and your comments on this, I don't sense you 
are particularly interested in moving this through. Is there 
anything you can tell me in terms of the EPA's intention? Do 
you have an EPA decision on when you are going to finish this 
regulation and promulgate it?
    Mr. Dunne. It is going through review right now, Senator. I 
would assume in the next few months, there would be some 
determination in terms of what rule will be published.
    Senator Boxer. In a few months, you will have a 
determination on?
    Mr. Dunne. On the cathode ray tube rule.
    Senator Boxer. So in a few months, you won't have the final 
version of the rule but you will know if you are going to have 
a rule?
    Mr. Dunne. Yes and it could be published shortly.
    Senator Boxer. What could be published?
    Mr. Dunne. The rule on cathode ray tubes.
    Senator Boxer. Do you expect that to happen?
    Mr. Dunne. It is very possible.
    Senator Boxer. Can you give me an approximate date?
    Mr. Dunne. I don't control the calendar in terms of when it 
goes to reviews.
    Senator Boxer. Who does?
    Mr. Dunne. The interagency review process takes time and 
the Office of Management and Budget reviews it.
    Senator Boxer. The value of leaded glass recently dipped to 
minus $200 per ton. This change reflects a shift in the 
consumer preference for different technologies. Doesn't this 
drop in value eliminate EPA's rationale for exempting cathode 
ray tubes from hazardous waste regulations as a ``valuable 
commodity''?
    Mr. Dunne. I don't think so.
    Senator Boxer. Do you still think it is valuable?
    Mr. Dunne. I think it is valuable in the sense that we want 
to be able to regulate only those things that create a real 
environmental threat. I don't think that we have to gauge every 
rule on today's market share.
    Senator Boxer. But that wasn't the question. I understand 
what you are saying. You want to make sure that it is an 
environmental threat before you regulate it. I understand that. 
I appreciate that, but that is not the question. One of the 
reasons for the rationale for exempting cathode ray tubes in 
the past has been that it has been deemed a valuable commodity. 
Isn't that rationale gone now given what I told you about the 
value, putting aside the risks?
    Mr. Dunne. I don't think what I have seen so far of the 
evaluation done by staff is that there is some cost benefit 
analysis if it has to be done with every rule and it seems to 
me there is probably some benefit to exemption.
    Senator Boxer. Because?
    Mr. Dunne. Because there is still value in the marketplace.
    Senator Boxer. I told you it is minus $200.
    Mr. Dunne. It still may have value. I don't know.
    Senator Boxer. I will follow up with some written 
questions. That makes no sense. I was an economics major, what 
do I know. I don't understand something having such great value 
when it doesn't have any value, has a minus value, but we will 
get into that later.
    To finish my last question, then I might ask for a second 
round, we know that cathode ray tubes can leach four times the 
amount of lead as material that is regulated as a hazardous 
waste. I just read EPA's own words on that. The EPA's Inspector 
General recently noted that EPA is testing other types of 
electronic wastes for their hazardous characteristics. What 
types of electronic material has EPA tested for its hazardous 
characteristics and what were the results?
    Mr. Dunne. I will have to get you that for the record, 
Senator. I am sorry, I can't answer that right now.
    Senator Boxer. In October 2003, EPA proposed a rule that 
could deregulate up to 3 billion pounds of hazardous waste 
including used circuit boards. Among other problems, EPA's 
proposed rule would allow hazardous waste to be shipped on 
public roads without any tracking documents. Can you please 
tell me the status of that proposed rulemaking?
    Mr. Dunne. I believe it is still under development and I 
don't have a timeframe in terms of when the regulation would 
come out but we can give you an approximation when we go back 
to the office.
    Senator Boxer. I would like that answer in writing. We will 
propound our unanswered questions.
    Thank you.
    Senator Thune. Senator Jeffords?
    Senator Jeffords. I have heard from numerous industry 
groups concerned about the emerging patchwork of conflicting 
State and local rules governing electronic waste disposal. Do 
you agree that the Federal legislation is needed to build a 
national infrastructure to encourage electronic waste recycling 
or does EPA have the tools it needs to do the job?
    Mr. Dunne. I think it has been pointed out by GAO that we 
don't have mandatory authority or regulatory authority. We have 
been meeting with industry and other people as I mentioned in 
my testimony. I am not too sure what Federal standards or a 
program would look like at this particular point. It was 
interesting to hear the two Senators and the Congressman who 
have two different approaches. That is fine and there may be 
many other approaches. It is a matter of which one do you test 
that is going to make some sense.
    We haven't taken a position because I don't think we have 
enough knowledge and information but we do recognize the 
problem in terms of the collection of electronic material and 
also the marketplace condition of electronic material in terms 
of making it more efficient. It may well be in the future that 
as you consider this, you will have enough ideas and we will be 
able to aid you if it is going to be a Federal system.
    Senator Jeffords. In my service of the Country in the Navy, 
I traveled around the world and I found when we went into Asian 
countries, they seemed to have a great facility for taking 
equipment and understanding them and modeling them and taking 
our secrets and improving on them. Do you find when you do 
travel that the European and Asian nations are somehow ahead of 
us, stealing information from us and getting better equipment?
    Mr. Dunne. I am not fortunate enough as a Government 
official to get to travel outside this Country, so I am not 
sure I am an expert on that. Certainly the European Union has 
advanced some laws and some regulations based on part of 
California's law. That is going to change some of the way our 
manufacturers who are international producers, not just for the 
United States, in terms of how they produce. Certainly there 
are lessons to be learned I suspect from watching what the 
European Union is doing.
    Senator Jeffords. Mr. Stephenson, Mr. Hickle, any comments?
    Mr. Stephenson. Some of the countries, Japan, the 
Netherlands, Switzerland, are leaders in the recycling of 
electronics. They have had programs in place since 1998, so I 
think they are a little bit ahead of us on this. The EU and 
certain countries in Europe have bans on landfills and the EU 
is proposing a financing option that largely puts a lot of the 
onus on the producer of the consumer electronics to be 
responsible for end-of-life disposal.
    We think, as the Senators said before, all options ought to 
be on the table at this point. Our stakeholders seem to think 
that some sort of a hybrid option possibly with an up-front fee 
combined with manufacturer responsibilities might be the way to 
go. Each approach one has pros and cons and that is part of 
what we will be evaluating as we complete our study for the 
subcommittee.
    I agree with Senator Boxer that in general, if people know 
what the fee is going to be used for, $6-$10 is not a lot to 
pay at the point of sale to build a fund to handle recycling 
and reuse later.
    Senator Jeffords. Mr. Hickle?
    Mr. Hickle. Senator Jeffords, in addition to the 
developments in the European Union, I think it is also 
important to look at the step forward that Canada has taken. 
Alberta currently has a program in place right now for e-waste 
and there are proposals on the table in Ontario, Nova Scotia, 
Sasketchwan and I believe British Columbia as well. I think 
largely in Europe, many of the countries in Asia and now in 
Canada, they have been able to address this problem in a fairly 
comprehensive fashion.
    Senator Jeffords. Thank you.
    Senator Thune. Thank you, Senator Jeffords.
    We will indulge the members and ask a few more questions. I 
have a couple here and I think Senator Boxer does as well.
    Mr. Hickle, as a Senator from a State that borders 
Minnesota, I appreciate hearing how your State has worked to 
address this issue. Because you prohibit CRT tubes from being 
disposed in landfills, I thought your perspective would be 
helpful to the committee as we learn more about the challenges 
the individual States are facing.
    Since it seems funding is the greatest challenge for 
implementation of your e-recycling program, where do you see 
your legislature heading on that? You mentioned in your 
testimony some things that they have been reviewing and looked 
at in the past. Are they coming to any consensus on that?
    Mr. Hickle. Senator Thune, we have been deadlocked on this 
issue for 4 years. As I mentioned, the competing industry 
visions of how any waste system should be financed has been 
very much in play in Minnesota, so there has not been 
resolution to this point. I am hoping that in the upcoming 
legislative session, the legislators will be able to look at 
what I think Mr. Stephenson referenced as a hybrid option that 
potentially combines some sort of fee-based and producer 
responsibility program as one package. There is a legislative 
task force that is being convened to address this issue in the 
interim, so I am really excited we will be able to see a break 
through on this next year.
    Senator Thune. Senator Boxer?
    Senator Boxer. Mr. Dunne, have you seen the EPA Inspector 
General report dated September 1, 2004?
    Mr. Dunne. I don't think I have read it.
    Senator Boxer. It is titled, ``Multiple Actions Taken to 
Address Electronic Waste but EPA Needs to Provide Clear 
National Direction.'' I would ask unanimous consent that we 
just put the summary in the record today, Mr. Chairman.
    Senator Thune. Without objection.
    [The referenced document not received at the time of 
print.]
    Senator Boxer. It is just very clear what your own 
Inspector General is telling you. I guess if you haven't read 
it, you wouldn't know, but one of the things is finalize the 
CRT rule as soon as possible and hopefully you are doing that; 
define your e-waste program, your goals, your performance 
measures, communicate them to stakeholders, just about five of 
these. I would like to get this to you.
    EPA's Plug-In To eCycling Program is a voluntary 
partnership to increase electronics recycling. The IG reported 
that several stakeholders involved with recycling electronics 
didn't understand the purpose of the program or weren't even 
aware of it. What steps is EPA taking to clearly define the 
program's goals and to increase awareness of the program?
    Mr. Dunne. Senator, we are in the stage where we are 
completing a strategy in terms of municipal solid waste and 
some others including electronics. I was out in Las Vegas to 
the Consumer Electronics Products Show and there were other 
governmental officials there and I believe there are 21 
partners involved in that who have been involved in recycling, 
some jointly, some on their own and we want to give recognition 
and encouragement to some others.
    I haven't read that report thoroughly enough I guess to 
understand, if I understood what you said, how somebody could 
participate in the program and not know what it is about. If 
that is what it said, it seems very strange. Maybe they 
interviewed the wrong person in the company. I am not too sure, 
so I would have to take a look at the analysis done on that 
because I really don't know.
    Senator Boxer. I would think if the Inspector General is 
doing a good job he wouldn't just talk to one person. I think 
they would go out and interview a number of companies to see 
whether or not they heard of this program. I guess my feedback 
to you is this is a year old or so.
    I hope you would look into it because that seems to be a 
sad situation when you are doing a program to help people 
understand they should recycle and they say, we don't even know 
about the program. It just sounds like you are doing it but you 
are not really putting any effort behind it maybe or the 
Inspector General maybe did a terrible job on this report which 
you indicated maybe he talked to the wrong person. Just accept 
the fact that the IG has made this very important evaluation.
    I think you should take it as a criticism you should take 
in a good way and say maybe we are not doing enough, let me get 
back to you, Senator, let me see, because I think rather than 
be defensive and say, they only asked one person, maybe the 
truth is there is a good program out there in the EPA but you 
are not doing enough to publicize it. That would be my 
reaction.
    Mr. Dunne. I am not going to question the competency of the 
Inspector General's Office on this. I mentioned in my testimony 
that we had an electronics conference not too many months ago 
and 200 people showed up. A number of them came from this 
particular program.
    I find it difficult that any company or city would lend 
their name to something and say they don't know about it, so I 
would have to go back and analyze what the Inspector General 
really did to come up with that conclusion. I just haven't seen 
it.
    Senator Boxer. OK. Let me ask you one more thing. The EPA 
Inspector General recently concluded that the United States is 
``lagging behind international e-waste efforts,'' which you 
alluded to when you talked about some of the things Europe is 
doing. The IG highlighted international laws that require 
manufacturers to take financial responsibility for recycling 
consumer electronic products and to reduce the use of six toxic 
chemicals in these products.
    Here is what I think is interesting. Maybe you are prepared 
and maybe you want to get back to me but here in the United 
States, we have the Pollution Prevention Act. It establishes a 
national policy that ``pollution should be prevented or reduced 
at the source whenever feasible.'' I guess my question is, why 
hasn't the EPA used its authorities under the Pollution 
Prevention Act to require e-waste pollution prevention 
activities?
    Mr. Dunne. We are tied in to Pollution Prevention but I 
don't think, as I said before, that products are produced for 
international consumption, not just consumption in the United 
States, so it would be very difficult for us alone to do that 
under the Pollution Prevention Act.
    I do understand that one of our goals is to reduce the 
number of materials and reduce and reuse materials. It just 
makes sense to us economically. We wouldn't be putting this 
kind of manpower and effort behind it like my colleague from 
Minnesota, if we didn't think this was a worthwhile effort.
    Senator Boxer. I see my time has run out. That is fine. I 
look forward to your written responses.
    But Mr. Chairman, I think we have a lot of good advice here 
from the Inspector General, from the GAO, some of Mr. Dunne's 
comments were helpful, some weren't but some were, and I think 
we have struck something here. My own view just from listening 
is maybe this issue just hasn't gotten the attention it 
deserves and maybe we can jump start it. I just want to thank 
ever member of the panel for answering the questions.
    Senator Thune. Thank you all very much.
    We will move to our third panel. On this panel we have: Ms. 
Sheila Davis, executive director, Silicon Valley Toxics 
Coalition; Mike Vitelli, senior vice president, Consumer 
Electronics and Product Management, Best Buy Company, Inc.; 
Scott Slesinger, vice president for Government Affairs, 
Environmental Technology Council; and Richard Goss, director of 
Environmental Affairs, Electronic Industries Alliance.
    Ms. Davis, if you would like to lead off, we would love to 
hear from you.

 STATEMENT OF SHEILA DAVIS, EXECUTIVE DIRECTOR, SILICON VALLEY 
                        TOXICS COALITION

    Ms. Davis. I am Sheila Davis, executive director of Silicon 
Valley Toxics Coalition. I want to thank you for the 
opportunity to speak to you today about a very important issue, 
electronic waste.
    The problem with electronic waste in the United States is 
becoming critical. Discarded computers and other electronic 
products are the fastest growing part of the waste stream as we 
heard earlier. These produces contain a lengthy list of toxic 
chemicals as well. They also cause serious health problems 
which we know.
    Less than 10 percent of discarded computers are currently 
being recycled, with the remainder getting stockpiled or 
improperly disposed of; 50 to 80 percent of e-waste collected 
for recycling is actually being exported to Asian countries 
which have no infrastructure to accommodate the hazardous 
properties of e-waste. Due to horrific working conditions and 
no labor standards in many other developing countries where e-
waste is sent, women and children are often directly exposed to 
lead and other hazardous materials when dismantling electronic 
products to recover the few valuable parts for resale.
    I don't know if you received a copy of the photo that was 
submitted earlier, but Silicon Valley Toxics Coalition as well 
as the Basil Action Network actually went to China several 
years ago to see what was happening with the materials and 
there is a video as well as photos. The photo submitted earlier 
is a photo of a woman squatting on the ground surrounded by e-
waste and she has a hammer and a baron cathode ray tube which 
is the inner part of the monitor and she is trying to knock off 
the copper in the back.
    [The referenced document can be found on page 87.]
    It says, here in the photo, you will see a woman who is 
working on dismantling. She is in Guiyu, China. You see that 
she has no protective equipment whatsoever, yet she is about to 
smash a cathode ray tube from a computer monitor in order to 
remove the copper-laden yoke at the end of the funnel.
    The glass is laden with lead but the biggest hazard the 
woman faces is inhalation of the highly toxic phosphor dust 
coating inside the CRT. The monitor glass is later dumped in 
irrigation canals and along the river where it leaches lead 
into the groundwater. The groundwater in Guiyu is completely 
contaminated to the point where fresh water is trucked in 
constantly for drinking purposes.
    Why does the computer that I turn in at my local recycler 
event in California end up in China at this woman's workplace? 
Why didn't my computer get dismantled and recycled here in the 
United States like I thought it would?
    The answer is that the market for recycling e-waste here 
doesn't exist. The recycled materials used in these products 
are so toxic, it is very expensive to recycle them. There are 
some good recyclers who are actually trying to recycle products 
as extensively as technology allows but this requires manual 
processing and protecting workers from exposure to the toxic 
chemicals is very expensive.
    The economics just don't work for most recyclers so they 
look for the cheaper, low road solutions and cream off the 
parts for which there are local markets and ship the rest 
across the ocean to become someone else's problem or they use 
low wage prison labor in the United States for disassembly 
which further undermines the chances for a healthy recycling 
market in this Country.
    How do we fix this problem? We think the solution is to 
create incentives for the market system to work here. We need 
to do two things to make that happen. First, we need the 
products to be easier to recycle. The economics of recycling 
will never work unless these products are easier and therefore, 
cheaper to recycle. Part of that means using less toxic 
materials and part of that means designing them so that they 
are more easily disassembled for recycling without relying on 
prison labor or women and children in China.
    Here is an example of what I mean by designing for 
recycling. For example, a local to California representative of 
a printer manufacturer told me a discouraging story about 
recycling at his company. He said that designers worked with 
the recyclers and found that if they simply added a part that 
was less than a dollar, a component part, to the new line of 
printers, it would make the printer easier to disassemble and 
cheaper to recycle but the design team was told not to include 
the part because there is no guarantee that the printer would 
be recycled. So the added cost could not be justified. Here the 
producer was not motivated to change the design because they 
were not concerned about the recycling end of life for their 
product.
    The second thing we need to do is to get the producer to 
take responsibility for the product at the end of the product's 
life so they do have this incentive. If the producer, and here 
I mean manufacturers and brand owners, have no connection to or 
responsibility for their products at disposal time, then what 
incentive do they have to modify their design for better 
recycling or even better reuse for their products? The answer 
is none. They have no incentive to do anything different.
    What if companies did have responsibility for taking back 
their products for recycling? What if that was just a normal 
part of operation, that each company had to recycle a 
significant portion of its own products each year? They would 
simply build these take back and recycling costs into their 
products' pricing structure.
    To be competitive and to cut the recycling costs, they 
would innovate, redesign and end up with computers that were 
cheaper to recycle. Less toxic materials would be used so 
recycling would be easier and cheaper and there would be no 
reason to even think about having perhaps taxpayers pay to 
solve some of these problems. The market would really work 
better and work for us.
    This legislation we are encouraging our lawmakers to adopt, 
this legislative approach I should say is a call to producer 
responsibility and this is far reaching and it is probably more 
complex than we can go into today in testimony here, but we 
think it is the only solution that will correct the market 
forces that currently send my computer and yours too into 
landfills or to a village in China or into prisons.
    My message here today is this is a big picture problem that 
really calls for big picture solutions. It won't be solved just 
by the tax credits or just by a front end fee paid at point of 
sale. I encourage you as lawmakers to seek the kinds of changes 
that will actually make the market take care of the problem of 
electronic waste.
    Senator Thune. Thank you, Ms. Davis.
    Mr. Vitelli.

 STATEMENT OF MICHAEL VITELLI, SENIOR VICE PRESIDENT, CONSUMER 
   ELECTRONICS AND PRODUCT MANAGEMENT, BEST BUY COMPANY, INC.

    Mr. Vitelli. I am Michael Vitelli, senior vice president of 
Consumer Electronics at Best Buy. I am here today on behalf of 
the Consumer Electronics Retailers Coalition. This is my first 
committee hearing also. CERC appreciates the opportunity to 
provide the views of the consumer electronics and general 
retail industry concerning the need for a national approach to 
handling electronic devices at the end of their life. We look 
forward to working with you and members of this committee to 
identify the best means of developing a national solution for 
electronic device recycling.
    Best Buy is the Country's leading consumer electronics 
retailer with close to 700 stores in 49 States and nearly 
100,000 employees. The company started back in 1966 with a 
single store in St. Paul, Minnesota and we continue to operate 
our headquarters in the Twin Cities today. In addition to our 
products and services offerings, Best Buy is also known for our 
commitment to our communities, providing volunteer support, 
financial resources and leadership on many issues but 
especially on the use of innovative technology to improve 
learning opportunities for children.
    Best Buy is also actively concerned with the issue of 
electronic waste. In 2001, we launched a series of recycling 
events to provide a simple and convenient program for recycling 
electronics that protects the environment while raising 
awareness of recycling options. Through these events, Best Buy 
has helped consumers nationwide recycle over 2.5 million pounds 
of electronics in an environmentally responsible way since the 
program began. We also offer the ability to recycle cell 
phones, ink cartridges and rechargeable batteries year round in 
all of our U.S. stores.
    CERC is a national coalition representing consumer 
electronics retail businesses and associations that operate in 
all 50 States and worldwide. Joining Best Buy in CERC are 
Circuit City, Radio Shack, Wal-Mart, Target, the North American 
Retail Dealers Association and the Retail Industry Leaders 
Association. Our goal at CERC is to educate, advocate and 
instill continued consumer and market confidence in consumer 
electronics policy issues.
    The most important point I want to make here today is that 
the Country needs a national solution to the issue of 
electronic waste. In the first half of 2005 alone, 30 States 
and local legislators saw more than 50 separate bills 
introduced on this issue including an e-waste measure 
introduced and still active in New York City. So 50 differing 
and potentially conflicting approaches will be administratively 
unreasonable and infeasible for manufacturers and retailers 
alike and will not lead to a comprehensive and efficient 
electronics waste management system for our Nation.
    While retailers have a limited role in the life cycle of 
the product we sell, consumer electronics retailers realize we 
have a responsibility in working with interested stakeholders, 
retailers, manufacturers, distributors, recyclers, public 
interest groups, charitable organizations, State and local 
governments and indeed our consumers themselves all have a role 
in advocating for the development of a successful, national 
electronics waste management system.
    Both consumer electronics and general retailers unanimously 
support a shared responsibility approach to handling electronic 
devices at the end of their life cycle. While other 
stakeholders have yet to reach a broad consensus, consumer 
electronics and general retailers, including their national and 
State federations, have come together. CERC drafted a consensus 
legislative position paper supporting a producer responsibility 
model based upon internal discussions, industry wide and 
meetings with policymakers.
    Since issuing this position paper, CERC has been working 
with and recruiting broad, across industry support among other 
interested stakeholders including environmental groups, 
recyclers, State legislators and manufacturers. Our members 
oppose a point of sale, advance recovery fee system at the 
State level because we know from firsthand experience that such 
an ARF will not accomplish its goals. It is an administrative 
burden for all parties and while it guarantees a new revenue 
source for Government, it does not guarantee there is an 
effective recycling system put in place or that the fees are 
adequate to support that system. In addition, such a program 
provides no incentive for the design of more environmentally 
friendly products and fails to take advantage of market forces 
to reduce the cost of recycling over time.
    While retailers and others believe that the producer 
responsibility approach is the most fair, least burdensome and 
perhaps the most easily managed model, we have also looked upon 
the Talent-Wyden Electronic Waste Recycling Promotion and 
Consumer Protection Act that would provide that limited tax 
credit to recyclers and to consumers as an excellent model that 
could jump start a national capitalization of e-waste 
recycling.
    Even without State or Federal laws governing management of 
electronic waste, the private sector, manufacturers and 
retailers, working with qualified recyclers, are fully 
supportive of a shared responsibility approach as evidenced 
through the numerous voluntary initiatives that collect and 
recycle today. CERC members and other consumer electronics 
retailers and manufacturers have participated in such EPA 
programs as the Plug-In To eCycling Outreach Campaign which 
works to increase the number of electronics devices collected 
and safely recycled in the United States. Partners in this EPA 
program have included manufacturers like Panasonic, Sharp, 
Sony, JVC, Lexmark, Dell, Intel, retailers like our company, 
Best Buy, as well as Staples and Office Depot and approximately 
two dozen State and local governments.
    More than 26.4 million pounds of electronics were collected 
in the first 10 months of this national program alone. In 
addition, a number of retailers and manufacturers have taken 
part in other voluntary programs to encourage greater 
recycling. As I mentioned earlier, Best Buy actively provides 
recycling options for our customers and our recycling events.
    We had an overwhelming response to one in our headquarters 
in Minnesota over a month ago that drew record crowds and we 
had 2,900 cars and collected over 250,000 pounds in just 2 
days. Another event is scheduled next week at our Mira Mesa, CA 
store and we are very excited to be partnering with HP and Sony 
in this event.
    We all realize that voluntary programs cannot fully handle 
or solve the end of life issues involving consumer electronics 
and CERC strongly believes that a comprehensive, nationwide 
approach to the matter of electronics is the ultimate solution. 
We further believe that a successful national system can be 
established without imposing fees at point of sale, without 
having to create a new complex administrative structure, and 
without mandates that discourage innovation. That is why the 
Talent and Wyden Act seemed to many of us a cost efficient and 
potentially successful national program. We urge you to 
consider this proposal as a viable and creative opportunity to 
deal with electronics at the end of their lives.
    The members of CERC together with consumer electronics, 
general retailers and their trade associations throughout the 
United States want to be constructive and contributing partners 
with lawmakers, manufacturers and others in dealing with these 
end of life cycle consumer electronics products. We cannot, 
however, afford to let individual States, individual cities and 
counties establish the wrong programs and impose inconsistent 
mandates on retailers and manufacturers and create confusion 
about the appropriate ways to handle electronics at the end of 
their life.
    We appreciate the holding of this hearing and encourage 
Congress in general and this committee in particular to work 
toward a national solution on electronics waste management. We 
pledge to work hard with you in arriving at a fair, viable and 
effective approach.
    Thank you.
    Senator Thune. Thank you, Mr. Vitelli.
    Mr. Slesinger.

  STATEMENT OF SCOTT SLESINGER, VICE PRESIDENT FOR GOVERNMENT 
           AFFAIRS, ENVIRONMENTAL TECHNOLOGY COUNCIL

    Mr. Slesinger. My name is Scott Slesinger and I am vice 
president for Governmental Affairs of the Environmental 
Technology Council. I want to thank the committee for 
requesting our views on the issues of e-waste. Our Council 
represents environmental service companies that recycle 
hazardous materials including e-waste and solvents. We also 
represent hazardous waste facilities permitted under RCRA.
    Similar to the lead shielding used to protect dental 
patients during x-rays, the amount of lead in computers is 
significant but is a crucial component that protects the user 
from radiation emitting from the tube. Without toxic metals, 
disposal in a sanitary landfill would be a safe and available 
option, however, these facilities are not operated to protect 
the environment from the leaching of the volumes and types of 
lead that would be placed in these facilities.
    In some communities, if you put a computer curbside in a 
garbage bag, it will be crushed, then incinerated and the lead 
and other contaminants will go into the air. Newer flat panel 
monitors do not use lead and glass but use mercury to operate 
efficiently.
    If computers are hazardous toxic waste under the law, why 
are they being disposed of in non-hazardous waste landfills and 
incinerators? Congress exempted households and certain small 
generators from the hazardous waste regulatory regime. The 
belief at the time was that the volume of toxic waste from 
households would be minor and not a threat to the environment.
    When communities became aware of the volume of lead being 
placed in their sanitary landfills, they grew concerned. About 
a quarter of the States passed laws treating CRTs as universal 
waste. Universal waste rules are clear and simple standards for 
managing widely distributed hazardous waste as compared to the 
more burdensome requirements intended for factories and similar 
facilities.
    Essentially, the universal waste rules are a middle ground 
between the household rules which exempt waste from controls 
and the full RCRA subtitle (c) hazardous waste standards. EPA 
is establishing universal waste rules for items such as mercury 
thermostats and flourescent lamps.
    An EPA advisory group that included State, Federal, 
environmental and industry officials recommended to EPA that 
CRTs be regulated as universal waste to ensure responsible 
recycling. However, we have learned that instead of requiring 
universal waste protections, EPA plans to finalize the rules 
that essentially deregulate these waste if sent to a domestic, 
unregulated recycler. EPA's proposed exemption from RCRA for 
CRT glass if followed by the States would represent a 
regrettable rollback in environmental protection.
    We believe that other electronic waste including computer 
hardware and cell phones should also be regulated under the 
universal waste rules instead of the normal hazardous waste 
rules. Those who may argue that deregulation will lead to more 
recycling may be right but such unregulated recycling will 
inevitably lead to improper recycling, taxpayer financed 
cleanups and public cynicism of recycling. Those costs would 
dwarf the benefits of a possible chance of some increase for 
recycling.
    The risks are not imaginary as Senator Talent mentioned a 
facility in Missouri. At a State convention of hazardous waste 
officials in 2002, State regulators described the recycling 
industry as a low profit, risky business with high turnover 
rates and inadequate insurance. The State regulators cited 
cases where low cost recyclers were merely sham operations who 
collected waste fees with no intention of doing any recycling. 
Many of these facilities have gone belly up leaving 
contaminated sites for States to clean up.
    Despite EPA's proposed approach, many generators of 
computer waste want recyclers to have some certification, a 
good housekeeping seal of approval. EPA responded by 
establishing fairly good guidelines in the document, Plug-In To 
eCycling, Guidelines for Materials Management. However, these 
guidelines are only voluntary and their effectiveness as 
opposed to the promulgated University Waste Standards is 
unconvincing.
    Many of our customers send computers to us for handling 
because our companies are protected. For instance, our member 
companies and legitimate competitors track the waste, train our 
employees, prepare spill prevention plans and hold 
environmental and closure insurance.
    Under the proposed EPA CRT rule, our companies and 
competitors would not need to meet any of those requirements. 
Unregulated companies would be subject to RCRA only if they 
spill the hazardous waste on the ground but it is hard to 
imagine how that would become known. It would be difficult if 
not impossible for regulated entities to compete in such a 
system.
    Today with commodity prices high, there have been many new 
businesses trying to make profits out of e-waste. When the 
price of the valuable components inevitably turns, these 
unregulated recyclers may fail and leave the taxpayer to clean 
up the toxic remains. We believe that whatever legal regime is 
established for recycling, the rule should require them to have 
financial assurance for closure, environmental liability 
insurance, employee training and some minimal waste tracking so 
consumers can be assured their discarded computers are managed 
properly.
    The goal should not be to increase recycling, the goal 
should be responsible recycling that conserves resources, saves 
energy and enhances the environment.
    Thank you and I look forward to any questions you may have.
    Senator Thune. Thank you, Mr. Slesinger.
    Mr. Goss.

