This docum ent does not reflect the intent or official position of the bill sponsor or House of Representatives. STORAGE NAME: h1241b.CIV DATE: 2/14/2022 HOUSE OF REPRESENTATIVES STAFF ANALYSIS BILL #: CS/HB 1241 Local Government Solid Waste and Recycling Collection Services SPONSOR(S): Local Administration & Veterans Affairs Subcommittee, Hawkins TIED BILLS: IDEN./SIM. BILLS: SB 1944 REFERENCE ACTION ANALYST STAFF DIRECTOR or BUDGET/POLICY CHIEF 1) Local Administration & Veterans Affairs Subcommittee 15 Y, 2 N, As CS Mwakyanjala Miller 2) Civil Justice & Property Rights Subcommittee Mawn Jones 3) State Affairs Committee SUMMARY ANALYSIS Counties have the authority and responsibility to provide and regulate solid waste collection and disposal. Counties are responsible for operating solid waste disposal facilities in order to meet the needs of the incorporated and unincorporated areas of the county and may contract with other persons to fulfill some or all of these solid waste responsibilities. Each county must also ensure that municipalities within its boundaries participate in the preparation and implementation of recycling and solid waste management programs through interlocal agreements or other means. In providing solid waste management services or programs, local governments are encouraged to use the most cost-effective means and contract with private entities for such services or programs to assure that the services or programs are provided on the most cost-effective basis. Local governments are expressly prohibited from discriminating against privately owned solid waste management facilities solely because they are privately owned. When a contract is breached, the nonbreaching party may generally seek damages against the breaching party. These damages may include administrative fees or charges and, if provided for in the contract, liquidated damages. Liquidated damages are amounts specified in a contract to which a contracting party may be entitled if the other party breaches the contract; such damages are typically specified where actual damages are difficult or impossible to prove. CS/HB 1241 provides that a local government may not seek liquidated damages or similar charges against a public or private solid waste management or recycling entity that provides residential municipal solid waste or recycling services when: A local, state, or federal emergency is in effect; and Such emergency materially affects the entity’s ability to provide residential municipal solid waste or recycling services. The bill applies to contracts involving a county or municipality and that are for the collection or transport of solid waste or recyclable material executed or renewed on or after July 1, 2022, except contracts for the collection or disposal of storm-generated yard trash. The bill does not appear to have a fiscal impact on state revenues or expenditures. However, local government revenues may be affected to the extent amounts recoverable as liquidated damages for breaches of solid waste or recycling services contracts are reduced. See II.D. Fiscal Comments. The bill provides an effective date of July 1, 2022. STORAGE NAME: h1241b.CIV PAGE: 2 DATE: 2/14/2022 FULL ANALYSIS I. SUBSTANTIVE ANALYSIS A. EFFECT OF PROPOSED CHANGES: Present Situation Home Rule Authority The Florida Constitution grants local governments broad home rule authority. Specifically, non-charter county governments may exercise those powers of self-government that are provided by general or special law. 1 Counties operating under a county charter have all powers of self-government not inconsistent with general law or special law approved by the vote of the electors. 2 Likewise, municipalities have governmental, corporate, and proprietary powers that enable them to conduct municipal government, perform municipal functions and provide services, and exercise any power for municipal purposes except when expressly prohibited by law. 3 Solid Waste Responsibilities Counties have the authority and responsibility to provide and regulate solid waste 4 collection and disposal. 5 A county may require any person within the county to demonstrate the existence of some arrangement or contract by which the person’s solid waste will be disposed of in a manner consistent with county ordinance or state or federal law. 6 Counties may also adopt ordinances governing the disposal of solid waste generated outside the county at the county’s solid waste disposal facility. 7 Counties are responsible for operating solid waste disposal facilities, which are permitted through the Department of Environmental Protection, in order to meet the needs of the incorporated and unincorporated areas of the county and may contract with other persons to fulfill some or all of these solid waste responsibilities. 8 Each county must also ensure that municipalities within its boundaries participate in the preparation and implementation of recycling and solid waste management programs through interlocal agreements 9 or other means. 10 In providing solid waste management services or programs, local governments are encouraged to use the most cost-effective means and contract with private entities for such services or programs to assure that the services or programs are provided on the most cost-effective basis. 11 Local governments are expressly prohibited from discriminating against privately owned solid waste management facilities solely because they are privately owned. 12 1 Art. VIII, s. 1(f), Fla. Const. 2 Art. VIII, s. 1(g), Fla. Const. 3 Art VIII, s. 2(b); s. 166.021(1), F.S. 4 Section 403.703(36), F.S., defines “solid waste” as sludge unregulated under the federal Clean Water Act or Clean Air Act, sludge from a waste treatment works, water supply treatment plant, or air pollution control facility, or garbage, rubbish, refuse, special waste, or other discarded material, including solid, liquid, semisolid, or contained gaseous material resulting from domestic, industrial, commercial, mining, agricultural, or governmental operations. 