HB 127
Department of Legislative Services
Maryland General Assembly
2021 Session
FISCAL AND POLICY NOTE
Third Reader
House Bill 127 (Delegate Boyce)
Environment and Transportation and Education, Health, and Environmental Affairs
Economic Matters
Maryland Paint Stewardship
This bill requires a producer of architectural paint sold at retail in the State, or a representative
organization acting on behalf of a producer, to (1) submit, by January 1, 2022, a plan for the
establishment of a Paint Stewardship Program to the Maryland Department of the
Environment (MDE) for approval; (2) pay a plan review fee to MDE; (3) implement the
program within six months after plan approval; (4) submit annual reports for MDE review;
and (5) pay annual report review fees to MDE. The bill establishes (1) a uniform paint
stewardship assessment for architectural paint sold in the State to cover program costs and
(2) a prohibition on the sale of architectural paint unless the producer or its representative is
implementing an approved paint stewardship program. The bill takes effect July 1, 2021.
Fiscal Summary
State Effect: Special fund expenditures increase by $54,000 in FY 2023, by $48,200 in
FY 2024, and minimally in other years; special fund revenues increase correspondingly
from plan review and annual report review fees. Minimal increase in State expenditures
(multiple funds) for paint beginning in FY 2023.
(in dollars) FY 2022 FY 2023 FY 2024 FY 2025 FY 2026
SF Revenue - $54,000 $48,200 - -
SF Expenditure - $54,000 $48,200 - -
GF/SF Exp. $0 - - - -
Net Effect $0 (-) (-) (-) (-)
Note:() = decrease; GF = general funds; FF = federal funds; SF = special funds; - = indeterminate increase; (-) = indeterminate decrease
Local Effect: Potential decrease in local waste management costs beginning in FY 2023.
Minimal increase in local government expenditures for paint beginning in FY 2023. Local
revenues are not materially affected.
Small Business Effect: Meaningful.
 Analysis
Bill Summary:
Paint Stewardship Program Plan Development and Related Assessment
The Paint Stewardship Program plan must minimize public-sector involvement in, and
financial responsibility for, the management of postconsumer paint by (1) reducing its
generation; (2) promoting its reuse and recycling; and (3) negotiating and executing
agreements to collect, transport, reuse, recycle, process for resource recovery, and dispose
of postconsumer paint. The plan must also provide for convenient and available statewide
collection of postconsumer paint, as specified.
A retailer may be identified as a postconsumer paint collection site if the retailer volunteers,
is in compliance with all applicable laws and regulations, and the site location is consistent
with maintaining a cost-effective network of postconsumer paint collection locations.
The plan also must establish a uniform paint stewardship assessment for all architectural
paint sold in the State and a mechanism for participating producers to remit payment of the
assessment to the representative organization to cover program costs. The total amount of
the assessment may not exceed the costs of implementing the program, and assessments
may be used only for program implementation. The assessment must be evaluated by an
MDE-designated independent financial auditor, as specified, and the costs of any work
performed by an independent financial auditor must be funded by the program.
Maryland Department of the Environment Plan Review
MDE must (1) review the program plan and the work product from the independent
financial auditor and (2) and establish a plan review fee to cover MDE’s plan review costs,
including associated costs for program compliance oversight, as determined by MDE. Plan
review fees are deposited in MDE’s State Recycling Trust Fund. The bill makes
conforming changes to provisions governing the State Recycling Trust Fund.
If MDE determines that the plan, including the assessment, complies with the bill’s
requirements, MDE must approve the program. MDE must list participating producers and
brands on its website.
Implementation of the Paint Stewardship Program
Within six months after plan approval, a producer or representative organization must
implement its paint stewardship program. Beginning October 1, 2022, or six months after
plan approval, whichever is later, a producer or retailer is prohibited from selling or
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offering to sell a brand of architectural paint to any person in the State unless the producer
of that brand, or a representative organization to which the producer is a member, is
implementing an approved paint stewardship program.
The bill requires each producer, retailer, and distributor to add the paint stewardship
assessment (described above) to the cost of all architectural paint sold to a retailer,
distributor, and a consumer in the State, respectively.
A participating producer or a representative organization must provide consumers with
educational materials regarding the program that include information about available
end-of-life management options for architectural paint offered through the program and
information that notifies consumers about the assessment. Following the implementation
of the program, a retailer may only order architectural paint from a participating producer
or producer’s agent that is listed on MDE’s website.
A postconsumer paint collection site that is identified in the plan may not charge an
additional fee for the disposal of paint when it is offered for disposal.