 STATEMENT OF RICHARD GOSS, DIRECTOR OF ENVIRONMENTAL AFFAIRS, 
                 ELECTRONIC INDUSTRIES ALLIANCE

    Mr. Goss. My name is Richard Goss. I am the director of 
Environmental Affairs for the Electronic Industries Alliance, 
EIA. EIA is the leading advocate for the $400 billion U.S. high 
tech and electronic industries. Our 1,300 member companies 
provide products and services ranging from microscopic 
electronic components to State of the art defense, space and 
industry high tech systems, as well as the full range of 
telecommunications, information technology and consumer 
electronics products.
    EIA appreciates the opportunity to provide the views of our 
membership concerning the end of life management of our 
products. We commend the subcommittee for holding this hearing 
and advancing the dialog on this important issue. We would also 
like to thank Senator Wyden and Senator Talent for their 
efforts and leadership in this area.
    EIA and our member companies support the safe and 
appropriate recycling of used electronics products to help meet 
the important environmental goal of increasing resource 
conservation and recovery. As manufacturers, we recognize that 
we are a key partner in the process and we will continue to 
work with Congress, Federal agencies, the States and involved 
stakeholders to address this challenge.
    The ongoing commitment of our member companies to product 
stewardship, environmental design and recycling can best be 
demonstrated by a listing of some of our industry's concrete 
achievements. Through a combination of direct corporate efforts 
and innovative partnerships, including USEPA's Plug-In To 
eCycling Campaign, EIA member companies have been involved in 
the proper recovery and management of well over 1 million tons 
of used electronics products, well over 2 billion pounds.
    In addition, EIA member companies use significant 
quantities of recycled materials including glass, metals and 
plastics in new generations of their products. EIA member 
companies are on target to be in compliance with the European 
Union directive on the restriction of hazardous substances, the 
Ross Directive, which will take effect on July 1, 2006. Since 
electronics products are manufactured for global sale and 
distribution, U.S. consumers will have broad access to products 
that comply with the new EU requirements.
    As a result of our members' longstanding dedication to 
product stewardship and technological innovation, the 
electronics industry continues to achieve significant and 
sustained environmental progress throughout the entire product 
life cycle, from design through beneficial use to end of life. 
On the whole, every year our products become more energy 
efficient, use fewer materials of potential environmental 
concern and become easier to upgrade, disassemble and recycle.
    EIA is currently compiling a record of member company 
achievements in the areas of product stewardship and design for 
the environment and we will be happy to share this document 
with the subcommittee once it is completed.
    In summary, we support electronics recycling as a way to 
conserve and reclaim resources. However, this is a complex 
challenge that will require the coordinated efforts of all the 
key stakeholders to resolve. Given the complex nature of the 
challenge, EIA supports efforts to establish a viable recycling 
infrastructure in which all the major stakeholders, 
manufacturers, government retailers, non-governmental 
organizations and recyclers participate based on the unique 
expertise and capabilities.
    The combined goal of these institutional stakeholders 
should be to develop a recycling infrastructure that is 
convenient for the residential consumer. Implementing a system 
based on principles of shared responsibility will increase the 
efficient collection of electronics and ensure economies of 
scale by taking advantage of existing infrastructure.
    EIA supports equitable, flexible and cost efficient 
solutions that encourage the proper management of used 
electronics while limiting additional cost to the public for 
these popular products. EIA also believes that it is essential 
to consider the science related to electronics products as part 
of any public policy discussion regarding recycling.
    Certain compounds are present in electronics products such 
as lead and mercury that provide clear safety performance and 
energy and efficiency benefits. These compounds should be 
appropriately managed at the end of the life. USEPA shares this 
view and has consistently stated the used electronic products 
when properly managed do not represent a human health or 
environmental concern.
    The agency considers electronics recycling as fundamentally 
a solid waste mangement and resource conservation issue. 
Likewise our member companies recognize that reusing and 
recycling electronics at the end of the life is the most 
environmentally preferable option and we support reasonable 
efforts to develop the recycling infrastructure.
    As you know, three States have already enacted three very 
disparate statutes which address electronics recycling. 
Numerous other States and even some localities have either 
developed special regulations for handling of used electronics 
or are actively considering their own electronics recycling 
legislation. These approaches often include significant 
variations in terms of financing mechanisms, the scope of 
covered products, the roles and responsibilities of key 
participants and the overall regulatory structure.
    Industry and other stakeholders are rightly concerned that 
potential confusion of State recycling laws and regulations 
will prove costly, inefficient and perplexing. There is clearly 
a role for the Federal Government to play in bringing national 
consistency to this emerging field. Federal action can help 
promote the safe and environmentally sound recycling by 
creating a streamlined and uniform regulatory framework that 
removes artificial barriers and instead encourages the free 
flow of used products for proper management.
    Specific steps include: establishing consistent regulatory 
definitions of key terms and strictly defining the scope of 
covered products through the application of fixed criteria; 
considering the establishment of a flexible third party 
organization that can help with roles such as data reporting, 
compliance and financing; ensuring broad consistency in 
labeling product information and regulatory reporting 
requirements; and assessing whether additional recycling 
regulations or standards are necessary to ensure the safe and 
environmentally sound management of used electronics.
    EIA and our member companies stand ready to work with the 
subcommittee on these and other initiatives.
    Thank you again for the opportunity to share industry's 
position on this important issue and I would be pleased to 
respond to any questions.
    Senator Thune. Thank you, Mr. Goss.
    I am now going to turn to Senator Boxer for questions.
    Senator Boxer. I know that is a favor to me because I have 
a 4:30 I have to attend but this has been a terrific panel. I 
do appreciate all of your. Every one of you has made a 
tremendous contribution at least to this Senator's 
understanding of this.
    Mr. Vitelli, thank you for what you do to recycle these 
products, take these products back. I guess what I am 
interested in is what you do with them once you get them?
    Mr. Vitelli. We work with qualified recyclers in the 
various States that we do that and with the manufacturers who 
participate with us. In some cases, they are the ones taking 
the product to the right place.
    Senator Boxer. So you don't send them to China?
    Mr. Vitelli. No, we do not. In fact, our RFQs with 
recyclers we work this, one of the key things in there is the 
fact the product will be recycled in the United States.
    Senator Boxer. I am glad. That makes me very proud of what 
you are doing.
    I was on a local county board years ago in the days we 
didn't think about recycling anything, paper, plastic, 
definitely not plastic, aluminum cans and we realized that 
there could be a profit in this. I am wondering whether you in 
this effort break even on this, make money, do you lose money? 
What do you think at the end of the day?
    Mr. Vitelli. You mentioned it earlier. There is not a 
tremendous profit in this, you are actually paying for the 
removal of waste.
    Senator Boxer. So it is a cost?
    Mr. Vitelli. It is a cost literally and it is going to be a 
function of who ends up paying for the cost.
    Senator Boxer. I think that is really important. You are 
doing the responsible thing and it is costing you something. 
You are getting goodwill out of it, getting people into the 
store. That is very good but still I think we need to consider 
that there needs to be a more equitable type of system.
    Ms. Davis, thank you so much for sending us this photo. The 
chairman and I were looking at this photo of the woman not 
really having a clue of what she is doing here, with no 
protective clothing or anything like that. How widespread a 
problem is the export of electronic waste to countries that 
lack adequate environmental protections?
    Ms. Davis. There is an estimate of about 80 percent of the 
materials that are accumulated in the United States are 
exported.
    Senator Boxer. Who are the major exporters?
    Ms. Davis. They are basically companies that are sometimes 
front men for recyclers. If you give your product to or drop it 
off at a recycle, they might collect it but will put it in a 
shipping container, give it to a broker and the broker will 
ship it overseas. That is where most of the waste ends up.
    Senator Boxer. Let me understand this. People go to a 
recycle?
    Ms. Davis. Go to a local recycle.
    Senator Boxer. Do they pay them the fee to take the 
computer?
    Ms. Davis. It depends on what State you are in. Most States 
don't have a fee.
    Senator Boxer. So what is in it for this person?
    Ms. Davis. The recycler will cream off the good computer, 
so some of the computers can be reused, they will take some of 
the valuable metals, some of the valuable chips and the rest is 
basically waste. The monitors basically do have some valuable 
parts like copper but it is very hard to recovery.
    Senator Boxer. They pay the broker out of their profits to 
get the stuff out?
    Ms. Davis. It depends. Sometimes the broker will actually 
pay them up to 2 cents a pound or so.
    Senator Boxer. You say 80 percent of the waste is winding 
up in these countries?
    Ms. Davis. It is estimated 80 percent but I don't think 
anyone in this Country is actually keeping track.
    Senator Boxer. I think this is amazing, Mr. Chairman. With 
all we do for good will, this is something we need to look at, 
what is happening.
    Scott, thank you for being here. EPA acknowledges that 
cathode ray tubes can leach four times the amount of lead as 
regulated hazardous waste. We got that out of the EPA today. It 
is in their rule. Electronic waste can also contain mercury, 
cadmium and other toxic substances. However, EPA has stated 
that municipal landfill standards are sufficiently protective 
to hold electronic waste. Do you agree with that?
    Mr. Slesinger. No. I think it is clear it fails EPA's test 
for what should not go into a municipal landfill. A similar 
test used by the State of California also failed the test. All 
landfills are different. It tries to mimic the average 
landfill. Certain landfills will probably leak more than others 
but if it is a hazardous waste and it is coming from Best Buy, 
Dell or a computer company, it can't go there. If it isn't 
recycled, it should go to a hazardous waste landfill.
    Hazardous waste landfills don't just put it with regular 
garbage and dump it into the landfill, they encapsulate it with 
a plastic and then use a reagent that goes around the material 
four inches thick that makes it so what was in there, lead, 
mercury, doesn't leach out and then it is put into a landfill. 
Then it is much more protected.
    Senator Boxer. Let me understand. Right now, there is no 
EPA rule to stop it from going to municipal landfills?
    Mr. Slesinger. Not exactly. The EPA rule generally says if 
you have a waste and it fails the EPA test, in this case for 
lead, which it fails, it should go to a hazardous waste 
landfill. A lot of the major manufacturers and retailers do 
send to our facilities for either recycling or for disposal. 
Most companies would rather have it recycled. We try to recycle 
as much as possible. In fact, today we are recycling all the 
hazardous materials in the computers but have to landfill the 
non-hazardous plastics and others because there is no market 
for those materials.
    Senator Boxer. Is there any rule of the EPA that these 
products have to go to a hazardous landfill?
    Mr. Slesinger. Yes.
    Senator Boxer. There is a rule. So they can't show up in 
municipal landfills?
    Mr. Slesinger. Unless it is a household which is exempt or 
a small quantity generator who is exempt.
    Senator Boxer. But household is exempt?
    Mr. Slesinger. That is correct.
    Senator Boxer. That is a lot. We are talking here, looking 
at the TV sets, many millions of these TVs. How many did you 
say?
    Ms. Davis. Two hundred and eighty-seven million.
    Senator Boxer. Two hundred and eighty-seven million analog 
TVs, if everyone just takes it to a municipal landfill, that is 
a lot of dangerous waste in municipal landfills.
    Mr. Slesinger. The alternative is if somebody does a pick 
up like a manufacturer or retailer, then it would go into the 
hazardous waste stream.
    Senator Boxer. That is why what Mr. Vitelli is doing is so 
responsible because he is making a point to try to do that.
    I am going to ask one last quick question to you, Mr. Goss, 
because the whole panel is so good and you have so much 
information.
    I wanted to ask you about your member companies that are 
complying now with the European Union requirements. To what 
extent will Europe's requirements provide your member companies 
with a system that we could duplicate here and that you could 
duplicate here in the United States? Is it onerous over there 
or are you learning ways to live with what they are 
recommending?
    Mr. Goss. You are referring to the electrical waste?
    Senator Boxer. Yes.
    Mr. Goss. The jury would still be out on that. The 
directive has not been implemented yet. It is scheduled to go 
into effect in August of this year. Several companies, the 
United Kingdom, France, have had difficulties in terms of 
transposing the directive so far and we are waiting to see 
exactly how it works in practice.
    Senator Boxer. Transposing it from the law into pragmatic 
rules?
    Mr. Goss. My understanding also is that in numerous 
countries they have yet to set down the regulations and the 
registration requirements.
    Senator Boxer. Couldn't it just be done by the European 
Union or be different for each?
    Mr. Goss. I am not an expert on the we approach but I 
believe each country has certain registration and regulatory 
requirements but we can certainly check on that.
    Senator Boxer. Mr. Goss, would you keep the chairman and me 
informed as to how it is going over there, if it is a total 
nightmare or if they are coming up with ideas that we could 
look at?
    Mr. Goss. We certainly will and in fact, we will keep a 
close eye on it because we are interested to see how it works 
in practice once it is implemented.
    Senator Boxer. I think it is good for all of us. Again, I 
want to thank you, Mr. Chairman and our terrific panel. Thank 
you all.
    Senator Thune. Thank you, Senator Boxer. I would echo what 
the Senator from California said. I think you have been a very 
enlightening and informative panel. Hearing about what is 
happening out there and some of the good things that companies 
like Best Buy are doing is encouraging to hear.
    Hopefully it gives us a bit of an idea and perspective on 
what we might or might not be able to do in terms of a national 
solution, if that is something we decide is necessary based 
upon the data collected about the risks associated with the 
stream currently heading into these landfills and will probably 
only increase in the future as we dump more and more of these, 
particularly the older television sets.
    Mr. Goss, I want to ask you during Ms. Davis' remarks, she 
mentioned the needs to make products easier to disassemble and 
I think if you look at the General Accountability Office's 
study it also points out that 50 percent of the cost recycling 
is in the labor and the companies currently doing that, it 
becomes almost prohibitive at times depending on the value of 
some of those materials to recycle.
    How would a requirement to make those products easier to 
disassemble impact the durability of the electronics consumers 
buy today? How would that affect the quality and the 
workmanship and all that? It is in the GAO study, and I don't 
have it in front of me, but talked about $1 per screw or 
something like. HP spent a $1 in additional design costs to 
reduce a number of different screws in each computer and would 
save Niranda, which does these disassemblies, $4 cost. Do you 
sacrifice something in terms of durability and quality?
    Mr. Goss. I would have to check with some of my individual 
member companies on that. Certainly there are a lot of advances 
that our companies have made and as I said in the compilation 
we are going to be sharing with the subcommittee some of those 
and be detailed in terms of the advances we made, in terms of 
designing for ease of upgrading and recyclability and reuse. I 
can get some specific information for you on that. I would 
imagine there are probably several innovations out there right 
now that would allow products to be recycled easier without 
compromising any of the performance.
    The other point I would make is that we will be dealing 
with recyclers as we do to find out the break down and exactly 
what makes it easier for them to recycle because as 
manufacturers, we know how to put the products together but we 
need that knowledge base and what makes it easier for them on 
their end to disassemble it.
    One related point is the transportation costs for the 
materials I think are far and away the largest single bulk of 
the cost involved with recycling.
    Senator Thune. Were members of your organization members of 
this NEPSI group in 2001?
    Mr. Goss. Yes, we were.
    Senator Thune. I guess the industries would prefer a 
national framework so that you don't have to comply or deal a 
patchwork of State requirements but it sounds like the 
consensus reached as a result of those meetings was they 
couldn't come to a consensus on what a national system or 
framework might look like. At least that was what I was told, 
that in 2005 those efforts dissolved because the stakeholders 
couldn't reach agreement.
    Could you explain some of the market competitiveness issues 
that have prevented your association from being able to advance 
a consensus position on what a national framework might look 
like?
    Mr. Goss. Certainly. The first point I will make is that 
our industry as a whole, all the companies recognize the 
importance of this issue and that we are a key player in this 
issue. For us, it is not a question of whether we should be 
involved in recycling, that question has already been answered 
in the affirmative.
    The question is how to finance it. Based on different 
companies with different product lines, different sales and 
distribution models and experiences in the market, there are 
some very market differences in terms of what they see as a 
fair and equitable approach to this recycling challenge.
    We went through well over a year of intimate industry 
discussions to try to come to a consensus on this. It was a lot 
of commitment to try to come up with something everyone could 
agree with. Those discussions are still ongoing. We still have 
hope we will be able to reach a consensus industry position on 
this but for right now, there are marked differences of opinion 
in terms of what the different players believe is fair and how 
it works to competitive advantage.
    Senator Thune. Mr. Slesinger, GAO's testimony talked about 
the amount of precious metals found in computers and other 
electronics. Why don't we see a larger U.S. business interest 
in recovering some of those precious metals like gold and 
copper, aluminum and platinum found in some of those products?
    Mr. Slesinger. The reason has to do mostly with labor 
costs. There might be a little bit of gold in some computers 
but finding it is very costly. EPA testified last week they 
thought recyclers were getting $1-$2 worth of valuable product 
out of a computer which they had to charge $15 to take apart. 
In fact, the metal prices are such that for instance today, if 
we send the glass to a glass company that makes new leaded 
glass, it doesn't cost us anything for them to take it and we 
don't get anything from it.
    What we find the most profitable part of a computer is if 
we can get a computer that is newly discarded, its hard disk or 
particular chips or other parts of it may have a resale value 
and that is really the value. An efficient way to mining for 
the gold has not been shown yet.
    Senator Thune. Mr. Vitelli, if I were wanting to drop off 
an old computer I have sitting in my closet, how does your 
collection program work? There is a Best Buy on 41st Street in 
Sioux Falls, SD. Do I just take it down there? How does that 
work?
    Mr. Vitelli. Currently, the programs we are doing have been 
voluntary with the manufacturer in a particular city or a 
particular State, so there isn't a comprehensive recycling 
program for computers today. We would actually look to whatever 
that particular city or State program may or may not be at that 
time, but there isn't a comprehensive here is what you do 
nationally or that particular store now.
    Senator Thune. So it is sort of State to State, store to 
store, so to speak.
    Mr. Vitelli. More voluntary versus anything else.
    Senator Thune. I have a question or two for Ms. Davis 
dealing with the issue raised earlier about extended producer 
liability which I think you suggested needs to happen. You 
mentioned in an attempt to reduce the amount of e-waste in the 
future, manufacturers need to have more responsibility for 
their products at disposal time which is one solution some of 
the States have implemented, some have front end fees, some 
have held the manufacturer responsible.
    If you didn't have a Federal mandate of extended producer 
responsibility, how would you see the Federal Government doing 
it? Would you have to impose a national mandate or is there 
another way of accomplishing the same objective I guess is the 
question I am asking?
    Ms. Davis. There would have to be some type of Federal law 
that would level the playing field for all the manufacturers to 
actually take some responsibility for their product at the end 
of life. That could mean there could be a third party, as Mr. 
Goss suggested, that can actually set up a system that would 
take back the products and set up some type of standards for 
the manufacturers to abide by and the manufacturers would pay 
into that third party in order to have their products recycled 
or they can go directly back to the manufacturer. For example, 
when you purchase a computer, you should be able to return your 
old computer and that manufacturer would take responsibility 
and recycle it for you.
    Senator Thune. If you create a third party, you have to 
figure out a way to finance, correct? In any of these 
scenarios, you are talking about some sort of way of paying for 
this. Manufacturers probably aren't going to volunteer, are 
they?
    Ms. Davis. No. I guess if they were going to volunteer, 
they would be doing it now but there would have to be some type 
of regulation or laws or framework put in place that would 
allow them to operate as a third party or operate with a third 
party and pay into it, I imagine.
    Senator Thune. Somebody mentioned today there ought to be a 
way of doing this without a front end fee or something like 
that, but it seems to me if the responsibility is placed upon 
the manufacturer, the producer, the producer or the 
manufacturer is going to pass it on to the retailer, the 
retailer is going to pass it on to the consumer.
    At some point, somebody is going to pay for this process 
unless there is enough incentive in the recycling side of it to 
encourage people and that is where I am kind of coming back to 
the Talent-Wyden bill, if in fact that creates enough incentive 
for either individual consumer buyers of these products or 
certified retailers to get in the business of recycling these 
products?
    Ms. Davis. If the manufacturers were responsible for paying 
the cost of recycling, then they would have to find innovative 
ways to change the design and drive down the costs just as they 
find innovative ways to manufacture the product to drive down 
the cost without hopefully sacrificing labor and so forth or 
labor standards. But if there were some type of incentives, 
whether it is a liability, some type of government incentives 
around recycle content or some type of tax break around 
research and development, those could be built into the 
framework.
    But I think the bottom line is that manufacturers, for the 
most part, need to incorporate the cost or internalize the cost 
for the recycling and for the end of life. That way they have 
some bottom line incentive to actually figure out how to do it 
cheaper.
    For example, in California where there is a front end, the 
manufacturers aren't involved at all, they have no incentive to 
redesign their products, so people in California could 
basically pay for now $5, $6 or $10 and the fee will probably 
go up and not down over the years to recycle their products.
    Senator Thune. Mr. Goss?
    Mr. Goss. I would say in terms of the design for 
environment, clearly the Ross directive goes into effect in the 
EU next July but the point I would make is that our member 
companies have been innovating in design for environment and 
product sustainability for years on a voluntary basis and have 
made some wonderful technological innovations in terms of 
design. This is not something that has only come about due to 
several directives or State laws or what have you. We are 
certainly designing more for upgrading, for recycling, for 
reuse and will continue to do so because it is part of what the 
public and consumers demand.
    Senator Thune. As a consumer, we want you all to make those 
upgrades but to get the prices down.
    Mr. Goss. We will do our best.
    Ms. Davis. I would like to note that I think the Ross 
directive with the restriction on hazardous substances in the 
EU as well as a redirective really truly has driven the 
manufacturers to change their practices. I think some of the 
manufacturers have done it on their own but again unless there 
is a level playing field for manufacturers, they are simply not 
going to be able to invest and manufacture products and stay 
competitive.
    Senator Thune. I want to thank you all very much for your 
testimony and for the light you have shed on the subject. It is 
not something that Congress has dealt with in the past. Clearly 
the States are beginning to deal with it. I think this is a way 
of defining and quantifying the problem, if there is a problem, 
and then trying to figure out what is the best way to come up 
with a solution.
    That is the challenge we are going to face but certainly 
your testimony and presentations today will add a lot to the 
body of evidence to say as we move forward we will need to come 
up with solutions.
    Thank you very much for your testimony.
    The hearing is adjourned.
    [Whereupon, at 4:41 p.m., the subcommittee was adjourned.]
    [Additional statements submitted for the record follow:]

   Statement of Frank Lautenberg, U.S. Senator from the State of New 
                                 Jersey

    Mr. Chairman, thank you for calling this hearing and giving us an 
opportunity to learn more about this issue.
    When I was a boy, my family was poor. We weren't ashamed of it, 
because everybody we knew was in the same boat.
    When people don't have a lot, they make the most of what they do 
have. That's what people did when I was growing up.
    If something could be used, it didn't get thrown away. Nobody could 
afford to waste anything.
    During World War II, Americans saved tin foil and tires so the 
aluminum and rubber could be reused.
    This was not only frugal--it aided the war effort and made our 
Nation stronger.
    Today Americans own two billion electronic products--which works 
out to about 25 items for every single household.
    On an individual basis, many Americans can probably afford to toss 
out these products when they become obsolete.
    But as a society, we can't afford to do that. The environmental 
costs are simply too high.
    Computers and televisions contain significant amounts of lead, 
mercury and other hazardous substances.
    Tossing old computers into landfills creates tons of lead and 
mercury waste.
    In fact, some experts predict one billion pounds of lead from 
electronics could enter our landfills in the next decade.
    This would pose a serious threat of toxic runoff--and it would 
ultimately be an expensive problem to clean up.
    We dispose of about twelve million computers every year. These fill 
up a lot of landfills. And in populated areas like New Jersey, landfill 
space is limited.
    There is a better way.
    Instead of throwing away these products, we should retrieve and 
reuse the resources that are salvageable.
    Electronics are currently the fastest growing part of the waste 
stream, but fewer than 10 percent of old electronics products are 
recycled.
    That has to change. Mr. Chairman, it is simply wasteful to continue 
throwing away old products that contain resources we could re-use.
    Congress needs to join with the producers of these products in 
leading the way for change.
    Thank you Mr. Chairman.
                               __________

   Statement of Hon. Ron Wyden, U.S. Senator from the State of Oregon

    Mr. Chairman, America is a computer-dependent society. I'm willing 
to bet that before coming to this hearing, almost every person in this 
room used a computer to write a document, to check e-mail, or to read 
the news. Yet as much as we depend on our computers, we seldom think 
about what they're made of. Let me tell you.
    The desktop computer in your office right now contains about 14 
pounds of plastic, 4 pounds of lead, 8.5 pounds of aluminum, more than 
12 pounds of iron, half a pound of nickel and lesser amounts of 
arsenic, cadmium, mercury, titanium, zinc, beryllium and gold. There's 
mercury in LCD and gas plasma screens, lead in monitors and circuit 
boards, cadmium in chip resistors and semiconductors and heavy metals 
in CPUs. And every year, millions of newly obsolete computers--and 
televisions, and other electronic trash or e-waste--are discarded to 
the tune of 2.2 million tons. Those 2.2 million tons of e-trash are the 
equivalent of 219 Boeing 737 jetliners. If handled improperly, this 
hazardous stew of toxic e-waste can poison water supplies, people and 
the environment. But there is a better way.
    Today, barely one in 10 computers gets recycled or reused. Compare 
that to old cars: 94 percent go to scrap yards where useable parts are 
reclaimed, and the rest of the material is shredded, compacted and 
recycled into appliances, cars and other products.
    Senator Talent and I believe that the United States can put less e-
waste in the landfill and more in the recycling bin. We have proposed 
S. 510, a pro-consumer, pro-environment and pro-technology bill to 
jumpstart a nationwide recycling infrastructure for electronic waste. 
Our bipartisan approach is the first to rely on incentives, rather than 
upfront fees or end-of-life penalties, to deal with electronic waste. 
Our legislation offers incentives to consumers and small businesses to 
get their old computers and laptops out of the closet and into the e-
waste stream. Our legislation offers manufacturers, retailers and 
recyclers incentives to recycle e-waste. The bill has the support of 
retailers, electronics manufacturers, and environmental recyclers.
    Specifically, our legislation would:
    Establish an $8 per unit tax credit for companies that recycle at 
least 5,000 display screens or computer system units per year;
    Establish a $15 tax credit for consumers who recycle their old 
computers and TVs, provided they use qualified recyclers;
    Prohibit the disposal in a municipal solid waste landfill of any 
electronic equipment with a display screen larger than 4 inches or any 
computer system unit, beginning 3 years after the bill passes if EPA 
finds that the majority of U.S. households have reasonable access to e-
waste recycling;
    Modify EPA's universal waste rule to classify screens and system 
units as ``universal wastes'' to allow for easier collection, 
processing, transportation and recycling;
    Require Federal executive agencies to recycle or reuse their 
display screens and CPUs; and
    Direct EPA to recommend to Congress the feasibility of establishing 
a nationwide e-waste recycling program that would preempt any state 
plan within 1 year.
    We do not claim to have a monopoly on the wisdom for how e-waste 
should be recycled, and so the tax credit is limited to 3 years. Our 
goal is to get a recycling infrastructure launched, and in the 
meantime, have EPA look at various options, at what various states are 
doing and come up with recommendations for Congress for a nationwide e-
waste recycling plan.
    The bill recognizes that states like California have already put a 
plan in place, and that many other states, like Oregon, are moving in 
that direction. But if every state and hundreds of municipalities and 
counties take different paths to solve the e-waste problem, the country 
will end up with a hodge podge of rules and regulations. Companies and 
consumers who are keen on doing the right thing will be confused, 
innovation will be stifled and not a lot of recycling would get done. 
One nationwide program seems to make the most sense.
    Last week the New York Times carried a story about computers so 
infected with spyware and adware that they are on life support. Rather 
than going through the painstaking process of debugging them, consumers 
opt to toss them out and pay several hundred dollars for a new one. 
Unless some miracle cure is found, the spyware plague is not going away 
anytime soon, and the number of discarded computers will grow.
    Then there's the transition to digital television, which could pull 
the plug on analog television sets in 21 million American households. 
The hand-over of the old analog channels could take place in the next 
4-5 years. Unless the U.S. gets serious about recycling electronic 
trash, what is going to happen to all those old tv sets?
    It is not very often Congress has the chance to get a jumpstart on 
solving a problem. This is one place where a bipartisan effort can make 
a real difference. I look forward to working with you to get a 
nationwide electronic waste recycling program launched.

                               __________

Statement of Hon. James Talent, U.S. Senator from the State of Missouri

    I would like to thank Chairman Thune and Ranking Member Boxer for 
holding this important hearing on electronic waste, the first of its 
kind in the Senate.
    There are roughly 50 million computers and 20 million televisions 
disposed of every year, some are illegally dumped, some are recycled, 
and others are just thrown away with the garbage. Computer monitors and 
televisions are a potential threat to our environment since they 
contain four to eight pounds of lead as well as other harmful 
materials. Because it's not always convenient to recycle computers, TVs 
and their parts, a lot of people store them in their basements, attics 
and backyards or just throw them away. According to the EPA, U.S. 
households have an average of two to three computers and televisions 
that they are not using in storage. That's about 70 million computers 
and televisions nationwide sitting around, collecting dust and 
potentially harming the environment.
    One of the largest illegal computer dumps was located in Rolla, 
Missouri. Someone was running an illegal computer recycling business 
out of a rented building on the property. Instead of properly disposing 
of the computers, the man collected over 15,000 monitors and dumped 
them. Cleaning up this illegal dump cost Missouri taxpayers hundreds of 
thousands of dollars.
    To avoid these types of hazardous and costly situations, Senator 
Wyden and I have introduced legislation that creates the first-ever 
nationwide infrastructure to deal with e-waste. The ``Electronic Waste 
Recycling Promotion and Consumer Protection Act'' (S. 510) gives tax 
credits to consumers as well as to manufacturers, and retailers for 
recycling old or unwanted computers and TVs. Importantly, this tax 
credit is completely voluntary. If folks don't want to recycle their 
old TVs and computers, they don't have to and there will be no penalty, 
which is where the law is now.
    Here's how the legislation works: There is a $15 credit, which is a 
one-time deal for people like you and me that may have a computer or TV 
in our basements. To get the credit, you must submit with your tax 
return proof that the recycling was done by a qualified recycler.
    There is also a small business credit, which operates like this: An 
$8 credit is available to anyone who collects no less than 5,000 TVs or 
computers in a given year and proves that they are recycled by 
qualified recyclers. They just have to submit with their tax returns a 
record of who recycled the computer or TV and where it ended up.
    We want to encourage people to do the right thing and recycle by 
developing a national solution, which is most desirable in the long run 
to avoid manufacturers and retailers from dealing with a patchwork of 
50 different state laws. This legislation will also help domestic 
manufacturing as companies will use the tons of recycled materials to 
make new computers and other electrical and industrial products.
    Further, it is pro-consumer since folks will have an incentive to 
recycle an old computer or TV and take the tax credit or use the money 
toward the purchase of new technology. Presently, consumers are 
actually discouraged from recycling e-waste since the garbage collector 
doesn't always collect it, folks don't know how to otherwise dispose of 
it, or manufacturers charge fees to recycle the technology. This bill 
helps move us in the right direction by providing people with 
incentives, rather than disincentives, to be environmentally 
responsible.
    I am pleased that we are working with a broad business and 
environmental coalition support this common sense, pro-business, pro-
technology and pro-environment solution to e-waste. In particular, I 
want to thank the Missouri Recycling Association and its 163 individual 
and business members for endorsing this first-ever Federal electronics 
recycling bill.
    Thank you for letting me join you today to discuss this pro-job, 
pro-technology and pro-environment legislation.

                               __________

     Statement of Hon. Mike Thompson, U.S. Representative from the 
                          State of California

    Good afternoon and thank you for inviting me here today to comment 
briefly on electronic waste or ``e-waste''. I appreciate Chairman Thune 
and Ranking Member Boxer allowing me to be a part of this hearing on 
the subject of e-waste, an issue with which I've been involved since I 
first came to Congress.
    Electronic devices are becoming smaller and lighter, but they also 
are creating an ever-growing environmental and waste disposal problem. 
That's because it's often cheaper and more convenient to buy a new PC 
or cell phone than to upgrade an old one.
    Today, the average lifespan of a computer is only 2 years and 
Americans are disposing of 3,000 tons of computers each day. Consumers 
Union, publisher of Consumer Reports, recently estimated that the 
typical household could expect to discard approximately 68 electronic 
items over the next 20 years including: 20 cell phones, 10 computers, 7 
TVs, 7 VCRs or DVD players and several answering machines, printers and 
CD players.
    While e-waste contains a number of valuable materials that are 
recoverable including aluminum, gold, silver and other metals, it also 
contains a witches' brew of toxic material such as lead, mercury and 
cadmium. If not properly disposed of these toxic materials can cause 
health and environmental problems. For example, the glass of a typical 
computer monitor contains six pounds of lead. When this glass is 
crushed in a landfill, the lead is released into the environment.
    There's a Native American proverb about stewardship, which says: 
``We don't inherit the earth from our ancestors, we borrow it from our 
children.'' To give you an idea of the potential legacy we are leaving 
future generations, the National Safety Council has projected that 
approximately 300 million computers are obsolete. If all 300 million 
units were discarded, this would involve nearly 1 billion pounds of 
lead, 2 million pounds of cadmium and 400,000 pounds of mercury.
    Residents in my District are stalwart stewards of the environment, 
recycling a healthy amount of e-waste compared to other parts of the 
country. Last year alone, Napa County collected 214 tons of e-waste, 
approximately 3 pounds for each of the County's 136,000 residents. In 
comparison, Boston collected 330 tons and San Diego collected 270 tons.
    But while Napa is tackling the problem of e-waste at a local level, 
we've done little to address the problem on a national scale. Some 
retailers and manufacturers have created voluntary recycling programs, 
but they are too small in scope to have a significant impact on the e-
waste stream. Without a national recycling infrastructure consumers and 
businesses today are left with few choices for getting rid of their old 
computers, cell phones and other electronic devices. Most people shove 
them in a spare closet or corner and wait. When people do try to 
dispose of their e-waste responsibly, all too often it is shipped 
overseas. There, it and its toxins can land in riverbeds or in the 
hands of unprotected workers.
    The buildup of e-waste on the local and state level has led 
California, Maine and Maryland to implement their own e-waste laws--
each very different from the others. Twenty-six additional states are 
also considering e-waste legislation. As states continue to develop 
their own approaches the need for a Federal solution only grows. 
Without Federal action both consumers and businesses will have to 
contend with an unmanageable patchwork of state laws.
    My colleagues--Representatives Louise Slaughter (D-NY), Randy 
``Duke'' Cunningham (R-CA) and Mary Bono (R-CA) and I formed the 
bipartisan congressional E-Waste Working Group with the objective of 
investigating possible Federal e-waste solutions and educating Members 
of Congress about the issue. At our first event, a forum entitled, ``E-
Waste: Is a National Approach Necessary?'' we invited all stakeholders, 
including consumers, manufacturers, retailers, recyclers, 
environmentalists and nonprofits. All agreed on the value of a national 
approach to e-waste.
    Again, I thank the subcommittee for bringing much needed attention 
to this issue and to gathering expert testimony on the problem of e-
waste. I--and other members of the E-Waste.

                               __________

Statement of Thomas P. Dunne, Acting Assistant Administrator, Office of 
   Solid Waste and Emergency Response, U.S. Environmental Protection 
                                 Agency

    Mr. Chairman and members of the Subcommittee, I am Thomas Dunne, 
Deputy Assistant Administrator for the Office of Solid Waste and 
Emergency Response at EPA. Thank you for inviting me to appear today to 
discuss electronics waste and EPA's interest in electronics product 
design and recycling. In 2002, we set in motion a plan of action to 
renew the emphasis on resource conservation in the Resource 
Conservation and Recovery Act (RCRA). At least since 1976, RCRA has 
included among its purposes a goal to reverse the trend of ``millions 
of tons of recoverable material which could be used [being] needlessly 
buried each year.''
    Today, the RCC has become a national program, challenging all of us 
to promote recycling and reuse of materials and to conserve resources 
and energy. One key area of focus is electronics.
    The use of electronic equipment has grown substantially in recent 
years. According to the Consumer Electronics Association (CEA), 
Americans own some 2 billion electronic products about 25 products per 
household. Electronics sales grew by 11 percent in 2004, and the same 
growth is expected again this year.

                 WHY WE CARE ABOUT ELECTRONICS AT EPA:

    EPA has been actively involved in helping to improve the design and 
recovery of electronics for more than 8 years now. Our interest in 
electronics stems from three primary concerns:
    (1) the rapid growth and change in this product sector, leading to 
a constant stream of changing offerings and wide array of obsolete and 
discarded products needing an appropriate response;
    (2) substances of concern present in many products which can cause 
problematic exposures during manufacturing, recycling or disposal if 
not properly managed--the presence of these constituents has sparked 
the search for workable substitutes and development of better 
management practices; and
    (3) the desire to help encourage development of a convenient and 
affordable reuse/recycling infrastructure for electronics, with an 
initial emphasis on TVs and PCs.

          HERE I WOULD LIKE TO PROVIDE SOME ILLUSTRATIVE FACTS

    1. Increasing volume of electronic waste.--Consumer Electronics 
including TVs and other video equipment, audio equipment and personal 
computers, printers and assorted peripherals--make up about 1.5 percent 
of the municipal solid waste stream (2003 Figures). This is a small, 
but growing percent of the waste stream. Consumer electronics have 
increased as a percent of municipal solid waste in each of the last few 
years that EPA has compiled data.
    2. Recycling is limited.--EPA's latest estimates are that in 2003 
approximately 10 percent of consumer electronics were recycled 
domestically, up slightly over previous years. The remaining 90 percent 
of used consumer electronics are in storage, disposed of in landfills 
or incinerators, or exported for reuse or recycling. EPA is now taking 
a closer look at the fate of all electronics waste such that the Agency 
can better account for the amount of electronic waste stored, disposed, 
or exported. But anecdotal information suggests that nontrivial amounts 
of consumer electronics are in storage or exported, rather than going 
to disposal in landfills.
    3. Substances of concern in electronics.--While industry is making 
progress in making its products with less toxic materials, many 
products may contain substances of concern such as lead, mercury and/or 
cadmium. For example, older cathode ray tubes (monitors) in TVs and PCs 
contain on average 4lbs of lead, although there are lower amounts of 
lead in newer CRTs. These constituents do not present risks to users 
while the product is in use; indeed, they are there for a good reason. 
Lead shields users from electromagnetic fields generated while the 
monitor is operating. Mercury is used in backlights in flat panel 
displays to conserve energy. But the presence of these materials means 
that some electronic equipment may present a risk if not properly 
managed.

                  WHAT WE ARE DOING ABOUT ELECTRONICS

    We are engaged in several broad scale partnerships with 
manufacturers, retailers, other Federal agencies, state and local 
governments, recyclers, non-government organizations (NGO's) and others 
to encourage and reward greener design of electronic products, to help 
develop the infrastructure for collection and reuse/recycling of 
discarded electronics, and to promote environmentally safe recycling of 
used electronics. I'd like to give you a little more detail about each 
of these efforts.

                     GREENING DESIGN OF ELECTRONICS

    EPEAT.--EPA funded and participated in a multi-stakeholder and 
consensus-based process, involving electronics manufacturers, large 
government IT purchasers, NGO's and others, to develop the Electronics 
Product Environmental Assessment Tool (EPEAT). It was created to meet 
growing demand by large institutional purchasers for a means to readily 
distinguish greener electronic products in the marketplace. EPEAT is 
modeled on other environmental rating tools like the LEED's Green 
Building Rating system. It is expected to gain wide acceptance in 
purchases of information technology equipment by Federal and state 
government--and eventually by other large institutional purchasers of 
IT equipment.
    The EPEAT rating system establishes performance criteria in eight 
categories of product performance, including reduction or elimination 
of environmentally sensitive materials; design for end of life; life 
cycle extension; energy conservation; and end of life management.
    The multi-stakeholder team that developed EPEAT has reached 
agreement on the main criteria that will be recognized for 
environmental performance. Now, the tool is being readied for use; as 
part of this effort, a third party organization will be selected to 
host and manage the tool. The aim is to have the EPEAT system up and 
running by December 2005 or January 2006--at which time manufacturers 
will be able to certify their products to the EPEAT requirements and 
purchasers will be able to find EPEAT certified products in the 
marketplace. The first EPEAT certified products will be desktop 
computers, laptops and monitors.
    Energy Star.--EPA recently made its best known brand, the Energy 
Star label, available for external power adapters that meet EPA's newly 
established energy efficiency guidelines. Power adapters, also known as 
external power supplies, recharge or power many electronic products--
cell phones, digital cameras, answering machines, camcorders, personal 
digital assistants (PDA's), MP3 players, and a host of other 
electronics and appliances. As many as 1.5 billion power adapters are 
currently used in the United States--about five for every American.
    Total electricity flowing through external and internal power 
supplies in the U.S. is about 207 billion kWh/year. This equals about 
$17 billion a year, or 6 percent of the national electric bill. More 
efficient adapters have the potential to save more than 5 billion 
kilowatt hours (kWh) of energy per year in this country and prevent the 
release of more than 4 million tons of greenhouse gas emissions. This 
is the equivalent of taking 800,000 cars off the road.
    On average, Energy Star-qualified power adapters will be 35 percent 
more efficient.
    EPA is promoting the most efficient adapters since they are 
commonly bundled with so many of today's most popular consumer 
electronic and information technology products.
    Design for the Environment (DfE).--Over the years, EPA's DfE 
program has worked numerous times with the electronics industry to help 
green the manufacturing of electronics as well as electronics products 
themselves. DfE has worked with the industry on ways to green the 
manufacture of printed wiring boards, assessed the life cycle impacts 
of CRTs and flat panel displays and has also recently assessed the life 
cycle impacts of tin-lead and lead-free solders used in electronics.
    One important ongoing project in this DfE realm is the joint 
government industry search for substitutes for tin-lead solder that 
have acceptable engineering performance and environmental attributes.
    The DfE Lead Free Solder Partnership is providing the opportunity 
to mitigate current and future risks by assisting the electronics 
industry to identify alternative lead free solders that are less toxic, 
and that pose the fewest risks over their life cycle. The draft final 
life cycle assessment report for the tin lead and alternative solders 
is available now for public review.
    (2) Encouraging reuse and recycling, rather than disposal, at 
product end of life Plug-In To eCycling--Plug In To eCycling is a 
voluntary partnership to increase awareness of the importance of 
recycling electronics and to increase opportunities to do so in the 
United States. Through Plug In, EPA has partnered with 21 manufacturers 
and retailers of consumer electronics as well as 26 governments to 
provide greater access to electronics recycling for Americans. In the 
first 2 years, the Plug In program has seen the recycling of 45.5 
million pounds of unwanted electronics by program partners--all of whom 
have agreed to rely on recyclers who meet or exceed EPA's ``Guidelines 
for Materials Management,'' EPA's voluntary guidelines for safe 
electronics recycling.
    Last year, we launched a number of pilot programs with 
manufacturers, retailers and local governments to create more 
compelling opportunities for consumers to drop off our old electronics. 
These pilots succeeded in collecting over 11 million pounds of used 
electronics and demonstrating that, when the circumstances are right, 
retail collection can be a successful model:
     The Staples pilot in New England collected over 115,000 
pounds in testing in-store collection and ``reverse distribution'' 
making use of Staples existing distribution network. In this pilot, 
trucks dropping off new equipment at Staples stores removed electronics 
that had been dropped off and took them to Staples distribution centers 
rather than leaving the stores with the trucks empty.
     The Good Guys pilot in the Seattle area collected over 
4,000 TVs--double the quantity expected--by offering in-store take back 
and a low fee for drop-off countered by a purchase rebate.
     Office Depot and Hewlett-Packard worked together to offer 
free in-store takeback of consumer electronics in all 850 Office Depot 
stores for a limited time period. It resulted in 10.5 million pounds 
collected, more than 441 tractor trailer loads.
    We believe these and other pilots sponsored by industry, states, 
and recyclers are generating critical data which will inform 
policymaking on electronics recycling. These pilots have proved crucial 
to testing out what works, what doesn't, where collaboration is 
possible and where it is not, what kinds of opportunities really get 
the attention of the consumer and what kind of material the consumer 
wants to recycle. And very importantly, what it costs to get 
electronics from the consumer into responsible recycling.
    Federal Electronics Challenge--The Federal Government is a large 
purchaser of IT products. To help the Federal Government lead by 
example the Federal Environmental Executive and the EPA launched the 
Federal Electronics Challenge (FEC). The FEC is a voluntary partnership 
program designed to help Federal agencies become leaders in promoting 
sustainable environmental stewardship of their electronic assets. As 
FEC Partners, Federal agencies agree to set and work toward goals in 
one or more of the three electronics life cycle phases--acquisition & 
procurement; operations & maintenance; and end-of-life management. As 
of this month, the FEC has 54 partners representing facilities from 12 
Federal agencies. All 12 Federal agencies are signatories to a national 
Memorandum of Understanding on Electronics Management and, in total, 
represent about 83 percent of the Federal Government's IT purchasing 
power.
    Recent National Electronics Meeting.--Last spring, EPA hosted a 
National Electronics Meeting to take stock of where we are with our 
electronics programs and talk with stakeholders about what else is 
needed. The goal of the meeting was to identify collaborative 
strategies that will contribute to effective management of used 
electronics across the country. Nearly 200 representatives from 
industry, government, and the non profit community participated in this 
meeting.
    A few of the collaborative strategies being developed include the 
following:
     Developing standards for environmentally safe electronics 
recyclers and a process for certifying these recyclers. EPA plans to 
take a leadership role in convening stakeholders to develop such 
standards.
     Further development of a centralized data repository for 
electronics recycling to collect nationwide market data/share by 
manufacturers and provide information and status on national, state and 
local e-waste initiatives (provides data on waste, geographic summaries 
and process/implementation data). This effort is being chaired by the 
National Center for Electronics Recycling (NCER) in partnership with 
EPA and other interested parties.
     Piloting a private multi-state Third-Party Organization 
(TPO) to support electronics recycling efforts in the Pacific 
Northwest. This project will explore how a multi-state TPO could assume 
responsibilities on behalf of manufacturers, like contracting for 
recycling services across state lines. This effort is being chaired by 
the NCER and the WA Department of Ecology with eight electronics 
manufacturers.
    Even if the key collaborations noted above are implemented, there 
will remain some gaps in needed infrastructure. In the course of 
developing, implementing, and sharing information related to key 
infrastructure-related collaborations, EPA looks forward to working 
with stakeholders to identify and plan to address other infrastructure-
related efforts.

         EPA WILL WORK WITH OTHER ORGANIZATIONS MOVING FORWARD

    EPA has been working with a wide range of stakeholders in a variety 
of forums, both domestically and, as appropriate, internationally. This 
approach has worked well, and we expect to continue to follow it in 
partnership with other Federal agencies such as the Commerce Department 
and with the Federal Environmental Executive.

                               CONCLUSION

    I hope that I have given you a sense of EPA's electronics goals and 
how we work with partners throughout the product chain to achieve 
shared responsibility for a greener, recovery-oriented product cycle.

                                 ______
                                 
 Responses by Thomas Dunne to Additional Questions from Senator Inhofe

    Question 1. The subject of electronics recycling is very broad and 
not all electronics are created equally. Some stakeholders point out 
the differences in addressing a console television versus a mobile 
telephone. The wireless industry has a voluntary program--would you 
agree that they are contributing to the proper management of wireless 
products?
    Response. The cell phone industry has developed programs to make 
sure wireless products find their way back into appropriate reuse or 
recycling programs when they are discarded. A lot of manufacturers, 
service providers, and retailers of cell phones recognize their 
responsibility in helping to ensure safe recycling and are acting on 
it. We hope that the successes we've seen to date with cell phone 
recovery spearheaded by retailers, manufacturers and non-profits will 
continue and that these players will continue to build on their 
outreach efforts so that eventually all cell phones will be recovered 
and recycled back into useful products.

    Question 2. Has EPA taken steps to facilitate the safe and cost 
effective recycling of end-of-line electronic equipment?
    Response. EPA has been involved with the improvement of electronics 
design and recovery for a number of years now. EPA is engaged in a 
series of partnerships with manufacturers, retailers, recyclers, state 
and local governments, non-profit and other organizations, and other 
Federal agencies to encourage the improved design of electronic 
products, help develop the infrastructure for the collection and reuse 
or recycling of discarded electronics, and encourage the 
environmentally safe recycling of used electronics.
    For example, EPA funded and participated in a process with 
electronics manufacturers, government technology purchasers, and other 
organizations to develop the Electronics Product Environmental 
Assessment Tool (EPEAT). EPEAT will help large technology purchasers 
identify electronics products that are designed in a more environmental 
friendly manner. More environmentally friendly electronics include 
products that are designed to be more easily and cost-effectively 
recycled. It is expected that EPEAT will be operating before the end of 
2006 when manufacturers that meet EPEAT criteria will be able to 
certify their products. The initial electronic products eligible for 
EPEAT certification will be desktop computers, laptops, and monitors.
    In addition, EPA has entered into a voluntary partnership with 
numerous electronics manufacturers, retailers, and state and local 
governments to develop the Plug-In To eCycling initiative. The aim of 
this initiative is to raise public awareness on electronics recycling 
and to increase recycling opportunities.
    In the first 2 years of Plug-In, more than 45 million pounds of 
unwanted electronics products were recycled by Plug-In partners. EPA 
launched several pilot programs under the Plug-In banner last year with 
manufacturers, retailers and local governments to provide consumer 
electronics recycling opportunities. The pilots resulted in collection 
of more than 11 million pounds of used electronics at retail stores, 
including New England area Staples, Seattle area Good Guys, and all 
Office Depot locations. All of this is helping to encourage growth of 
the electronics recycling infrastructure.
    To help make sure that as electronics recycling opportunities 
increase, human health and the environment are also protected, we have 
issued voluntary safe recycling guidelines. These guidelines, issued 
under the Plug-In program, establish safe management practices for 
electronics recyclers.
    EPA has also partnered with the Federal Environmental Executive and 
several other Federal agencies to launch the Federal Electronics 
Challenge (FEC). Given that the Federal government is such a large 
purchaser of information technology products, it is fitting that we 
lead by example. The FEC is a voluntary partnership of Federal agencies 
that have committed to develop a more sustainable environmental 
stewardship of their electronic products. Twelve Federal agencies have 
signed a Memorandum of Understanding on electronics management, which 
represents roughly 83 percent of the government's information 
technology purchasing power. Among the key goals of the FEC are to help 
promote further expansion of the electronics recycling infrastructure 
and safe recycling practices.
    Finally, EPA continues to work with a wide range of stakeholders to 
further encourage the reuse and recycling of electronics products. Last 
Spring, the Agency hosted a National Electronics Meeting attended by 
representatives from industry, governments, and non-profit 
organizations to discuss electronics management issues. As a result of 
the meeting, collaborative strategies are being developed that include 
the development of a certification program for electronics recyclers, 
the development of a nation-wide electronics recycling data repository, 
and piloting a private multi-state manufacturer-led organization to 
help support electronics recycling efforts in the Pacific Northwest.
                                 ______
                                 
  Responses by Thomas Dunne to Additional Questions from Senator Boxer

    Question 1. Cathode ray tubes used in most televisions can leach 
significant quantities of lead into a landfill. The EPA's Inspector 
General (IG) recently criticized EPA's failure to finalize a rule 
stating how the agency would regulate these tubes. EPA began this 
rulemaking in 1998. When will EPA finalize its rulemaking on cathode 
ray tubes?
    Response. First, we should clarify that many waste cathode ray 
tubes (CRTs) are currently regulated as hazardous waste under RCRA if 
they are being discarded. That is, the vast majority of color CRTs will 
exceed the criteria in the Toxicity Characteristic (TC) regulation for 
lead (5 mg/l, in the Toxicity Characteristic Leaching Procedure Test 
(TCLP) test; see 40 CFR 261.24), and so would be classified as RCRA 
hazardous on this basis (see Musson, et al., 2000, Jang and Townsend 
2003, and Townsend et al., 2004). Large quantity generators of color 
TVs bound for disposal would be required to dispose of these materials 
in hazardous waste landfills or hazardous waste incinerators. The 
rulemaking that you reference in your question would not change this.
    Most monochrome CRTs would not qualify as hazardous waste under the 
TCLP test for lead, but there are relatively few monochrome CRTs 
produced any more.
    Color CRTS that would not be regulated as hazardous include those 
generated by households and conditionally exempt small quantity 
generators of hazardous waste (less than 100 kg/month of all hazardous 
waste). These may be disposed in municipal solid waste landfills under 
current RCRA regulations, as would all other types of hazardous waste 
generated by households and conditionally exempt small quantity 
generators.
    As to the premise in your question that cathode ray tubes leach 
significant quantities of lead into landfills, EPA believes that the 
disposal of electronics--including those that qualify as household 
hazardous waste--in municipal solid waste (MSW) landfills is protective 
of human health and the environment if that disposal occurs in properly 
managed municipal solid waste landfills.
    In 1991, EPA updated the MSW landfill criteria to ensure that these 
landfills will be protective of human health and the environment, even 
if they accept household hazardous waste or conditionally exempt 
hazardous waste. Recent studies indicate that landfill leachate from 
properly designed and operated MSW landfills is unlikely to cause 
drinking water contamination due to low levels of metals present in the 
leachate from these landfills, and due to leachate collection and 
treatment systems. There is ongoing research being undertaken by the 
University of Florida to further assess the effects of electronics 
waste in MSW landfills.
    With respect to your specific question, the final rule on CRTs is 
currently undergoing interagency review and until this review is 
completed, we cannot say with certainty when the rule will be 
finalized.