5 Ss. 125.01(1)(k)1. and 403.706, F.S. 6 S. 125.01(1)(k)2., F.S. 7 S. 403.706(1), F.S. 8 S. 403.706(1) and (8), F.S.; R. 62-701, F.A.C. 9 “Interlocal agreement” means a contract providing for a joint exercise of power by local governmental units. S. 163.01, F.S. 10 S. 403.706(3), F.S. 11 S. 403.7063, F.S. 12 Id. STORAGE NAME: h1241b.CIV PAGE: 3 DATE: 2/14/2022 Storm-Generated Yard Trash “Storm-generated yard trash” is vegetative matter that: Results from a tropical storm, a hurricane, a tornado, or any other significant weather event and is located or placed within a federally designated disaster area on public property or a public right-of-way; Is eligible for federal reimbursement under 42 U.S.C. ss. 5121 et seq.; 13 and Is placed curbside or on public property or a public right-of-way within the 15-day period after the weather event that is the subject of the federally declared disaster. 14 The term includes storm-generated debris under s. 403.7071, F.S. – that is, solid waste generated as a result of a storm event that is the subject of an emergency order issued by the Department of Environmental Protection. 15 Liquidated Damages When a contract is breached, the nonbreaching party may seek damages against the breaching party. These damages may include administrative fees or charges and, if provided for in the contract, liquidated damages. Liquidated damages are amounts specified in a contract to which a contracting party may be entitled if the other party breaches the contract; such damages are typically specified where actual damages are difficult or impossible to prove. 16 A local government’s contract with a solid waste management or recycling entity under which the entity provides residential municipal solid waste or recycling services to the local government may provide for liquidated damages and other fees or charges for the entity’s breach of the contract. 17 Effect of the Bill CS/HB 1241 provides that a local government may not seek liquidated damages or similar charges against a public or private solid waste management or recycling entity that provides residential municipal solid waste or recycling services when: A local, state, or federal emergency is in effect; and Such emergency materially affects the entity’s ability to provide residential municipal solid waste or recycling services. The bill applies to all contracts between a county or municipality for the collection or transport of solid waste or recyclable material executed or renewed on or after July 1, 2022, except contracts for the collection or disposal of storm-generated yard trash. The bill provides an effective date of July 1, 2022. 13 These sections contain Congressional findings on Federal Government assistance given to state and local governments in order to alleviate suffering and damage resulting from disasters. 14 S. 403.703(42), F.S. 15 Id. 16 Lefemine v. Baron, 573 So. 2d 326, 328 (Fla. 1991), (citing Hyman v. Cohen, 73 So. 2d 393 (Fla. 1954)); Legal Information Institute, Liquidated Damages, https://www.law.cornell.edu/wex/liquidated_damages#:~:text=Liquidated%20Damages%20are%20a%20variety,difficult%2 0or%20impossible%20to%20prove (last visited Feb. 9, 2022). 17 See, e.g., “Amended Residential Solid Waste and Recycling Collection Franchise Agreement,” art. 23 (July 9, 2020), between Santa Rosa County and Waste Pro, Inc., https://www.santarosa.fl.gov/DocumentCenter/View/5350/Amended- Residential-Solid-Waste-and-Recycling-Collection-Franchise-Agreement?bidId (last visited Feb. 9, 2022). STORAGE NAME: h1241b.CIV PAGE: 4 DATE: 2/14/2022 B. SECTION DIRECTORY: Section 1: Amends s. 403.706, F.S., relating to local government solid waste responsibilities. Section 2: Provides an effective date of July 1, 2022. II. FISCAL ANALYSIS & ECONOMIC IMPACT STATEMENT A. FISCAL IMPACT ON STATE GOVERNMENT: 1. Revenues: None. 2. Expenditures: None. B. FISCAL IMPACT ON LOCAL GOVERNMENTS: 1. Revenues: See II.D. Fiscal Comments. 2. Expenditures: None. C. DIRECT ECONOMIC IMPACT ON PRIVATE SECTOR: A private waste management or recycling entity that contracts with a local government for the collection or transport of solid waste or recyclable material may have reduced liability exposure under such contract because it will no longer be subject to paying liquidated damages or similar charges when a local, state, or federal emergency is in effect and such emergency materially affects its ability to provide residential municipal solid waste or recycling services under the contract. D. FISCAL COMMENTS: Local governments would no longer be able to seek liquidated damages or similar charges against a solid waste management or recycling entity that provides residential municipal solid waste or recycling services when a local, state, or federal emergency is in effect and such emergency materially affects the ability of the solid waste management or recycling entity to provide residential municipal solid waste or recycling services. However, this only applies to contracts for the collection or transport of solid waste or recyclable material executed or renewed on or after July 1, 2022, except contracts for the collection or disposal of storm-generated yard trash. III. COMMENTS A. CONSTITUTIONAL ISSUES: 1. Applicability of Municipality/County Mandates Provision: Not applicable. This bill does not appear to require counties or municipalities to spend funds or take action requiring the expenditures of funds; reduce the authority that counties or municipalities have to raise revenues in the aggregate; or reduce the percentage of state tax shared with counties or municipalities. 2. Other: None. B. RULE-MAKING AUTHORITY: The bill neither requires nor provides authority for administrative agency rulemaking. STORAGE NAME: h1241b.CIV PAGE: 5 DATE: 2/14/2022 C. DRAFTING ISSUES OR OTHER COMMENTS: None. IV. AMENDMENTS/COMMITTEE SUBSTITUTE CHANGES On February 2, 2022, the Local Administration and Veterans Affairs Subcommittee adopted a strike-all amendment and reported the bill favorably as a committee substitute. The amendment: Provided that a local government may not seek liquidated damages from a solid waste management or recycling entity that provides residential municipal solid waste or recycling services when a local, state, or federal emergency is in effect and such emergency materially affects the ability of the entity to provide residential municipal solid waste or recycling services. Specified that the bill applies to all contracts between a county or municipality for the collection or transport of solid waste or recyclable material executed or renewed on or after July 1, 2022, except contracts for the collection or disposal of storm-generated yard trash. This analysis is drafted to the committee substitute adopted by the Local Administration and Veterans Affairs Subcommittee.