Five electronics companies, including ViewSonic, CTX Technology and ToteVision are threatening litigation against Washington state. The reason for the potential lawsuit is that the state has a new electronic waste law that requires manufacturers to fund recycling and collection services for old TVs, personal computers, and monitors.
The companies believe that the law charges them too much and improperly includes out-of-state businesses.
At the same time, the Consumer Electronics Association (which represents 2,000 electronics companies) is trying to negotiate with New York City officials in hopes of changing a city ordinance (which will take effect on July 31) requiring electronics companies to pick up old gadgets door-to-door. According to the group, the new ordinance will cost the industry $200 million annually. As for the bigger companies, Dell (DELL) and Best Buy (BBY) have expanded their recycling programs as parts of the tech industry and are trying to stem the spread of the recycling programs.
ToteVision's president Bill Taraday said that the company is "extremely alarmed" by these electronic recycling laws, noting that it has had to pay 4 percent of its profits (the company has $10 million in annual sales) in order to cover its recycling bills in Washington since January. Taraday continued to say that if this legislation existed in all 50 states, "we wouldn't be in business." State officials and environmental groups believe that electronics companies should be responsible for recycling costs, especially in light of the fact that "The manufacturers will absolutely pass the costs along to consumers" according to Barbara Kyle of the Electronics TakeBack Coalition - which is a "consortium" of environmental groups.
Since 2003, 19 states along with New York City have passed mandated electronics recycling. Twelve other states have introduced similar legislation this year, with 10 states having the laws take effect. New Jersey and Illinois are set to have such laws go into effect in January. As for the amount of electronics recycled, Oregonians recycled nearly five million pounds of electronics in the first quarter, which puts the state on pace to exceed its annual goal of 12 million pounds recycled. Washington is on pace to collect 36 million pounds.
The problem that some of the electronics makers have is that a good portion of the cost of these programs falls on them, not on the states. A lawyer for ViewSonic and other companies protesting Washington's law states that "A lot of these companies are really, really hurting." That said, in Washington electronics firms can be charged for recycling fees even if they go out of business or pull their product off shelves. For example, CTX has not sold monitors in Washington, but it has been billed more than $70,000 to recycle electronics in the state.
Something doesn't seem right here, and maybe someone can explain it to me - but why would a company that doesn't sell products in a state have to pay for the state to recycle electronics? This policy seems a bit unfair. Yes, these products were "destined for recycling regardless of the state that it is in," as John Frederick (executive director of the Washington Materials Management and Financing Authority) notes (in what I feel is a rather bold and far-reaching statement). Maybe other industries do this - does Coca-Cola (KO) have to pay recycling fees in all 50 states? It sure feels like these states are trying to grab cash from companies under the guise of doing something good for the environment.
Again, I am not against recycling. It just appears to me that the states are trying to make a few bucks at the companies' expense. Of course, that is what the companies are also trying to do to you and me, right?