    Question 2. The value of leaded glass recently dipped to minus $200 
per ton. This change reflects a shift in the consumer preference for 
different technologies, among other factors. Doesn't this drop in value 
affect EPA's rationale for exempting cathode ray tubes from hazardous 
waste regulations as a ``valuable commodity''?
    Response. EPA has no data indicating that leaded glass has the 
negative economic value mentioned in your question. In fact, according 
to very recent conversations with a glass processor, leaded glass sent 
for recycling to make new cathode ray tubes is worth at least $100 per 
ton. Although this figure is lower than it was when EPA proposed its 
CRT rule in 2002, it is still significant. In addition, CRT glass 
processors have recently stated that demand for leaded glass is still 
very high, and that the market for new CRTs in other countries is 
strong. We note that recycled leaded glass is necessary to make new CRT 
glass; raw materials such as silica are not considered an adequate 
substitute.
    In contrast, processors who send leaded glass to lead smelters must 
pay the smelter approximately $140 per ton to accept the lead. The 
smelter then uses the glass as fluxing material and as lead feedstock. 
Broken glass from CRTs resembles industrial sand in composition and can 
therefore serve as a substitute for this sand in the fluxing process. 
The sand is inexpensive. CRT glass manufacturers have stricter quality 
standards than lead smelters for the type of material that they can 
accept.
    Further evidence of the economic value of CRT glass is demonstrated 
by the cost savings realized by CRT glass manufacturers and lead 
smelters when using processed CRT glass. The use of processed CRT glass 
cullet benefits the manufacturer in several ways, such as improving 
heat transfer and melting characteristics in the furnaces, lowering 
energy consumption, and maintaining or improving the quality of the 
final product.

    Question 3. Toxicity tests have shown that cathode ray tubes can 
leach four times the amount of lead as material that is regulated as a 
hazardous wastes. The EPA's IG recently noted that EPA is testing other 
types of electronic waste for their hazardous characteristics. What 
types of electronic material has EPA tested for its hazardous 
characteristics or plans to test for such characteristics?
    Response. EPA has funded studies by researchers at the University 
of Florida at Gainesville on the RCRA status of a variety of waste 
electronics devices (see Townsend, et al., 2004). These include 
(excluding CRTs): Computer CPUs, Laptop computers, Cell phones, 
Computer printers, Keyboards, Computer Mice, TV Remote controls, Smoke 
Detectors

    Question 4. What are the results of any tests that EPA has already 
conducted?
    Response. From Townsend 2004:
    CPUs: 1 out of 22 computer CPUs tested using the TCLP exceeded the 
lead TC level of 5 mg/l, having 6.0 mg/l lead in the test leachate.
    Keyboards: No keyboards (0/3) failed the TCLP.
    Mice: All mice tested (15/15) failed the TC for lead using the 
TCLP.
    Laptops: 6 out of 6 laptops tested failed the TC using the TCLP.
    Remote controls: All remotes (4 out of 4 tested) failed the TC for 
lead using the TCLP.
    Smoke detectors: Most (8 out of nine 9 tested) failed the TC for 
lead using the TCLP.
    Cell Phones: 28 out of 38 individual cell phones tested exceeded 
the TC for lead using the TCLP. The average lead in test leachate 
overall for cell phones was 20 mg/l. However, there was wide 
variability in the leach test results by brand and model, and the 
results ranged from zero to 65 mg/l lead in the test leachate.
    Circuit boards: Many electronic devices fail the TC regulatory 
value for lead because lead is used in the printed wire boards (PWB), 
or circuit boards, which are part of these devices. In Jang and 
Townsend (2003), PWBs were leached using the TCLP, and lead exceeded 
the TC value, with an average of 162 mg/l. In Townsend (2004), PWBs 
tested with TCLP averaged 151 mg/l lead in the test leachate (3 
samples).
    References to studies cited:
    Musson, S., Jang Y., Townsend, T., and Chung, I. ``Characterization 
of Lead Leachability from Cathode Ray Tubes Using the Toxicity 
Characteristic Leaching Procedure'' Environ. Sci. Technol. 2000, 34, 
4376-4381.
    Townsend, T., Vann, K., Mutha, S., Pearson, B., Jang, Y.,Musson, 
S., and Jordan, A. (2004). ``RCRA Toxicity Characterization of Computer 
CPUs and Other Discarded Electronic Devices'' July 15 2004. Funded by 
U.S. EPA Regions 4 & 5. Unpublished.
    Jang , Y., and Townsend, T. (2003) ``Leaching of Lead from Computer 
Printed Wire Boards and Cathode Ray Tubes by Municipal Solid Waste 
Landfill Leachates'' Environ. Sci. Technol. 2003, 37, 4778-4784.
    Townsend, T. (2003). ``Leachability of Printed Wire Boards 
Containing Leaded and Lead-Free Solder''. November 5, 2003. Funded by 
U.S. EPA/OPPTS. Unpublished.

    Question 5. In October 2003, EPA proposed a rule that could 
deregulate up to 3 billion pounds of hazardous waste, including used 
circuit boards. Among other problems, EPA's proposed rule would allow 
hazardous wastes to be shipped on public roads without any tracking 
documents. Can you please tell me the status of this proposed 
rulemaking?
    Response. This proposed rule would modify the definition of solid 
waste to promote increased recycling. EPA is currently evaluating the 
numerous and varied public comments received in response to our 
proposal. We are developing a broad range of options for the final 
rule, and we anticipate that EPA management will select preferred 
options by the end of this year. We currently expect to publish a final 
rule in November 2006. However, if the Agency believes it needs to re-
propose all or parts of the proposal, we would expect to finalize that 
by the Winter of 2008. EPA would not support regulatory approaches that 
would allow unsafe management of hazardous wastes under the guise of 
recycling.

    Question 6. EPA's ``Plug-In to eCycling'' program is a voluntary 
partnership to increase electronics recycling. The IG reported that 
several stakeholders involved with recycling electronics did not 
understand the purpose of this program or were not even aware of it. 
What steps is EPA taking to clearly define the program's goals and to 
increase awareness of the program?
    Response. Electronics recycling is one of the key pillars of EPA's 
Resource Conservation Challenge (RCC)--a major initiative undertaken by 
EPA's Office of Solid Waste and Emergency Response as well as the 
Office of Pollution Prevention and Toxics to place more emphasis on 
toxics reduction and materials recovery. These two offices have 
developed an RCC Action Plan that addresses electronics.
    Long before we developed the RCC Action Plan for electronics, EPA 
had clear goals with respect to our electronics programs and our 
electronics projects were designed to align with these goals. See page 
14 of the IG's final report.
    Despite the fact that numerous well-known retailers and 
manufacturers signed on as early supporters and participants of EPA's 
Plug-In to eCycling program (examples include Dell, Sony, Panasonic and 
Best Buy), purportedly, others that the IG spoke with were not aware of 
the program. Therefore, EPA has undertaken efforts to increase its 
communication of the Agency's electronics goals and programs.
    In particular, EPA has worked hard to give greater visibility to 
the Plug-In goals. These goals are to:
     Work with partners to inform the public about the 
importance of electronics reuse and recycling and give them information 
about how to reuse or recycle their outgrown/unwanted electronics.
     Increase opportunities for Americans to safely recycle 
their electronics and to promote shared responsibility for safe 
electronics recycling by facilitating partnerships with communities, 
electronics manufacturers, and retailers.
     Establish pilot projects to test innovative approaches to 
safe electronics recycling.
    Since the release of the IG report, EPA has done the following to 
give higher visibility to these goals:
    (1) More visibly presented the program goals on the Plug-In 
website;
    (2) Incorporated program goals, partners, and partner 
accomplishments into speeches by senior EPA officials, presentations at 
conferences, and materials and discussions at stakeholder meetings;
    (3) Developed more public education materials that are disseminated 
at conferences, trade shows, and meetings. EPA partners also 
disseminate these materials at their recycling events, trade shows and 
meetings;
    (4) Discussed the purpose of the Plug-In program and highlighted 
retailer-based Plug-In pilots in press advisories and shared the 
results of pilots through press releases and postings on EPA and 
partner websites;
    (5) Highlighted the goals of Plug-In and partner accomplishments in 
media events at CES 2005;
    (6) Highlighted the goals of Plug-In at the EPA National 
Electronics Meeting held in March 2005;
    (7) Launched multi-stakeholder collaborative efforts aimed at 
increasing public awareness on how to donate outgrown computers and 
overcome hindrances to reuse like concerns regarding data security; and
    (8) Required all partners to contribute to public outreach goals by 
completing education and outreach initiatives regarding electronics 
recycling.

    Question 7. The EPA's IG recently concluded that the United States 
is ``lagging behind international e-waste efforts.'' The IG highlighted 
laws in the European Union that require manufacturers to take financial 
responsibility for recycling their consumer electronic products and to 
reduce the use of six toxic chemicals in these products. Here in the 
United States, the Pollution Prevention Act establishes a national 
policy that ``pollution should be prevented or reduced at the source 
whenever feasible.''
    Why hasn't the EPA used it authorities under the Pollution 
Prevention Act to require pollution prevention activities and 
manufacturer responsibility with electronic waste similar to the 
European Union's policies?
    Response. The Pollution Prevention Act does not give EPA the 
authority to require pollution prevention activities or impose 
manufacturer responsibility. Under the Pollution Prevention Act, EPA is 
authorized to encourage voluntary approaches to pollution prevention. 
Voluntary measures we are undertaking to help support pollution 
prevention for electronics include the Electronic Product Environmental 
Assessment Tool (EPEAT), Federal Electronics Challenge, Plug-In to 
eCycling and the Design for the Environment program's work on lead-free 
solder.
    It is true that the U.S. does not have Federal substance bans for 
electronics similar to those that will soon take effect in Europe. Most 
electronic products are manufactured for a worldwide market; thus 
manufacturers generally need to design their products to the most 
stringent design standards in effect wherever they are. According to 
many industry observers, many, if not most, electronics sold in the 
U.S. will meet the EU design requirements simply because most 
manufacturers will not be making a separate product for the U.S. 
market. California recently adopted substance bans essentially 
identical to those of the EU for selected electronic products. It is 
anticipated that these California requirements will capture any covered 
electronics that are made for a strictly U.S. market.

    Question 8. EPA's EPEAT program seeks to develop criteria for 
judging electronics products that are designed to be environmentally 
friendly. The EPEAT program will allow manufacturers to self-select 
whether they meet all of the criteria to qualify for a bronze, silver 
of gold label.
    Will EPA or a third party audit the representations made by 
manufacturers, or merely rely on data submitted by manufacturers?
    Response. A credible verification process for product declarations 
is one of the most critical aspects for long-term EPEAT success. 
Purchasers and the environmental community must have confidence that 
the claims of manufacturers are accurate.
    However, the stakeholders in the development of EPEAT, which 
include manufacturers, federal and state and local procurement 
officials, environmental organizations, recyclers, and others, agreed 
that, given the very short time-to-market characteristic of the 
electronic marketplace, it is impractical to use a third-party process 
to pre-verify each product claim before that claim can be used by the 
manufacturer. EPEAT therefore relies on manufacturer self-declaration 
that is backed up by a multi-tiered verification process.
    The first tier in verification is the signing of a legal agreement 
with each manufacturer that wishes to declare products to the EPEAT 
standard. This must be signed by a high-level, responsible company 
manager, and will spell out, in an enforceable manner, the commitments 
of the company and the consequences of failing to meet those 
commitments.
    Second, for each manufacturer, product self-declarations will be 
monitored to assure that they are being entered correctly. This is not 
a verification of accuracy, but declarations will be double checked by 
the EPEAT host organization. (The process of identifying a host 
organization for the EPEAT tool is now underway; it is expected that a 
host organization will be chosen later this year.) In product 
declarations, manufacturers are required to have ready for review 
specified data that supports the claim for each criterion.
    Then on an annual basis, products will be selected for spot checks 
by the EPEAT host organization--a thorough verification of accuracy. 
Products will be randomly selected and, if questions or challenges have 
been raised by users of the system, specific products will be targeted. 
The number of spot checks will be variable, depending on the need to 
assure EPEAT credibility.
    The process for administering and performing spot checks will use 
Qualified Verifiers, who have been properly trained and certified. The 
spot checks will include a review of the data that will be provided by 
the manufacturer, and will include product testing or other procedures 
as necessary. The spot check of factual findings will be brought to a 
Technical Verification Committee of independent, technical experts to 
pass judgment.
    The EPEAT host organization will take any outstanding problems to 
the manufacturer to be explained or resolved. If a resolution cannot be 
achieved, termination of the declaration of the product in question 
will be undertaken. If multiple problems of this nature should occur, 
the manufacturer's ability to declare to EPEAT may be terminated. All 
these procedures will have been spelled out in the original agreement 
with the manufacturer.
                                 ______
                                 
        Response by Thomas Dunne to an Additional Question from 
                            Senator Jeffords

    Question. There have been numerous reports about unsafe recycling 
of electronic waste in China, exposing children and workers to 
hazardous materials from computers that were exported from the U.S. 
Will EPA's upcoming rule on cathode ray tubes address this problem by 
either banning the export of electronic waste or requiring exporters to 
verify that electronic waste sent overseas to be recycled will be 
properly handled to protect against harm to human health and the 
environment? What is the status of this rulemaking and when is it 
expected to be published as a final rule?
    Response. In response to our proposed rule, EPA received many 
comments about CRTs exported for recycling. We thoroughly evaluated all 
of these comments when developing our final rule, and examined all 
relevant options. The final rule, which is currently undergoing 
interagency review, will discuss the comments received and describe the 
final approach adopted, including responding to the comments that were 
submitted.
                                 ______
                                 
        Response by Thomas Dunne to an Additional Question from 
                           Senator Lautenberg

    Question. As you know, CRTs may contain up to 10 lbs. or more of 
leaded glass. Are you planning to issue a ``universal waste rule'' for 
CRT glass to control this toxic metal? If not, why not?
    Response. In June, 2002, EPA proposed an exclusion from the 
definition of solid waste for CRTs and CRT glass sent for recycling. 
The purpose of this rule is to encourage more reuse, recycling, and 
better management of this rapidly growing waste stream, while at the 
same time ensure that these materials are safely managed. The Agency 
believed that this regulatory exclusion was preferable to including 
CRTs in the universal waste rule because, in our view, these materials 
resemble commodities more than wastes when sent for reuse or recycling. 
Therefore, some of the requirements of the universal waste rule (e.g., 
notification and tracking) did not seem appropriate. However, we note 
that the management conditions of our proposed exclusion are very 
similar to the general conditions of the universal waste rule. Both 
sets of conditions would minimize the release of toxic constituents 
during storage and transport. With that said, the Agency did describe 
in the proposal and specifically requested comment on an alternative 
approach that would regulate CRT's and CRT glass sent for recycling 
under the universal waste rule, instead of excluding them from the 
definition of solid waste. The Agency received many comments on this 
``request for comment'' which have been carefully evaluated and 
considered in the draft final rule, which is currently undergoing 
interagency review.
    Finally, our proposed rule would not streamline RCRA requirements 
for CRTs that are hazardous and sent for disposal. Under the proposed 
rule, CRTs that are hazardous and sent to landfills or incinerators 
would still be subject to existing requirements, including use of the 
hazardous waste manifest.
                               __________
          Statement of John B. Stephenson, Director, Natural 
                       Resources and Environment

    Mr. Chairman and Members of the Subcommittee:
    Thank you for the opportunity to discuss our work to date on the 
issues surrounding the growing volume of used electronics accumulating 
in the nation's basements, attics, and landfills. Rapid advancements in 
technology have led to increasing sales of new electronic devices, 
particularly televisions, computers, and computer monitors. 
Approximately 62 percent of U.S. households had computers in 2003, 
compared with only 37 percent just 6 years earlier. With this increase 
comes the dilemma of how to manage these products when they come to the 
end of their useful lives. The Environmental Protection Agency (EPA) 
has estimated that in 2003 alone, about 50 million existing computers 
became obsolete, but one estimate forecast that less than 6 million 
were recycled.
    Disposal of used electronics creates potential problems that can be 
averted through recycling or reuse. For example, concerns have been 
raised because toxic substances such as lead, which have well-
documented adverse health effects, can potentially leach from used 
electronics. Concerns have also been raised over used electronics that 
are exported from the United States to countries with less stringent 
environmental regulations. In addition, computers contain precious 
metals, such as gold, silver, and platinum, that require substantial 
amounts of energy and land to extract. These metals can often be 
extracted with less environmental impact from used electronics than 
from the environment. The U.S. Geological Survey, for instance, reports 
that 1 metric ton of computer scrap contains more gold than 17 tons of 
ore and much lower levels of harmful elements common to ores, such as 
arsenic, mercury, and sulfur.
    In this context, you and several other Members of the Congress 
asked. that we address, a number of issues surrounding this problem. 
Specifically, we were asked to (1) summarize existing information on 
the volumes of, and problems associated with, used electronics and (2) 
examine the factors. affecting the nation's ability to recycle and 
reuse electronics when such products have reached the end of their 
useful lives.
    To address these issues, we are examining studies that provide 
nationwide estimates on the amount of used electronics,\1\ as well as 
federal and state government studies (including those by EPA and task 
forces in Oregon and Washington), industry and interest group studies, 
and local studies (including municipal solid waste characterization 
studies) that discuss the problems associated with used electronics. We 
are also visiting states and localities that have implemented programs 
or passed legislation to responsibly manage used electronics, including 
California, Maine, Maryland, Massachusetts, Oregon, and Washington. In 
addition, we are surveying participants in the National Electronics 
Product Stewardship Initiative and other key stakeholders, which 
include key stakeholders from Federal, State, and local governments, 
environmental organizations, recyclers, retailers, equipment 
manufacturers, and academicians. To date, we have received responses 
from 41 of the 53 survey participants. We are also comparing current 
government and industry practices with existing practices for promoting 
recycling in other industries, such as bottle- and can-recycling 
programs and the Rechargeable Battery Recycling Corporation program. 
Further, we are examining EPA-sponsored Federal, State, and local pilot 
programs that attempt to encourage recycling of electronic products. 
Our work is being done in accordance with generally accepted government 
auditing standards, which include an assessment of data reliability and 
internal controls.
---------------------------------------------------------------------------
    \1\ For the purposes of our study, used electronics includes 
computers, computer monitors, and televisions that have reached the end 
of their original useful life.
---------------------------------------------------------------------------
    We are here to present our preliminary observations on these 
issues. We will report the final results of our study and any 
recommendations we may develop at a later date. In summary:
     Available estimates suggest that the volume of used 
electronics is large and growing and that if improperly managed can 
harm the environment and human health. While data and research are 
limited, some data suggest that over 100 million computers, monitors, 
and televisions become obsolete each year and that this amount is 
growing. These obsolete products can be either recycled, reused, 
disposed of in landfills, or stored by users in places such as 
basements, garages, and company warehouses. Available data suggest that 
most used electronics are probably stored. These units have the 
potential to be recycled and reused, disposed of in landfills, or 
exported for recycling and reuse overseas. If ultimately disposed in 
landfills, either in the United States or overseas, valuable resources, 
such as copper, gold, and aluminum, are lost for future use. 
Additionally, standard regulatory tests show that some toxic substances 
with known adverse health effects, such as lead, have the potential to 
leach into landfills. Although one study suggests that leaching is not 
a concern in modern U.S. landfills, it appears that many of these 
products end up in countries without modern landfills or the 
environmental regulations comparable to the United States.
     Both economic and regulatory factors discourage recycling 
and reuse of used electronics:
         Economic factors inhibit the recycling and reuse of 
        used electronics. Consumers generally have to pay fees and drop 
        off their used electronics at often inconvenient locations to 
        have them recycled or refurbished for reuse. Consumers in 
        Snohomish County, WA, for instance, may have to travel more 
        than an hour to the nearest drop-off location, which then 
        charges between $10 and $27 per unit depending on the type and 
        size of the product. Consumers in the Portland, OR area, pay 
        one local recycler 50 cents per pound to have their used 
        computers recycled, which is about $28 for an average-sized 
        desktop computer. Recyclers and refurbishers charge these fees 
        because costs associated with recycling and refurbishing 
        outweigh the revenue received from recycled commodities or 
        refurbished units. This point was underscored by the 
        International Association of Electronics Recyclers, which 
        reported that the value of commodities recovered from computer 
        equipment (such as shredded plastic, copper, and aluminum) is 
        only between $1.50 and $2.00 per unit. It was further 
        underscored by our interviews with eight electronics recyclers, 
        who were unanimous in emphasizing that they could not cover 
        costs without charging fees.
         Federal regulatory requirements provide little 
        incentive for environmentally preferable management of used 
        electronics. The governing statute, the Resource Conservation 
        and Recovery Act, bars entities that dispose of more than 220 
        pounds of hazardous waste per month from depositing hazardous 
        waste (including some used electronics) in landfills. However, 
        RCRA does not prohibit households and entities that generate 
        less than 220 pounds of hazardous waste per month from sending 
        hazardous waste to municipal landfills. Consequently, since 
        only four states currently ban disposal of used electronics in 
        their trash or local landfill, most consumers in the remaining 
        46 states (and the District of Columbia) are allowed to do so-
        and have little incentive to do otherwise. Not surprisingly, 
        available data suggest that states and localities that do not 
        have landfill bans have dramatically lower levels of recycling 
        than the four states that have enacted landfill bans. In 
        addition, federal regulations provide for neither a financing 
        system for responsible management of used electronics, nor 
        oversight of these products when exported--a particular problem 
        in the case of some developing countries, where risks to the 
        environment and human health may be more likely because of less 
        stringent environmental regulations.
    In the absence of a national approach, a patchwork of potentially 
conflicting state requirements is developing. This patchwork may be 
placing a substantial burden on recyclers, refurbishers, and other 
stakeholders. As we conclude our work, we will be examining the 
implications of our findings for the ongoing efforts among the states 
to deal with the problem, for the various legislative solutions that 
have been proposed to create a uniform national approach, and for 
options the federal government can pursue to encourage recycling and 
reuse of used electronics.

                               BACKGROUND

    Few people are aware of recycling options for their old televisions 
and personal computers. Because of the perceived value of used 
electronics, some pass their used equipment to family members or 
friends before eventually storing these units in their attics, 
basements, or garages. Eventually, though, consumers need to dispose of 
these units in some manner. By choosing to have these products 
recycled, consumers ensure the recovery of resources like copper, iron, 
aluminum, and gold, which would otherwise be procured through less 
environmentally friendly practices such as mining. Likewise, consumers 
who choose to recycle also reduce the amount of waste entering the 
nation's landfills and incinerators. Since used electronics typically 
contain toxic substances like lead, mercury, and cadmium, recycling or 
refurbishing will prevent or delay such toxic substances from entering 
landfills.
    The Congress affirmed its commitment to reducing waste and 
encouraging recycling, first through enactment of the Resource 
Conservation and Recovery Act (RCRA) of 1976, and then again with 
passage of the Pollution Prevention Act of 1990. Both RCRA and the 
Pollution Prevention Act address alternatives to waste disposal. RCRA 
promotes the use of resource recovery, either through facilities that 
convert waste to energy or through recycling. To promote recycling, 
RCRA required EPA to develop guidelines for identifying products that 
are or can be produced with recovered materials. RCRA also requires 
federal agencies to procure items that are, to the maximum extent 
practicable, produced with recovered materials. The Pollution 
Prevention Act provides that pollution that cannot be prevented should 
be recycled or treated in a safe manner, and disposal or other releases 
should be used only as a last resort. It specified that pollution 
prevention can include such practices as modifying equipment, 
technology, and processes; redesigning products; and substituting less-
toxic raw materials. Executive Order 13101, issued on September 14, 
1998, also affirmed the federal government's commitment to encourage 
recycling by directing federal agencies to consider procuring products 
that, among other things, use recovered materials, can be reused, 
facilitate recycling, and include fewer toxic substances.
    Nonetheless, while large-quantity generators, such as businesses, 
schools, and government agencies, must treat some used electronics as 
hazardous waste due to the relatively high level of toxic substances, 
it is not illegal for households or for small quantity generators--non-
household entities disposing of less than 220 pounds per month--to 
dispose of used electronics in landfills in most states. Under RCRA, 
household hazardous wastes, including used electronics, may be disposed 
of at municipal solid waste landfills. However, some states have begun 
imposing more stringent disposal requirements for used electronics. For 
example, because of concerns regarding the potential environmental and 
health effects of leaded glass in cathode ray tubes (CRTs), California, 
Maine, Massachusetts, and Minnesota recently banned them from disposal 
in municipal landfills.
    As national awareness of potential problems associated with the 
disposal of used electronics has grown, EPA has taken steps to 
encourage recycling of used electronics. For instance, EPA, together 
with electronics manufacturers, retailers, and recyclers, sponsored 
several pilot programs in 2004 to measure the success of convenient 
collection options for used electronics. Other recent EPA efforts, such 
as the Federal Electronics Challenge and the Electronic Product 
Environmental Assessment Tool (EPEAT) program, attempt to leverage U.S. 
Government procurement power to drive environmentally preferable design 
for electronic products. Finally, through the establishment of the 
National Electronic Product Stewardship Initiative (NEPSI) in 2001, EPA 
established a voluntary, multi-stakeholder initiative to reach 
consensus on a national approach to encourage recycling of used 
electronics. This voluntary effort ultimately dissolved in 2005 without 
agreement, however, because stakeholders could not reach consensus on a 
nationwide financing system.

         VOLUME OF USED ELECTRONICS AND THE PROBLEMS THEY POSE

    The information we have reviewed to date suggests strongly that the 
volume of used electronics is large and growing. For example, in a 1999 
study, the National Safety Council forecast that almost 100 million 
computers and monitors would become obsolete in 2003-a three-fold 
increase over the 33 million obsolete computers and monitors in 
1997.\2\ Additionally, a 2003 International Association of Electronics 
Recyclers report estimated that 20 million televisions become obsolete 
each year--a number that is expected to increase as CRT technology is 
replaced by new technologies such as plasma screens.\3\
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    \2\ National Safety Council, Electronic Product Recovery and 
Recycling Baseline Report May 1999. These estimates are based on major 
assumptions, as well as responses from only 38 percent of sampled 
companies. Although, the study supports the existence of a large and 
growing problem, the precise estimates should be used with caution.
    \3\ International Association of Electronics Recyclers, IAER 
Electronics Recycling Industry Report 2003. These estimates are based 
on major assumptions, as well as responses from only 20 percent of 
sampled companies. Although the study supports the existence of a large 
and growing problem, the precise estimates should be used with caution.
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    Thus far, it appears that relatively few units have found their way 
into either landfills or recycling centers. Available EPA data indicate 
that less than 4 million monitors and 8 million televisions are 
disposed of annually in U.S. landfills-only a fraction of the amount 
estimated to become obsolete annually, according to EPA. Additionally, 
the 1999 National Safety Council report forecast that only 19 million 
computers, monitors, and televisions would be recycled in 2005. Hence, 
the gap between the enormous quantity of units that are obsolete (or 
becoming obsolete), and the quantity either in landfills or sent to 
recycling centers, suggests that most used electronics are still in 
storage-such as attics, basements, and garages-and that their ultimate 
fate is still not certain, or have been exported for recycling and 
reuse overseas.
    Conventional disposal of used electronics in landfills raises two 
primary concerns, according to research we reviewed: the loss of 
natural resources and the potential release of toxic substances in the 
environment. By disposing of these products in landfills or 
incinerators, valuable resources are lost for future use. For example, 
computers typically contain precious metals, such as gold, silver, 
palladium, and platinum, as well as other useful metals like aluminum 
and copper. Further, the U.S. Geological Survey reports that one metric 
ton of computer circuit boards contains between 40 and 800 times the 
concentration of gold contained in gold ore and 30 to 40 times the 
concentration of copper, while containing much lower levels of harmful 
elements common to ores, such as arsenic, mercury, and sulfur.\4\ The 
research we have thus far reviewed also suggests that the energy saved 
by recycling and reusing used electronics is significant-the author of 
one report by the United Nations University states that perhaps as much 
as 80 percent of the energy used in a computer's life can be saved 
through reuse instead of producing a new unit from raw materials.\5\
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    \4\ Bleiwas, Donald and Kelly, Thomas, Obsolete Computers, ``Gold 
Mines,''or High-Tech Trash? Resource Recovery From Recycling 
(Washington, DC: U.S. Geological Survey, 2001). Because we have not yet 
reviewed this study, this data should be used with caution.
    \5\ The United Nations University is a think tank for the United 
Nations and is not a degree granting university.
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    Regarding the issue of toxicity, the research we have reviewed to 
date is unclear on the extent to which toxic substances may leach from 
used electronics in landfills. On one hand, according to a standard 
regulatory test RCRA requires to determine whether a solid waste is 
hazardous and subject to federal regulation, lead (a substance with 
known adverse health affects) leaches from some used electronics under 
laboratory conditions. Tests conducted at the University of Florida 
indicate that lead leachate from computer monitors and televisions with 
cathode ray tubes exceeds the regulatory limit and, as a result, could 
be considered hazardous waste under RCRA.\6\ On the other hand, the 
study's author told us that these findings are not necessarily 
predictive of what could occur in a modern landfill. Furthermore, a 
report by the Solid Waste Association of North America suggests that 
while the amount of lead from used electronics appears to be increasing 
in municipal solid waste landfills, these landfills provide safe 
management of used electronics without exceeding toxicity limits that 
have been established to protect human health and the environment.\7\
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    \6\ Townsend, Timothy, et al, Characterization of Lead Leachability 
from Cathode Ray Tubes Using the Toxicity Characteristic Leaching 
Procedure. (University of Florida, Department of Environmental 
Engineering Sciences: 2000). Because we have not yet reviewed this 
study, these estimates should be used with caution.
    \7\ Solid Waste Association of North America, The Effectiveness of 
Municipal Solid Waste Landfills in Controlling Releases of Heavy Metals 
to the Environment (2004). Because we have not yet reviewed this study, 
this data should be used with caution.
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       ECONOMIC AND REGULATORY FACTORS DETER RECYCLING AND REUSE 
                          OF USED ELECTRONICS