Immunity from Liability
A producer or representative organization that organizes the collection, transport, and
processing of postconsumer paint in accordance with an approved program is immune from
liability for any claim of a violation of antitrust, restraint of trade, or unfair trade practice
arising from conduct undertaken in accordance with the program.
Annual Reports, Maryland Department of the Environment Review, and Annual Report
Review Fees
Beginning April 1, 2023, and annually thereafter, a producer or representative organization
must submit a report to MDE that includes (1) a description of the methods used to collect,
transport, and process postconsumer paint in the State; (2) the volume of paint collected;
(3) the volume and type of postconsumer paint collected by method of disposition and by
county, as specified; (4) the total cost of implementing and administering the program, as
determined by an independent financial audit funded by the paint stewardship assessment;
and (5) samples of educational materials provided to consumers of architectural paint.
Specified information is confidential and not subject to public inspection. MDE is
authorized to release summary data, as specified.
MDE must review each annual report and evaluate the total costs of the program, including
all expenses and revenues, to determine whether the paint stewardship assessment meets
or exceeds the costs of the program. MDE must also determine whether the plan is being
implemented according to the statutory requirements. MDE must approve the annual report
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if the report, including the paint stewardship assessment, complies with the bill’s
requirements. The producer or representative organization must make the approved annual
report available to the public.
The producer or representative organization that submits an annual report is required to
pay an annual report review fee to MDE. Annual report review fees are deposited in MDE’s
State Recycling Trust Fund. The report review fee must cover MDE’s costs of reviewing
the annual reports, including associated costs for program compliance oversight, as
determined by MDE. The bill makes conforming changes to provisions governing the
State Recycling Trust Fund.
Relevant Definitions
“Architectural paint” means interior and exterior architectural coatings sold in containers
of five gallons or less. Industrial coatings, original equipment coatings, and specialty
coatings are excluded. “Postconsumer paint” is unused architectural paint that is no longer
wanted by the purchaser. A “distributor” is a company with a contractual relationship with
one or more producers to market and sell architectural paint to retailers in the State. A
“producer” is a manufacturer of architectural paint that sells, offers for sale, or distributes
the paint in the State under the producer’s own name or brand. A “representative
organization” is a nonprofit organization created by producers to implement a paint
stewardship program.
Current Law: Household hazardous waste (HHW) is defined in Title 9 of the
Environment Article of the Maryland Annotated Code as any waste material, including
garbage or trash, derived from a household that would be listed as hazardous waste under
the federal Resource Conservation and Recovery Act but for the fact that the waste is
derived from a household. HHW may include agricultural chemicals, cleaning agents and
solvents, paint, pesticides, and preservatives.
According to MDE, Maryland does not regulate HHW as hazardous waste, and federal law
allows for the disposal of HHW in household trash. However, due to the potential for HHW
to cause physical injury, contaminate septic tanks or wastewater treatment systems, and
present hazards to children and pets, MDE recommends the proper recycling and disposal
of HHW materials at local HHW collection programs.
MDE reports that several Maryland counties have programs in place to collect HHW, such
as mercury, paint, paint thinner, pesticides, herbicides, batteries, and, to a lesser extent,
medications. However, some counties collect HHW only once each year.
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State Expenditures:
Maryland Department of the Environment General Program Administration Costs
Special fund expenditures from the State Recycling Trust Fund increase by $54,029 in
fiscal 2023, which accounts for the program’s earliest possible implementation date of
July 1, 2022. This estimate reflects the cost of hiring one contractual environmental
compliance specialist to conduct compliance and enforcement activities and to maintain
the listing of compliant producers on MDE’s website. It includes a salary, fringe benefits,
one-time start-up costs, and ongoing operating expenses, including travel. The estimate
does not include costs associated with MDE’s plan or annual report review, which are
discussed below.
Contractual Position 1
Salary and Fringe Benefits $42,084
Operating Expenses 11,945
Total FY 2023 MDE Expenditures $54,029
MDE advises that the contractual environmental compliance specialist is only needed
during the first two years that the program is operational. Although the bill’s effective date
is July 1, 2021, it is assumed that the new staff is not hired until July 1, 2022, which is
when program implementation and coordination responsibilities for MDE are anticipated
to begin.
Future year expenditures reflect a salary with annual increases and employee turnover and
ongoing operating expenditures, including travel. Beginning in fiscal 2025, MDE advises
that it can implement the bill’s requirements with existing budgeted resources and that the
contractual employee is no longer necessary.
