Proposed Regulation of Hazardous Waste in Retail Sector

by Reed Smith
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The Environmental Protection Agency has released a Notice of Data Availability (NODA) in order “to collect information towards improving hazardous waste requirements for the retail sector.” To read it, click here. Retailer hazardous waste violations are already a hot enforcement issue in some jurisdictions like California, where settlements against big box retailers and chain stores are regularly in the millions of dollars, e.g., K Mart’s $8 million settlement and Home Depot’s settlement of $9.9 million. Now, the EPA appears to be extending this focus nationally: the NODA states that it has committed to analyze information and identify issues about the regulations applicable to hazardous waste generated in the retail industry, including: (a) materials that may be affected; (b) the scope of the issues ; and, (c) options that may exist for addressing the issues. Hazardous wastes from the retail industry sector are regulated under the federal Resource Conservation and Recovery Act, the enforcement of which is typically delegated to the various states.

In the notice, the EPA states that it has conducted meetings with the Council on Safe Transportation of Hazardous Articles Inc., the National Retail Federation, the Retail Industry Leaders Association, and select large retailers and consumer goods manufacturers. Many of the comments received were related to specific issues faced by the retail sector when managing hazardous waste pharmaceuticals. However, other retail-related comments were also raised, with some of the most important comments focusing on episodic generation, hazardous waste determination, reverse distribution, and aerosol can management. The EPA recognizes that retailers face widely varying duties under the hazardous waste generation regulations due to product recalls, customer returns, expiration dates, accidental product spills or breakage, seasonality, and midnight dumping in parking lots. Different rates of hazardous waste generation also may subject retailers to different training, recordkeeping, manifesting, and other hazardous waste regulations, as stated in the NODA.

While the states have taken the majority of enforcement actions against several major retail companies in connection with hazardous waste issues, in 2013, the EPA and the U.S. Department of Justice reached agreement with one of the largest retailers to resolve RCRA violations that allegedly occurred across the country. As part of that agreement, the retailer committed to the continued development and implementation of a comprehensive, corporate-wide waste management program to identify and properly manage all hazardous wastes generated throughout its retail operations. Specifically, the retailer now requires suppliers to submit product information to a third party to evaluate product formulations to determine a product’s regulatory waste status and transportation classification, an electronic system that provides every employee with waste handling information for each product through the scanning of the UPC bar code, a waste management system that utilizes colored buckets to clearly designate where certain types of waste are accumulated prior to off-site shipment, and a reverse logistics system to track the disposition of all items going through their reverse distribution system.

All comments on the NODA should be submitted within 60 days following the notice's publication in the Federal Register. The notice was issued on February 4, 2014, and should be published shortly in Docket ID No. EPA-HQ-RCRA-2012-0426. Instructions on how to submit comments can be found in the NODA.

Reed Smith has represented and currently is representing companies facing these “reverse logistics” issues of how to properly manage hazardous substances in products that are returned to stores or other facilities, including decision-making on how and when it is possible to resell such products or return products to vendors or third parties who assist in reusing, reselling or recycling products. For questions, please reach out to one of the authors of this Alert.

DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

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