    The costs associated with recycling and reuse, along with limited 
regulatory requirements or incentives, discourage environmentally 
preferable management of used electronics. Generally, consumers have to 
pay fees and take their used electronics to often inconvenient 
locations to have them recycled or refurbished for reuse. Recyclers and 
refurbishers charge fees to cover the costs of their operations. In 
most states, consumers have an easier and cheaper alternative--they can 
take them to the local landfill. These easy and inexpensive 
alternatives help explain why so little recycling of used electronics 
has thus far taken place in the United States. This economic reality, 
together with federal regulations that do little to preclude disposal 
of used electronics along with other wastes, have led a growing number 
of states to enact their own laws to encourage environmentally 
preferable management of these products.
Cost and Consumer Inconvenience Discourage Recycling and Reuse of Used 
        Electronics
    Consumers who seek to recycle or donate their used electronics for 
reuse generally pay a fee and face inconvenient drop-off locations. 
Unlike their efforts for other solid waste management and recycling 
programs, most local governments do not provide curbside collection for 
recycling of used electronics because it is too expensive. Instead, 
some localities offer used electronics collection services, for a fee, 
at local waste transfer stations. These localities send consumers' used 
electronics to recyclers for processing. For example, transfer stations 
in Snohomish County, WA, charge consumers between $10 and $27 per unit 
for collecting used electronics and transporting them to recyclers. 
Moreover, such transfer stations are generally not conveniently 
located, and rural residents, such as those in Snohomish County, may 
need to drive more than an hour to get to the nearest drop-off 
station.\8\ In some localities, consumers can also take their used 
electronics directly to a recycler, where they are typically charged a 
fee. In the Portland, OR area, for instance, one recycler charges 
consumers 50 cents per pound to recycle computers, monitors, and 
televisions, which means it costs the consumer about $28 to recycle an 
average-sized desktop computer system.
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    \8\ Over 70 percent of the survey respondents felt that existing 
collection options for recycling used electronics were inconvenient for 
households.
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    Recyclers charge these fees to cover the costs they incur when 
disassembling used electronics, processing the components, and refining 
the commodities for resale. As noted in a 2003 report by the 
International Association of Electronics Recyclers, most recyclers and 
refurbishers in the United States cannot recoup their expenses from the 
resale of recycled commodities or refurbished units. The report, which 
compiled data from more than 60 recyclers in North America, stated that 
the costs associated with recycling are greater than the revenue 
received from reselling recycled commodities, and that fees are needed 
to cover the difference. Furthermore, the report states that the value 
of commodities recovered from computer equipment, such as shredded 
plastic, copper, and aluminum, is only between $1.50 and $2.00 per 
unit.\9\
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    \9\ This point is further underscored by our interviews with 8 
electronics recyclers, who were unanimous in emphasizing that they 
could not cover costs without charging fees.
---------------------------------------------------------------------------
    The costs associated with recycling make it unprofitable (without 
charging fees) for several reasons. First, recycling used electronics 
is labor intensive-the equipment must be separated into its component 
parts, including the plastic housing, copper wires, metals (e.g., gold, 
silver, and aluminum), and circuit boards, as well as parts that can be 
easily reused or resold, like hard drives and CD-ROM drives. Officials 
with Noranda Recycling Inc., which recycles used electronics for 
Hewlett-Packard, told us that over 50 percent of their total costs for 
recycling are labor costs involved in disassembly, even though they 
operate some of the most technologically advanced equipment available. 
Labor costs are high, in part, because electronic products are not 
always designed to facilitate recycling at their end of life. For 
instance, a Hewlett-Packard official told us 30 different screws must 
be removed to take out one lithium battery when disassembling a 
Hewlett-Packard computer for recycling. According to this official, if 
Hewlett-Packard spent $1 in added design costs to reduce the number of 
different screws in each computer, it would save Noranda approximately 
$4 in its disassembly costs.
    Second, to obtain sellable commodities, the resulting metal and 
plastic ``scrap'' must be further processed to obtain shredded plastic, 
aluminum, copper, gold, and other recyclable materials. Processing in 
this fashion typically involves multimillion-dollar machinery. 
According to officials with one international electronics recycling 
company, processing costs are high, in part, because this sophisticated 
machinery is being used to process the relatively limited supply of 
used electronics being recycled in the United States. The firm's 
officials noted that in Europe, by contrast, where manufacturers are 
required to take financial responsibility for the disposal of their 
products, the increased supply of recyclable electronics has decreased 
the firm's per-unit processing costs and increased the profitability of 
recycling used electronics.
    Finally, recyclers incur additional expenses when handling and 
disposing of toxic components (such as batteries) and toxic 
constituents (such as lead), which are all commonly found in used 
electronics. These expenses include removing the toxic components and 
constituents from the product, as well as handling and processing them 
as hazardous material. Once separated from the product, these wastes 
are considered hazardous wastes and are subject to more stringent RCRA 
requirements governing their transportation, storage, and disposal. 
CRTs from computer monitors and televisions are particularly expensive 
to dispose of because they contain large volumes of leaded glass, which 
must be handled and disposed of as a hazardous waste. Since CRT 
manufacturing is declining in the United States, some recyclers send 
their CRT glass to a lead smelter in Missouri that charges recyclers 
for their CRT glass. A study on the economics of recycling personal 
computers found that the cost associated with disposing of CRT monitors 
substantially reduces a recycler's net revenue.\10\
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    \10\ Boon, J.E., Isaacs, J.A., and Gupta, S.M. ``Economic 
Sensitivity for End of Life Planning and Processing of Personal 
Computers.'' Journal of Electronics Manufacturing (Vol. 11, 81-93, 
2002). Because we have not yet reviewed this study, this data should be 
used with caution.
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    Refurbishers charge similar fees to cover the costs involved in 
guaranteeing data security by ``wiping'' hard drives, upgrading 
systems, installing software, and testing equipment. A program manager 
for a nonprofit technology assistance provider told us that it 
generally costs about $100 to refurbish a Pentium III computer system, 
plus an additional licensing fee of about $80 for an operating system.
    To encourage used electronics recycling, EPA sponsored pilot 
programs that addressed the cost and inconvenience issues. Office Depot 
and Hewlett-Packard, for example, partnered to provide free take-back 
of used electronics at Office Depot retail stores. Collected used 
electronics were sent to Hewlett-Packard facilities for recycling. Over 
a 3-month period, nearly 215,000 computers, monitors, and televisions 
were collected and recycled. EPA officials told us that the pilot 
program showed the extent to which recycling can be encouraged by 
making it inexpensive and convenient to the consumer.
Federal Regulatory Framework Governing Used Electronics Provides Little 
        Incentive for Recycling or Reuse
    The lack of economic incentives promoting recycling and reuse of 
electronics is compounded by the absence of federal provisions that 
either encourage recycling, or preclude their disposal in landfills. 
Specifically, current federal laws and regulations (1) allow hazardous 
used electronics in municipal landfills, (2) do not provide for a 
financing system to support recycling, and (3) do little to preclude 
electronic products generated in the United States from being exported 
and subsequently threatening human health and the environment overseas. 
While several promising federal initiatives supporting electronics 
recycling have been launched, their voluntary nature makes their 
success uncertain.
Hazardous Used Electronics Are Allowed in Municipal Landfills
    Regulation of used electronics at the federal level falls under 
RCRA Subtitle C, which was established to ensure that hazardous waste 
is managed in a manner that is protective of human health and the 
environment. However, households and small quantity generators are 
exempt from many RCRA regulations, thus allowing them to deposit their 
used electronics in municipal solid waste landfills--even though 
cathode ray tubes in computer monitors and televisions, and potentially 
circuit boards in computers, exhibit characteristics of hazardous 
waste. EPA's Office of Solid Waste regulates hazardous waste under 
RCRA, but it lacks the authority to require environmentally preferable 
management of used electronics through recycling and reuse or to 
establish a mandatory national approach, such as a disposal ban. As a 
result, all of the office's efforts with regard to the recycling of 
used electronics are voluntary.
    In response to RCRA's exemption for household hazardous waste and 
the growing volume of obsolete electronics within their boundaries, 
four states-California, Maine, Massachusetts, and Minnesota-recently 
banned from landfills some used electronics.\11\ Our preliminary work 
suggests that such bans have contributed to a higher degree of 
recycling than in states where disposal in solid waste landfills is 
allowed. In San Ramon, CA, for instance, a 1-day collection event for 
television monitors yielded 24,000 units. In contrast, in Richmond, 
Virginia, a metropolitan area 4 times the size of San Ramon but without 
a landfill ban, a similar collection event (organized by the same 
electronics recycler as in San Ramon) only yielded about 6,000 
monitors. This difference in yield is consistent with assessments of 
California and Massachusetts officials, who all told us that their 
states have seen substantial increases in used electronics recycling. 
One international electronics recycler, for instance, set up recycling 
facilities in the San Francisco area in 2003 because of the large 
volume of used electronics that were no longer being disposed of in 
landfills. In Massachusetts, an official with the Department of 
Environmental Protection told us that six businesses dedicated to 
electronics recycling were created following the enactment of a 
landfill ban. Finally, about 75 percent of the survey respondents to 
date said that a national disposal ban should be enacted to overcome 
the economic and regulatory factors that discourage recycling and reuse 
of used electronics.
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    \11\ The landfill bans in Maine and Minnesota take full effect in 
2006.
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Experts Believe a National Financing System is Needed to Support 
        Recycling
    Given the inherent economic disincentives to recycle used 
electronics, we found widespread agreement among our survey respondents 
and others we contacted that the establishment of some type of 
financing system is critical to making recycling and reuse sufficiently 
inexpensive and convenient to attract the participation of consumers. 
For instance, almost 90 percent of survey respondents believe that 
either an advanced recycling fee (ARF), extended producer 
responsibility (EPR), or a hybrid of the two should be implemented if 
national solution is instituted. Yet despite broad agreement in 
principle, participants in the recent multi-stakeholder NEPSI process, 
particularly those in the computer and television industries, did not 
reach agreement on a uniform, nationwide financing system after several 
years of meetings.
    In the absence of a national system, several states have enacted 
their own financing systems through legislation to help ensure 
environmentally preferable management of used electronics. For example, 
in 2005, California implemented an ARF on all new video display 
devices, such as televisions and computer monitors, sold within the 
state. The fee is charged to consumers at the time and location of 
purchase, and can range between $6 and $10. According to an official 
with the California Department of Toxic Substance Control, the revenues 
generated from the fee are intended to deal with a key concern--used 
electronics in storage, or ``legacy waste.'' The officials explained 
that while California's recycling industry for used electronics had 
sufficient capacity to recycle large volumes, consumers and large-
quantity generators had little incentive to take products out of their 
basements or warehouses to have them recycled. The state uses revenues 
from the fees to reimburse electronics recyclers at the rate of 48 
cents per pound of used electronics recycled. The recyclers, in turn, 
pass on 20 cents per pound to collectors of used electronics, thereby 
providing an incentive for entities to make collection free and 
convenient for households.
    The state is still in the preliminary stages of program 
implementation, and state officials acknowledge that they face a number 
of challenges. Some of these challenges underscore the difficulty of 
dealing with the electronic waste problem on a state-by-state basis. 
The officials noted, for instance, that the ARF applies only to 
electronics purchased in California, and that the fees are intended 
only for used electronics originating in the state. Implementing the 
program within the state's boundary, however, may prove difficult 
because the payout for used electronics may attract units originating 
in other states. Preventing this problem, they say, requires 
substantial documentation for each unit, and may require a substantial 
enforcement effort.
    While California's ARF focuses on consumers of electronics, Maine's 
approach focuses on producers. In 2004, the state passed legislation 
requiring computer and television manufacturers who sell products in 
Maine to pay for the take back and recycling of their products at their 
end of life-a strategy referred to as EPR. Under this plan, consumers 
are to take their used electronics to a consolidation point, such as a 
transfer station, where they are sorted by original manufacturer. Each 
manufacturer is responsible for transporting and recycling its 
products, along with a share of the products whose original 
manufacturer no longer exists. According to one official with Maine's 
State Planning Office, a key challenge of its EPR system is the lack of 
a financial incentive for consumers to take their used electronics out 
of storage: they must still take their products to a consolidation 
point, and will still likely have to pay a fee.
    Several other states, as well as some countries, have implemented 
or are considering implementing financing systems for used electronics. 
Earlier this year, Maryland passed legislation requiring all computer 
manufacturers that sell computers in the state to pay $5,000 into a 
fund to help implement local recycling programs.\12\ Other states, such 
as Arkansas, Colorado, Florida, and Massachusetts have allocated grants 
to help pay for the recycling of used electronics, and New York, Rhode 
Island, and Vermont are considering enacting manufacturer take-back 
programs. In Europe, the European Union implemented the Waste 
Electrical and Electronic Equipment Management Regulations in July 
2004, which requires producers of electronic products to be financially 
responsible for the recycling or reuse of their products at end of 
life. In our final report, we will provide a more complete examination 
of various strategies for financing environmentally preferable 
management of used electronics.
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    \12\ An official with the Maryland Department of Environment 
estimated that anywhere from 40 to 200 computer manufacturers might be 
required to pay the fee. He cited one estimate that the fee will 
provide the state with about $400,000 to use toward recycling used 
electronics.
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Oversight of Exhorted Used Electronics Is Limited
    The lack of oversight over exports of used electronics could also 
discourage environmentally preferable management of used electronics. 
In the United States, businesses, schools, government agencies, and 
other organizations, as well as households, face multiple options for 
their used electronics. In some instances, organizations and recyclers 
receive e-mails from brokers, who typically have partners in Asia, 
willing to pay them for their used electronics, regardless of whether 
they can be reused. For example, one broker requests up to 50,000 used 
monitors per month and does not require the monitors to be tested. 
Another broker specifically requests nonworking monitors and wanted to 
fill at least 10 containers, which equals anywhere from 6,000 to 11,000 
units, depending on their size. One Seattle area recycler said that 
brokers such as these are probably not handling the units in 
environmentally preferable ways once the units are exported. Even so, 
one business we contacted said it regularly receives e-mail requests 
such as these.
    Companies export used electronics because the largest markets for 
reused computers and computer parts are overseas, according to an EPA 
official. Likewise, demand is high for recycled commodities, which can 
be processed more cheaply due, in part, to lower, wages and less 
stringent environmental requirements. Also, unlike their counterparts 
in some other developed countries, the U.S. officials have permitted 
the export of hazardous used electronics, such as CRT monitors and 
televisions, if the exporter asserts that the equipment is destined for 
reuse. While some environmental groups have called for a ban on exports 
of used electronics, the Congressional Research Service noted that such 
a ban would cut recyclers off from many of the markets able to reuse 
the materials.\13\
---------------------------------------------------------------------------
    \13\ Congressional Research Service, Recycling Computers and 
Electronic Equipment: Legislative and Regulatory Approaches for ``E-
Waste,'' (Washington, D.C.: 2003).
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    However, few safeguards are in place to ensure that exported used 
electronics are indeed destined for reuse.\14\ Used electronics that 
are destined for reuse are not considered to be waste subject to RCRA 
export regulations. Instead, such electronics are considered to be 
commodities, which means that they can be exported with little or no 
documentation, notification, and oversight. Nonetheless, instances have 
been recently documented in which environmental and human health 
threats have resulted from the less-regulated disassembly and disposal 
of United States-generated used electronics overseas. For example, a 
2002 documentary by the Basel Action Network and Silicon Valley Toxics 
Coalition videotaped egregious disassembly practices in China that 
involved open burning of wire to recover copper, open acid baths for 
separating precious metals, and human exposure to lead and other 
hazardous materials.\15\ Without the ability to track the exported 
units to importing countries, or to audit companies exporting used 
electronics, it is difficult to verify that exported used electronics 
are actually destined for reuse, or that they are ultimately managed 
responsibly once they leave U.S. shores. As our work continues, we will 
further examine the extent of the problems associated with 
irresponsible management of used electronics overseas.
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    \14\ The following are generally not classified as solid wastes 
under RCRA: Used electronics for reuse, whole circuit boards, shredded 
circuit boards, if free of certain hazardous materials, metal from used 
electronics, and scrap metal.
    \15\ The Basel Action Network is an environmental group that works 
to prevent the trade of toxic wastes from developed countries to 
developing countries. The Silicon Valley Toxics Coalition is an 
environmental group that works to prevent environmental and human 
health problems caused by the electronics industry.
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Opportunities Exist for Federal Initiatives to Enhance Electronics 
        Recycling
    The federal government has taken some steps to affirm its 
commitment to encourage recycling of used electronics through the 
implementation of two voluntary programs sponsored by EPA. The Federal 
Electronics Challenge (FEC) and the Electronic Product Environmental 
Assessment Tool (EPEAT) both leverage U.S. Government purchasing power 
to promote environmentally preferable management of electronic products 
from procurement through end of life. For example:
     The FEC program challenges federal agencies and facilities 
to procure environmentally preferable electronic products, extend the 
lifespan of these products, and, expand markets for recycling and 
recovered materials by recycling them at their end of life. The FEC 
provides guidance on environmentally preferable attributes of 
electronic products information, on operating and maintaining them in 
an energy-efficient manner, and on options for recycling or reusing 
them at the end of their useful lives. To date, 11 federal agencies and 
26 individual federal facilities participate in the FEC to some extent. 
The Bonneville Power Administration (BPA) recently documented cost 
savings associated with its FEC participation. BPA noted, for example, 
that the program extended the lifespan of its personal computers from 3 
to 4 years. With over 500 computers procured each year at an annual 
cost of more than $500,000, a BPA official told us extending computer 
life spans could generate substantial savings. Additionally, BPA 
decided to procure new flat-screen monitors instead of CRT monitors, 
reducing both hazardous waste tonnage and end of life recycling costs. 
According to BPA, it expects to save at least $153 per monitor over 
each monitor's life.
     The EPEAT program promotes environmentally preferable 
management of electronics by allowing large purchasers, such as 
government agencies, to compare and select laptop computers, desktop 
computers, and monitors with environmentally preferable attributes. For 
example, EPEAT evaluates an electronic product's design for energy 
conservation, reduced toxicity, extended lifespan, and end of life 
recycling, among other things. EPEAT's three-tier system--bronze, 
silver, and gold--provides purchasers with the flexibility to select 
equipment that meets the minimum performance criteria, or to give 
preference to products with more environmental attributes. For 
manufacturers, EPEAT provides flexibility to choose which optional 
criteria they would like to meet to achieve higher levels of EPEAT 
qualification. EPA expects EPEAT to be instituted in 2006, and products 
with higher environmental ratings could receive preferred consideration 
in federal procurement decisions.
    While we will continue to examine the FEC and EPEAT programs in 
greater detail, including how stakeholders say they might be improved, 
our preliminary work suggests that the federal government can build on 
these initiatives by using its purchasing power to lead markets for 
electronic products in environmentally friendly directions. In fact, 
there is ample precedent for such a strategy, perhaps most notably in 
EPA's and the Department of Energy's Energy Star program. In that 
program, the federal government partners with industry to offer 
businesses and consumers energy-efficient products that ultimately save 
money and protect the environment. According to EPA, in 2004 alone, 
Energy Star products helped save approximately $10 billion in energy 
costs and reduced greenhouse gas emissions by an amount equivalent to 
that produced by 20 million automobiles. Part of Energy Star's success 
can be attributed to federal actions, particularly those outlined in 
two executive orders that required federal agencies to purchase 
products equipped with Energy Star features. Since the federal 
government will spend over $60 billion on information technology 
products in fiscal year 2005, including televisions, computers, and 
computer monitors, it could go beyond the voluntary and limited FEC and 
EPEAT programs by broadening the programs' scope and requiring agency 
participation in, or adherence to, some of the programs' key practices. 
As with the Energy Star program, such actions may lead to cost savings 
and greater environmental protection. Of particular note, over 80 
percent of the survey respondents to date said that Federal Government 
procurement criteria along the lines of FEC and EPEAT should be 
required, and about 95 percent of the survey respondents to date said 
that such procurement criteria would encourage environmentally 
preferable product design, as well as recycling and reuse.

      OBSERVATIONS ON FEDERAL ACTIONS TO ENCOURAGE RECYCLING AND 
                       REUSE OF USED ELECTRONICS

    In our future work, we will continue to examine factors affecting 
recycling in greater detail, and the diverse efforts by individual 
states and others to deal with these issues. It is becoming clear, 
though, that in the absence of a national approach, a patchwork of 
potentially conflicting state requirements is developing, and that this 
patchwork may be placing a substantial burden on recyclers, 
refurbishers, and other stakeholders. A manufacturer in one state, for 
example, may have an advance recovery fee placed on its products, 
whereas in another state, the same manufacturer may have to take back 
its products and pay for recycling. Further, a retailer may have to set 
up a system in one state to collect fees on specific products and, at 
the same time, set up a different system in another state to take back 
a particular manufacturer's product. Hence, manufacturers we contacted 
said that while they had their preferences regarding, for instance, an 
ARF or EPR system, their main preference is to operate within a uniform 
national system that mandates a financing mechanism that preempts 
varying state requirements. Our preliminary survey results substantiate 
these views, with over 90 percent of survey respondents indicating that 
national legislation should be enacted and, if so, almost 90 percent 
believe a financing mechanism should be included.
    Our future work will also discuss some of the options--both 
legislative and administrative--being considered to encourage 
environmentally preferable management of used electronics at a national 
level. Frequently cited options include disposal bans, consumer 
education programs, a variety of financing systems, export 
restrictions, and federal government procurement requirements. These 
options may offer suggestions for a uniform national approach and what 
aspects should be considered. Additionally, an examination of EPA's 
voluntary programs--the FEC and EPEAT--may shed light on other, more 
effective options available to the federal government that can save 
money over electronic products' life cycle; enhance environmental 
protection; drive markets for environmentally preferable product 
design; and establish a recycling infrastructure and markets for 
recycled commodities.
    Finally, with rapid advances in technology, particularly in 
consumer electronics, new products are reaching.the marketplace with 
remarkable speed. Consequently, our future work will also examine the 
implications of these newer generations of electronics entering the 
nation's waste stream.
    Mr. Chairman, this completes my prepared statement. I would be 
happy to respond to any questions you or other Members of this 
Subcommittee may have at this time.

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      Response by John Stephenson to an Additional Question from 
                             Senator Inhofe
    Question. GAO's report recognizes that there is potential for 
contamination from electronics if they are not managed properly. What 
specific examples of mismanagement that led to contamination has GAO 
found?
    Response. Instances of improper management of used electronics have 
been documented overseas, for example, by the Basel Action Network and 
the Silicon Valley Toxics Coalition. Their findings were confirmed in 
an investigation conducted by the San Jose Mercury News. These efforts 
documented practices in China that involved open burning of plastic 
computer casings, open acid baths for separating precious metals, and 
human exposure to lead and other hazardous materials. Of note, GAO is 
not aware of any contamination from used electronics in the United 
States.
                                 ______
                                 
Responses by John Stephenson to Additional Questions from Senator Boxer

    Question 1. Your written testimony states that a ``lack of 
oversight over exports could [] discourage environmentally preferable 
management of used electronics.''
    Could you please elaborate on this finding, and in particular its 
potential effects for domestic markets of recycled products?
    Response. Some businesses in developing countries with less 
stringent environmental and human health standards will disassemble 
used electronics and extract valuable materials without paying the cost 
of proper worker and environmental protection. As a result, many of 
these products will ``flow'' to these countries and potentially expose 
workers and citizens to hazardous substances. Further, the U.S. 
recycling infrastructure will be at a competitive disadvantage when 
compared to these less-responsible overseas operations. In fact, only 
22 percent of GAO's survey respondents believe that the export of non-
working equipment--which many experts believe is the equipment most 
often handled irresponsibly--should be allowed. Oversight, such as 
``downstream'' tracking or notification requirements to importing 
countries, could help ensure that United States-generated used 
electronics are only exported to responsible entities overseas.

    Question 2. The GAO examined EPA's EPEAT program, which establishes 
criteria for judging electronic products that are designed in an 
environmentally-sensitive fashion.
    Could you please describe how federal and state governments can 
best promote this type of program to reduce the use of toxic material 
and increase the recycling rate of electronic products?
    Response. Federal and state governments could require electronic 
products they procure to meet some level of EPEAT criteria--bronze, 
silver, or gold. Additionally, preference could be given to electronic 
products that meet higher levels of EPEAT criteria.

    Question 3. California and three other states currently have bans 
on the disposal of cathode ray tubes in municipal land fills.
    Please describe the effect of such bans on the recycling rate for 
electronic waste.
    Response. Interviews with state government officials in California 
and Massachusetts, as well as large, international recyclers, suggest 
that landfill bans on used electronics substantially increase the 
amount of used electronics available for recycling. For example, In San 
Ramon, CA, a 1-day collection even for CRT television monitors yielded 
24,000 units. In contrast, in Richmond, Virginia, a metropolitan area 4 
times the size of San Ramon but without a landfill ban, a similar 
collection event (organized by the same electronics recycler as in San 
Ramon) only yielded about 6,000 monitors.

    Question 4. Your written testimony suggests that the costs of 
taking electronic waste apart to recover valuable material can 
negatively impact some recycling.
    Do you think that manufacturers can facilitate the recycling of 
electronic products by redesigning their products to be more easily 
recycled?
    Are any manufacturers currently undertaking such redesign 
initiatives?
    Response. Several manufactures have modified their electronics to 
ease disassembly at end-of-life. For example, Hewlett-Packard designed 
its DeskJet 6540 printer to snap together so that it could be easily 
disassembled for recycling. Dell has also taken strides in product 
design to ease disassembly at end of life. These efforts are voluntary, 
however, and to date there has been little economic or regulatory 
incentive for manufacturers to design their products for end of life 
recycling. European regulations, such as the WEEE directive, are 
helping to drive manufacturers of consumer electronics in this 
direction.
                                 ______
                                 
       Responses by John Stephenson to Additional Questions from 
                           Senator Lautenberg

    Question 1. How much is known about whether toxics and heavy metals 
can leach from electronic units discarded in landfills to possibly 
contaminate groundwater?
    Response. Regarding the issue of toxicity, the research we have 
reviewed to date is unclear on the extent to which toxic substances may 
leach from used electronics in landfills. On one hand, standard 
regulatory tests required by RCRA to determine whether a solid waste is 
hazardous and subject to federal regulation show that lead, as 
substance with known adverse health affects, leaches from some used 
electronics under laboratory conditions. On the other hand, the author 
of this study told GAO that these findings are not necessarily 
predictive of what could occur in a modern landfill. Further, a report 
by the Solid Waste Association of North America suggests that while the 
amount of lead from used electronics appears to be increasing in lined 
municipal solid waste landfills, these landfills provide safe 
management of used electronics without exceeding toxicity limits that 
have been established to protect human health and the environment. 
Overall, however, research on the long-term effects of used electronics 
in landfills is limited, in part because many of them are fairly new 
products.

    Question 2.  Does the GAO have a viewpoint on whether ``producer 
take backs'' or financing mechanisms such as fees, are most effective?
    Response. At this time, the effectiveness of either an advanced 
recovery fee (ARF) or extended producer responsibility (EPR) system is 
difficult to determine because the only examples--California's ARF 
system and Maine's EPR system--are in the beginning stages of 
implementation. Overall, the effectiveness of these state systems might 
not necessarily predict their success on a national level because 
California and Maine adopted them, in part, to address each state's 
unique challenges. California, for example, has a robust recycling 
infrastructure capable of handling large volumes of used electronics; 
and, there was evidence that California citizens had millions of units 
of historic e-waste in storage. Therefore, California enacted an ARF to 
provide immediate funding to handle this waste. Maine, on the other 
hand, has a waste management infrastructure capable of collecting e-
waste at consolidation points, but they have a very limited recycling 
infrastructure. Additionally, state officials wanted to ensure that 
future electronic products were produced with fewer toxic substances 
and designed for recycling. As a result, Maine enacted an EPR system to 
ensure that recycling of e-waste occurs without over-burdening limited 
recycling resources and to provide electronics manufacturers to design 
products in environmentally preferable ways in the future.
    Recognizing each state's unique waste challenges and concerns, 
participants in the NEPSI process appeared to be advocating a hybrid 
ARF/EPR approach before the process was dissolved earlier this year. 
Supporters of this approach viewed it as a way of dealing with both (1) 
the need to recycle used electronics in storage (as emphasized in the 
California approach), and (2) the need to encourage more 
environmentally-friendly design while at the same time addressing 
future used electronics (as emphasized in the Maine approach). We will 
be examining this and other approaches in greater detail during the 
remainder of our work.

    Question 3. I am a proponent of the ``cradle to cradle'' philosophy 
which would reduce waste, protect the environment, and stimulate the 
economy. Could EPA do more to move industries closer to a ``cradle to 
cradle'' management system?
    Response. Through its voluntary partnerships with industry under 
the Resource Conservation Challenge, EPA has sponsored numerous pilot 
projects to make recycling used electronics inexpensive and convenient. 
While EPA has other ``tools'' at its disposal, we are working with them 
to determine what EPA can do to help reduce the level of toxic 
substances in electronics are to facilitate recycling and reuse at 
these products' end of life.
                                 ______
                                 
       Responses by John Stephenson to Additional Questions from 
                            Senator Jeffords

    Question 1. Mr. Stephenson, based on research conducted by GAO so 
far, do you have a recommendation on which of the following systems is 
the most effective to promote the recycling of used electronics: 
manufacturer take back or an advanced recycling fee levied at the time 
of purchase by the manufacturer?
    California and Maine adopted their respective ARF and EPR systems, 
in part, to address each state's unique challenges, such as their 
individual waste management and recycling infrastructures, but the 
effectiveness of these state systems is not yet known and might not 
necessarily predict success on a national level. California, for 
example, has a robust recycling infrastructure capable of handling 
large volumes of used electronics, and there was evidence that 
California citizens had millions of units of historic e-waste in 
storage. Therefore, California enacted an ARF to provide immediate 
funding to handle this waste. Maine, on the other hand, has a waste 
management infrastructure capable of collecting e-waste at 
consolidation points, but they have a very limited recycling 
infrastructure. Additionally, state officials wanted to ensure that 
future electronic products were produced with fewer toxic substances 
and designed for recycling. As a result, Maine enacted an EPR system to 
ensure that recycling of e-waste occurs without over-burdening limited 
recycling resources and to provide electronics manufacturers to design 
products in environmentally preferable ways in the future.
    Recognizing each state's unique waste challenges and concerns, 
participants in the NEPSI process appeared to be advocating a hybrid 
ARF/EPR approach before the process was dissolved earlier this year. 
Supporters of this approach viewed it as a way of dealing with both (1) 
the need to recycle used electronics in storage (as emphasized in the 
California approach), and (2) the need to encourage more 
environmentally-friendly design while at the same time addressing 
future used electronics (as emphasized in the Maine approach). We will 
be examining this and other approaches in greater detail during the 
remainder of our work.

    Question 2. Mr. Stephenson, you testified that several states have 
banned cathode ray tubes and other used electronics from landfill 
disposal. How has this impacted the electronic waste recycling rates in 
those states and would you recommend a national landfill ban?
    Response. Interviews with state government officials in California 
and Massachusetts, as well as large, international recyclers, suggest 
that landfill bans on used electronics substantially increase the 
amount of used electronics available for recycling. For example, In San 
Ramon, CA, a 1-day collection even for CRT television monitors yielded 
24,000 units. In contrast, in Richmond, Virginia, a metropolitan area 4 
times the size of San Ramon but without a landfill ban, a similar 
collection event (organized by the same electronics recycler as in San 
Ramon) only yielded about 6,000 monitors. While a landfill ban appears 
to have been a key component to the success of recycling in these 
states and localities, at this time there limited controls over exports 
and illegal dumping--both of which may increase if a nationwide 
landfill ban were imposed--and there is no national financing mechanism 
to ensure that used electronics are recycled or reused. As a result, 
the ultimate effectiveness of a national landfill ban on used 
electronics is uncertain.
                               __________
 Statement of Garth T. Hickle, Principal Planner, Minnesota Office of 
                        Environmental Assistance

    Mr. Chair and members of the Subcommittee:
    My name is Garth Hickle and I am with the Minnesota Pollution 
Control Agency.
    Thank you for the opportunity to provide testimony today and share 
Minnesota's experience with the management of waste electronics. Given 
the state legislative and programmatic attention devoted to this issue 
over the past 5 years, congressional attention is an important step 
toward addressing this complex issue.
    The Minnesota Office of Environmental Assistance began to address 
this issue in 1995 at the request of our state legislature in response 
to concerns regarding the growing presence of discarded electronic 
products in the waste stream and the potential environmental impacts of 
electronics disposal.
    While there is debate regarding the actual long-term environmental 
impacts from disposing of waste electronics in landfills, Minnesota has 
framed the issue as one of resource conservation and the promotion of 
economic development opportunities created by the collection and de-
manufacturing of old electronic products. The environmental benefits, 
energy savings, and job creation from promoting ``waste as a resource'' 
have guided our thinking as to the rationale for the collection and 
recycling of waste electronics. It is Minnesota's intent to ensure that 
residents have convenient access to collection opportunities, and that 
the infrastructure is sufficient to discourage illegal dumping, 
abandonment of collected products, and the export of waste electronics 
to nations with less-stringent environmental standards.
    Since 1997, the OEA has facilitated a number of demonstration 
projects for the collection of waste electronics with participation 
from manufacturers, local government, and recyclers. Partnerships with 
individual manufacturers and retailers served to model various 
collection options and assess costs.
    The OEA also participated in several efforts to bring parties 
together to implement comprehensive programs, both at the state level 
and nationally. The Office convened a multi-stakeholder cathode ray 
tube (CRT) task force in 1999, and actively participated in the 
National Electronics Product Stewardship Initiative (NEPSI). While 
NEPSI did not arrive at a consensus regarding how a national program 
should be financed, the stakeholders did agree on the need for several 
important elements of a national program: including a broad scope of 
products beyond just televisions and monitors; performance goals; 
funding for local collection activities; environmentally sound 
management standards; and a third-party organization to implement a 
program.
    The Minnesota Legislature has considered legislation for waste 
electronics each year since 2002. The proposals have ranged from 
advance recycling fees similar to the program enacted by SB 20 in 
California to the shared-responsibility approach implemented in Maine. 
The differing business models and perspectives within the industry that 
prevented a national approach from emerging from NEPSI have also 
stymied passage of a state program in Minnesota.
    Following the 2004 Minnesota legislative session, the OEA initiated 
another consultation process, with significant participation from 
stakeholders, to identify expectations for a program in Minnesota. As 
part of that effort, the OEA identified the following elements for an 
effective state program:
     Offering convenient collection options for residents that 
address a broad scope of products and track purchasing and disposal 
habits.
     Utilizing existing infrastructure and providing incentives 
for collection.
     Ensuring accountability for collection and recycling by 
identified parties.
     Promoting environmentally sound management.
     Providing incentives for design for the environment.
     Supporting private management, to the extent possible, to 
reduce government involvement in the program.
     Financing the program without relying on end-of-life fees 
or local government funding.
    While developed for Minnesota, the expectations listed above will 
also be relevant for a comprehensive national program.
    This Subcommittee will certainly hear from manufacturers and 
retailers on the preference for a national approach for business 
reasons to avoid a patchwork of state programs. A federal approach will 
also address some concerns faced by state governments grappling with 
this issue.
    From the perspective of state government and consumers, a federal 
approach may provide a consistent standard and eliminate regional 
disparities. For instance, in 2003 Minnesota enacted a disposal ban for 
cathode ray tube containing products, now slated for implementation in 
2006. This ban raised a concern among neighboring states, South Dakota, 
North Dakota, Wisconsin and Iowa, that televisions and monitors from 
Minnesota would be transported across the Minnesota's border for 
disposal. A federal framework would eliminate the impact upon border 
sales if, for instance, one state enacted a consumer-fee-based program 
while a neighbor state did not. A national program may also greatly 
simplify administrative responsibilities such as compliance, reporting, 
and public education.
    If comprehensive national legislation is contemplated-a step 
Minnesota supports-it is important to consider the following:
     Adopting an approach that engages all of the players along 
the product chainmanufacturers, retailers, and local government, among 
others-to share responsibility for funding and operating a program. 
Such an approach will result in a more effective system that provides 
incentives for more environmentally friendly products in the future, 
but will not place significant additional burdens on government. 
Legislation should contain a financing mechanism that recognizes the 
differing business models within the electronics industry and provide
     Establishing a framework so that products can be added or 
deleted as the technology and consumer purchasing habits evolve.
     Adopting performance standards and mechanisms for 
evaluating progress.
    However, even if a comprehensive national program is not adopted, 
there are several steps that the federal government could undertake to 
support the collection and recycling of discarded electronic products, 
including:
     Performing data collection and analysis that tracks the 
sales of new products and recycling and disposal of waste electronics.
     Ensuring a consistent regulatory environment to support 
the reuse and recycling of discarded products.
     Developing clear standards for environmentally sound 
management that impose restrictions on the export of waste electronics 
to countries with less stringent environmental standards.
     Engaging in research and analysis regarding innovative 
partnerships to manage the program.
    It is important to acknowledge that U.S. EPA and others have 
projects underway to address some of these issues. U.S. EPA deserves 
significant recognition for the resources and staff that have been 
devoted to this issue over the past several years including, among 
others, the support for NEPSI and grants for collection pilots.
    Thank you again for the opportunity to be here today. I look 
forward to addressing any questions you may have.

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Responses by Garth Hickle to Additional Questions from Senator Jeffords

    Question 1. Mr. Hickle, what are the consequences for your state if 
Congress fails to enact national electronic waste legislation?
    Response. With the July 1, 2006, implementation date for the ban on 
the disposal of cathode-ray-tube-containing products looming and the 
expected increase in disposal due to the transition to digital 
television scheduled for later in the decade, it is necessary that a 
program be in place for the collection and recycling of waste 
electronics. The Minnesota Legislature is scheduled to address this 
issue in the 2005 legislative session, but the prospects for enacting a 
comprehensive program are unclear at this time.
    If Congress does not move forward with legislation for waste 
electronics, Minnesota will continue to examine legislative options for 
e-waste and promote proper management of waste electronics.
    In lieu of comprehensive national legislation, Congressional action 
to facilitate harmonized state legislation may be a useful step. Such 
action could be the authorization of state compacts to assist with 
program administration and, potentially, fee collection and 
disbursement if that option is selected.

    Question 2. Mr. Hickle, what prompted Minnesota to initiate its 
landfill ban on Cathode Ray Tubes and how effective has it been? Based 
on Minnesota's experience, would you endorse a national landfill ban?
    Response. Following the deliberation of legislation to enact a 
comprehensive program for waste electronics during the 2003 session, 
the Minnesota Legislature enacted the disposal ban as a step toward 
restricting the disposal of CRT-containing products and raising public 
awareness of the need to recycle monitors and televisions.
    Minnesota's disposal ban is scheduled for implementation in 2006, 
so it is difficult to assess the potential impact on the solid waste 
management system. A national ban on the disposal of CRTs and other 
electronic products would eliminate regional disparities within the 
solid waste management system and ensure consistency with the 
requirements for commercially generated CRTs.
                                 ______
                                 
  Responses by Garth Hickle to Additional Questions from Senator Boxer

    Questions 1a. Minnesota has identified seven elements for an 
effective state recycling system for electronics. These elements 
include providing incentives for environmentally-safe designs of 
products and a financing system that does not rely on end-of-life fees 
or local governments funding.
    What types of incentives do you think are most effective for 
increasing the number of products with an environmentally-safe design?
    Response. There are three principal policy tools that serve as 
incentives for manufacturers to increase Design for Environment (DfE) 
activities. The first is a financial obligation to collect and recycle 
products, ensuring feedback between design, manufacturing, and 
disposal. The second is restrictions and/or bans on the use of certain 
substances, such as the EU Directive on the Restrictions of Hazardous 
Substances (RoHS). Third, purchasing standards that specify DfE 
attributes, such as the EPA's EPEAT tool, act as a marketplace driver 
for enhanced product design.

    Question 1b. What type of recycling-promotion system do you think 
can most efficiently promote recycling here in the United States?
    Response. The key to an effective recycling program in the United 
States is clear guidance for consumers regarding collection options, 
combined with a financial incentive for collection entities to offer 
service. Recyclers, retailers, local government, and even charities 
have indicated an interest in establishing permanent collection 
services but require funding for sustained and adequate service.
    It is also important that manufacturers share responsibility for 
financing, public education, and in some cases direct management of the 
collection and recycling system.

    Question 2a. One of the concerns with a lack of national standards 
for recycling consumer electronics is that some businesses do not have 
strong environmental practices.
    Have you heard of any problems with businesses accumulating 
electronic products that were not recycled?
    Response. There have been at examples of accumulation and 
abandonment of discarded waste electronics in Minnesota counties in 
recent years. In Hennepin County six instances of illegal dumping have 
occurred since 1999. The most prominent example was a company 
purporting to be a recycler that aggregated old computers, removed 
valuable components, and abandoned the remaining material in a 
warehouse.

    Question 2b. And, if so, what are the potential problems associated 
with the accumulation of such waste?
    Response. Fortunately, the environmental impacts from the cases 
identified above have been minimal. However, such cases have required 
substantial resources from the county and the state to resolve the 
situation.

    Question 3a. Your testimony refers to the need for clear standards 
that impose restrictions on the export of waste electronics to 
countries without strong environmental protections.
    Please describe the most important types of standards that you 
think are needed on exports to overseas recycling operations.
    Response. Due to the potential environmental and public health 
impacts of improper management of waste electronics, this is a critical 
area for attention by the federal government. Export should comply with 
the Organization for Economic Cooperation and Development (OECD) 
control system that is implemented by national laws and regulations of 
OECD countries and the Basel Convention.

    Question 3b. Please also describe any relevant international laws 
that incorporate such export controls.
    Response. The Basel Convention on the Control of Transboundary 
Movements of Hazardous Wastes and their Disposal is the most relevant 
international treaty that addresses export and movement of waste 
electronics.

    Question 4. Minnesota enacted a ban on the disposal of cathode ray 
tubes in 2003, but has delayed implementation until 2006 out of 
concerns voiced by surrounding states that Minnesota would export it 
electronic waste.
     What steps do other states want Minnesota to take before 
implementing this ban?
    Response. It is my understanding that neighboring states would 
prefer Minnesota institute a comprehensive program for managing e-waste 
to ensure that adequate collection and recycling opportunities exist 
within our borders. Such a program would include a robust public 
information and outreach component to inform Minnesota residents of 
existing collection opportunities.

    Question 5. What are the best current policies for encouraging the 
least amount of hazardous substances in electronic products and the 
largest amount of recycling? Are any governments pursing such policies? 
If so, what is your assessment of the implementation of those policies?
    Response. Both the European Union and the state of California have 
enacted restrictions on the use of certain substances such as heavy 
metals (lead, mercury, hexavalent chromium, and cadmium) and certain 
flame retardants in electronic products, as well as instituting 
programs to manage waste electronics at the end of life.
    Several states, including Minnesota, have contemplated legislation 
that would adopt the RoHS restrictions or add additional substances to 
the list of restrictions (typically an expanded list of flame 
retardants).
    The RoHS restrictions do not come into force in the EU until July 
1, 2006, so assessing progress toward meeting the goals is difficult.

    Question 6. The Council of State Governments/Eastern Regional 
Conference and the Northeast Recycling Council are attempting to 
develop a consistent policy approach for e-waste recycling programs.
    Do you think the system discussed in their draft system could 
efficiently increase e-waste recycling and promote public health 
protections from exposure to toxic substances?
    Response. The draft policy developed by the Northeast Recycling 
Council and the Council of State Governments is an important step 
toward regional consistency, incorporating many of the attributes of 
both the advance-recycling-fee and producer-responsibility models 
promoted by members of the electronics industry. The manufacturer-paid 
fee will engage manufacturers in directly funding the system, but does 
not obligate them to establish their own collection and recycling 
infrastructure. This funding mechanism will also reduce the number of 
fee payers, reducing administrative and compliance responsibilities for 
state government.
    The financing approach will create sufficient funding to spur the 
development of an expanded collection infrastructure as has happened 
with the program in California.
                                 ______
                                 
    Response by Garth Hickle to an Additional Question from Senator 
                               Lautenberg

    Question. Minnesota is one of the States with the longest records 
in trying to address electronic recycling. Could you give me your 
opinion on whether ``producer take backs'' or financing mechanisms are 
the most effective recycling method?
    Both methods of establishing a program for managing waste 
electronics have distinct advantages, particularly if they ensure a 
mechanism for funding collection activities. However, after thorough 
consideration of models enacted or proposed in the United States, the 
Minnesota Pollution Control Agency recommended a fee-based system to 
finance the program. A fee-based program offers a level playing field 
and generally assures sufficient financial resources for 
implementation. As referenced earlier, a manufacturer-paid fee, rather 
than a retailer-administered fee, will reduce concerns with 
administration and compliance.
                               __________
 Statement of Sheila Davis, Executive Director, Silicon Valley Toxics 
                               Coalition

    Mr. Chairman and Committee Members:
    I am Sheila Davis, and I am the Executive Director of the Silicon 
Valley Toxics Coalition. I want to thank you for the opportunity to 
speak to you today about the very important issue of electronic waste.
    The problem of electronic waste in the United States is becoming 
critical. Discarded computers and other electronic products are the 
fastest growing part of the waste stream. And these products contain a 
lengthy list of toxic chemicals, which cause some serious health 
effects when they leak out of landfills and into our groundwater, or 
are incinerated into our air.
    But less than ten percent of discarded computers are currently 
being recycled, with the remainder getting stockpiled or improperly 
disposed of. Fifty to eighty percent of the e-waste collected for 
recycling is actually being exported to Asian countries which have no 
infrastructure to accommodate the hazardous properties of e-waste. Due 
to horrific working conditions and no labor standards in many of the 
developing countries where e-waste is sent, women and children are 
often directly exposed to lead and other hazardous materials when 
dismantling the electronic products to recover the few valuable parts 
for resale.
    Here, in the photo shown, you will see a woman who works in one of 
these dismantling shops in Guiyu, China. You will see that she has no 
protective equipment whatsoever. Yet she is about to smash a cathode 
ray tube from a computer monitor in order to remove the copper laden 
yoke at the end of the funnel. The glass is laden with lead but the 
biggest hazard this woman faces here is the inhalation of the highly 
toxic phosphor dust coating inside this CRT. The monitor glass is later 
dumped in irrigation canals and along the river where it leaches lead 
into the groundwater. The groundwater in Guiyu is completely 
contaminated to the point where fresh water is trucked in constantly 
for drinking purposes.