This estimate does not include any health insurance costs that could be incurred for
specified contractual employees under the State’s implementation of the federal Patient
Protection and Affordable Care Act.
Maryland Department of the Environment Plan and Report Review
MDE plans to use existing staff to conduct the required review of the proposed program
plan and the annual reports. Further, although producers may participate individually or
jointly through a representative organization, similar programs in other states are generally
only carried out by a single representative organization (PaintCare) under a single program
plan. As such, MDE assumes, and the Department of Legislative Services concurs, that it
is likely that MDE reviews only one plan (in fiscal 2022) and one annual report each year.
Thus, special fund expenditures from the State Recycling Trust Fund increase minimally
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for MDE to review the proposed plan in fiscal 2022 and to review the annual reports
beginning in fiscal 2023.
State Agencies as Consumers of Paint
State expenditures (multiple fund types) increase beginning in fiscal 2023 for any State
agency that purchases paint as a result of the assessment established under the bill. Based
on similar programs in other states, this fee is likely no more than $1.99 per container of
paint. Although the total amount of paint purchased by the State is unknown, this analysis
assumes that any increase in costs for State agencies to purchase paint is likely minimal.
State Revenues: MDE is required to set the plan review fee at a level to cover MDE’s
plan review and program compliance oversight costs. Similarly, the annual report review
fee must cover MDE’s costs to review the annual reports and for program compliance
oversight. Thus, this analysis assumes that MDE’s costs to implement the bill (as described
above) are fully offset by plan review and annual report review fees. Accordingly, special
fund revenues increase minimally in fiscal 2022, by $54,029 in fiscal 2023, by $48,169 in
fiscal 2024, and minimally annually thereafter.
Local Fiscal Effect: Waste management costs at local landfills may decrease as a result
of the diversion of architectural paint waste under the paint stewardship program. Further,
costs may decrease for local governments that currently collect paint and choose to
participate in a producer’s stewardship program instead. PaintCare reports that since the
cost of managing postconsumer paint is passed on to everyone who purchases the paint,
costs for paint management for local governments are reduced.
In addition, as a consumer of paint, any local government agency that purchases paint must
pay the paint stewardship assessment established as a result of the bill. Thus, local
government expenditures for the purchase of paint increase minimally beginning in
fiscal 2023.
Small Business Effect: The bill results in potentially significant additional operational
responsibilities for producers, retailers, and distributors of architectural paint in the State,
as they are required to (1) add a paint stewardship assessment to the cost of all architectural
paint sold and (2) account for those assessments and remit them to the representative
organization. Producers and retailers must also (1) verify that all architectural paint sold in
the State is in compliance with an approved program and (2) submit required reports. On
the other hand, retailers who volunteer to act as postconsumer paint collection sites may
benefit if they are able to attract additional customers to their stores as a result. Several
retailers affected by the bill are likely considered small businesses.
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As a consumer of paint, small businesses that purchase paint incur additional costs to pay
the paint stewardship assessment established by the bill. On the other hand, small
businesses may benefit from having viable options for disposing of and managing
end-of-life paint.
Additional Information
Prior Introductions: HB 890 of 2020 passed the House with amendments and was
referred to the Senate Education, Health, and Environmental Affairs Committee, but no
further action was taken. SB 168 of 2017, a similar bill, received a hearing in the Senate
Education, Health, and Environmental Affairs Committee, but no further action was taken.
Its cross file, HB 674, received a hearing in the House Environment and Transportation
Committee but was subsequently withdrawn.
Designated Cross File: None.
Information Source(s): Anne Arundel, Garrett, and Montgomery counties; Maryland
Association of Counties; Northeast Maryland Waste Disposal Authority; Maryland
Municipal League; Judiciary (Administrative Office of the Courts); Maryland Department
of the Environment; Department of Legislative Services
Fiscal Note History: First Reader - January 26, 2021
md/lgc Third Reader - February 26, 2021
Analysis by: Kathleen P. Kennedy Direct Inquiries to:
(410) 946-5510
(301) 970-5510
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Statutes affected:
Text - First - Maryland Paint Stewardship: 91-701 Environment, 91-702 Environment, 91-707 Environment, 91-709 Environment, 91-703 Environment, 91-731 Environment, 91-732 Environment, 91-733 Environment, 91-707 Environment
Text - Third - Maryland Paint Stewardship: 91-701 Environment, 91-702 Environment, 91-707 Environment, 91-709 Environment, 91-703 Environment, 91-731 Environment, 91-732 Environment, 91-733 Environment, 91-707 Environment