The bill establishes a new chapter in Rhode Island law titled "Composting and Organic Waste Diversion," aimed at reducing the amount of compostable material sent to landfills. To address this issue, the legislation imposes a solid waste disposal surcharge of $2.00 per ton on solid waste processed, with the revenue directed to a newly established compost fund. This fund will provide funding to the Department of Environmental Management to award grants that assist with the costs of developing, implementing, or expanding equipment, infrastructure, and education related to reducing solid waste, surplus food rescue, shell recovery and waste shell diversion, compost production and use, and minimizing illegal dumping.

The bill creates two special nonlapsing funds: the competitive composting and waste diversion grant fund (CG fund) and the municipal waste diversion grant fund (MG fund), both supported by the surcharge revenue. The CG fund is designed to award grants to eligible entities for costs associated with compost production, compost use, and waste diversion efforts. The MG fund is specifically intended to assist municipalities in implementing activities that promote food waste prevention, food rescue, recovery, and composting, as well as addressing illegal dumping.

Municipalities can apply for grants from the MG fund if they have created a separate account in their general fund for the grant money and established accounting procedures to ensure compliance. The bill outlines grant reporting requirements, allowing eligible entities to use simplified formats or their standard annual reports to fulfill obligations. The Department of Environmental Management will oversee the administration of these funds and ensure equitable distribution of grants, prioritizing projects that provide community benefits, particularly those involving low-income or socially disadvantaged groups. The act is scheduled to take effect on January 1, 2026.