[GRAPHIC] [TIFF OMITTED] T7447.017

              [Photo 2001 Copyright: Basel Action Network]

    So why does the computer that I turned in, at a local ``recycling'' 
event in California, end up in China, at this woman's workplace? Why 
didn't my computer get dismantled and recycled here, like I thought it 
would. The answer is that the market for recycling e-waste here doesn't 
work. The materials used in these products are so toxic, it's very 
expensive to recycle them. There are some ``good recyclers'' who are 
actually trying to recycle the products as extensively as technology 
allows, but this requires manual processing, and protecting workers 
from exposure to the toxic chemicals is very expensive. The economics 
just don't work for most recyclers. So they look for the cheaper, low-
road solutions, and cream off the parts that there is a local market 
for, and ship the rest across the ocean to become someone else's 
problem. Or they use low wage prison labor for disassembly, which 
further undermines the chances for a healthy recycling market in this 
country.
    So how do we fix this problem? We think the solution is to create 
incentives for the market system to work here. And we need to do two 
things to make that happen:
    First we need the products to be easier to recycle. The economics 
of recycling will NEVER work unless these products are easier, and 
therefore cheaper, to recycle. Part of that means using less toxic 
materials. Part of that means designing them so they are more easily 
disassembled for recycling, without relying. on prison labor or women 
and children in China. Here's an example of what I mean by designing 
for easier recycling:
    A representative from a printing manufacturer told me a 
discouraging story about recycling at his company. He said that 
designers worked with the recyclers and found that if they simply added 
a $1.25 component part to the new line of printers it would make the 
printer easier to disassemble and cheaper to recycle. But the design 
team was told not to include the part because there is no guarantee 
that the printer would be recycled, so the added cost could not be 
justified.
    So here, the producer was not motivated to change their design 
because they were not concerned about the recycling end of their 
product's life.
    So the second thing we need to do is to get the producers to take 
responsibility for their products at the end of their useful life, so 
that they do have this incentive. If the producers (and here I mean the 
manufacturers and brand owners) have no connection to, or 
responsibility for their products at disposal time, then what incentive 
do they have to modify their designs for better recycling, or even 
better reuse of their products? The answer is none--they have no 
incentive to do anything different.
    But what if the companies did have responsibility for taking back 
their products for recycling? What if that was just part of their 
normal operation, that each company had to recycle a significant 
portion of its old products each year? They would simply build these 
takeback and recycling costs into their pricing structure. But to be 
competitive, (and cut their recycling costs) they would innovate, 
redesign, and end up with computers that were cheaper to recycle. Less 
toxic materials would be used, so recycling would be easier and 
cheaper. And there would be no reason to even think about having to use 
taxpayer money to solve this problem. The market would work.
    So this is the legislative solution that we are encouraging our 
lawmakers to adopt, the approach that is called Producer 
Responsibility. Of course, this is a far reaching, complex solution, 
with many components that can't be covered in a short testimony. But we 
think it's the only solution that will correct the market forces that 
currently send my old computer into a landfill or to a village in 
China. So my message here today is that this is a big picture problem 
that calls for big picture solutions. It won't be solved with partial 
fixes like tax breaks or making consumers pay a recycling fee. I 
encourage our lawmakers to seek the kinds of changes that will actually 
make the market take care of the problem of electronic waste.
                               __________

Responses by Sheila Davis to Additional Questions from Senator Jeffords

    Question 1. Ms. Davis, in your testimony, you advocated a Producer 
Responsibility approach to create incentives to manufacturers to 
consider the full life-cycle costs of their products and to design 
products that are easier to recycle. I've heard concerns, however, that 
a true producer responsibility approach is impractical. Please comment 
on whether you think it is economically feasible to overcome the 
logistical hurdles needed to collect and transport end of life products 
back to their original manufacturer for recycling?
    Response. There is no doubt that this is a complex issue, and 
effective solutions will not be simple. It will require companies to 
set up infrastructures (individually or collectively) to manage this 
system. But it is economically feasible, because the companies will 
incorporate their cost into their pricing structure for their products. 
If anything, it will level the playing field between companies who 
currently have a significant recycling program, and companies who are 
currently making no significant effort to recycle their products. All 
of these same companies are already implementing this system in Europe 
right now, in order to meet Europe's deadline (set by the WEEE 
directive) of August 13. (And the European program is far more 
demanding, since it includes home appliances.) We think that many 
companies would end up funding a third-party organization (TPO) which 
can handle all of the logistics, contracts, etc. and benefit from 
economies of scale. One example of this called the European Recycling 
Platform (ERP), which is a combined effort of Sony Europe, Hewlett-
Packard, Braun and Electrolux to collectively manage their takeback 
obligations across Europe. (See http://www.erp-recycling.org.)

    Question 2. Ms. Davis, your testimony details the unsafe recycling 
of electronic waste in China. Do you think that the export of 
electronic waste should be banned?
    Response. Yes, exporting of hazardous electronic waste (see 
discussion below of relevant definitions) should be banned to China and 
the dozens of other developing countries who are not members of the 
Organization for Economic Co-operation and Development OECD or the 
European Union (EU) for two reasons. First, exporting these wastes to 
China and these countries violates international law (1986 OECD 
Decision, discussed below). Second, developing countries like China and 
India have no effective infrastructure for handling these materials in 
a safe, environmentally sound way, so exporting our hazardous wastes 
knowing that this is the case constitutes a blatant form of 
environmental injustice.
    International Laws Around Waste Exporting.--There are two relevant 
international laws or treaties that address hazardous waste export: the 
Basel Convention (which the United States has not ratified) and the 
OECD Decision (which the United States ratified, but doesn't enforce). 
The United States could take giant steps in addressing the e-waste 
export problems by ratifying the Basel Convention or even just 
enforcing the OECD Decision, which we are violating. Below is an 
explanation of both laws and how they would help with this problem.
    Basel Convention.--Most countries in the world (166 so far) have 
ratified the international treaty restricting the trade in hazardous 
wastes, known as the Basel Convention.\1\ All developed nations of the 
world except the United States have ratified the Basel Convention and 
are thus legally bound to strictly control Basel listed hazardous waste 
exports. The Basel Convention called for, at a minimum, all trade in 
hazardous wastes to be preceded by government to government 
notification and the receipt of consent. The treaty also called for 
guarantees of environmentally sound management, and a general 
prohibition against trade in hazardous wastes with non-Parties.
---------------------------------------------------------------------------
    \1\ Full name is Basel Convention on the Control of Transboundary 
Movements of Hazardous Wastes and their Disposal. (www.basel.int).The 
Basel Convention is a multilateral environmental agreement under the 
auspices of the United Nations Environment Program (UNEP) that is noted 
for being the first international treaty that promotes environmental 
justice. It was designed to protect developing countries from being 
disproportionately burdened by hazardous wastes via trade, simply due 
to their economic status. The original treaty called for a minimization 
of transboundary movements of hazardous wastes and national self-
sufficiency in waste management by all countries (see www.basel.int).
---------------------------------------------------------------------------
    Further, the Parties in 1995 have agreed to amend the treaty to 
include a full prohibition on all exports of hazardous wastes from OECD 
countries, EU countries, and Liechtenstein (totaling 37 countries) to 
all countries outside of that group. This is known as the Basel Ban 
Amendment which now has garnered 58 of the 62 ratifications necessary 
for it to enter into force. More significantly, even prior to entering 
into strict legal force, 30 of the 37 countries to which the export ban 
applies have already implemented it in their national law.
    The United States has received Senate advice and consent to ratify 
the original treaty, but has not as yet asked for the advice and 
consent for the Basel Ban Amendment. But the fact that the United 
States has not approved the Basel convention is a problem for two 
reasons:
    (1) Basel would prevent the United States from sending hazardous 
waste to China and other developing countries, and
    (2) Until the United States does ratify the Basel Convention, we 
can't legally export wastes to most other ``developed'' countries, 
because all the Basel Parties are prohibited from importing hazardous 
wastes from the United States. This is because Parties are forbidden 
from trading with non-Parties such as the United States (Article 4, 
Paragraph 5), unless they have signed a special ratified a bilateral or 
multilateral agreement with that possesses an equivalent level of 
control to that of the Basel Convention. The only such agreements the 
United States has signed are the OECD agreements and a bilateral accord 
with Canada. The OECD has treaties binding on the United States, 
governing the transboundary movement of hazardous waste, with direct 
relevance to electronic waste generated here in the United States. Yet 
the United States has failed to implement many of these OECD 
obligations (in RCRA, etc.), resulting in the uncontrolled exports of 
our hazardous wastes to some of the poorest nations in the world.
    Organization for Economic Cooperation and Development Decision.--
While the United States has not ratified the Basel Convention and 
therefore is technically not bound by it, we have ratified and agreed 
to a 1986 OECD accord which would require that all exports of hazardous 
wastes to non-OECD countries be controlled similarly to what is 
required under the Basel Convention. However, the United States is 
failing to implement this agreement for hazardous electronic wastes.
    In 1986, the Organization for Economic Cooperation and Development 
(OECD) adopted Council Decision-Recommendation 
C(86)64(final)1 (OECD Decision) which has to do with 
hazardous wastes exported from the 30 developed nations who comprise 
the OECD. Decisions of the OECD Council are legally binding upon Member 
countries at the time of the adoption of the decision.1 
Since the United States was a member country in 1986, the OECD Decision 
is legally binding on the United States.
    There are several elements in this OECD Decision that could address 
this problem of e-waste export, but none of them are actually being 
enforced, and the United States violates all four:

          1. The United States should monitor and control exports, 
        including prohibiting certain exports. (The United States has 
        avoided restricting export of electronic waste by selecting a 
        definition that does not define it as hazardous waste)
          2. The United States should use the same strict controls on 
        exporting hazardous wastes to developing (non- OECD) countries 
        as to developed (OECD) countries.\2\
---------------------------------------------------------------------------
    \2\ Transfrontier shipments between OECD member states of cathode 
ray tubes (CRTs), and/or CRT glass, for example, must in fact be 
controlled within the OECD as it is part of the ``amber'' list under 
Council Decision C(92)39/Final, as amended by C(2001)107/Final 
(governing recycling trade in hazardous wastes between Member States).
---------------------------------------------------------------------------
          3. The United States should not send hazardous wastes to non 
        OECD countries without their consent.
          4. The Unite States should not send hazardous waste to non 
        OECD countries unless they are sent to an adequate disposal 
        facility.

    Definitions of what should and shouldn't be banned.--To be banned: 
The export of non-working or untested electronic equipment or parts 
containing hazardous materials, as defined internationally (see below), 
should most definitely be banned to all non-OECD/EU countries for 
recycling, major refurbishment\3\, and/or disposal. Also, any used 
electronics must be banned from going to any country that has domestic 
laws forbidding the import of those electronics, otherwise those U.S. 
exports result in the violation of laws in recipient countries. 
Further, until the United States ratifies the Basel Convention they 
should not trade in Basel-listed wastes with any of the 160+ countries 
that have ratified the Convention. To do otherwise violates the laws of 
the importing country.
---------------------------------------------------------------------------
    \3\ Major repairs are any repairs that result in the removal or 
replacement of hazardous materials/components as defined in the Basel 
Convention, www.basel.int.
---------------------------------------------------------------------------
    Not to be banned.--Tested working equipment going into the reuse 
market, or equipment needing minor repairs\4\ does not need to be 
banned for export, as working equipment is considered a product, not a 
waste, under international definitions. Additionally parts that are not 
considered hazardous such as power supplies, copper wires and cables, 
clean plastic housings etc. need not be banned from export.
---------------------------------------------------------------------------
    \4\ Minor repairs are any repairs that do not result in the removal 
or replacement of hazardous materials or components, as defined in the 
Basel Convention, www.basel.int.
---------------------------------------------------------------------------
    Which waste components are to be controlled (Basel listed hazardous 
e-wastes).--At a minimum, cathode ray tubes (including leaded glass 
cullet), circuit boards made with lead solder, components containing 
beryllium or beryllium copper, items containing mercury, beryllium, 
PCBs, or the equipment that contains any of the above. Likewise, any 
electronic equipment that in any form or units needing major repairs 
that contain these materials.
    Consistent Definitions.--The United States has not harmonized its 
definitions of hazardous wastes with the global ones in use by most 
other nations (www.basel.int). U.S. law (The Resource Conservation and 
Recovery Act) previously controlled hazardous wastes even for export, 
but industry succeeded in lobbying for de-listings from waste 
definitions for recycling, resulting in an ugly loophole where the 
United States in the only country in the world that does not consider 
electronic waste, lead-acid batteries, and other known hazardous wastes 
from being controlled from international trade (dumping on developing 
countries). While this de-listing made some sense for domestic-only 
transactions, it results in a gross violation of laws in other 
countries as well as a violation of the principle of environmental 
justice.
    Conclusion on Export issue.--In conclusion, it is imperative that 
Unite States legislation finally prohibits the export to any non-OECD/
EU of any electronic waste that is regulated under the Basel Convention 
and OECD treaties. At a minimum, this includes cathode ray tubes 
(including leaded glass cullet), circuit boards made with lead solder, 
mercury, beryllium, PCBs, and any wastes or units needing major repairs 
that contain these materials.
    Much more information about this issue can be found in our report 
``Exporting Harm: The High-Tech Trashing of Asia which can be 
downloaded at: www.ban.org.

    Question 3. If the recycling of electronic waste were profitable, 
more businesses would be doing it and waste disposal would not be as 
big a problem. In your opinion, what are the economic barriers to 
making recycling of electronic waste economically viable?
    Response. The major barrier to making recycling economically viable 
is that our solid waste infrastructures reward disposal rather than 
recycling. Our existing solid waste infrastructure was developed and 
engineered for the purpose of disposing of materials in municipal 
landfills. The federal government should provided leadership in setting 
standards and goals and promoting policies that support responsible e-
waste recycling. The current e-waste recycling system which depends on 
voluntary standards encourages sham recycling and penalizes legitimate 
recyclers who pay living wages, protect their workers health and safety 
and invest in recycling equipment. Responsible recyclers can not 
financially compete with sham recyclers who dump or burn e-waste in 
developing countries or engage in dirty recycling that takes advantage 
of child labor or prison labor. Similarly, existing regulations do not 
reward manufacturers who pro-actively invest in product designs that 
facilitate recycling.
    The Federal Government has the capacity to eliminate barriers to 
recycling and support e-waste recycling industries by enacting the 
following policy changes.
    (1) Design for recycling. Require electronic manufacturers to 
incorporate the cost of end-of-life-management into a product's pricing 
structure. Incorporating end-of-life-management into the price of the 
product provides incentives for manufacturers to invest in product 
designs that bring down the cost of recycling and increase the value of 
the recovered materials. This also eliminates the need for consumer 
recycling fees and/or government taxes that subsidize recycling 
businesses to recycle electronic products that were not designed for 
recycling and contain very limited amount of valuable materials.
    (2) Protect U.S. consumers from sham recyclers. U.S. customers 
recycle their products with the intention of protecting human health 
and the environment. The lack of e-waste industry standards, government 
monitoring and oversight defies public confidence in recycling and 
leaves well-meaning citizens vulnerable to brokers and ``front men'' 
who say that they are recycling e-waste but are really exporting the e-
waste overseas and dumping it in developing countries or endangering 
health and safety of entire communities by recycling in horrendous 
conditions. Banning the export of non-working or untested electronic 
equipment or parts containing hazardous materials (as defined in the 
Basel Agreement) would close the export loop hole and protect human 
health and the environment and promote consumer confidence in e-waste 
recycling.
    (3) Develop and enforce e-waste recycling standards. Currently 
there are few e-waste recycling industry standards. For example, there 
is not an accepted e-waste recycling certification or performance 
auditing system. There is a very limited understanding of worker 
exposure to hazardous materials at e-waste recycling facilities or the 
appropriate types of worker protective measures and equipment needed. 
There are no accepted ``best practices'' for demanufacturing 
electronics or standards for acceptable levels of contamination in 
recovered material.
    (4) Establish national e-waste recycling goals. Long-term national 
e-waste recycling goals are key to the development of an economically 
viable e-waste recycling industry. Thus, national recycling goals 
should reward electronic manufacturers whose products are made with 
materials that contain few contaminants, can be easily recycled and 
that retain market value. The federal government can further support 
the e-waste recycling industry by harmonizing national e-waste 
recycling goals with federal environmental preferable purchasing 
guidelines for electronics. For example, new federal purchasing 
guidelines will give preference to electronic products in which 90 
percent of materials and components (by weight) are reusable or 
recyclable within the current infrastructure and use demonstrated 
technologies.\5\ The federal government could encourage profitable 
recycling industry by incorporating this guideline into other policies.
---------------------------------------------------------------------------
    \5\ Electronic Product Assessment Tool (EPEAT) Criteria Worksheet 
Draft, 9-20-04
---------------------------------------------------------------------------
    (5) Federal investment in e-waste recycling research and 
development. A public investment in e-waste research and development 
will provide non-proprietary technology that would potentially improve 
and contribute to regional and national infrastructure development.
    E-waste research and development needs:
     Work measurement studies that can be shared throughout the 
industry,
     Automation of disassembly systems that reduce labor cost 
and protect worker health and safety
     University green chemistry and materials science that 
helps manufacturers determine the impact of materials throughout the 
lifecycle of their products
     Affordable materials separation systems that produce a 
clean stream of recovered materials
     Identification of end market for recovered materials
     Recycling facilities warehousing and inventorying systems
     Worker health and safety studies that include health 
monitoring and improvements in ergonomics
     Development of affordable plastic identification equipment
     Open source website that posts latest studies, provides 
information about specific products recycling, disassembly and best 
practices
     Tests and reports on prototype recycling equipment
     Collaborate between recyclers and Original Equipment 
Manufacturers (OEMs) to overcome barriers to recycling products before 
the products are introduced into the consumer market

    Question 4. What are the consequences if Congress fails to enact 
national electronic waste legislation?
    Response. Clearly, this is a national problem that calls for a 
comprehensive national solution. There are economies of scale to be 
gained on a national level. Sales, distribution and marketing patterns 
for these companies are national. But if Congress fails to act, the 
states can also pass legislation to address this problem. We think that 
because this is a complex issue, there are advantages to setting it up 
at the state level first, before trying to tackle it on a national 
level.

    Question 5. Ms. Davis, your testimony also discusses the lack of 
recycling standards in China, and, as you know, there are none in this 
country. Would a Federal program to certify recyclers in the United 
States address your concerns and lessen the export of electronic waste?
    Response. The lack of recycling standards in China has nothing to 
do with the illegality of the United States shipping its hazardous e-
waste there. U.S. exports of such waste not only violate China's 
obligations under the Basel Convention, but also violate China's 
domestic import bans on this material, and should not be occurring, 
regardless of the level of technology or standards in China. China has 
ratified the Basel Convention and its Ban Amendment, and is a non-OECD 
country; the United States has not ratified the Basel Convention, and 
is an OECD country. We should be looking to handle our own hazardous 
waste problems domestically rather than exploit weaker economies with 
these types of problems. This type of environmental injustice is not 
acceptable in the United States and it should not be acceptable to dump 
our wastes on the world's poorest communities either.
    While there is a desperate need for national recycling standards 
here in the United States and in all countries, these standards will 
only be meaningful if those standards explicitly forbid that export. 
This is due to the fact that there will be very little waste to manage 
domestically if export is allowed, and on the other hand, it is 
impossible to enforce a standard extraterritorially, particularly in 
countries that lack the infrastructure to properly enforce or monitor 
such standards.
                                 ______
                                 
        Response by Sheila Davis to an Additional Question from 
                           Senator Lautenberg

    Question. Your description of women and children dismantling toxic 
equipment by hand is very disturbing--and something we must try to 
stop. Since it will take years to get a U.S. system for e-recycling in 
place, does the Coalition have any short-term recommendations for 
improving this situation?
    Response. One of the most important and overdue things the United 
States can do is implement the 1986 Organization for Economic 
Cooperation and Development (OECD) Council Decision-Recommendation 
C(86)64(final)1 treaty described above in the Resource 
Conservation and Recovery Act. This is already a legal requirement of 
the United States. Doing this shouldn't even be controversial. It 
requires no advice and consent, but just requires that Congress mandate 
that legislation to implement the requirement be drafted and adopted. 
This will have the immediate effect of requiring minimal controls on 
export and curtailing a great deal of it. It is not the ultimate 
solution, which involves passing EPR and toxic phase-out legislation, 
ratifying both the Basel Convention and the Basel Ban Amendment, but it 
will create a major dam against the tsunami of e-waste trade.
                                 ______
                                 
  Responses by Sheila Davis to Additional Questions from Senator Boxer

    Question 1. What do you think the main advantages and disadvantages 
are of using market-based systems--such as product stewardship--to 
encourage recycling versus consumer-financed incentives?
    Response. There are four significant advantages to a market based 
solution:
    Financing shift to producers, not taxpayers.--This will be a 
lasting, far-reaching solution that doesn't require taxpayer funds. By 
giving the producers the financial responsibility for this sytem, 
taxpayer money, which currently pays for most local recycling programs, 
would no longer be needed. The ARF system uses the legislature to set a 
specific fee on products when they are sold. But if these fees turn out 
to be inadequate to cover the costs (and the legislature has not acted 
to increase them), then either taxpayer money will make up the 
difference, or less recycling will happen. The quantities of e-waste 
that need recycling will continue to grow, so we need a solution that 
can easily grow with it.
    Drives more recycling.--Once the producer takeback system is in 
place (assuming it has important components like recycling goals) it 
will drive more recycling to occur because the companies will have 
goals to meet. The consumer advanced recycling fee (ARF) system has no 
real drivers to make more recycling happen. It's simply a system to 
collect some fees to pay for some recycling.
    Incentive to design for the environment.--Another advantage to this 
system is that the companies who manufacture the products have an 
incentive to reduce the problem, by reducing the toxics in their 
products. While some companies are pursuing ``design for the 
environment'' goals, many are not. This system would give them a 
financial incentive to do so.
    Restricts export dumping and sham recycling.--The producer takeback 
model includes provisions for making sure the products are actually 
recycled safely, not exported to third world countries. By having the 
producers charged with the responsibility for working with responsible 
recycling vendors, we can fix one of the biggest problems with 
electronics recycling in this country--illegal export. The ARF model, 
by being just a fee generation system, doesn't alter the way things are 
done, just who pays.
    The main drawbacks of this system are: (1) its comprehensive 
approach makes it more complicated to establish, and (2) because it 
requires a large commitment from the producers, it will be resisted and 
challenged by industry.

    Question 2. Your testimony provides vivid and disturbing details 
concerning the lack of public health and environmental protections at 
recycling operations in China. How widespread of a problem is the 
export of electronic waste to countries that lack adequate 
environmental protections?
    Response. The problem is severe and widespread, due to the sheer 
economics of the trade, and the completely unregulated export of e-
waste from the United States. We believe that 50-80 percent of what is 
being collected for recycling, finds its way offshore to these types of 
conditions. Because the United States is failing to `control and 
monitor' its exports of hazardous e-waste despite its OECD obligations 
to do so, there are no hard numbers indicating the exact amount going 
offshore. However, a number of environmental groups and reporters have 
documented numerous sites in China, India, Pakistan, and elsewhere. 
(www.ban.org, www.toxiclink.org, www.greenpeace.org) There are also 
many reports of sites in Malaysia, Indonesia, and Viet Nam. African and 
South American nations are receiving millions of cell phones and 
computers, some of it waste when it arrives, with little to no 
hazardous waste facilities to properly manage the toxic materials. 
Greenpeace is about to release a report documenting extremely high 
levels of toxins found at electronic recycling sites in China and 
India. Also available will be photos of labels (asset tags) from 
computers found in these 2 countries, on riverbanks, at primitive 
`recycling' operations, and in openly discarded mountains of electronic 
waste. Limited health studies have been done on populations living 
amongst these toxic recycling yards in Guiyu, China, by both the 
Medical College of Shantou University, in the Guangdong Province of 
China (attached), and by Greenpeace China.
    It must be understood, however, that while many of these developing 
countries may claim to have (or could soon have) the technology to 
perform electronics recycling, their economies clearly cannot support a 
full array of infrastructural and democratic, social support systems 
and safety nets that should be in place to protect them from the 
dangers of recycling. For instance, they have almost no occupational 
health equipment, training, clinics, legal remedies for damages, 
governmental monitoring, and enforcement, of standards, etc. No doubt, 
if these existed, then the economies would be similar to developed 
nations; and the exploitive incentive to export would no longer exist 
as the waste management costs would have been fully internalized. Any 
exports to weaker economies equates to a violation of principles of 
environmental justice. It is therefore essential that the United State 
strategy does not entail finding ways to justify continued export based 
on exporting technological fixes.

    Question 3. What, in your opinion, are the pressures that promote 
the exportation of e-waste to other countries?
    Response. The primary pressure to export e-waste is, without a 
doubt, an economic one in the absence of legislation. Exporters can (a) 
claim they are involved in recycling, (b) demand payment from consumers 
believing that recycling is the right thing to do, and (c) then get 
paid again at the back end by the Chinese broker for the raw value of 
the equipment sold. When there are no U.S. regulations limiting the 
options of export and prison labor, many waste generators will opt for 
making money off their hazardous e-waste, rather than incurring an 
expense to ensure that it is properly managed in ways that won't impact 
citizens and the environment in any country.
    Integral to the economic pressure to export is the toxicity of this 
equipment. Costs associated with managing known hazards can be avoided 
if one simply decides to make a buck instead. With the U.S. Government 
freely allowing this export of toxic waste, there are only matters of 
conscience for some to contend with. It is precisely because of the 
economic incentives to do the wrong thing that nations came together in 
the 1980's to erect a trade barrier to hazardous wastes (the Basel 
Convention and the Basel Ban Amendment). The United States remains the 
only developed nation to disregard this landmark treaty, and to 
continue to dump its hazardous waste on any country it wants.

    Question 4. What level of oversight exists at the state or federal 
level to monitor and enforce protections for public health and 
environmental quality at overseas recycling facilities that take 
domestically generated e-waste?
    Response. None. U.S. State and Federal agencies have no 
extraterritorial jurisdiction whatsoever. Without this authority, it is 
impossible to claim that proper monitoring and enforcement can take 
place. The oversight is reduced to an honor system which is not 
adequate to ensure standards are upheld.
    As we continually must stress, with weaker economies, one cannot 
expect that the infrastructure will exist to protect the environment, 
workers and communities, from the impacts of hazardous wastes. Even if 
they did actually have the same infrastructure as developing countries, 
it is still inappropriate to burden weaker economies with 
disproportionate amounts of hazardous wastes or other environmental 
problems simply because they are relatively poor. This is the type of 
behavior which gives globalization it reputation as being exploitive.
    Rather than looking for ways to put band-aids on the disastrous e-
waste export situation it is far better to work toward establishing 
national recycling infrastructure and providing support for it by 
promoting mandated recycling paid for by producers.
    The OECD treaty, however, attempts to address this issue by 
allowing OECD member countries to keep their hazardous waste within 
those 30 developed countries, using only environmentally sound 
management systems (EMS) for the hazardous wastes. The United States, 
an OECD member country, has the legal right to ship its hazardous waste 
to other OECD countries, if it meets the minimal requirements for prior 
informed consent, EMS facilities, etc.
    To this end, the OECD has developed the ``Technical Guidance for 
the Environmentally Sound Management of Specific Waste Streams: Used 
and Scrap Personal Computers'' This document is a set of guidelines, 
not requirements, that was created for and by the 30 OECD member 
countries, and only for use within the OECD. It is not intended as a 
guidance to justify exports to non-OECD countries. Therefore, any 
system set up in the United States should never suggest that OECD 
Guidelines be met in non-OECD countries.

    Question 3a. What is the best way to encourage the least amount of 
hazardous substances in electronic products and the largest amount of 
recycling?
    Response. Costs of management must be internalized so that those 
that profit from the use of consumer products (both the manufacturers 
and the consumers) bear the entire costs of the products' liabilities 
presented through its entire life cycle. This type of feedback 
mechanism ensures incentives for greener and greener design. Proper 
mechanisms that provide for consumer and producer responsibility must 
be promoted through legislation. It is not appropriate to allow 
mechanisms that externalize costs to taxpayers, city or local 
governments, utility rate payers, prison labor forces, or offshore 
communities.
    The EU passed the RoHS Directive (Reduction of Hazardous 
Substances) listing six specific materials that must be removed from 
new products by July 2006. Companies are redesigning their products to 
remove these materials, rather than be left out of those markets. The 
United States will presumably benefit from Europe's efforts, if these 
redesigned products are also available to U.S. markets. The RoHS list 
of substances is only a preliminary list, and there are other materials 
that require attention, but it's an excellent example of how chemical 
policy can force change in design. It would be easier and cheaper to 
recycle electronics products if they were not so toxic. So reducing the 
toxic materials, along with setting up an effective recycling 
infrastructure, is the best way to increase recycling

    Question 3b. E-waste contains a number of heavy metals and other 
hazardous substances that can threaten public health, especially 
vulnerable populations. Lead is one such metal in abundance in e-waste. 
What is the state of knowledge regarding the safety of current 
standards for protecting children from lead exposure?
    Response. Actually with every year that passes, scientific research 
shows that lead is even more of a problem for childhood development 
than previously thought. For the last 2 years, the EPA has been 
readying a new lead level thresholds. It is likely however that no 
amount of lead exposure is truly safe. The impacts on children can be 
devastating, leaving irreparable damage to nervous system and brain 
development. The notion that lead somehow disappears once placed in a 
landfill is very shortsighted thinking. If we believe in the survival 
of the human species, we must think of very long-term leaching and 
exposure. Heavy metals are immortal--they don't have a half-life. They 
are with us forever. The ultimate answer for lead, mercury and other 
toxic metals is to rapidly provide incentives to design our way away 
from their continued use. This is best done through mandated extended 
producer responsibility and toxic use phase-outs.
    Note: The Computer TakeBack Campaign would like to mention the 
contributions by our partner organization, the Basel Action Network, in 
supplying answers to some of the recycling questions.

                               __________

Statement of Michael Vitelli, Senior Vice President, Best Buy on Behalf 
         of the Consumer Electronics Retailers Coalition (CERC)

    Chairman Thune, Ranking Member Boxer and members of the Committee, 
I am Michael Vitelli, Senior Vice President of Consumer Electronics of 
Best Buy and am here today on behalf of the Consumer Electronics 
Retailers Coalition (CERC) to provide the views of CERC's membership on 
the need for a national electronics management system.
    CERC very much appreciates the opportunity to provide the views of 
the consumer electronic and general retail industry concerning the need 
for a national approach to handling electronic devices at their end of 
life. We are also very appreciative, Mr. Chairman, of the leadership 
you have shown in holding this hearing today and providing a forum for 
interested stakeholders to express their views. We look forward to 
working with you and the members of this Committee to identify the best 
means of developing a national solution for electronic device recycling 
that will, obviously, have to be implemented at the local level.

                              INTRODUCTION

    Best Buy is the country's leading consumer electronics retailer 
with close to 700 stores in 49 of the 50 states and nearly 100,000 
employees. The company started in 1966 with a single store in St. Paul, 
Minnesota and we continue to operate our headquarters in the Twin 
Cities.
    In addition to our product and service offerings, Best Buy is also 
known for our commitment to our communities, providing volunteer 
support, financial resources and leadership on many issues, but 
especially on the use of innovative technology to improve the learning 
opportunities for kids. We provide over 1300 scholarships to students 
entering higher education--3 scholarships in every Congressional 
district in the country. Our new tech program rewards schools and 
educators who are using technology to energize their lesson plans and 
engage students. The National Parks Foundation's Junior Ranger program 
is available to kids across the country through the Web Ranger program 
sponsored by Best Buy. With Junior Achievement's ``Titan'' business 
simulation game, we've helped harness the excitement of a video game to 
stimulate real learning.
    Best Buy has also been actively concerned with the issue of 
electronic waste. In 2001, we launched a series of recycling events to 
provide a simple, fun and convenient program for recycling electronics 
that protects the environment while raising awareness of recycling 
options. Best Buy has helped consumers nation-wide recycle over 2.5 
million pounds of electronics in an environmentally responsible way 
since the program began. In addition to recycling events, we also offer 
the ability to recycle cell phones, ink cartridges, and rechargeable 
batteries year round in all our U.S. stores.
    CERC is a national coalition representing small, medium and large 
consumer electronics retail businesses and associations that operate in 
all 50 states and worldwide. Our members, in addition to Best Buy, 
include Circuit City, RadioShack, Wal-Mart, Target, the North American 
Retail Dealers Association and the Retail Industry Leaders Association. 
Our goal is to educate, advocate and instill continued consumer and 
market confidence in consumer electronics policy issues.
    Consumer electronics (CE) retailers throughout the United States 
strongly believe that developing an electronics management system that 
encourages the collection and recycling of electronic waste is far more 
preferable, desirable and efficient if it is handled as a federal 
solution implemented by local authorities, rather than dealing with a 
patchwork of different eWaste laws instituted by individual States. In 
the first half of 2005 alone, 30 State and local legislatures saw more 
than 50 separate bills introduced on this issue including an eWaste 
measure introduced and still active in New York City. A 50-by-50 
approach is administratively unreasonable and infeasible for 
manufacturers and retailers alike and will not lead to a comprehensive 
and efficient electronics waste management system for our Nation.
    Retailers have a limited role in the life cycle of the products we 
sell. We neither design nor make the products, nor do we have control 
over what a consumer does once the product is purchased, and have no 
control on a products reuse, recycling or disposal. However, CE 
retailers realize that we have a responsibility in working with all the 
interested stakeholders. Retailers, manufacturers, distributors, 
recyclers, public interest groups, charitable organizations, state and 
local governments, and our customers all have a role in advocating for 
the development of a successful national electronics waste management 
system.
    Both CE and general retailers unanimously support a shared 
responsibility approach to the handling of electronic devices at the 
end of their life cycle. Product stewardship addresses the 
environmental impact of electronic products at all stages of their life 
cycle--from design and manufacturing to packaging and distribution to 
end-of-life management. When done correctly and fairly, it shifts the 
responsibility for end-of-life management from the public sector 
(government and taxpayers) alone, to a shared responsibility that 
includes the private sector (manufacturers, recyclers, non-profits, 
retailers and purchasers). The goal is to encourage environmentally-
friendly design and recycling and reduce flow to the landfills.
    Following months of internal discussion, conducting an industry-
wide survey, holding meetings with state legislative leaders and 
experiencing the impact and initial results of the California advance 
recycling fee law, CERC drafted a consensus legislative position paper 
on electronic waste management earlier this year, which is attached to 
my written statement. While other stakeholders have yet to reach a 
broad consensus, consumer electronic and general retailers, including 
their national and state federations, have come together around a 
position that we believe succinctly and forthrightly lays out the 
issues, opportunities and obstacles involved in setting up a nationwide 
eWaste model. Since issuing this Position Paper, CERC has been working 
with and recruiting broad cross-industry support among other interested 
stakeholders, including environmental groups, recyclers, state 
legislators and manufacturers.
    While retailers and many others believe that the producer 
responsibility approach is the most fair, least burdensome, and most 
easily manageable model, we have also looked upon the Talent-Wyden bill 
(S 510) that would provide a limited tax credit to recyclers as an 
excellent conceptual model that could jump-start a national 
capitalization of eWaste recycling.
    While we have expressed general support for some state initiatives, 
such as laws recently passed in Maine and Maryland; and opposition to 
others, such as the point of sale advance recycling fee recently 
instituted in California; our purpose in testifying today is not on 
which state law is good or bad, efficient or administratively 
burdensome, helpful or hurtful to eWaste recycling efforts. Rather, we 
are here to advocate for a national approach and to highlight some very 
successful voluntary efforts that industry partners have been engaging 
in.

                      CURRENT PROGRAMS/ACTIVITIES

    Even without state or federal laws governing management of 
electronic waste, the private sector--manufacturers and retailers 
working with qualified recyclers--has been fully supportive of the 
shared responsibility product stewardship approach through numerous 
voluntary initiatives that collect and recycle devices. These programs 
have included the development of a strong and meaningful educational 
campaign for consumers and policy makers. Best Buy and other members of 
CERC, as well as consumer electronic retailers that are not members of 
our organization, together with a number of manufacturers, have been 
actively involved in activities that highlight the need for 
conservation and how best to handle electronic devices at their end of 
life.
    There are several initiatives in place today to reduce and manage 
electronic waste both at the federal and industry levels. CERC members 
and other consumer electronic retailers and manufacturers have 
participated in such EPA programs as the Plug-In To eCycling outreach 
campaign, which works to increase the number of electronic devices 
collected and safely recycled in the United States and has identified 
new and creative flexible, yet more protective ways to conserve our 
valuable resources.
    Plug-In To eCycling focuses on:
     Providing the public with information about electronics 
recycling and increasing opportunities to safely recycle old 
electronics;
     Facilitating partnerships with communities, electronics 
retailers and manufacturers to promote shared responsibility for safe 
electronics recycling; and
     Establishing pilot projects to test innovative approaches 
to safe electronics recycling.
    Program partners have included manufacturers like Panasonic, Sharp, 
Sony, JVC, Lexmark, Dell, Intel; retailers like our company, Best Buy, 
as well as Staples and Office Depot; and approximately two dozen state 
and local governments. More than 26.4 million pounds of electronics 
were collected in the first ten months of this national program alone.
    In addition to the Plug-In To eCycling campaign a number of 
retailers and manufacturers have taken part in voluntary programs to 
encourage greater recycling.
    As noted in my introduction, Best Buy actively provides recycling 
options for our customers with our recycling events. We have had an 
overwhelming response to our events. In fact, the event we hosted a 
month ago at our corporate headquarters in Minnesota drew record crowds 
with over 2,900 cars and a collection of over 250,000 pounds (125 tons) 
in just two days. This is in a county that already has a program in 
place for the recycling of electronics. Our next event is scheduled for 
our Mira Mesa, CA Best Buy store (9540 Mira Mesa Blvd, San Diego, CA) 
on Friday, August 5th and Saturday, August 6th from 10:00 a.m. to 5:00 
p.m. We are very excited to be partnering with HP and Sony at this 
event.
    In another example, six of our Best Buy stores in the Indianapolis 
area served as recycling drop-off points for many consumer electronics 
items in a 2004 pilot. Accepted items included computers, monitors, 
printers, fax machines, televisions, stereos, VCRs, DVD payers and 
camcorders.
    In addition to Best Buy activities, a number of CE retailers and 
manufacturers have and are taking part in voluntary pilot projects. 
Staples, for example, sponsored a New England-based pilot program in 
cooperation with EPA's Plug-In To eCycling campaign and the Product 
Stewardship Institute (PSI) in the summer of 2004. Also last summer, 
Office Depot and HP sponsored a similar in-store electronics recycling 
pilot nationwide. Both programs accepted hardware from any 
manufacturer, including PCs, mice, keyboards, PDAs, monitors, flat-
panel displays, laser and ink jet printers, scanners, all-in-one 
printers, digital cameras, fax machines, cell phones, TVs, and TV/VCR 
combos. This summer, Good Guys is partnering with the EPA and a number 
of electronics manufacturers to collect and recycle televisions.

                A NATIONAL ELECTRONICS MANAGEMENT SYSTEM

    But we all realize that voluntary programs cannot fully handle or 
solve the end of life issues surrounding electronics products. CERC 
strongly believes a comprehensive nationwide approach to the management 
of electronics is the ultimate solution. We further believe that a 
successful national system can be established without imposing fees at 
the point-of-sale; without having to create a new complex 
administrative structure; and without mandates that discourage 
innovation. This is why the Talent-Wyden ``Electronic Waste Recycling 
Promotion and Consumer Protection Act'' (S 510) seems to many of us as 
a cost-efficient and potentially successful national approach. We urge 
you and your colleagues to look at this end of life tax credit as a 
viable and creative opportunity to deal with electronics at their end 
of life.
    However, in the alternative, retailers support a no-fee producer 
responsibility system because it will provide consumers with a variety 
of choices and manufacturers with flexibility to implement electronics 
recycling programs that make sense--to our customers, government, 
retailers and manufacturers.
    Our Position Paper outlines the factors and components that a 
successful producer responsibility program should include:
     Initially, any program should have a limited number of 
types included to insure an easy transition, and clear definitions of 
which devices are covered.
     Making sure that any `take-back' programs--if mentioned at 
all--remain voluntary.
     A `safe harbor' for a consumer electronics retailer that 
sells a product not covered under an approved management plan absent 
actual knowledge.
     Programs that help educate and are easily understood by 
consumers.
     A flexible system that allows manufacturers the ability to 
provide services to consumers and encourages the market to drive 
efficiencies and choices.
     Encouragement to voluntary collection initiatives by 
manufacturers to partner with retailers, charities and/or local 
government.
     Establishment of manufacturers' financial responsibility 
based on the products that consumers return to the system--not fees at 
the point of sale or other financial models that do not reflect the 
true costs and realities of the return system.
     The ability of manufacturers to work independently or 
collaborate with others to meet the established responsibility goals.
    Our members oppose a point of sale advance recovery fee (POSARF) 
system because we know from firsthand experience that such an ARF will 
not accomplish its goals, is administratively burdensome for all 
parties, and will only guarantee a new revenue source for government 
without guaranteeing that an effective recycling system will be put 
into place. In addition, such a program provides no incentive for the 
design of more environmentally-friendly products, and fails to take 
advantage of market forces to reduce the cost of recycling over time.
    The recent institution of such a fee/tax program in California has 
already been shown to be:
     Too complicated for all parties--government, businesses 
and consumers--to understand and administer.
     Incredibly costly for both governmental agencies and 
retailers to implement.
     Impracticable to bring sufficient dollars down to the 
local level to implement enough local collection and disposal 
facilities.
     Impossible to impose on out-of-state online/mail order 
retailers.
     Impractical, by asking the government to set up a new 
administrative structure to collect the fees, to manage the program and 
disperse the revenue for effective recycling.
     Impossible to know how high the taxes/fees charged to 
consumers needs to be in order to adequately fund a successful 
electronics device recycling program.
    In short, a POSARF--particularly given significant budget cutting 
at all levels of government--will not adequately fund an effective 
recycling program, and will only serve to confuse and burden the 
consumer with the imposition of new fees and perceived new taxes 
without any direct benefits.

                               CONCLUSION

    The members of the Consumer Electronics Retailers Coalition, 
together with CE and general retailers and their trade associations 
throughout the United States, want to be constructive and contributing 
partners with law makers, manufacturers, public interest groups, 
recyclers and our customers in dealing with the end of life issues 
surrounding electronics products. We cannot, however, afford to let 
individual states and certainly individual cities and counties, 
establish their own programs that impose inconsistent mandates on 
retailers or manufacturers.
    We very much appreciate the holding of this hearing and encourage 
Congress in general and this Senate Committee in particular to continue 
to work towards a national solution to electronics waste management. We 
pledge to work with you in arriving at a fair, viable and effective 
approach.
    Thank you.

    [GRAPHIC] [TIFF OMITTED] T7447.018
    
    [GRAPHIC] [TIFF OMITTED] T7447.019
    
  Response by Michael Vitelli to an Additional Question from Senator 
                                 Inhofe
    Question. In 2003 California passed the Electronic Waste Recovery 
Act which established a funding mechanism to provide for the recycling 
of certain electronic products. The goal was to eliminate these items 
from public landfills and provide an easy and convenient method of 
proper management. The system is funded through fees paid by consumers 
of covered electronics products at the time of purchase. The projected 
revenue for the first year was $60 million, and $15 million have 
already been collected. In addition, more than 13 million pounds of 
materials have been recovered for recycling in the first quarter alone.
    How much is compliance with the California system costing 
retailers?
    Response. Best Buy has spent nearly $1 million in California to 
update our point-of-sale systems, to educate our store personnel and 
consumers, and to ensure compliance going forward. Since these point-
of-sale fees are not added to all products, like a sales tax often is, 
but rather added to only some products (and not even all products in a 
given category of products,) the cost of compliance is high. In 
addition, each time changes are made to the fees and to the list of 
applicable products, these systems must be updated, adding costs. 
Finally, if different states implement differing schedules of fees, the 
costs of compliance will increase.
                                 ______
                                 
       Responses by Michael Vitelli to Additional Questions from 
                            Senator Jeffords

    Question 1. Mr. Vitelli, in your testimony, you advocate ``a shared 
responsibility approach.'' Please explain how such a system would work. 
In particular, please delineate the relative responsibilities of 
manufacturers, retailers, consumers, and recyclers under such a shared 
responsibility approach?
    Response. In the manufacturer responsibility model, manufacturers 
are responsible for working with consumers to properly recycle their 
product. This can mean that they provide direct recycling, work with a 
recycler or in some instances, fund a recycling system. Retailers are 
responsible for the education and outreach of consumers, working with 
manufacturers to ensure that they are carrying product from 
manufacturers who are compliant with the law. Retailers are also 
responsible as a manufacturer; if they produce private label brand 
products (Best Buy brands include Insignia and Dynex.) Consumers are 
responsible for the proper disposal of products and recyclers must meet 
environmentally sound practices when working with consumers and 
manufacturers.

    Question 2. If the recycling of electronic waste were profitable, 
more businesses would be doing it and waste disposal would not be as 
big a problem. In your opinion, what are the economic barriers to 
making recycling of electronic waste economically viable?
    Response. One of the driving reasons this issue requires government 
action is that the recycling of electronic waste will probably always 
cost more than value of the residual scrap. Thus a system that provides 
an incentive to reduce the costs of recycling through design of the 
product has the greatest potential to ultimately provide the least cost 
solution to this issue.
    A complicating factor is that there is currently a significant 
amount of historic waste waiting for a solution. These products were 
manufactured without the expectation that they would need to be 
recycled. This adds a ``hurdle'' of initial cost to any new system. If 
the issue of historic waste could be handled through a different 
program than the ultimate, ongoing program, the solutions might be 
easier to achieve. The Talent-Wyden approach provides a significant 
incentive to tackle this initial cost ``hurdle'' and could help start a 
recycling process that ultimately does not need the incentives provided 
through the Talent-Wyden approach.

    Question 3. What are the consequences for your industry if Congress 
fails to enact national electronic waste legislation?
    Response. The Consumer Electronic Retailers Coalition represents 
small, medium and large consumer electronics retail business in all 50 
states and worldwide. In 2005, 30 states contemplated 50 different 
pieces of legislation. Ultimate passage of differing solutions in each 
of the 50 states would present real compliance challenges and costs. In 
addition, differing solutions in each of the 50 states will cause great 
confusion for consumers. Products purchased in one state with a fee 
added at the time of sale, may need to be recycled in another state 
where the solution may be a charge at the time of recycling.
                                 ______
                                 
Responses by Michael Vitelli to Additional Questions from Senator Boxer

    Question 1. The Consumer Electronics Retailers Coalition supports a 
national electronics recycling system based on making manufacturers 
responsibility for recycling electronic waste. What are the biggest 
advantages and disadvantages to this type of recycling system?
    Response. In the manufacturer responsibility model, manufacturers 
are responsible for working with consumers to properly recycle their 
product. This can mean that they provide direct recycling, work with a 
recycler or in some instances, or fund a recycling system. Under the 
manufacturer responsibility model, the manufacturer is ultimately 
responsible for their product at end-of-life which provides the double 
incentive to both develop environmentally-friendly products and to find 
the most cost effective ways to recycle product. Ultimately consumers 
will pay for recycling through either higher taxes, fees at the time of 
purchase, or additional costs included in the cost of the product by 
the manufacturer. Only the latter offers an economic incentive for 
improvements.

    Question 2. Best Buy has been a leader in several, highly-
successful voluntary efforts to recycle waste from electronic products. 
Do you think that these voluntary initiatives can solve our problems 
with recycling electronic waste, or is more needed?
    Response. Best Buy's voluntary recycling events only provide a 
small solution to a much larger need. More industry leaders would need 
to join this effort in order for it to be effective at addressing the 
problem. The Talent-Wyden (S-510) could provide an incentive for 
industry to take that added step.

    Question 3. What are the two or three best things that the federal 
government can do to increase the rate of recycling to both promote 
environmental stewardship and help businesses make profits?
    Response. The Talent-Wyden bill provides a good incentive to help 
businesses grow their recycling efforts. It also provides a solution to 
the issue of historic waste, which is a complicating and costly portion 
of the total solution. By giving manufacturers and/or retailers a tax 
credit to run recycling programs, it not only can help to create more 
of a base for programs, it allows manufacturers to realize their true 
costs in recycling and can help motivate manufacturers to design more 
environmentally-friendly products, ultimately reducing their recycling 
costs.
    In addition, the Federal Government could actively study this 
issue, thereby providing assurance to states that a federal solution 
may be found and potentially reducing the number of individual state 
actions. Many states are acting only because they do not see a federal 
action.
                               __________
Statement of Scott Slesinger, Vice President for Governmental Affairs, 
                  The Environmental Technology Council

    My name is Scott Slesinger. I am Vice-President for Governmental 
Affairs of the Environmental Technology Council. I want to thank the 
Committee for requesting for the views of our Council on the issue of 
electronic or e-waste. Our council represents environmental service 
companies that recycle hazardous materials including electronic wastes 
and solvents. We also represent hazardous waste facilities permitted 
under the Resource Conservation and Recovery Act.
    The volume of e-waste is growing, now comprising about 2 million 
tons a year. But this is a small percentage of the 236 million tons of 
waste that is disposed in our nation's sanitary landfills. The reason 
that e-waste is a problem is the composition of the waste--electronic 
wastes such as television screens, computer screens and cell phones 
contain toxic materials including mercury, cadmium and lead.

                          CHALLENGE OF E-WASTE

    Despite public statements to the contrary the amount of lead in a 
cathode ray tube (CRT) is not a ``trace amount.''\1\ Similar to the 
lead shielding used to protect dental patients during x-rays, the 
amount of lead in computer is significant. A CRT can easily contain 
over 10 pounds of lead; large televisions have significantly more. The 
lead is a critical component that protects the users from radiation 
emitting from the tube. Other parts of the computer use lead in solder. 
Without these toxic metals, disposal in a sanitary landfill would be a 
safe and available option. However, sanitary landfills contain mostly 
organic food and other biodegradable acetic waste. These facilities are 
not operated to protect the environment from the leaching of the volume 
and types of lead that would be placed in such facilities. Newer, flat 
panel monitors do not use leaded glass, but require another toxic 
chemical, mercury, to operate efficiently.
---------------------------------------------------------------------------
    \1\ Gattuso, Washington Post, June 19, 2005, page B8. Attachment B. 
Response published in Washington Post July 2, 2005 Page A27, Attachment 
A.
---------------------------------------------------------------------------
    If computers are hazardous toxic wastes under the law, why are they 
being disposed in non-hazardous waste landfills? When Congress passed 
the hazardous waste law, Congress exempted households and certain small 
quantity generators from the hazardous waste regulatory regime. The 
belief at the time was that the volume of toxic wastes from households 
and small generators would be minor and therefore would not be a threat 
to the environment.

                    RESPONSE TO THE E-WASTE PROBLEM

    When communities became aware of the volumes of lead being placed 
in their sanitary landfills, they grew concerned. Some communities 
passed laws to encourage recycling and alternative waste management 
activities. Some banned such waste from landfills; others supported e-
waste recycling.
    About a quarter of the states passed laws treating CRTs as 
universal wastes. The universal waste rules are clear and simple 
standards for managing widely distributed hazardous wastes where the 
full hazardous waste requirements would be overly burdensome. The 
intent of the universal waste rules is to get hazardous waste out of 
the sanitary waste stream but without the rigorous requirements 
protections intended for industrial process wastes at factories and 
similar facilities. Essentially, the universal waste rules are a 
middle-ground between the household and conditional exempt generator 
rules, which exempts waste from controls and the full RCRA Subtitle C 
hazardous waste rules. EPA has established universal waste rules for 
items such as mercury thermostats, spent lead-acid batteries, unused 
pesticides, mercury thermostats and fluorescent lamps. An EPA advisory 
group that included state, Federal, and environmental and industry 
representatives\2\ recommended to EPA that CRTs be added to the 
universal waste program to ensure responsible recycling. However, we 
have learned that instead of requiring universal waste protections, EPA 
plans to finalize regulations that essentially deregulate these wastes 
if sent to domestic recyclers. EPA's proposed exemption from RCRA for 
CRT glass, if followed by the states, would represent a regrettable 
rollback in environmental protection.
---------------------------------------------------------------------------
    \2\ The Common Sense Initiative (CSI) Council Computer and 
Electronics Sector Subcommittee 67 FR 40,515 col.1.
---------------------------------------------------------------------------
    The universal waste requirements that some states have in place for 
computers and CRTs provide for proper packaging, labeling, and tracking 
of shipments of CRTs sent and received to prevent illegal dumping and 
ensure legitimate recycling. The requirements also include notifying 
state regulatory officials of CRT waste management activities to allow 
necessary inspections and compliance. These requirements are 
appropriate and not unduly burdensome for companies engaged in the 
commercial collection, processing, and recycling of this type of 
hazardous waste. The practical and sensible approach is for EPA to 
apply universal waste standards to all CRT glass destined for recycling 
at the point of commercial collection. Other electronic waste, 
including computer hardware and cell phones should likewise be 
regulated under universal waste rules. The universal waste rules were 
promulgated for just this type of waste. Those who may argue that 
deregulation will lead to more recycling may be right. But such 
unregulated recycling will inevitably lead to improper recycling, 
taxpayer financed cleanups and public cynicism of recycling. These 
costs will dwarf the benefits of the possible chance of some increased 
recycling.
    The risks are not imaginary. At the State Hazardous Waste 
Conference in 2002, many state regulators described the recycling 
industry as a ``low-profit, risky business'' with high turnover rates 
and inadequate insurance. The state regulators cited cases where low 
cost recyclers were merely sham operations that collected wastes fees, 
with no intention of doing any recycling. Many of these facilities have 
since gone out of business leaving contaminated sites for state 
agencies to clean up. One example occurred in Phelps County, MO. 
According to media reports,\3\ The Missouri Department of Revenue found 
15,000 abandoned computer monitors. The DNR found someone was running a 
``computer recycling'' business out of a rented building on the 
property. The owner of the business reportedly told customers he would 
take the monitors and dispose of them properly. Instead, state 
investigators say the man took the monitors, the cash and left. Hot sun 
melted the plastic coverings and rain can cause the lead to run-off 
into the soil and groundwater. It cost Missouri taxpayers hundreds of 
thousands of dollars to clean up the mess. By proposing to exclude CRT 
glass recycling from RCRA and the universal waste rule, EPA would be 
aiding and abetting this problem.
---------------------------------------------------------------------------
    \3\ KOLR-TV, Springfield, MO. www.recycles.org/124226366.htm
---------------------------------------------------------------------------
    Despite EPA's approach, many generators of computer wastes want 
recyclers to have some ``Good Housekeeping'' seal of approval. EPA 
responded by establishing fairly good guidelines in the document Plug-
In to eCycling Guidelines for Materials Management. However, these 
Guidelines are only voluntary and their effectiveness as opposed to a 
promulgated universal waste standard is unconvincing.

                         ECONOMICS OF RECYCLING

    The key to e-waste recycling is economics. The first choice for the 
handling of e-waste, and the most economically viable alternative, is 
reuse of complete systems or individual components removed from the 
computer systems. Unfortunately, this alternative is not sufficient to 
accommodate the entire quantity of e-waste generated. Although donation 
programs are a means of providing technology to those that may not be 
able to afford it, there is a potential downside to this practice. If a 
company donates usable but outdated equipment to a school or program 
for low income individuals, the service life of that equipment is much 
shorter than that of new equipment. As such, the organization that 
could not afford to purchase new equipment is saddled with the cost of 
disposing the donated items when they cease operating. We know of one 
instance where a school received donated computer systems only to find 
that greater than 50 percent of the monitors received ceased operating 
within the first year.
    For those items which cannot be reused, the other alternative is to 
recycle e-waste. Recycling will pay for itself if the value of the 
commodities that can be harvested from the computer is greater than the 
cost associated with the labor and facilities necessary to safely 
separate the materials into recoverable assets. If the economics don't 
work, recycling can still occur if someone--the consumer, government, 
or manufacturers pays for the recycling. Today, recyclers cost to 
recycle computers has dropped as commodity prices and useable parts 
prices have increased.
    There are several variables that work against a vibrant domestic e-
waste recycling industry. The first is the availability of ``glass to 
glass'' recycling. As domestic manufacturers have moved operations 
overseas or discontinued the manufacture of CRT glass, the demand for 
leaded glass within the United States has dropped. When EPA proposed 
its CRT rule in June of 2002, the Agency determined that the value of 
leaded glass waste was $170 a ton. By January 2004, the value was minus 
$200. This economic reality created a situation where leaded glass was 
cheaper to dispose than to recycle. It also undermined EPA's rationale 
in its proposed CRT rule that defined broken leaded glass as 
``commodity'' because of its value. There is now a strong demand for 
CRT glass in Brazil and China for use in computers and televisions in 
those countries. However, the ultimate disposal of those CRTs after 
their second life is unlikely to be protective of the environment. A 
related factor is the price of metals on the commodities market. Most 
commodities do not go up with inflation as we see with the price of 
real estate or beer. Instead prices fluctuate wildly based on worldwide 
demand. When prices are high, inevitably there is more mining, 
recycling and use of alternatives followed by over-supply and price 
declines. The price of lead has fluctuated dramatically over the years. 
(Attachment C) Therefore any subsidy system should be flexible to 
accommodate the fluctuating prices of the metals and re-usable parts of 
e-waste.
    Another factor is the cost of the recycling activity. It is 
difficult for e-waste recyclers located in the United States to compete 
with other low cost foreign recyclers. Because the recycling of e-waste 
is so labor intensive, the low wages and lack of benefits paid in some 
foreign countries provide these recyclers with disproportionately lower 
processing cost. Processing costs are not just limited to labor costs 
but also include the costs associated with environmental compliance and 
providing for worker safety. Many of these recyclers are located in 
countries that do not have the same level of standards that exist 
within the United States. The Basel Action Network report on China 
highlights the problems that exist. To address the labor costs, a few 
states have turned to prison labor; however this has been controversial 
due to questions concerning worker protection and other health and 
safety standards.
    Many of our customers send computers to us for handling because our 
companies are heavily regulated. They know by our reputation and 
regular audits that we are in compliance with RCRA and state laws. For 
instance, we must track our waste, train our employees, prepare spill 
prevention plans and hold environmental insurance and closure 
insurance. Under the EPA proposed CRT rule, our competitors would not 
need to meet any of those requirements. Those companies would be 
subject to RCRA if they spilled hazardous waste on the ground but it is 
hard to imagine how that would be known. It would be difficult, if not 
impossible, for regulated entities to compete in such a system.
    Our companies also have policies in place which mandate appropriate 
due diligence is exercised in selecting proper facilities for the 
recycling or disposal of materials derived from e-waste, regardless of 
whether the company is located domestically or abroad. These customers 
want to be assured that the wastes will actually be recycled properly 
and that the wastes from the recycling process, if any, are handled 
safely and consistent with the law.
    Today, with commodities prices high, there have been many new 
businesses trying to make profits out of e-waste. When the price of the 
valuable components inevitably turns, these unregulated recyclers may 
fail and leave the taxpayer to clean up the toxic remains. We believe 
that whatever legal regime is established for recycling the rules 
should require financial assurance for closure, environmental liability 
insurance, employee training and some minimal waste tracking so 
consumers can be assured their discarded computers are managed 
properly.
    The Wyden-Talent bill, which we endorse, includes standards for e-
waste recyclers. With protections and economic incentives, we believe 
e-waste recycling can expand and be a significant part of the 
manufacturing life cycle. Mr. Chairman, the goal should not simply be 
to increase recycling. The goal should be responsible recycling that 
conserves sources, saves energy and enhances the environment.
    Thank you and I look forward to answering any questions you may 
have.

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[GRAPHIC] [TIFF OMITTED] T7447.022

       Responses by Scott Slesinger to Additional Questions from 
                            Senator Jeffords
    Question 1. Mr. Slesinger, you testified that lead and other 
hazardous substances of concern present in many used electronic 
products may pose an environmental risk during recycling or disposal if 
not properly managed. To your knowledge, is EPA conducting any 
inspections in this area or monitoring the proper handling of 
electronic waste?
    Response. Unlike in the European Union, Canada and Japan, EPA does 
not regulate most recycling, even when the recyclers are handling 
hazardous materials. Only companies that recycle hazardous wastes and 
have permits for storage may be subject to inspections by EPA or a 
state agency. To the best of my knowledge, EPA is not conducting any 
inspections or monitoring activities with respect to the proper 
handling of electronic wastes that are recycled.
    Under our environmental laws, states are often allowed to be more 
protective than the federal government. States such as California, 
Maine and Washington do regularly inspect recyclers of computers and 
other hazardous discarded materials.

    Question 2.If the recycling of electronic waste were profitable, 
more businesses would be doing it and waste disposal would not be as 
big a problem. In your opinion, what are the economic barriers to 
making recycling of electronic waste economically viable?
    Response. Generally, it costs more to recycle than dispose of 
electronic wastes. Unless companies and homeowners with old computers 
are willing to pay to have them recycled, an industry will not exist to 
serve a need not in demand. The value that can be mined from most 
discarded computers is almost always less than the cost of collection, 
handling, and separation. This is not surprising. Although computers 
are manufactured using some valuable metals, computers are highly 
value-added products. A silicon disk may have raw materials that cost 
$5 but the expertise used to produce such technology makes the price of 
the chip hundreds of dollars. If the price of gold or lead doubles or 
drops in half, it will have little practical effect on the cost of the 
computer and only a minor impact on the economics of recycling.
    The economics of recycling are not unique to e-waste. For instance, 
take the case of paper recycling. If the price of collection, 
separation and de-inking newsprint is more expensive than the cost of 
virgin paper, recycled paper will not be economically viable unless it 
is subsidized.
    Therefore, the top of the waste management pyramid, reuse, is the 
key to economic computer recycling. If the components of a discarded 
computer, such as the hard disk, are still marketable, then it is more 
likely that the computer can be recycled profitably.
    Since the value of the harvestable raw materials in a computer is 
limited, the other variable is the cost of separation and handling. If 
computers were manufactured with reuse and disposal in mind, then the 
cost of separation and handling could be reduced. The European Union is 
banning certain toxic metals from computers and requiring manufacturer 
take-back of obsolete computers. These laws will encourage changes in 
how computers are constructed so they will be easier to recycle or 
dispose. The economics are not likely to change. Fees, tax incentives, 
manufacturer subsidies are likely to be needed to create the economic 
incentives to recycle computers.
    There are two alternatives when recycling is not economically 
viable. One is disposal in a municipal landfill that is allowed because 
of the household waste exemption. Some municipalities are enacting 
local laws that prohibit such disposal, however. The other alternative 
is disposal in a hazardous waste landfill that is built and operated so 
that toxic metals do not leach into the environment. The second option 
is the preferable environmental option if recycling of e-waste is not 
subsidized.

    Question 3. What are the consequences for your industry if Congress 
fails to enact national electronic waste legislation?
    Response. There will continue to be a patchwork of state 
requirements that will include different funding mechanisms, different 
administrative requirements, different standards that will be 
disruptive to industry. Even today, one of the problems without a 
national approach can be seen in California, where recyclers are 
required to prove that the computers have not been shipped from other 
states. A national program that standardizes the collection, handling, 
and recycling system would be much more efficient.
    Historically, RCRA has encouraged a state-by-state approach by 
allowing states to be more protective than the federal rules. This 
allows states to experiment with different strategies to protect the 
environment, especially when EPA is gridlocked. For instance, some 
communities have taken positive steps to remove e-waste from their 
municipal wastes stream. However, this type of balkanization is 
wasteful and discourages addressing problems that are national in 
scope.

    Question 4. Mr. Slesinger, what are the advantages of regulating 
the management of electronic waste under the Universal Waste Rule 
compared to no regulation of electronic waste at all?
    Response. The Universal Waste Rule for electronic wastes would 
enhance environmental protection, avoid the creation of new remediation 
sites, and encourage the development a sophisticated e-waste recycling 
industry that is required to comply with world-class environmental 
standards.
    Today the e-waste recycling industry is still immature. It is 
critical that EPA adopt a regulatory approach that both encourages 
responsible recycling and safeguards the environment. ETC member 
companies have already moved to the forefront of this new industry by 
establishing the necessary collection networks, processing capacity, 
and recycling facilities in many states. In doing so, the ETC companies 
have worked with the states to ensure that necessary safeguards are 
met, including employee training, tracking of shipments, secure 
handling, and legitimate recycling.
    We are concerned that EPA's proposed rule that would not regulate 
CRTs as universal waste will be the death knell for this new industry. 
Instead of standards to ensure safe and responsible recycling of lead-
contaminated CRT glass, EPA has proposed a rule that essentially allows 
anybody with a hammer and cardboard box to be an exempt ``recycler.'' 
In doing so, EPA is not only cutting off responsible companies at the 
knees, but it is also inevitably exposing the public to lead 
contamination from haphazard CRT recycling.
    Lead is a potent developmental neurotoxicant, and is especially 
harmful to children. Thus, CRTs can be hazardous and should be 
carefully managed by responsible companies according to necessary 
regulatory standards. For this reason, many states currently regulate 
CRT glass that is sent to a dismantler or recycler as either a RCRA 
hazardous waste or a universal waste.
    Under EPA's CRT proposed rule, new intact CRTs and new broken CRTs 
sent for recycling would not be regulated in any way. Used intact CRTs 
would have an unconditional exclusion unless they are disposed. Used 
broken CRTs would have a conditional exclusion, provided minimum 
requirements such as packaging and labeling are met. Household CRTs, 
even when collected and stored in bulk for recycling by commercial 
firms, would not be subject even to the conditional standards. 
Processed glass from used CRTs sent for recycling would be subject to 
speculative accumulation limits. There would be no limits on 
speculative accumulation applied to new intact or new broken CRTs or 
used intact CRTs, but used broken CRTs would have speculative 
accumulation requirements.
    In the real world, commercial firms and state regulators will never 
be able to accurately keep track of whether CRTs collected for 
recycling are new, used, household, commercial, broken or intact (at 
least when initially picked up). Moreover, these various 
classifications are irrelevant to proper management and recycling of 
CRT glass. A state inspector at a collection or processing facility 
would never be able to determine whether CRT glass is subject to even 
the minimal standards of the conditional exclusion or is totally exempt 
from any standards depending on its pedigree. Sham recyclers will have 
a field day claiming that the CRTs piled high in their rented buildings 
and leadleaching glass scattered around the property are all 
completely exempt from Federal waste management standards. Most 
importantly, commercial firms that are legitimately in the business of 
hazardous materials recycling, and that are willing to make the 
investment in proper management in accordance with generally-applicable 
standards, will simply be forced to abandon CRT glass recycling rather 
than compete with unregulated recyclers.
    The practical and sensible approach is for EPA to apply the 
universal waste standards to all CRT glass destined for recycling at 
the point of commercial collection. The universal waste rule was 
promulgated for just this type of material. CRT leaded glass destined 
for recycling is just as much a waste material as spent lead-acid 
batteries, unused pesticides, mercury thermostats and lamps, all of 
which are subject to the universal waste standards. The CRT itself is a 
commodity; the leaded glass from a dismantled CRT is clearly a waste. 
Importantly, CRT glass is a waste material that poses a hazard because 
of its high leachable lead content that warrants universal waste 
stewardship.
    The universal waste rule applied to recyclable CRT glass would 
include requirements for employee training and release response that 
are necessary to ensure that the glass is collected, stored, and 
managed in all respects to prevent the leaching of lead into the 
environment. The universal waste requirements would also provide for 
proper packaging, labeling, and tracking of shipments of CRTs sent and 
received to prevent illegal dumping and ensure legitimate recycling. 
Most importantly, the universal waste rule would apply accumulation 
time limits to CRT glass to prevent speculative accumulation by sham 
recyclers with no intent to legitimately recycle. The requirements 
would also include notification to EPA and state regulatory officials 
of CRT waste management activities to allow necessary inspections and 
compliance. These requirements are appropriate and not unduly 
burdensome for companies engaged in the commercial collection, 
processing, and recycling of this hazardous waste.

    Question 5. Mr. Slesinger, EPA has suggested that disposal of 
electronic waste in municipal landfills may not present an 
environmental risk, even though electronic waste fails the Agency's 
toxicity test. Do you agree?
    Response. EPA's suggestion is not based on any reputable research. 
It is nothing more than speculation, and it is belied by the fact that 
many electronic wastes, such as CRTs, flunk the Agency's fundamental 
test for hazardous characteristics. The toxicity test was developed to 
predict what will happen if a waste is disposed in a municipal 
landfill. EPA's ``suggestion'' hints at solving the e-waste problem by 
pretending it does not exist. It also moves in the opposite direction 
as the rest of the developed world.
    Please refer to the response to Senator Boxer Question No. 3 for a 
discussion of the critical differences of disposal in a municipal 
landfill and a hazardous landfill.
                                 ______
                                 
Responses by Scott Slesinger to Additional Questions from Senator Boxer

    Question 1. Your testimony referred to an EPA's proposed rule that 
would exempt some cathode ray tubes from hazardous waste regulations. 
What is the main danger if this rule is implemented as proposed?
    Response. The proposed rule would exempt all cathode ray tubes that 
are sent for recycling from regulation under the hazardous waste rules. 
The danger is that some companies, without the requirement for 
financial assurance, training of employees, and tracking of wastes, 
will mismanaged these toxic wastes causing releases and contaminated 
sites. Because recyclers will not have financial assurance for cleanup, 
the taxpayers will undoubtedly be required to pay the cost of 
remediation.
    By encouraging cheap, unregulated recycling, the commercial waste 
management industry, with significantly higher costs of environmental 
compliance, will not be able to compete.
    Please refer to the detailed response to Senator Jeffords Question 
No. 4 that details the risks of the EPA proposal.

    Question 2. And, in you're your opinion, would public health be 
better protected if cathode ray tubes are regulated as hazardous waste?
    Response. Rather than require the full panoply of RCRA 
requirements, we suggest that CRTs, like mercury thermostats and 
fluorescent tubes, be managed as universal waste. This would make it 
easier for the generators to get CRTs disposed or recycled without the 
full RCRA requirements, but require recyclers to meet some minimal 
requirements such as financial assurance for closure, employee training 
and waste tracking.
    Please refer to the more detailed answer to Senator Jeffords 
Question No. 4.

    Question 3. EPA acknowledges that cathode ray tubes can leach four 
times the amount of lead as regulated hazardous waste. Electronic waste 
can also contain mercury, cadmium and other toxic substances. However, 
EPA has left open the possibility that municipal landfill standards are 
sufficiently protective to hold electronic waste.
    In your opinion, do EPA's municipal landfill standards protect 
groundwater or other environmental values from toxic chemicals in 
electronic products?
    Response. No, municipal landfills do not adequately protect 
groundwater from toxic chemicals in electronic products. Municipal 
landfills and hazardous waste landfills are operated very differently. 
First, under RCRA rules, the employees at hazardous waste sites are 
trained to safely handle toxic materials and are properly equipped to 
protect themselves from possible contamination. Second, in a hazardous 
waste landfill e-wastes are treated to prevent the toxic contaminants 
from leaching out by being coated with an impermeable substance that 
hardens and covers all exposed sides of the e-waste. This leach-
resistant encapsulated waste is then placed in the landfill cell where 
it will not be disturbed. As with all waste in hazardous waste 
landfills, each specific waste load is mapped so that if there is a 
problem the waste can be dug up and properly handled. All leachate from 
hazardous waste landfills is collected and also managed as hazardous 
waste. All shipments to the landfill are on trucks that are specially 
permitted to carry hazardous waste. Hazardous waste landfills are not 
allowed to take organic wastes. Organic wastes, such as paints, 
cleaning products, and household pesticides, are not allowed in 
hazardous waste landfills because they could promote leaching.
    Municipal landfills are operated differently. First, the wastes are 
much more heterogeneous including acids and liquids from regular trash. 
Second, because of the household exemption, municipal solid waste 
landfills are allowed to take e-wastes and other hazardous waste. The 
toxic e-waste and other garbage are not treated, stabilized or 
encapsulated. Unlike hazardous waste landfills, the wastes are 
commingled, crushed in the truck and mixed with the other garbage. 
Because of daily cover, e-wastes such as CRTs are likely to be 
repeatedly bulldozed and broken, leading to more surface area of the 
leaded glass being exposed causing more leaching. There is no way to 
know where the particular hazardous wastes are buried as all the wastes 
are commingled. With the acids and different bio-degradables in the 
garbage, and the lack of encapsulation treatment, the likelihood of 
lead leaching is significantly higher than in a hazardous waste 
landfill. Despite this, the leachate collected from an MSW landfill is 
not considered a hazardous waste. Although municipal and hazardous 
waste landfills may be constructed with similar attributes, the 
operation of hazardous waste landfills makes them more protective of 
the environment for disposing of toxic wastes.

    Question 4. The companies that you represent are among the most 
heavily regulated entities that handle hazardous waste in the United 
States. Please describe the environmental and public health benefits of 
going to a hazardous waste landfill versus a municipal landfill.
    Response. Certain types of hazardous waste, such as toxic metal-
bearing wastes, should be disposed in hazardous waste landfills. As my 
answer to your previous question indicates, hazardous waste landfills 
are built and operated so these substances do not leach into the 
environment. Our Nation uses many toxic chemicals that are a necessary 
part of the standard of living we enjoy today. With hazardous waste 
landfills, the toxic wastes of society are intended to remain safely 
within the landfill indefinitely. In many cases, states now require our 
companies to establish perpetual funds to monitor the landfill and 
provide the states with a source of funds if toxic wastes ever escape 
from the landfill. These specialized facilities cost more to operate 
and use, but the increase in environmental protection versus disposal 
in a municipal landfill is substantial and worth the investment.

    Question 5. A company that you represent, Onyx Environmental 
Services, was recently approved as a ``collector'' and ``recycler'' 
under California's recycling law.
    How many facilities does Onyx have in California and what types of 
recycling services does it offer? Is Onyx generally happy with 
California's recycling program?
    Response. Onyx has a total of 10 facilities located throughout 
California. These include a waste-to-energy facility (Montenay Power), 
several 10-day transfer facilities, service centers and Industrial 
Service Groups. A facility in Azusa recycles the E-waste under SB50 
within the State of California. In addition, this location recycles/
reclaims thinners, solvents, mercury compounds, laboratory chemicals 
and other types of acids and caustics.
    Overall, Onyx has been pleased with the California recycling law 
(SB50). While payments to some of the recyclers have been delayed, it 
is often due to deficiencies in the paperwork process. I believe it to 
be very important that the State continue to require detailed paperwork 
since the real opportunity for recyclers to import covered electronics 
from out of State generators will continue to tempt those recyclers not 
committed to ethical standards. With that said California is leading 
the way and influencing change in other parts of the Country which 
inevitably will have far reaching effects in diverting E-waste from 
landfills.
                                 ______
                                 
      Response by Scott Slesinger to an Additional Question from 
                           Senator Lautenberg

    Question. Mr. Slesinger, you probably heard my question to Mr. 
Dunne about whether EPA would issue a ``universal waste rule'' for the 
leaded glass in computers, in order to control this highly toxic heavy 
metal. Would you like to respond to his comments?
    Response. EPA has proposed not to regulate CRTs under the universal 
waste rule. Mr. Dunne did not indicate whether the Agency would follow 
that proposal in the final rulemaking or follow the comments of many 
states and our Council to regulate leaded CRTs as universal wastes. As 
I indicated in the response to the question above (Senator Jeffords 
Question No. 4), we believe that the arguments made by EPA in the 
proposal were seriously flawed. For instance, EPA considered leaded 
glass, broken or not, to be a commodity because the glass had a 
positive value and generators would therefore be careful and 
protective. However, the value of leaded glass is now about zero. This 
calls into question the entire theory of assuming that generators will 
be careful with the glass when it has no value. Second, I believe the 
interest of encouraging an e-waste recycling industry that would be 
protective of the environment would be undermined if the Agency 
deregulated this waste instead of requiring basic environmental 
standards for its proper handling.
                               __________
     Statement of Richard Goss, Director of Environmental Affairs, 
                     Electronic Industries Alliance

                              INTRODUCTION

    Thank you Chairman Thune, Senator Boxer and members of the 
Subcommittee. My name is Richard Goss, and I am the Director of 
Environmental Affairs for the Electronic Industries Alliance (EIA). EIA 
is the leading advocate for the $400 billion U.S. high-tech and 
electronics industries. Our 1,300 member companies provide products and 
services ranging from microscopic electronic components to state-of-
the-art defense, space and industry high-tech systems, as well as the 
full range of telecommunications, information technology and consumer 
electronics products.
    EIA appreciates the opportunity to provide the views of our 
membership concerning the end-of-life management of our products. We 
commend the Subcommittee for holding this hearing and advancing the 
dialogue on this important issue. We would also like to thank Senators 
Wyden and Talent for their efforts and leadership in this area.

                          INDUSTRY COMMITMENT

    EIA and our member companies support the safe and appropriate 
recycling of used electronics products to help meet the important 
environmental goal of increasing resource conservation and recovery. As 
manufacturers, we recognize that we are a key partner in the process, 
and we will continue to work with Congress, federal agencies, the 
states and involved stakeholders to address this challenge.
    The ongoing commitment of our member companies to product 
stewardship, environmental design and recycling can best be 
demonstrated by listing some of our industry's concrete achievements:
     Through a combination of direct corporate efforts and 
innovative partnerships--including U.S. EPA's Plug-in to eCycling 
campaign--EIA member companies have been involved in the proper 
recovery and management of well over one million tons of used 
electronics products. In addition, EIA member companies use significant 
quantities of recycled materials, including glass, metals and plastics, 
in new generations of their products.
     EIA member companies are on target to be in compliance 
with the European Union Directive on the Restriction of Hazardous 
Substances (the RoHS Directive), which will take effect on July 1, 
2006. Since electronics products are manufactured for global sale and 
distribution, U.S. consumers will have broad access to products that 
comply with the new EU requirements.
     As a result of our members' long-standing dedication to 
product stewardship and technological innovation, the electronics 
industry continues to achieve significant and sustained environmental 
progress throughout the entire product lifecycle: from design, through 
beneficial use, to end-of-life. On the whole, every year our products 
become more energy efficient, use fewer materials of potential 
environmental concern, and become easier to upgrade, disassemble and 
recycle.
    EIA is currently compiling a record of member-company achievements 
in the areas of product stewardship and design for the environment, and 
we will be happy to share this document with the Subcommittee once it 
is completed.
    In summary, we support electronics recycling as a way to conserve 
and reclaim resources. However, this is a complex challenge that will 
require the coordinated efforts of all the key stakeholders to resolve.

                      GENERAL RECOMMENDED APPROACH

    Given the complex nature of the challenge, EIA supports efforts to 
establish a viable recycling infrastructure in which all the major 
stakeholders--manufacturers, government, retailers, nongovernmental 
organizations (NGOs) and recyclers--participate based on their unique 
expertise and capabilities. The combined goal of these institutional 
stakeholders should be to develop a recycling infrastructure that is 
convenient for the residential consumer. Implementing a system based on 
principles of shared responsibility will increase the efficient 
collection of electronics and ensure economies of scale by taking 
advantage of existing infrastructure. EIA supports equitable, flexible 
and cost-efficient solutions that encourage the proper management of 
used electronics while limiting additional costs to the public for 
these popular products.

                        ENVIRONMENTAL DISCUSSION

    EIA believes it is essential to consider the science related to 
electronics products as part of any public policy discussion regarding 
recycling. Certain compounds are present in electronics products, such 
as lead and mercury, that provide clear safety, performance and energy 
efficiency benefits. These compounds should be appropriately managed at 
the end of life. U.S. EPA shares this view, and has consistently stated 
that used electronics products, when properly managed, do not represent 
a human health or environmental concern. The agency considers 
electronics recycling as fundamentally a solid waste management and 
resource conservation issue. Likewise, our member companies recognize 
that reusing and recycling electronics at the end of life is the most 
environmentally preferable option, and we support reasonable efforts to 
develop the recycling infrastructure.

                         SUGGESTED FEDERAL ROLE

    As you know, three states have already enacted three very disparate 
statutes which address electronics recycling. Numerous other states, 
and even some localities, have either developed special regulations for 
the handling of used electronics, or are actively considering their own 
electronics recycling legislation. These approaches often include 
significant variations in terms of financing mechanisms, the scope of 
covered products, the roles and responsibilities of key participants, 
and the overall regulatory structure.
    Industry and other stakeholders are rightfully concerned that a 
potential confusion of state recycling laws and regulations will prove 
costly, inefficient and perplexing. There is clearly a role for the 
federal government to play in bringing national consistency to this 
emerging field.
    Federal action can help promote safe and environmentally sound 
recycling by creating a streamlined and uniform regulatory framework 
that removes artificial barriers and instead encourages the free flow 
of used products for proper management. Specific steps include:
     Establishing consistent regulatory definitions of key 
terms, and strictly defining the scope of covered products through the 
application of fixed criteria;
     Considering the establishment of a flexible third party 
organization that can help with roles such as data reporting, 
compliance, and financing;
     Ensuring broad consistency in labeling, product 
information, and regulatory reporting requirements; and,
     Assessing whether additional recycling regulations or 
standards are necessary to ensure the safe and environmentally sound 
management of used electronics.
    EIA and our member companies stand ready to work with the 
Subcommittee on these and other initiatives. Thank you again for the 
opportunity to share industry's position on this important issue. I 
would be pleased to respond to any questions.
                                 ______
                                 
 Response by Richard Goss to an Additional Question from Senator Inhofe

    Question Mr. Goss, I understand that the electronics industry would 
prefer the federal government to offer a national waste and recycling 
program because it is fearful of a patchwork of state requirements. 
Could you explain some of the market competitiveness issues that have 
prevented the EIA from advancing a consensus position?
    Response. First, it is important to note that our industry has 
successfully reached agreement on most of the primary elements of an 
electronics recycling approach. These elements include the following:
     National consistency in electronics recycling--
particularly a streamlined and uniform regulatory framework--will 
encourage the appropriate and efficient management of used products.
     A viable recycling infrastructure will require that all 
the major stakeholders--manufacturers, government, retailers, non-
governmental organizations and recyclers--coordinate efforts and share 
responsibility.
    While used products can and should be appropriately managed at the 
end of life, electronics recycling is fundamentally a solid waste 
management and resource conservation issue.
    Any recycling approach should begin with a limited and defined 
scope of products, rather than attempting to cover all electronics 
products at once.
    Since the EIA member companies manufacture products for global sale 
and distribution, an approach should seek to harmonize any labeling, 
product information, and regulatory reporting requirements.
    Regulations or standards for recyclers are important in order to 
ensure the safe and environmentally sound management of used 
electronics.
    The one area where our members have yet to reach consensus is on a 
preferred approach for financing an electronics recycling 
infrastructure. Over the past months and years, EIA and our member 
companies have worked diligently to try and achieve a common position 
on funding. The difficulty that our industry faces in reaching 
consensus is directly related to the quantity and diversity of 
manufacturers, and to the intense competition in the marketplace. The 
primary products contemplated under most electronics recycling 
approaches--computers and televisions--are increasingly treated by the 
market as commodities. Since margins are thin and producers depend on 
volume sales, any shift in the competitive playing field can have a 
direct and immediate impact on market share and the bottom line.
    The EIA member companies, which include all the global brand-name 
manufacturers of these products, hold divergent views on financing 
based in large part on their particular business models and corporate 
strategies. Specific factors include but are not limited to:
     Company size
     Number and types of product lines, and the comparative 
life-spans of their products
     Sales and distribution methods (i.e., traditional 
distribution and retail channels versus direct-to-consumer sales)
     Experiences and capabilities related to recycling
     Relative market share (i.e., current market share as 
compared to historical market share; business sales as compared to 
household sales)
    Given this diversity of business models and capabilities, any 
particular funding approach may result in a competitive imbalance in 
this extremely competitive industry. Consequently, several of our 
member companies support an advanced recycling fee, Hewlett-Packard in 
particular supports producer responsibility, and other companies 
promote market-driven initiatives as a way to resolve the challenge.
    The competitive issues are keen enough just between the EIA member 
companies. However, concerns over fair competition are significantly 
heightened due to the presence in the market of numerous small 
producers and/or no-name manufacturers that cannot necessarily be 
compelled to participate in a recycling program. These manufacturers 
fall predominantly into one of two groups: (1) small foreign producers 
that sell mostly low-end units into U.S. markets; and (2) the so-called 
``white box'' manufacturers that produce and sell generic computers at 
retail or remotely via catalogs or the internet. While individual 
manufacturers in these categories are usually small, they nonetheless 
collectively represent a noteworthy segment of the market.
    EIA member companies comply with existing state requirements, and 
will certainly step up and participate in any broader national system. 
The same cannot be said of ``fly-by-night'' companies that often 
frequently change brand names, or the white-box manufacturers that sell 
remotely. There are already serious concerns over whether states can 
effectively compel these manufacturers to play by the rules. For 
instance, the California Board of Equalization issued an opinion that 
it cannot impose a fee collection obligation on out-of-state retailers 
that have no physical presence in the state. While the state of Maine 
does not implement its recycling program until 2006, EIA members 
already have significant doubts over whether state officials can take 
effective enforcement actions against small foreign producers or white-
box manufacturers to pay their fair share of recycling costs.
    In addition, there are also concerns over how a given financing 
approach will apportion responsibility for orphan products--those 
products coming back into the recycling system that were manufactured 
by companies that have since gone out of business and have no successor 
in interest.
    In summary, different business models, recycling capabilities and 
concerns over newer and non-traditional market entrants have resulted 
in differing opinions over financing. EIA and our members are 
continuing to ongoing commitment and concerted efforts.
                                 ______
                                 
Responses by Richard Goss to Additional Questions from Senator Jeffords

    Question 1. Mr. Goss, I understand that a European Union directive 
requires manufacturers to design electronics with less toxic materials. 
Are there similar incentives to encourage electronics manufacturers to 
design their products to promote easy reuse and recycling?
    Response. The competitive marketplace continues to be the primary 
driver behind improvements in product design, efficiency and 
performance. The electronics industry continues to achieve significant 
and sustained environmental progress throughout the entire product 
lifecycle: from design, through beneficial use, to end-of-life. In 
fact, many of our companies have long-standing design-for-environment 
or product stewardship programs that pre-date the adoption of the 
European Union Directive on the Restriction of Hazardous Substances 
(the RoHS Directive) by several years. On the whole, every year our 
products become more energy efficient, use fewer materials of potential 
environmental concern, and become easier to upgrade, disassemble and 
recycle. This process of continuous evolution--driven by market demand 
and competition--can be readily observed by comparing today's products 
to similar products that were manufactured just a few years ago.
    Given the intense competition in the consumer electronics 
marketplace, any manufacturing efficiencies that a company achieves can 
result in increased output while simultaneously decreasing per-unit 
production costs. These market-driven innovations on the production 
side directly translate into benefits for reuse and recycling. Please 
consider the following examples:
    1. Manufacturers have a clear incentive to streamline and simplify 
product assembly by, for instance, using fewer screws and connectors. 
Not only does this improve production efficiency, but it makes these 
products easier to service during their useful lives. It also makes 
these products easier to upgrade, disassemble and recycle at the end of 
life.
    2. To achieve valuable economies of scale, manufacturers are 
increasingly purchasing larger volumes of a single plastic, instead of 
smaller amounts of different plastics. The use of a uniform type of 
plastic makes these products easier and less expensive to recycle at 
the end of life.
    3. Larger and heavier products cost more to transport. Accordingly, 
our companies strive to use lighter-weight materials as they become 
available in order to control transportation costs for distribution and 
sale. To achieve production efficiencies and meet market demand, our 
members are also constantly innovating to create smaller products 
without sacrificing functionality or performance. Since transportation 
costs represent one of the single largest expenses associated with 
recycling, these ongoing innovations directly result in products that 
are less expensive to recycle.
    4. Metals and certain other compounds are present in electronics 
products because of their important safety, performance or energy 
efficiency characteristics. However using these materials can add costs 
to the manufacturing process, as companies may need to implement 
additional measures to ensure proper management. As technically and 
economically viable substitutes become available, EIA member companies 
have worked to reduce or eliminate the uses of these compounds. These 
efforts also facilitate the recycling of electronics products.
    In addition, EIA member companies have gained invaluable knowledge 
by recovering products themselves and by working with independent 
recyclers. Understanding the requirements for recycling also helps 
manufacturers factor in end of life management considerations into the 
design of new products.
    Many government and other institutional purchasers already include 
environmental requirements for electronics products in their 
procurement contracts. These approaches offer market incentives to 
those companies that can satisfy the contract specifications. EIA and 
our member companies are also cooperating with U.S. EPA, state 
governments, private entities and non-governmental organizations to 
standardize a list of environmental criteria that governments and other 
large institutional purchasers can specify when buying information 
technology equipment. This initiative, known as the Electronic Product 
Environmental Assessment Tool (EPEAT), will provide a market reward to 
those companies that reduce the environmental footprint of their 
products throughout the entire life cycle.
    Finally, there are international standards for electronics products 
already in place or currently under consideration that focus on 
environmental design and recycling. Due to the global nature of the 
electronics manufacturing and distribution chain, international 
standards will be reflected in our companies' products sold in the 
United States. These standards will also help drive improvements in 
reuse and recycling.

    Question 2. If the recycling of electronic waste were profitable, 
more businesses would be doing it and waste disposal would not be as 
big a problem. In your opinion, what are the economic barriers to 
making recycling of electronic waste economically viable?
    Response. The key economic barrier to establishing a viable and 
self-sufficient recycling infrastructure is that the overall costs of 
recycling exceed the value of the resulting commodities (primarily 
glass, plastic and metals). Recycling thus represents a significant and 
absolute cost, leading inevitably to differing stakeholder perspectives 
over how it should be funded and by whom.
    The three major elements of an electronics recycling system are 
collection, transportation and the actual disassembly and recycling. 
The physical collection of used electronics represents arguably the 
biggest single economic barrier to recycling. Televisions are 
ubiquitous in American households, and personal computers are now 
nearly as prevalent. With hundreds of millions of these products spread 
out across urban, suburban and rural areas, collection becomes an 
enormous and costly logistical challenge.
    The vast majority of electronics products are sold through 
traditional distribution and retail channels. In general, manufacturers 
sell products in bulk to distributors, who sell them to retailers who 
in turn sell them to consumers. These products then have years of 
useful life, and are often re-sold, given to friends or family members, 
or donated to charities. In most cases, manufacturers do not have a 
direct relationship with the end user at the time of initial sale, let 
alone years later when the product is ready to be placed into the 
recycling stream.
    As a consequence, EIA and our member companies believe that an 
electronics recycling system should take advantage of the existing 
infrastructure rather than attempting to create a separate and costly 
system to collect used electronics products. This existing 
infrastructure includes municipal waste collection systems and reverse 
distribution systems that rely on established product distribution and 
retail channels.
    Transportation costs are another major economic barrier to 
establishing a self-sufficient recycling infrastructure. As noted 
above, previous generations of products--particularly cathode ray tubes 
(CRTs)--are larger and heavier than contemporary devices. Loading and 
transporting large volumes of electronics long distances to centralized 
recycling facilities is costly in terms of time, labor and overhead, 
especially given the marked rise in fuel prices. Mailing back larger 
and heavier devices can be cost prohibitive. While these costs are not 
fixed--they would likely decrease if there were more recycling 
facilities--they can only be controlled so much and will remain a 
significant expense.
    The labor and overhead costs to conduct the actual recycling are 
also significant, and the commodities generated often suffer from low 
prices and a lack of consistent market demand. For example, as 
manufacturers continue to move away from CRTs to alternate display 
technologies--i.e., LCD screens, plasma screens, digital light 
processing technology--the supply of processed CRT glass has 
outstripped demand. Also, since most electronics products destined for 
U.S. markets are manufactured overseas, the recycled commodities must 
often be transported thousands of miles to be used in the next 
generation of products.
    In addition to the economic barriers, there are also regulatory 
obstacles that serve to artificially increase the costs of recycling. 
For example, the patchwork of state regulations on transport of certain 
electronic products aggravates the economic situation. As discussed in 
our testimony to the Subcommittee, one step to consider is the creation 
of a streamlined and nationally uniform regulatory framework for 
electronic products destined for recycling. This includes adoption of 
the proposed rule that allows for the movement of CRTs sent for proper 
recycling.

    Question 3. What are the consequences for your industry if Congress 
fails to enact national electronic waste legislation?
    Response. Absent a consistent national approach to electronics 
recycling, manufacturers, retailers and recyclers will be confronted by 
an expensive, inefficient and unworkable confusion of state laws and 
regulations. Such a patchwork of approaches will impact interstate 
commerce and may be a barrier to certain companies participating in the 
markets of some smaller states. If this state-by-state pattern is 
allowed to continue, it will impose an enormous administrative and 
logistical burden on the system that will ultimately result in 
increased prices to consumers for new products. As detailed above, EIA 
member companies are already facing competition that is unprecedented 
in this industry. Federal action should strive to keep costs to 
consumers as low as possible, create a level playing field for market 
participants, and ensure that the products are being recycled in an 
environmentally sound manner.
                                 ______
                                 
 Response by Richard Goss to an Additional Question from Senator Boxer

    Question. Ensuring a large amount of electronic waste for recycling 
can reduce the costs of recycling as more waste is fed into the system. 
What steps are your member companies taking to promote this type of 
economy of scale in recyclable material?
    Response. EIA member companies have been involved in the proper 
recovery and management of well over one million tons--greater than two 
billion pounds--of used electronics products. Our companies are 
involved in a variety of efforts to increase the collection and 
recycling of used products. These efforts include: implementing 
individual recovery, refurbishment and recycling programs; 
participating in recycling partnerships with U.S. EPA, state and local 
governments, retailers, recyclers and charities; and sponsoring 
collection events and grants. We are also leading efforts to raise 
public awareness of the importance and benefits of recycling. In 
addition, our member companies use significant quantities of recycled 
materials, including glass, metals and plastics, in new generations of 
their products, thus creating demand that helps sustain markets for 
these materials.
    It is also important to note that, regardless of the volume of used 
products placed in the system, recycling will likely remain an overall 
cost. As detailed above, collection and transportation costs each 
represent a significant part of the overall expense. Even with greater 
volumes of products and the establishment of more recycling facilities, 
these costs will still remain fixed within a range. The value of the 
resulting commodities still won't pay for the overall costs of 
collecting and recycling products, at least not at the present time.
                               __________

  Statement of David Isaac, Director, Government and Public Policy on 
                 Behalf of Hewlett-Packard Company (HP)

    On behalf of Hewlett-Packard Company (HP), I am pleased to provide 
this testimony on the recycling of used electronics. My name is David 
Isaacs, and I am Director, Government and Public Policy, based in our 
Washington, DC office. HP is a technology solutions provider to 
consumers, businesses and institutions globally. The company's 
offerings span IT infrastructure, global services, business and home 
computing, and imaging and printing. More information about HP is 
available at www.hp.com.
    HP applauds Chairman Thune and Ranking Member Boxer for convening 
this important hearing to discuss electronic waste. Today's hearing is 
a valuable first step in advising Members of the Senate and the public 
on the emerging challenge of managing and recycling used electronics in 
the United States. HP supports increased recycling to conserve natural 
resources and protect our environment through a harmonized national 
approach. HP calls on Congress to support a national solution to the 
challenge of recycling used electronics, the adoption of recycling 
incentives and the removal of regulatory barriers to cost-effective 
recycling, and market-based solutions to finance government recycling 
programs. HP believes that the Congress should reject attempts to 
impose a new tax on American consumers and to create bureaucratic 
recycling programs. Imposing more taxes on consumers will needlessly 
increase costs to the public and fail to achieve our nation's recycling 
goals in an efficient manner. Several decades of experience in 
implementing environmental laws and regulations in this country have 
proven that environmental goals can best be achieved by providing the 
private sector with flexibility and incentives to innovate.
    As a major manufacturer of a broad range of technology products, as 
well as a leading recycler of these products, HP has a strong interest 
in the development of policies relating to electronics recycling. HP 
has nearly 20 years of first-hand experience in product take-back and 
recycling. Since 1987, HP has successfully collected and recycled more 
than 600 million pounds of used or unwanted computer-related equipment 
globally. With our vast knowledge and experience, HP's goal is to 
recycle 1 billion pounds of equipment by the end of 2007. HP encourages 
Congress to allow companies such as HP to maintain this flexibility in 
implementing recycling--which provides American companies opportunities 
and incentives to continue to focus on innovation--and efficiently 
achieve superior recycling results that best protect our nation's 
natural resources for future generations.
    We wish to emphasize the following points in our testimony today:
     A harmonized national approach to the recycling of used 
electronic products is necessary to avoid a patchwork of varying state 
and local requirements.
     As first steps in the development of a national approach, 
Congress should adopt incentives for recycling, such as those set forth 
in the ``Electronic Waste Recycling Promotion and Consumer Protection 
Act'' (S.510); expand federal support for recycling projects; and 
remove regulatory impediments to recycling.
     A comprehensive national approach should promote 
innovation and allow for flexible implementation to achieve recycling 
goals in the most efficient manner.
     Congress should reject calls for new taxes on technology 
products and new government recycling programs.

          I. A NATIONAL APPROACH IS NECESSARY AND APPROPRIATE

    A national solution for the recycling of used electronic products 
can help promote efficiency and avoid a patchwork of inconsistent state 
approaches. Electronics recycling is an emerging national challenge 
resulting from the growing use and enjoyment of technology products and 
consumer electronics throughout our society. As an emerging 
environmental challenge, the country as a whole would benefit from a 
national approach that enables the United States to address this issue 
at a relatively early stage in its development. Environmental 
challenges are too often addressed by the Congress after a problem 
already exists. This issue presents an opportunity for the Congress to 
act proactively in developing a solution to an emerging challenge.
    A patchwork has already begun to develop. Three states--California, 
Maine, and Maryland--have adopted comprehensive recycling laws for 
certain electronic products, but each of these laws is significantly 
different from the other. The most important differences are the 
varying methods of financing the recycling system. California has 
imposed a new tax on consumers to fund a bureaucratic government 
recycling program. In contrast, Maine has developed an innovative 
shared responsibility model in which the burdens of recycling are 
shared by various stakeholders. Manufacturers are required to pay for 
consolidation and recycling or to conduct recycling of their products 
on their own. Maryland has imposed a fee on manufacturers to finance 
computer recycling programs around the state, with the fee varying 
depending on whether a manufacturer offers a computer take-back 
program. Moreover, numerous states, and even some localities, have been 
and are considering proposals to address the management of used 
electronics, and we anticipate that this trend will continue.
    This emerging patchwork of differing state laws is adding 
significant new costs and impeding the development of an efficient 
nationwide infrastructure, while creating the potential for consumer 
confusion. A consistent national approach is necessary and appropriate.
    We recognize, however, that solid waste issues are traditionally 
managed by the states and localities. Nonetheless, a federal solution 
is needed in this instance not only to address disparate state program 
developments, but also because of the connection between the recycling 
of used electronics and the adoption of state-specific design 
standards. Several states have adopted, or are considering, mandated 
design requirements on new technology products as part of their 
recycling laws or other environmental initiatives, driven largely by 
concerns with environmental issues associated with disposal of used 
electronic products. Differing state design requirements are 
problematic for HP and other technology companies because our products 
are designed and manufactured for global distribution. Conflicting 
state design requirements can impair our ability to sell products 
globally, may needlessly raise costs, and ultimately restrict 
innovation in the development of new products. An effective national 
solution can address the concerns of the states with the disposal of 
used electronics, thereby avoiding the need for design standards at the 
state level that may balkanize the global technology marketplace.

 II. RECYCLING INCENTIVES, FEDERAL SUPPORT, AND REMOVAL OF REGULATORY 
   IMPEDIMENTS ARE APPROPRIATE FIRST STEPS IN THE DEVELOPMENT OF AN 
                   EFFICIENT RECYCLING INFRASTRUCTURE

    To further the development of an effective recycling infrastructure 
for used electronics, HP believes that incentives to promote recycling 
are a useful first step. One such incentive is a tax credit for 
consumers to return their products for recycling and for manufacturers 
to offer recycling services to their consumers. In this regard, HP 
supports the ``Electronic Waste Recycling Promotion and Consumer 
Protection Act'' (S.510), a bipartisan bill introduced by Senator 
Talent and Senator Wyden. This bill would provide tax credits to help 
manufacturers, retailers, the recycling industry, and others to 
establish an efficient national infrastructure for the environmentally 
sound recycling of computers and other products and to encourage 
consumers to return their products for responsible recycling. These 
incentives can serve as a catalyst for voluntary, market-based 
solutions that avoid the need for potentially burdensome, costly 
mandates at the federal or state level.
    Similarly, expanded government support for pilot projects and other 
initiatives can help promote the development of an efficient recycling 
infrastructure for electronics. Programs such as the ``Plug-In to 
eCycling'' initiative of the U.S. Environmental Protection Agency have 
played a useful role in successfully recycling large volumes of 
products and collecting data on the nature of the issue and the range 
of approaches that can be successful. For example, during the summer of 
2004 HP partnered with Office Depot stores nationwide on an in-store 
takeback program that collected and recycled approximately 10 million 
pounds of products in a manner that was convenient for consumers and 
efficient for the two companies. Another retail return program, in 
which HP participated, involving Staples stores in New England also 
proved to be successful. Continued and expanded funding for these 
``Plug-In to eCycling'' programs can facilitate more recycling of used 
electronics and the development of new approaches.
    Finally, the federal government can play an important role in 
promoting recycling by removing regulatory impediments to cost-
effective recycling. Under current federal and state regulations, used 
electronics are sometimes classified as ``hazardous waste,'' even 
though they are routinely used in our homes and offices and, when 
recycled, pose no risk to human health or the environment. When these 
used products are classified as hazardous waste, they become subject to 
burdensome and costly regulatory requirements associated with their 
collection, storage, transportation, and processing. Congress and the 
EPA should reform these regulatory requirements to facilitate recycling 
of used electronics, while continuing to protect human health and the 
environment.

   III. A NATIONAL APPROACH SHOULD PROMOTE INNOVATION AND ALLOW FOR 
                 FLEXIBLE AND EFFICIENT IMPLEMENTATION

    HP supports a comprehensive, national approach to the recycling of 
used electronics that allows for flexible implementation and innovative 
approaches that can achieve our recycling goals in the most efficient 
manner. In discussions with several states, we have advocated a Product 
Stewardship Solution that is based on implementing a market driven 
system for recycling CRT-containing computer monitors and TVs (``CRT 
devices''). The approach requires manufacturers to take responsibility 
for the recycling of a specified amount of CRT devices, either by 
implementing a recycling program to cover this specified amount or by 
assuming financial responsibility for this amount. It places limited 
responsibilities on retailers and state government and avoids creation 
of new taxes and government bureaucracies. It provides funds to local 
governments for CRT device collection, consolidation, and recycling. As 
a result, the approach promotes flexible and efficient implementation 
of CRT recycling.
    Under the Product Stewardship Solution, manufacturers must take 
responsibility for their ``equivalent share'' of CRT devices--including 
orphan CRT devices--returned by households (individual consumers and 
home businesses) for recycling. They can do this either (1) by 
establishing a recycling program or (2) by paying the state reasonable 
collection, consolidation, and recycling costs for their equivalent 
share.\1\ Manufacturers implementing a recycling program have the 
flexibility to design their program as they see fit, so long as they 
recycle their equivalent share in compliance with applicable laws and 
regulations.
---------------------------------------------------------------------------
    \1\ This is a hybrid approach that combines elements of a producer 
responsibility system and the widely supported Maryland Statewide 
Computer Recycling Pilot Program (HB 575). A producer responsibility 
system enables manufacturers to assume responsibility for their 
products by establishing a recycling program. The Maryland law requires 
manufacturers to pay to the state an annual registration fee--the 
amount of which varies depending on whether the manufacturer offers a 
computer takeback program.
---------------------------------------------------------------------------
    Manufacturer equivalent shares are determined annually by the 
state. A manufacturer's equivalent share is that manufacturer's portion 
of the annual CRT device waste stream. The equivalent share concept 
allows manufacturers that choose to run a recycling program to satisfy 
their obligations with CRT devices of any brand or their own brand. 
This approach avoids the need for brand sorting, but preserves the 
ability of manufacturers to implement recycling programs that collect 
only their own brand products. It provides an efficient recycling 
system with multiple options for consumers.
    Manufacturers will be held accountable to the state to meet their 
equivalent share obligations. This is a self-implementing performance 
standard keyed to a specific amount of CRT devices to be recycled. 
Thus, a manufacturer that chooses to provide a recycling program but 
fails to recycle its equivalent share has a predetermined payment 
obligation for the shortfall to the state. This system is designed to 
achieve recycling results by manufacturers, not merely to generate 
revenue or establish government recycling programs.
    The Product Stewardship Solution has numerous benefits and 
advantages compared to alternative approaches such as advance recycling 
taxes or fees (``ARFs''):

A. Provides efficiencies through market-based solutions and the 
        opportunity for improvements over time, thereby offering a 
        lower cost solution to consumers
    Relies on and leverages the expertise of manufacturers to produce 
competitive, market-based solutions. Key recycling responsibilities are 
placed on manufacturers competing among themselves in the private 
sector, rather than on the government, which faces no competitive 
pressure.
    Provides flexibility to allow manufacturers to develop over time 
least-cost recycling arrangements. Manufacturers have broad flexibility 
to act individually or in partnership with others to develop recycling 
programs or to pay for their recycling responsibility. This provides 
manufacturers with maximum flexibility to be innovative and to work 
with recyclers to develop least-cost alternatives.
    Allows collection costs and responsibilities to be determined by 
the market. Manufacturers that choose to run recycling programs are 
required to recycle their equivalent share of discarded CRT devices. 
But no particular entity has a mandated responsibility to collect 
discarded CRT devices. This fosters development of cost-effective, 
market-driven collection methods by manufacturers, non-profits, 
independent collectors, municipal governments, and others.
    Provides consumers a broad range of collection/recycling options. 
Consumers may return their unwanted CRT devices to recycling programs 
offered by manufacturers or to any other recycling program--whichever 
collection/recycling option best suits their needs.

B. Avoids new taxes on consumers
    The Product Stewardship Solution imposes no point-of-sale taxes on 
consumers. ARF proposals are simply a new tax on consumers to finance 
new government recycling programs.

C. Places key responsibilities on manufacturers, not government, to 
        achieve recycling goals, including recycling of orphan CRT 
        devices
    Manufacturers are responsible for their contribution to the 
household-CRT device waste stream--the fundamental performance goal of 
a recycling program. Manufacturers are responsible for their equivalent 
share of CRT devices that are discarded each year by households, i.e., 
the contribution that their products make to the annual CRT device 
waste stream.
    Manufacturers are responsible for the orphan waste stream. This 
includes both unlabeled CRT devices and CRT devices for which the 
manufacturer is no longer in business and has no successor in interest.

D. Places minimal responsibilities on retailers
    Retailers are not required to impose and collect new taxes and are 
not obligated to collect products. The only obligations of retailers 
are not to sell unlabeled and unregistered CRT devices and to certify 
annually that they checked the state CRT device registration website to 
determine if the branded CRT devices they sell are registered.

E. Limits government involvement to enforcement and other necessary 
        functions, avoiding the creation of new taxes and new agencies
    Requires government to perform limited administrative and 
enforcement functions. These limited functions will be sufficient to 
establish the level playing field that makes it possible for 
manufacturers to provide market based recycling solutions. Among the 
functions performed by government are determining annual manufacturer 
equivalent share obligations, enforcing the requirements of the law, 
and collecting and compiling recycling data.
    Avoids establishing new taxes and new agencies. By placing 
fundamental recycling responsibilities on manufacturers, there is no 
need for consumers to pay new taxes on their purchases of CRT devices 
or for new agencies to be created to collect or administer a tax. The 
limited government responsibilities required by the approach are 
designed, like the other parts of the approach, to achieve overall 
recycling goals efficiently.

F. Reduces burdens on local governments by providing manufacturers with 
        incentives to keep CRT devices out of the municipal waste 
        stream and by providing a funding source for CRT device 
        collection, consolidation, and recycling
    Provides manufacturers with incentives to keep their CRT devices 
out of the municipal waste stream. Manufacturers' equivalent share 
obligations are based on the percentage of CRT devices for each 
manufacturer that are collected in local government recycling programs. 
Thus, manufacturers have incentive to keep their CRT devices out of the 
municipal waste stream.
    Provides local governments with a funding source for CRT device 
collection, consolidation, and recycling. Manufacturers that elect to 
pay the government for their recycling obligation, or that are required 
to pay for failing to meet their equivalent share obligation, provide 
local governments with a funding source for collecting, consolidating, 
and recycling CRT devices.

G. Provides the opportunity for design improvements
    Allows manufacturers to benefit from improved environmental design 
and innovation. Those manufacturers that collect their own brand 
products can benefit from design improvements they have made. Moreover, 
the system provides an incentive to improve product design by removing 
materials of concern, enhancing recyclability, and incorporating 
recycled content into their new products.

     IV. CONGRESS SHOULD REJECT NEW TAXES AS A MEANS OF FINANCING 
                           RECYCLING PROGRAMS

    California has adopted a new tax, or ``advance recycling fee'' 
(``ARF''), to finance a government recycling program, and other states 
are considering this approach.\2\ Congress should reject this approach. 
HP believes that a new tax on technology products to raise revenue for 
government to use for recycling is a poor way of achieving recycling 
goals.
---------------------------------------------------------------------------
    \2\ Supporters of this approach refer to it as a ``fee'' and not a 
tax. The law generally distinguishes between ``taxes'' and ``fees'' 
based on whether the payment provides a public benefit (a tax) or a 
specific service (a fee). National Cable Television Assn. v. United 
States, 415 U.S. 336 (1973). Because the revenue raised provides a 
general public benefit and not a specific service for the consumer 
paying the tax, an ARF is properly characterized as a tax.
---------------------------------------------------------------------------
    This new tax on consumers will raise the price of technology 
products and, assuming it is used for its intended purpose, establish a 
new government program that will likely result in efficient recycling 
solutions. There is no incentive for improvements over time--all 
products are subject to the same fee regardless of the cost of 
recycling that product. Manufacturers and others have little incentive 
to reduce these costs. This new tax is a one-size-fits-all approach 
that removes incentives for innovation and market-based solutions, 
thereby likely resulting in higher overall costs. Moreover, there is 
the risk that the funds collected by the government would be used for 
purposes other than recycling, thereby failing to address the issue.
    A tax-based approach suffers from other deficiencies, including the 
following:
    A Tax on Products Is Burdensome To Retailers.--The Consumer 
Electronics Retailers Association (``CERC''), supported by retailers 
such as Best Buy Co., Circuit City Stores, Inc., Radio Shack Corp., 
Sears Holdings, Target, and Wal-Mart, opposes an ARF because an ARF is 
``administratively burdensome for all parties;'' and ``too complicated 
for all parties.''\3\
---------------------------------------------------------------------------
    \3\ See http://www.ceretailers.org/cerc/CERC--Position--on--
eWaste.pdf.
---------------------------------------------------------------------------
    A Tax Finances A Large New Government Program.--A tax-based system 
requires receipt and administration of new sales taxes on consumers 
transmitted by likely thousands of retailers and distribution of the 
tax proceeds to hundreds of collectors and recyclers. The result is a 
large new government program with substantial administrative expenses.
    The Tax Revenues Can Be Diverted For Other Governmental Purposes.--
The tax revenues may be diverted to finance other governmental 
programs. Given tight government budgets and numerous competing 
priorities, governments often shift spending from one area to another. 
Indeed, there is no way to prevent a future legislature from taking 
such action. Numerous recycling and other environmental programs based 
on special taxes or fees that are presumably dedicated to a specific 
purpose have witnessed the funds being shifted to other uses.
    A Tax System Does Not Guarantee That Any Amount of Electronic 
Devices Will Be Recycled. Although proponents of tax-based recycling 
systems typically call for achieving numeric collection goals, the 
proposed systems provide no mechanism for enforcing these goals or 
ensuring that any amount of electronic devices are actually recycled. 
The California ARF statute does not require that any amount of 
discarded electronic devices must be recycled. The only guaranteed 
outcome of these tax-based systems is the generation of new tax revenue 
for government, not the recycling of products.
    Collection And Administration Of Taxes By A TPO Raises Concerns of 
Efficiency, Expertise, Legality, and Accountability. Some proponents of 
new taxes advocate the formation of a ``Third Party Organization'' 
(TPO) to receive and administer the government-imposed taxes collected 
by retailers. This proposal raises concerns of efficiency, expertise, 
legality, and accountability:
     The TPO duplicates functions currently performed by 
government agencies.
     The TPO lacks the expertise of existing tax collecting 
agencies and is unlikely ever to acquire equivalent expertise.
     The lack of accountability of the TPO to the government 
for TPO expenditures of public revenues raises significant legal 
issues. A TPO would control public tax revenues without congressional 
oversight over appropriations.
     TPO proposals provide no accountability if the TPO fails 
to achieve recycling goals or fails to meet other obligations. There is 
no ability by the government to enforce against a TPO.
    An ARF Constrains Competition And Limits The Efficiencies To Be 
Gained From Competition. A new tax to fund a monopolistic recycling 
program fails to establish a competitive environment that will provide 
incentives for improved performance. Under the California ARF system, 
all collectors and recyclers receive a uniform rate of compensation set 
by the state. In ARF systems that depend on a TPO, the only possibility 
of competitive bidding is with a monopoly organization that sets the 
bid requirements. This is not the same as a fully functioning private 
market with multiple manufacturers seeking recycling services.

                             V. CONCLUSION

    HP supports a Product Stewardship Solution that requires 
manufacturers to take responsibility for their equivalent share of CRT 
devices returned for recycling by households, that places minimal 
responsibilities on retailers and state government, and that provides 
local governments with funds for CRT collection, consolidation, and 
recycling. Overall, this approach offers a more efficient and flexible 
way to achieve our recycling goals.
    HP looks forward to working with the Subcommittee and other Members 
of Congress on the development of a national recycling system that 
leverages the capabilities and expertise of manufacturers, retailers, 
recyclers, and others to achieve efficient and low cost opportunities 
for all consumers.
                               __________

          Statement of the Retail Industry Leaders Association

    The Retail Industry Leaders Association (RILA) appreciates the 
opportunity to provide the committee with comments on the need for a 
national electronics management system and applauds the leadership of 
Chairman Thune and Ranking Member Boxer for holding a hearing on this 
important environmental issue.
    By way of background, The Retail Industry Leaders Association 
(RILA) is an alliance of the world's most successful and innovative 
retailer and supplier companies--the leaders of the retail industry. 
RILA members represent more than $1.4 trillion in sales annually and 
operate more than 100,000 stores, manufacturing facilities and 
distribution centers nationwide. Its member retailers and suppliers 
have facilities in all 50 states, as well as internationally, and 
employ millions of workers domestically and worldwide. Through RILA, 
leaders in the critical disciplines of the retail industry work 
together to improve their businesses and the industry as a whole. The 
mission of RILA is to lead and serve the most successful and innovative 
retailers and suppliers through the delivery of world class education, 
innovation and advocacy.
    RILA strongly believes that a federal solution that encourages the 
proper collection and recycling of electronic waste is far more 
practical than dealing with a patchwork of 50 or more different 
``eWaste'' laws instituted by individual states and localities. This 
year alone, 30 State and local legislatures have introduced over 50 
separate bills on this issue. It would be impractical and ineffective 
to expect retailers and manufacturers to comply with over 50 eWaste 
programs, and, if Congress legislates in this area, we urge it to 
create a strong federal preemption of state and local law.
    RILA also supports a ``producer responsibility'' eWaste recycling 
model, and is working with the Consumer Electronics Retailers Coalition 
(CERC), state retail associations and other interested stakeholders in 
advocating this approach. A producer responsibility approach would make 
manufacturers responsible for the recycling of electronic devices in an 
efficient and cost-effective manner that fits into each individual 
company's business model. This program may also include participation 
from distributors, retailers and consumers, all of which benefit from 
the sale of electronic products. A producer responsibility model, 
similar to those adopted in Maine and Maryland, provides consumers with 
a variety of choices and manufacturers with flexibility to implement 
practical electronics recycling programs that make sense to customers, 
government, retailers and manufacturers alike.
    A producer responsibility model also gives retailers the ability to 
develop voluntary recycling programs for their customers. For years, 
many retailers have partnered with manufacturers and certified 
recyclers to periodically offer recycling programs that encourage 
customers to return obsolete electronic equipment for recycling. These 
programs have proven to be successful and popular for all parties 
involved and such private sector initiatives should not only be 
permitted, but also encouraged through public policy.
    RILA strongly opposes eWaste policies that would mandate that 
retailers collect and/or dispose of used or unwanted electronic 
products. Retail stores are designed to make the shopping experience as 
enjoyable as possible for consumers. They are not designed to serve as 
collection centers, nor do they have room to store discarded products 
targeted for recycling. Retailers are highly efficient distributors of 
consumer products who operate on razor thin profit margins. Forcing 
them to play the role of recycling centers will add significantly to 
the cost of doing business. We urge Congress to reject mandated 
retailer recycling programs.
    In addition, RILA also opposes ``point of sale advance recovery 
fee'' (POSARF) programs such as the one adopted in California. 
Experience has shown that a POSARF does not accomplish its goals, is 
administratively burdensome for all parties, and only guarantees a new 
revenue source for government without guaranteeing that an effective 
recycling system will be put into place. In addition, such a program 
provides no incentive for the design of more environmentally friendly 
products, and fails to take advantage of market forces to reduce the 
cost of recycling over time.
    Finally, RILA endorses the ``Electronic Waste Recycling Promotion 
and Consumer Protection Act'' (S 510), legislation introduced earlier 
this year by Senators Jim Talent (R-MO) and Ron Wyden (D-OR). This bill 
would give consumers a one-time tax credit for turning in electronic 
equipment to a qualified recycler. It also provides manufacturers, 
retailers and qualified recyclers tax credits over a 3-year period for 
recycling a certain amount of e-waste each year. This bill appears to 
be a cost-efficient and potentially successful approach to jump-
starting the development of a national eWaste recycling industry. RILA 
hopes Congress will view this tax credit as a viable and creative 
opportunity to deal with electronics at their end of life, and urges it 
to enact the bill quickly.
    RILA is dedicated to working with the Subcommittee and other 
Members of Congress on developing a fair and effective program for the 
recycling of electronic products. The fact that states and localities 
continue to consider their own recycling initiatives that impose 
inconsistent requirements on retailers and manufacturers is clear 
evidence that Congress should move quickly to develop a federal 
solution.
                               __________

             Statement of Basel Action Network, Seattle, WA
                              the problem

Volume of e-Waste
    Gartner, Inc, a research firm, states that Americans discard 
133,000 PCs daily. This doesn't include televisions, cell phones, fax 
machines, and other electronics. EPA estimates that American dispose of 
3 million tons of outdated or broken electronic devices annually. This 
fastest growing segment of the waste stream is largely invisible, 
unless one has the opportunity to visit the massive warehouses filled 
with pallets and huge boxes of monitors, central processing units, TVs, 
printers, etc. The average length of time Americans keep their 
computers is 18 months. Lease agreements between electronics 
manufacturers and their corporate/institutional customers guarantee a 
complete replacement of all units within agreed upon timeframes, 
usually 1-3 years. Where do the ``old'' ones go? We have created 
societies that thrive on, even depend on, the latest technology, 
generating massive volumes of unwanted electronics. But they are laden 
with toxins, and we must create legislation to safely manage these 
mountains of unwanted electronics without impacting human health or the 
environment in any country.

Toxicity of e-Waste
    The sheer volume of electronic or e-waste is stunning, but it is 
only part of the problem. Electronics are made of many materials, some 
of them benign, and some of them quite toxic. Lead, mercury, beryllium, 
cadmium, hexavalent chromium, and brominated flame retardants are only 
a few of the many toxins that comprise electronic devices. Many of the 
substances in electronics are on the U.S. EPA's 1998 ``Draft RCRA Waste 
Minimization List of Persistent, Bioaccumulative, and Toxic Chemicals'' 
(PBTs). The EPA set a national goal of reducing the amount of these 
persistent biological toxins in waste by at least half by this year, 
and yet the levels of many of them continue to rise in the environment 
and in body burden samples taken in studies. PBTs remain in the 
environment for a very long time without degrading, accumulating in 
fatty tissues of humans and animals. This results in increasing 
concentrations as the persistent toxins move up the food chain. They 
also readily bio-transport, moving easily through air, water and soil 
to places far from where they originated.
    For more information on toxins in electronics, see attached 
Greenpeace document entitled, ``Toxic Tech: Dangerous Chemicals in 
Electronic Products'', available at: http://www.greenpeace.org/
international/press/reports/toxic-tech-chemicals-in-elec
    For information on the health impacts of these toxins, go to the 
following websites:
     Global Alliance for Incinerator Alternative (GAIA) at 
http://www.no-burn.org/resources/index.html#top
     International POPs Elimination Network at http://
ipen.ecn.cz/index.php?z=&l=
en&k=home

Export of e-Waste
    Largely unregulated in the United States, this massive volume of 
hazardous material is being managed in a myriad of ways, including 
landfilling it, illegally dumping it, sending it to federal 
penitentiaries where prisoners disassemble it, or to private sector 
recyclers who manually disassemble or mechanically shred the end-of-
life electronics. But currently the most lucrative `solution' to this 
toxic waste problem is to export it to developing countries that are in 
need of materials to manufacture the world's trinkets and tools. The 
lack of regulation and complete absence of control of these exports 
result in U.S. hazardous e-waste flowing to developing countries where 
impoverished or displaced communities, desperate for work of any kind, 
suffer the profound effects of recycling hazardous e-waste, 
dramatically impacting human health and the environment. These 
communities are faced with the choice between poverty or poison, and 
frequently choose to accept the developed world's unknown toxins in 
exchange for food on the table and schools for their children. Please 
view our 23-minute film, ``Exporting Harm: The High Tech Trashing of 
Asia'', documenting the toxic recycling of U.S. e-waste in China 
(available from Grant Cope in Senator Boxer's office).
    In our film and report by the same name, (http://www.ban.org/E-
waste/technotrashfinalcomp.pdf) we document some of these impacts on 
the region called Guiyu, in the Guangdong Province in SE China. Here, 
families live and work in yards where they use primitive and toxic 
techniques to dismantle and process e-waste primarily from the US, but 
also from Japan and other developed Nations. For example, they remove 
and sell the copper yokes from the back of the cathode ray tubes 
(picture tubes), then throw the leaded glass into their former 
irrigation ditches, which brought water to rice patties until about 8 
or 9 years ago, when they found they could make a little more money by 
scavenging materials from e-waste. Each monitor tube has 6-8 pounds of 
lead.
    Without any protection from lead fumes, mostly women and girls heat 
circuit boards over open pools of molten lead-tin solder, plucking 
individual circuits from the heated boards.
    The loosened chips are then sorted for re-sale or to be sent to 
acid chemical strippers to recover gold from the chips. These acid 
operations are located on riverbanks out of town, where they heat a 
mixture of 75 percent pure hydrochloric acid and 25 percent pure nitric 
acid to dissolve tiny amounts of gold from the chips. Then the workers 
dump the pure acids and dissolved heavy metals directly into the 
rivers. The water table in the Guiyu region is so toxic that hundreds 
of vendors truck in water from another town on a daily basis. Our 
samples of river water and sediments revealed some extraordinary test 
results for 18 different heavy metals and elements, available on page 
47 (Annex II) and page 48 (Annex III) of the Exporting Harm report 
(linked above). One water sample yielded a lead level that was 2400 
times higher than the World Health Organization's limit for lead in 
drinking water. Page 14 displays a photograph of computer asset tags 
found on computers in China--computers from the United States, 
including a State of California medical facility, the L.A. Unified 
School District, the City of Los Angeles.
    Other neighborhoods in Guiyu sort small computer wires by day, and 
burn them by night in open fires. These copper wires have a PVC 
sheathing, which creates dioxins and furans--some of the most toxic 
substances known to humankind--when melted at low temperatures. Dioxins 
have no smell or taste; they are invisible threats.

Volume of e-Waste Exported
    No one knows the amount of electronic waste being exported from the 
US; this fact in itself is important, as it indicates the sheer 
irresponsibility of the United States (unlike most other countries) in 
controlling and monitoring its exports of hazardous e-wastes, 
frequently in violation of laws in recipient countries. [To see the 
Auststralian Government's ``Criteria for the Export and Import of Used 
Electronic Equipment'', go to http://www.deh.gov.au/settlements/
publications/chemicals/hazardous-waste/electronic-paper.html]
    The fact is electronic waste is leaving the United States by ocean-
going container loads daily. Anecdotal reports from U.S. recyclers 
indicate that, of all the electronics collected in the United States by 
recyclers, 80 percent-90 percent of it goes offshore. Aggressive buyers 
from Asia, particularly China, are purchasing as much as electronic 
waste as they possibly can, with ``toxins along for the ride'', in 
order to obtain copper, aluminum, steel and precious metals at lower 
costs than if they mine and smelt primary ore in their countries. 
Because the United States has failed to implement its legally binding 
obligations to control and monitor its exports of hazardous wastes (see 
below), these massive volumes of toxic e-waste are exported anywhere in 
the world, frequently in violation of laws in recipient countries, and 
many times with horrific impacts.
    Even if the United States had the political will to oversee it 
exports of toxic waste to poor countries, there are no harmonized 
tariff codes (used to document international trade) that distinguish 
between waste and new electronics. Because of this, there is currently 
no customs information on e-waste available.

Why is e-Waste Being Exported
    The United States is the only developed country not to ratify the 
``Basel Convention on the Control of Transboundary Movements of 
Hazardous Wastes and their Disposal'' (Basel Convention). 165 Nations, 
however, are a Party to this Convention, and apply Basel restrictions 
and definitions of hazardous wastes when it comes to exports and 
imports of such. Despite the United States refusal to respect the Basel 
laws and definitions that govern most of the rest of the world's trade 
in hazardous waste, the United States has ratified a multi-lateral 
agreement governing trade in hazardous wastes between the 30 
Organization for Economic and Cooperative Development (OECD) countries, 
but has failed to implement its legally binding obligations. (More 
details below.)
    Without any controls on the export of hazardous e-waste, the 
resulting free-for-all is based on pure profitability, regardless of 
toxic impacts or violation of laws in recipient countries. In this 
country, the sheer economics of the waste trade, without restrictions, 
are a powerful incentive to do the wrong thing. Waste generators and/or 
their recyclers are faced with a choice: either pay to have their 
unwanted electronics properly managed, or be paid by brokers who whisk 
them away to developing countries. For some, it's a simple choice 
between an expense or revenue, and when it involves a lucrative way to 
get rid of toxic materials, many make this choice. Other individuals, 
corporations and institutions who have concerns about data security, 
liability for improper hazardous waste disposal, and even impacts on 
citizens in developing countries, make better choices. But these 
choices about how to manage this hazardous waste stream should not be 
completely left up to individuals and corporations. The U.S. Government 
must join the global community and ensure that all citizens of the 
world are protected from U.S. toxic electronic wastes.
    One might argue that importing countries should `just say no' to 
toxic U.S. e-waste, but in so many developing countries, the lack of 
environmental laws, poor enforcement, the need for raw materials for 
manufacturing and the jobs that come along with it, and widespread 
corruption result in open ports for toxic waste shipments. It is more 
difficult for any Nation to control its imports than its exports, as 
the United States found out after September 11th. As called for in the 
Basel Convention, each Nation must be responsible for controlling and 
monitoring its exports of hazardous wastes. Decontaminate the wastes in 
developed nations, keeping jobs here, and then send the clean 
commodities any where in the world.

U.S. vs. International Laws Pertaining to e-Waste
    The Basel Convention is a multilateral environmental agreement 
under the auspices of the United Nations Environment Program (UNEP) 
that is noted for being the first international treaty that promotes 
environmental justice. It was designed to protect developing countries 
from being disproportionately burdened by hazardous wastes via trade, 
simply due to their economic status. The original treaty called for a 
minimization of transboundary movements of hazardous wastes and 
national self-sufficiency in waste management by all countries.\1\ In 
1995, by consensus vote, the Basel Convention banned the export of 
hazardous wastes for any reason from European Union (EU) or 
Organization for Economic Cooperation and Development (OECD)\2\ 
countries to all other countries, and proposed this ban as an amendment 
to the Convention. This is known as the Basel Ban Amendment.\3\ 
Although this amendment is still acquiring the necessary ratifications 
to enter into strict legal force globally, it has already been 
implemented by many of the nations that have ratified it, including the 
entire European Union.
---------------------------------------------------------------------------
    \1\ Article 4, paragraph 2(d) and 2(b) respectively; www.basel.int
    \2\ An organization representing the interests of 30 developed 
nations; www.oecd.org
    \3\ Decision III/1 of the Basel Convention
---------------------------------------------------------------------------
    The United States signed the Basel Convention in 1989 but has to 
date failed to ratify it. There are only three countries that signed 
and never ratified. These countries are Afghanistan, Haiti, and the 
United States.
    Indeed, the United States is the only developed country in the 
world that has not ratified the Basel Convention. Furthermore, because 
the United States has created exemptions from controls in the Resource 
Conservation and Recovery Act (RCRA) for wastes deemed recyclable, we 
are now the only developed country in the world that allows electronic 
waste to flow uncontrolled as a toxic tide out of our borders. Every 
week, hundreds of container loads of hazardous electronic waste flow 
across U.S. borders to disproportionately burden foreign communities. 
This is not legal in any other developed country. The irony of this is 
that the United States is where the concept of ``environmental 
justice'' was born. Environmental Justice Executive Order 12898 
requires that each federal agency include environmental justice as part 
of its mission by identifying and addressing, as appropriate, 
disproportionately adverse human health or environmental effects of its 
programs, policies, and activities on people of color and low-income 
populations in the United States and its territories. The U.S. Office 
of International Affairs' 2004 Environmental Justice Action Plan 
states, ``OIA's senior leaders are committed to the principles of 
environmental justice both at home and abroad.''
    If the toxic impacts on these communities were not a big enough 
affront, it must be understood that this policy of ``free trade in 
toxic waste'' is actually illegal in the United States and promotes 
illegal activity in developing countries globally. The OECD has 
treaties binding on the United States, governing the transboundary 
movement of hazardous waste, and the United States turns a blind eye to 
these legally binding obligations. Indeed, the United States is in 
direct violation of one of these OECD treaties.
    In 1986, the Organization for Economic Cooperation and Development 
(OECD) adopted Council Decision-Recommendation C(86)64(final)\4\ (OECD 
Decision) which has to do with hazardous wastes exported from the 30 
developed nations who comprise the OECD. Decisions of the OECD Council 
are legally binding upon Member countries at the time of the adoption 
of the decision.\5\ Since the United States was a member country in 
1986, the OECD Decision is legally binding on the United States. Some 
of the more pertinent OECD Decision elements that the United States 
agreed to implement are as follows:
---------------------------------------------------------------------------
    \4\ Decision-Recommendation of the Council on Exports of Hazardous 
Wastes from the OECD Area, 5 June 1986, C(88)90(Final) see http://
www.oecd.org. Note that Decision-Recommendations include both Decisions 
and Recommendations.
    \5\Art. 5(a), OECD Convention, see http://www.oecd.org.
---------------------------------------------------------------------------
    i. ``Monitor and control exports of hazardous wastes to a final 
destination which is outside the OECD area; and for this purpose shall 
ensure that their competent authorities are empowered to prohibit such 
exports in appropriate instances;''
    Reality in the United States today.--U.S. competent authorities are 
empowered to forbid only some of their exports but remarkably do not 
consider lead-acid batteries, electronic wastes and other OECD-defined 
hazardous wastes to be hazardous waste. This is illegal when they are 
exported. The United States has failed to harmonize its definitions of 
hazardous wastes with those in the OECD regime.
    ii. ``Apply no less strict controls on transfrontier movements of 
hazardous wastes involving non-member countries than they would on 
movements involving only Member countries;''
    Reality in the United States today. Transfrontier shipments between 
OECD member States of cathode ray tubes (CRTs), and/or CRT glass, for 
example, must in fact be controlled within the OECD as it is part of 
the ``amber'' list under Council Decision C(92)39/Final, as amended by 
(2001)107/Final\6\ (governing recycling trade in hazardous wastes 
between Member States). Thus, in fact, the United States is violating 
this provision.
---------------------------------------------------------------------------
    \6\ See http://www.oecd.org/pdf/M00029000/M00029772.pdf
---------------------------------------------------------------------------
    iii. ``Prohibit movements of hazardous wastes to a final 
destination in a non-Member country without the consent of that country 
and the prior notification to any transit countries of the proposed 
movements;''
    Reality in the United States today. The United States does not 
require the consent of the receiving country for hazardous electronic 
waste, lead-acid batteries and other hazardous waste exports, as 
defined by the OECD, and thus, is in clear violation of this 
obligation.
    iv. ``Prohibit movements of hazardous wastes to a non-Member 
country unless the wastes are directed to an adequate disposal facility 
in that country.''
    Reality in the United States today. The United States exercises no 
control, nor shows any concern as to whether exported hazardous wastes 
are destined for adequate facilities, or even whether they are recycled 
or simply dumped.
U.S. vs. International Definitions of Hazardous Wastes
    It is also essential to understand that United States intentionally 
does not harmonize its definitions of hazardous wastes with 
international ones found in the Basel Convention and the OECD treaties. 
While this is acceptable for domestic only transactions, it creates a 
huge loophole and illegalities for export. Once U.S. companies load up 
containers with material that is designated as hazardous waste 
internationally, and that container gets outside of U.S. territory, it 
automatically falls under the umbrella of international laws and 
definitions, whether we like it or not.
    The definitions applicable to the OECD C(86)64(final) that have to 
do with wastes exported from the OECD area have been amended to those 
found in Council Decision C(88)90(Final)\7\, which in turn has been 
amended by C(94)152(Final)\8\.
---------------------------------------------------------------------------
    \7\ OECD Council Decision C(88)90(final), see http://
www.olis.oecd.org/horizontal/oecdacts.nsf/
a0da5457376d5a1f412569750054d65b/
eca14832de914b75c1256acb005158fb?OpenDocument
    \8\ OECD Council Decision C(94)152 (final), see http://
www.olis.oecd.org/olis/1994doc.nsf/linkto/c(94)152-final
---------------------------------------------------------------------------
    The definition of hazardous waste in C(94)152(Final) calls any 
waste listed in a core, Y list of hazardous constituents to be 
controlled as a hazardous waste, as long as they possess hazardous 
characteristics listed in Table 5. The Y list includes lead, listed as 
Y31--``Wastes having as constituents lead or lead compounds''. Table 5 
includes substances considered H11--``toxic'', H12--``ecotoxic'', and 
H13--``capable, by any means, after disposal, of yielding another 
material, e.g. leachate, which possesses any of the characteristics 
listed above.''
    Because of their lead content, CRTs, circuit boards, and lead-acid 
batteries, etc., have been demonstrated to create toxic lead leachate 
by virtue of their failure to pass the Toxic Characteristic Leachate 
Procedure (TCLP) threshold of 5mg/l. It is clear that CRTs and circuit 
boards, as well as equipment containing CRTs, CRT glass, or circuit 
boards fall under the OECD Council Decision-Recommendation C(86) 64 
(final) having satisfied both the list and Table 5. Other toxic 
materials in electronic waste, such as mercury, beryllium, and 
hexavalent chromium, are also designated as hazardous waste under the 
OECD treaty, and therefore the exports of e-waste with these 
constituents ought to be controlled and monitored.
    The United States' claim that certain wastes are not hazardous 
simply because they are recyclable and can therefore be freely traded 
is not consistent with U.S. obligations under OECD accords. The United 
States currently is in direct violation of their OECD treaty 
commitments. The violation also allows for the disproportionate 
burdening of developing country communities with U.S. toxic e-waste.
U.S. e-Waste Trade Violates the Laws of Importing Countries
    The export of hazardous waste without controls also violates the 
laws of many developing countries globally. The Basel Convention 
forbids any Party to the Convention (165 nations) from trading with a 
non-Party, without a special bilateral or multilateral agreement. 
Because the United States is not a Party to the Convention and 
virtually every other country in the world is, most countries cannot 
accept hazardous waste, as defined by the Convention, from the United 
States. The only exception to this rule is 30 OECD countries that have 
signed waste trade accords, for example, for recyclable wastes. 
However, any Basel country that is not an OECD member State (there are 
about 132 of these, including virtually all Asian countries except 
Japan and South Korea), cannot legally accept hazardous waste, such as 
e-waste, from the United States. To do so is illegal traffic with 
criminal sanctions applicable.
    Every day, container loads of hazardous electronic wastes are 
leaving the United States with the full knowledge of EPA, and Commerce 
and State Department authorities; once these container loads arrive at 
most importing nations' ports, they are contraband. Many countries like 
China have made it very clear they do not want this hazardous waste, 
have passed national importation bans, and have announced these import 
bans through the formal conduit of the Basel Convention Secretariat. 
Still the U.S. EPA, Commerce and State Departments ignore these 
violations. Imagine if the shoe was on the other foot, and China 
continued to knowingly send us thousands of tons of material each year 
that is in clear violation of our laws. Wouldn't this be considered at 
least a diplomatic affront?
    The EPA has refused to list the countries for which imports of 
electronic waste from the United States are illegal, despite being 
urged at length to do so, and despite considerable recycling industry 
support for the notion during EPA's development of the Plug-In to e-
Cycling electronic waste recycling guidelines. Nor has the EPA warned 
U.S. recyclers that it is illegal for those 130+ countries to receive 
hazardous waste, including electronic waste, from the United States. 
Furthermore, the Plug-In Guidelines created definitions for electronic 
waste that are completely incompatible with those developed (even with 
the United States present and active in the negotiations) at the 
international level in the Basel Convention\9\. This makes it even more 
difficult for recyclers and exporters in the United States to comply 
with importing countries' laws (which are based on international 
definitions). This appears to indicate a willful disregard on the part 
of EPA to respect those laws, and the principles of environmental 
justice upon which they are based.
---------------------------------------------------------------------------
    \9\ A full critique of these Guidelines is available at: http://
www.epa.gov/epaoswer/osw/conserve/plugin/pdf/guide.pdf
---------------------------------------------------------------------------
    Likewise, in the drafting of the rule on managing CRTs, the EPA was 
roundly criticized for providing no controls on the export of these 
toxic wastes. The final rule is yet to be promulgated, but it is not 
expected that Basel-like controls will be applied to the export of CRTs 
or CRT glass.\10\
---------------------------------------------------------------------------
    \10\ For a full critique on the draft CRT rule see: http://
www.ban.org/Library/BAN--comments--CRTrule.PDF
---------------------------------------------------------------------------
    ``As boundaries between domestic and global environmental issues 
erode, environmental challenges facing the United States have become 
more complex. In an increasingly interconnected world, domestic 
environmental quality and public health often require global action, 
which in turn have economic, political, cultural, and humanitarian 
implications. As in the United States, the burden of a degraded 
environment in developing countries has been even greater to minority 
and low-income communities, often with little or no inclusion in the 
decision-making processes.
    ``The fair treatment of all people and their right to meaningful 
involvement in the environmental decision making process does not exist 
in many countries. OIA has the challenge of respecting the traditions, 
laws and protocols in the countries where we work, while encouraging 
environmental justice for all people.''--Office of International 
Affairs' Environmental Justice Action Plan
Unintended Consequences of the California e-Waste Bill
    Because the financing scheme in CA SB 20/SB50 only covers display 
devices such as monitors and TVs, consumers are bringing to recyclers 
these items along with non-covered devices, such central processing 
units (the computer box), printers, fax machines, etc., and asking 
recyclers to also take them for free. Many recyclers in CA quickly 
learn that the only way they can avoid the expense of properly 
recycling these non-covered devices is to export them to developing 
countries, which generates more revenue for them. The net result is an 
increase in exports of hazardous waste (as defined internationally), 
while at the same time collecting the leaded glass tubes for proper 
recycling.

                             THE SOLUTIONS

    It is essential in any national legislation define the scope of 
products to include all components that are defined as hazardous waste 
internationally (listed above). In this way, legislation will not 
result in an increase in exports of non-covered hazardous wastes (as 
defined internationally).
    Control and monitor of exports is a federal jurisdiction. National 
legislation requiring the collection and recycling of unwanted 
electronics must forbid the export of hazardous e-waste based on U.S. 
OECD obligations, the Basel obligations of other nations, and the 
Basel/OECD definitions of hazardous wastes in use by almost all other 
nations besides the United States. This means that any waste 
electronics or untested or non-working electronics that contain a 
cathode ray tube (CRT), circuit boards that use lead solder, mercury, 
beryllium, PCBs, or any e-scrap or untested/non-working equipment with 
them in them, must be kept in OECD/EU countries only for recycling or 
disposal. After decontaminating the hazardous wastes, clean commodities 
can be sold anywhere in the world.
    Provide a funding mechanism that no longer allows the United States 
to externalize the end-of-life costs of these toxic electronics onto 
citizens in developing countries, and prisoners in this country. We 
believe the best financing system is to require all original equipment 
manufacturers (OEMs) to pay an advanced recycling fee (ARF) on every 
product sold in the United States into a non-profit, third party 
organization (TPO). This TPO would be responsible for managing the full 
participation of OEMs, contracting for the collection and recycling of 
electronics, informing the public about the free recycling options, and 
managing the funds. We do not believe an ARF collected at the point of 
retail is an acceptable solution, because this toxic waste problem 
belongs to the manufacturers, who must oversee the end-of-life 
management and costs. This `extended producer responsibility' provides 
a direct financial incentive to redesign the products with fewer 
toxins, make them more upgradeable, more easily recycled. In order to 
provide widespread collection options to urban and rural citizens, 
collection payments can be offered to existing and new infrastructure 
(if they choose to opt into the system), including recyclers, 
charities, municipal waste collection facilities, retailers, and mail 
back programs with the manufacturers.
    Legislation must also require that adequate recycling and reuse 
standards are set to ensure that occupational and public health are 
protected from the many toxins in e-waste, and that adequate financial 
assurances exist to cover environmental, liability, closure, and other 
costs are in place.
    Hazardous e-waste must be prohibited from landfills, incinerators 
(including waste to energy incinerators), and prison recycling 
operations, based on definitions that recognize toxicity of any waste 
or unwanted electronic.
    Create new harmonized tariff codes for the various components of 
used electronics, based on international definitions of hazardous 
waste, and requiring a distinction between tested working used 
equipment vs. untested/waste equipment or components.
    An official enquiry must be made into the U.S. violation 
(documented above) of the 1986 OECD accord on hazardous waste exports. 
The United States must finally implement its legally-binding 
obligations under the OECD treaty, requiring that we:

          ``Monitor and control exports of hazardous wastes to 
        a final destination which is outside the OECD area; and for 
        this purpose shall ensure that their competent authorities are 
        empowered to prohibit such exports in appropriate instances;''
         ``Apply no less strict controls on transfrontier 
        movements of hazardous wastes involving non-member countries 
        than they would on movements involving only Member countries;''
          ``Prohibit movements of hazardous wastes to a final 
        destination in a non-Member country without the consent of that 
        country and the prior notification to any transit countries of 
        the proposed movements;''
          ``Prohibit movements of hazardous wastes to a non-
        Member country unless the wastes are directed to an adequate 
        disposal facility in that country.''
                               __________

           Statement of The Consumer Electronics Association

                              INTRODUCTION

    The Consumer Electronics Association (CEA) thanks Chairman Thune 
and Members of the Subcommittee for the opportunity to present its 
views on electronic waste.
    CEA represents more than 2,000 companies involved in the design, 
development, manufacturing, distribution and integration of audio, 
video, in-vehicle electronics, wireless and landline communication, 
information technology, home networking, multimedia and accessory 
products, as well as related services that are sold through consumer 
channels. CEA also produces the nation's largest annual event, the 
International Consumer Electronics Show.
    By extending information and entertainment to everyone--regardless 
of income or geographic location--our products have improved lives and 
changed the world. Meanwhile, America stands as the global leader in 
innovation, ingenuity and creativity.
    In addition, the competition and falling prices characteristic of 
our industry continue to confer benefits to consumers. As our products 
become increasingly affordable, it is often more economical for 
consumers to replace a product with a new one rather than repair older 
equipment.
    While these displaced products may have reached the end of their 
lives or be out-of-date, they are definitely too valuable to be 
completely discarded. Most consumer electronics products contain 
valuable materials such as precious metals, plastics and other raw 
materials that can be resold in the commodities market by recyclers. 
Moreover, used, working computers can find use in thousands of schools, 
charities and public agencies committed to training people with 
disabilities, students at risk and economically disadvantaged 
Americans.
    In fact, CEA recently joined eBay's Rethink Initiative, which 
brings together leading technology companies, government agencies, 
environmental groups and millions of eBay users to confront the problem 
of electronic waste (e-waste). Rethink's members offer consumer 
education via comprehensive information on options available to reuse 
or responsibly recycle, as well as disposition tools such as assisted 
selling, convenient local drop-off, trade-in programs and charity 
donations.

         CEA SUPPORTS A NATIONAL APPROACH TO E-WASTE MANAGEMENT

    The Consumer Electronics Association strongly supports the 
development of a national framework for e-waste management. The current 
de-facto system for e-waste is an evolving patchwork of state-by-state 
approaches. This conflicting, ad-hoc approach imposes unnecessary 
burdens on technology companies and consumers alike. E-waste is a 
national issue that should have a national solution.
    A national end-of-use framework would apportion responsibility and 
ensure a level playing field among stakeholders, while promoting a 
widespread and adequately financed e-waste solution.
    In addition to the development of a national e-waste framework, CEA 
believes the following elements are worthy of consideration:

1. Tax Credits
    The federal government should support states choosing to rely on 
effective market-based solutions. Federal tax credits can enable 
manufacturers, recyclers, and retailers to offer recycling services in 
those states. Tax credits also may enable stakeholders in other 
electronics sectors to offer recycling services or to develop markets 
for recycled products. Tax credits should be available to all 
stakeholders involved in the end-of-life infrastructure, including 
retailers to help defray costs in those states adopting visible fee-
based systems.

2. Fostering Design for Environment
    The principal responsibility of manufacturers of display devices 
lies in product design. CEA supports the creation of reasonable federal 
procurement policies based on environmental criteria. The market power 
of the government can play a significant role in providing a direct 
sales-based incentive to manufacturers. States can augment this by 
adopting federal environmentally sensitive procurement guidelines, 
increasing the market and the incentive for manufacturers. Federal and 
state governments will capture cost-savings through reduced energy 
usage and other advantages offered by these products.

3. A National Recycling Third-Party Organization
    States considering advanced recovery fee or ``ARF''-based systems 
may opt to select a third-party organization (``TPO'') to collect and 
administer recycling funds. CEA will support the creation of a national 
TPO, both to assist states considering a TPO system and to provide a 
national clearinghouse for consistent product scope to ensure stable 
harmonization of state-level systems. A national TPO should include 
manufacturers, retailers, and recyclers in its governance structure. 
TPO creation and availability to states can serve as a further 
incentive to create state-level systems complementing a national 
solution. If additional federal authority to enable to harmonization is 
required, CEA will work with the U.S. Congress as appropriate to put 
that authority in place.

4. Ensuring a Level Playing Field Through Federal Policy
    The role of the federal government lies primarily in ensuring a 
level playing field nationally for recycling stakeholders complying 
with state-level recycling systems. The federal government should put 
measures in place that enable states to ensure a level competitive 
playing field for in-state retailers with Internet and out-of-state 
retailers. CEA supports any required additional federal authority to 
ensure interstate compliance with state-level market-based or visible 
fee-based systems.

                               CONCLUSION

    Finding a solution to this public policy challenge is a priority 
for CEA. As we continue to make strides in eco-friendly design 
initiatives, lead the consumer electronics industry on environmental 
issues and be a part of the effort to educate consumers about e-
recycling, CEA hopes to work with Congress and all interested parties 
to reach a common-sense, national solution that makes recycling as 
convenient as possible for all Americans.

                               __________

  Statement of Bill Sheehan, Ph.D., Director, Product Policy Institute

    Thank you for the opportunity to provide comments to the Senate 
Subcommittee on Superfund and Waste Management hearing on the problem 
of electronic waste disposal. The Product Policy Institute is an 
independent nonpartisan research and education organization that 
focuses on the link between production and consumption, on the one 
hand, and waste generation and disposal, on the other, in order to 
promote public policies that encourage sustainable practices. We 
believe that the policy approach of extending producer responsibility 
for end of life management of electronic waste offers the most 
effective solution to the problem of electronic waste management, 
because it relies on market forces and incentivizes fundamental 
solutions upstream at the design stage..
    Extended Producer Responsibility (EPR) is a policy principle to 
promote total life cycle environmental improvement of product systems 
by extending the responsibilities of the manufacturer of the product to 
various parts of the entire life cycle of the product, and especially 
to the take-back, recycling and final disposal of the product. EPR 
policies shift part, or all, of the responsibility for the end-of-life 
management of products and packaging from tax payers and waste 
management authorities to those who design the products and packaging--
the manufacturers. Manufacturers have the largest opportunities to 
reduce lifecycle environmental and health impacts, because the design 
phase of the product chain is the most critical to reducing waste. 
Moreover, local public authorities do not have the resources to safely 
manage e-waste.
    EPR policies appeal to both conservative and liberal political 
perspectives. From a fiscal conservative perspective, EPR makes sense 
because it gets waste management off the tax base and it is based on 
the notion that the market will drive programs that are more efficient 
than government managed programs. Those of a more liberal bent support 
EPR because they believe that producers should have responsibility for 
pollution prevention. In several European countries and Canadian 
provinces, EPR regulations have been implemented, maintained or 
strengthened by conservative governments.
    In our opinion, the most critical step in solving the ``e-waste 
problem'' using the market-based approach is establishing optimal roles 
for government and industry. The key is to ensure that government's 
role is focused on setting performance standards in the public interest 
and enforcing agreed outcomes that create a level playing field. When 
correctly designed and implemented, EPR policies can provide an 
alternative both to traditional bureaucratized command-and-control mode 
of environmental regulation, on the one hand, and to radical 
deregulation and privatization, on the other. Such policies allow 
regulated parties and other affected groups a greater share in shaping 
the rules under which they operate and permits a certain degree of 
self-regulation.
    In North America, this approach is best developed in the Canadian 
province of British Columbia, where regulations allow brand-owners to 
develop their own EPR programs for a range of products, as long as they 
meet approval of the province. Targeted products never come through the 
municipal waste management system. British Columbia has applied this 
approach to beverage containers and household hazardous waste products, 
and is expected to shortly include electronic waste in the system.
    Maine's e-waste law comes closest to EPR in the United States. 
Maine's law leaves significant collection responsibility to the 
municipalities, but overall Maine's approach is a strong step forward 
in the right direction.
    We append to these comments a checklist of elements for effective 
EPR programs developed from a variety of sources. These are intended to 
apply to a range of products and packaging beyond electronic waste, but 
were developed with electronics in mind. We note several elements here.
     A key objective is to transfer costs of product waste 
management from taxpayers to producers and users, so that more 
efficient designs are rewarded in the market. Thus, tax credits alone 
are unlikely to solve the problem of e-waste.
     Competition is critical to making a market-based system 
work. Consequently, individual producers should be clearly assigned 
responsibility for results, even if given a choice to join a 
collective, third-party recovery system. Legislating a third-party 
monopoly is dangerous, as is direct government participation in 
managing such third party organizations. If government shares 
governance of such organizations, it becomes too easy to blame 
government for inefficiencies and failures.
     Bans on landfill disposal and other inappropriate forms of 
disposal like incineration and exporting to countries with inadequate 
safety regulations are essential to effective EPR programs. If these 
options are available to producers, there is little incentive to 
recycle responsibly.
    We believe that advanced fees charged to consumers may be 
appropriate in the short term as a fair way of dealing with historical 
waste. But fees do nothing to influence product design, so should not 
persist beyond the initial period.
    We also append to these comments a recent report by the Product 
Policy Institute comparing the development of EPR policies in the 
United States and Canada. Canada is instructive to look at. Canadians 
have progressed beyond debating whether EPR is a good idea, to figuring 
out how to implement it. Besides being our neighbor, Canada displays a 
diversity of EPR models being tested at the provincial level.
    Thank you for taking up the critical issue of electronic waste 
management. We hope these comments are useful in your deliberations.

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  Statement of Scott Cassel, Executive Director, Product Stewardship 
                            Institute, Inc.
                       Comments Related to NEPSI

    Since the first multi-stakeholder NEPSI discussions in April 2001, 
significant progress has been made. PSI believes that the results of 
this multi-stakeholder dialogue, involving numerous meetings and 
conference calls, should be acknowledged and built upon, as even more 
stakeholders have become interested since NEPSI. PSI would like to 
emphasize that NEPSI participants agreed on the following:
    1. Electronic wastes present an environmental problem.--None of the 
participants--including manufacturers and government officials--
considered landfilling and incinerating these products as viable 
management solutions. Participants understood that we do not want to 
bury lead and other heavy metals for future generations to dig up, that 
the disposal of electronic equipment is akin to throwing jobs, 
resources, and economic value into the garbage can, and that 
environmental problems can result from improper management. In 
addition, much solid waste disposal is accomplished through 
incineration in waste-to-energy plants; the inclusion of electronic 
waste in the feedstock increases the emissions of toxics into our air.
    2. NEPSI's goal should be to develop a national solution.--In the 
February 26, 2004, NEPSI Compromise Resolution, which PSI helped 
negotiate, participants agreed to the following: ``it is the desire of 
the NEPSI group to establish a national system to collect, transport 
and process consumer electronics in a manner that is protective of 
human health and the environment, and one that is economically 
sustainable and market driven.'' State governments have been forced to 
develop their own legislation primarily because the electronics 
manufacturers have been split on the type of system needed to finance 
and manage electronic wastes.
    3. The cost of managing electronic wastes should be included in the 
purchase price of a new product.--At the start of the NEPSI dialogue, 
manufacturers argued that all taxpayers should cover the cost of 
managing electronic wastes, and that government programs, funded by 
taxes, should be increased to pay for waste management programs. This 
was a non-starter for government agency officials. Industry officials 
then proposed that consumers be charged ``end-of-life'' fees to be 
assessed when a consumer returned an item for recycling. Again, 
government agency officials considered this solution a non-starter, 
since fees discourage recycling and encourage illegal dumping. Finally, 
industry officials agreed to some type of ``front-end financing 
system'' that would include the cost to manage the product at its end-
of-life in the purchase price of the product. It is on this single 
point--the type of front-end financing system--that manufacturers have 
been unable to agree.
    4. The Scope of Products to be covered by an agreement was agreed 
to as follows:
     TV/TV Monitors (cathode ray tubes [CRTs] and flat panels).
     Stand-alone computer CRT and flat panel monitors greater 
than 9 inches.
     Laptop/notebook computers.
     Computer Processing Units (CPUs).
     Small peripherals (mice, keyboards, cables, speakers)
     Consumer desktop devices (printers and multifunction 
devices).
    5. The financing system should be a ``hybrid''--starting with an 
``advanced recycling fee'' (ARF) and transitioning to a type of ``cost 
internalization,'' in which the end-of-life management costs are 
included in the product purchase price, but invisible to the consumer 
(e.g., not a specified and visible fee). While all government NEPSI 
participants supported this system as a compromise to their preferred 
system, there were several other stakeholders who dissented. Government 
officials believe there is great merit in a system that internalizes 
all the system costs. However, recognizing that such a proposal was a 
non-starter for industry in NEPSI, agencies agreed to start with an ARF 
to pump quick funds into the development of badly needed 
infrastructure, then transition to an internalized financing system 
based on set criteria.
    6. The Hybrid system should allow for an equivalent alternative 
system. The NEPSI resolution allows for a flexible alternative system 
that would permit individual manufacturer responsibility if a company 
could provide a level of service that is equivalent to the ``base level 
of service'' that the NEPSI group believed was needed for an effective 
collection and processing infrastructure.
    7. Standards are needed for electronics recyclers.--The NEPSI group 
supported the creation of recycling standards to ensure the 
``environmentally sound management'' of electronic wastes.
    In addition to the above agreements among the multi-stakeholder 
NEPSI group, PSI was able to develop a consensus among the state and 
local government participants as to their legislative preferences on 
several other issues.
     Use a non-profit entity to manage system finances.--
Government officials supported the development of an industry-led non-
profit that would collect and disburse funds to pay for the collection, 
reuse, and recycling of electronic equipment. This organization could 
also contract for collection and recycling services, submit reports on 
system performance, and perform other administrative functions. These 
non-profit entities already operate in Canada and Europe to enhance the 
efficiency of product management systems. In addition, government 
agencies researched legal precedents that allowed private entities to 
manage funds created by a government program.
     Develop performance measures for collection and 
recycling.-- Agencies believe that the group's focus should be on 
system performance, and that the logistics should be the role of the 
private sector, which has greater incentive to reduce costs. Government 
agencies believe that its role should be to establish performance 
goals, with multi-stakeholder input.
     Disposal bans should be preceded by a recycling 
infrastructure.-- While disposal bans will help to create a market for 
recycling, they will create consumer frustration and enforcement 
concerns if there is no alternative to disposal. Disposal bans, 
however, work well when a recycling infrastructure is in place.

                       COMMENTS RELATED TO S. 510

    With regard to S. 510, PSI welcomes the opportunity that the 
introduction of this bill gives to consider interim measures to improve 
the national system for recycling used electronics. Provisions within 
the bill that PSI considers valuable include:

        1. Federal government agencies should ensure that federally 
        procured electronics equipment is recycled. PSI suggests that 
        government agencies develop purchasing specifications that 
        include the cost of recycling unwanted electronics equipment in 
        the purchase price of new equipment.
        2. Requiring electronics recyclers to be certified according to 
        standards that will promote environmental protection.
        3. Preceding a disposal ban by an adequate recycling 
        infrastructure.
        4. Determining how national legislation can be consistent with 
        the intent of current state electronics recycling laws.

    Provisions that PSI believes require additional consideration 
include the following:
        1. Although the proposed study will have significant value, the 
        study of end-of-life fees should acknowledge the experience 
        gained in the last 5 years of electronics collections, much of 
        which was financed by such fees. End-of-life fees may play a 
        minor role in a comprehensive collection and processing 
        infrastructure, but as a general policy, they discourage 
        recycling and encourage illegal dumping. While some consumers 
        will be more than happy to pay such a fee, this is not a 
        strategy to reach the levels of recycling needed to make a true 
        environmental difference.
        2. Some PSI members believe that tax credits could be an 
        interim measure, or a supplement to a comprehensive system, and 
        that they could only help an ailing electronics recycling 
        infrastructure. However, many of our members are concerned that 
        all taxpayers would finance tax credits for electronics waste 
        management, and not just those who use the product. These 
        members believe that it is not fair for all taxpayers to pay an 
        equal share of the costs when some taxpayers use, and benefit 
        from, more or higher quality electronic equipment than others. 
        Tax credits will not provide an incentive for manufacturers to 
        change their product design or find ways to reduce the end-of-
        life management cost of their products. In addition, these tax 
        credits will not go to local governments, which are most 
        burdened financially by waste management, but to recyclers.
        State and local government agencies in NEPSI preferred that all 
        potential collectors of electronic equipment be eligible to 
        receive a set ``incentive payment'' based on the unit or weight 
        of material collected. Such a payment would directly cover 
        their costs, and would provide an incentive for retailers, 
        charities, and other entities to contribute to the collection 
        infrastructure so that the burden did not fall completely on 
        local government. Further, this approach would be more 
        convenient to consumers, who would have multiple points at 
        which they could drop off equipment. We would not expect many 
        consumers to save their receipts for a $15 tax credit.
        3. PSI would like to consider the best ways to encourage reuse 
        in the context of the legislation.
    Let me again express PSI's appreciation to the Committee for 
spending the time necessary to understand this complex environmental 
issue, and to take action toward resolving electronics waste management 
issues. I would urge the Committee to take advantage of the discussions 
that have already taken place and use them as a springboard for new 
ideas so that we can truly find a workable national solution that is 
amenable to all key stakeholders. Now that there are three state laws 
pertaining to electronics waste management, we need to work together to 
find a national law that will integrate these systems into a strong 
national electronics management system.

                               __________

              Maine Department of Environmental Protection,
                                                     July 28, 2005.
Hon. John Thune, Chairman,
Subcommittee on Superfund and Waste Management,
Senate Environment and Public Works,
Washington, DC.

Hon. Barbara Boxer, Ranking Member,
Senate Environment and Public Works,
Washington, DC.

Re: Testimony for hearing on electronic waste issues

    Dear Senators: Thank you for recognizing that the disposal of 
electronic waste represents an unconscionable waste of resources and 
creates an unnecessary risk to human health and the environment. Our 
challenge is to create public policy that achieves appropriate 
recycling of electronic waste in an efficient and cost effective way.
    The State of Maine was the second state to adopt an electronic 
waste law. Maine's program is a first-in-the-nation system in which 
responsibility for a comprehensive recycling program is shared by 
consumers, the public sector; and the private sector. It shifts away 
from the presumption that government alone is responsible for end-of-
life management of solid wastes from households by assigning 
manufacturers direct responsibility for ensuring electronic waste is 
appropriately recycled.
    Our experience in working with stakeholders to design and implement 
Maine's system has been very positive. Manufacturers and recyclers 
understand that the more responsibility and authority they are given to 
manage the recycling of their products, the more opportunity they have 
to develop innovations in product design, collection and recycling 
systems that can lead to financial gains.
    The Maine program is a system that is fair and flexible while 
adhering to high environmental standards. It clearly defines roles, 
establishes accountability and provides incentives for private sector 
innovation and for ``Smart Production'', i.e., environmentally 
sustainable production without the need for a new, extensive public 
sector bureaucracy to manage the system.
    If you choose to establish a national program, it should not be 
more costly to the consumer than any of the existing state programs. A 
national program that assigns end-of-life product responsibility to the 
manufacturers will reward ``green design'' and environmentally-
sustainable production processes. Such producer responsibility leaves 
the private sector with the ability to apply its strengths in 
innovation and efficient systems management to recapturing the 
resources that are currently wasted every time an electronic product is 
thrown away instead of recycled, and it can do this without creating a 
new layer of bureaucracy.
    One positive step that the federal government can take to support 
current State e-waste programs and to lay a strong foundation for any 
future national program is to adopt an import ban on products from 
overseas manufacturers that are non-compliant with electronic waste 
laws in the United States. This would level the playing field for U.S. 
manufacturers, against whom states can readily take enforcement action, 
while provide significant incentive to comply to foreign manufacturers 
with no physical presence in the United States.
    Once again, thank you for understanding that our current e-waste 
management problem presents us with a great opportunity to effectively 
recoup wasted resources and prevent environmental degradation through 
application of ``Smart Production'' principles and appropriate end-of-
life management.
            Sincerely,
                                         Dawn R. Gallagher,
                                                      Commissioner.

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