Many states charge user fees at the time of a tire's sale to help foster market development for recycled rubber. (Commodity Focus).
In an effort to establish sustainable markets for scrap rubber, many states charge consumers a user fee when purchasing tires. This in turn helps to fund market development as well as tire abatement and enforcement programs. According to information compiled by the Scrap Tire Management Council, Washington, 35 states have active programs or fees. In 25 of these states, tire dealers collect the fees at the time of sale, with fees ranging from 25 cents to $2.00 per tire.
While most states employ grants to distribute the funds collected, five states--Louisiana, New Mexico, North Carolina, Tennessee and Virginia--use reimbursement systems.
VIRGINIA'S APPROACH TO REIMBURSEMENT
"What we do is put out a list of end uses that are eligible to get payments from the state waste tire fund," explains Allan Lassiter, waste tire program manager for the Virginia Department of Environmental Quality. Companies generating material into these approved uses receive a direct payment from the fired, which is financed through a 50-cent fee on each new tire sold.
"It's direct market support, but at the end of the process, once the business decisions are made," Lassiter says. The three end market categories are civil engineering, fuel and recycled products.
"In the case of civil engineering, it can be used in any kind of drainage project," Lassiter says. Alternative daily cover for landfills, septic system chips and aggregate replacement are some examples of civil engineering applications.
Regarding potential fuel markets, Lassiter says, "It's anybody who can use tire derived fuel (TDF) as a fuel supplement." In Virginia power plants, pulp plants and even municipal trash incinerators use TDF, he says.
The category of recycled products is underdeveloped within Virginia, as it is in most states, Lassiter says. "Most of it has to be made into crumb rubber first, then made into a variety of products, from mats to sealers to asphalt additives for rubberized asphalt. [Chips or crumbs are] also used in playground materials, mulches and soil amendments," Lassiter says. "Any of those things are eligible for reimbursement under the state of Virginia program."
Regardless of application, Virginia pays $22.60 per ton of tires consumed. Companies using tires from stockpiles are reimbursed at a rate of $50 per ton to encourage tire abatement, Lassiter says.
End market choices in Virginia are sufficient for the amount of fires processed within the state, he says. "We are handling not only all the current flow in the state of Virginia, but we're also doing a lot of tire pile cleanups that are being added into that same mix, and we do import a few fires from surrounding states, too," Lassiter says. "We have over 52 end users right now, so I think we've got a pretty good program."
SOUTH CAROLINA'S ASPHALT FOCUS
In South Carolina, 55 cents of the $2 collected by fire dealers goes into a trust fund with the state's Department of Health and Environmental Control. Clemson University's Asphalt Rubber Technology Service (ARTS) was initiated with a $6 million grant for five years. ARTS director Dr. Serji Amirkhanian says that the program gives $950,000 in grants per year to municipalities.
"We are providing the grant to cover the difference in cost between the normal asphalt and the rubberized asphalt," he says. "Therefore, the municipalities involved are not really paying any extra money for its use."
Amirkhanian adds, "Our ultimate goal is that eventually the specifications will be the Department of Transportation's specifications. We'll be out of the picture for all intents and purposes."
He says the ARTS project has been successful in its last two years. "At least three or four contractors--big ones--around the state have been willing to try it," Amirkhanian says. "They have been very happy with it. They are asking for more jobs, which is very unusual. It has been a pleasant surprise so far."
MISSOURI'S PLAYGROUND GRANTS
In Missouri, tire dealers collect a 50-cent fee on each tire. Dan Fester, waste tire unit chief for the state's Department of Natural Resources, says that 5 percent of the fee goes toward grants to fund playground projects.
Fester says that 65 percent of the tire fee goes toward abatement projects. "And then 25 percent is essentially for everything we do--enforcement efforts, permitting, beneficial use approvals, inspections, that sort of thing."
Most of the fires processed in Missouri are burned as TDF. "We have an immense capacity for that product," Fester says. He does not think that playgrounds represent a sustainable market for Missouri through the current grant program. "We have one manufacturer of that material here in the state. That is a very minor portion of what they do. They produce crumb rubber as a raw material for other manufacturers, which is their main line of business," he says.
Missouri's tire fee will expire January 1, 2004. However, the DNR hopes to introduce new legislation in the next session, which begins in January 2003 and runs through May.
California's program initially charged a user fee of 25-cents per tire. The amount increased to $1 in 2000, but drops to 75-cents in January 2007, with no sunset date.
Roughly $ 30 million is collected yearly, $8 million of which is used for market development grants, Martha Gildart, branch manager of the California Integrated Waste Management Board, says. The remaining funds are split between permitting, enforcement, hauler registration and manifesting of loads and remediation and cleanup of tire piles.
"We're recycling somewhere between 65 and 70 percent of the tires," she says. "There's been some competition for our crumb rubber producers from imported crumb rubber. Apparently, British Columbia has a pretty strong subsidy program, and they've outbid some of our guys on contracts for rubberized asphalt." Gildart adds, "We do have some markets that usually take care of our tire supply, but there are little hiccups in the system occasionally."
Gildart says, "I think we've developed a good variety of markets here. We have markets that use crumb rubber, whether it's a molded rubber product or a rubberized asphalt. We have markets for shredded tires, both in civil engineering and in tire derived fuel. There are some markets for what they call stamped products that take the tire as is, flatten it out and cut out a product. There are even some uses for whole tires, particularly with the cement kilns. I think having a mix like that gives you some strength."
THE APPROACH IN ILLINOIS
Todd J. Marvel of the Illinois EPA/Bureau of Land, Springfield, says that 80 cents from the $1 tire user fee goes into a used tire management fund. "The Illinois EPA receives approximately half of the money from that fund for waste tire cleanups and for regulation and enforcement of the scrap tire industry," Marvel says. Approximately a third of the money goes to the Illinois Department of Commerce and Community Affairs (DCCA), which is responsible for market development. Marvel says, "We do participate in that as well, but it's a primary function of DCCA," which administers a grant system.
Marvel says Illinois's TDF market alone exceeds the state's annual generation of scrap tires. "Our end use markets are anywhere from 15 to 20 million [passenger tire equivalents] a year. Our annual generation is somewhere around 12 million." Illinois's in-state TDF market is approximately 16 million, he says. "We also have some crumb rubber manufacturing, and we also use shredded fires in engineered applications." Marvel says shredded tires are used to a lesser extent as alternate daily cover at landfills and in road base within landfills.
"In addition to market development, there has to be a very significant compliance and enforcement program, both civil and criminal, to make sure that the used tires that are generating are going into the markets and not creating more waste tire dumps," Marvel says. "From my perspective, that's what the EPA does with the vast majority of the money that we receive from the fee."
THE NEED FOR FUNDING
While most officials hope that the markets can be established to the point where a fee won't be necessary, they realize this may be a lofty goal.
Amirkhanian says that if the ideas ARTS proposes are implemented by the DOT and municipalities throughout South Carolina, it is possible to create a sustainable market for scrap tires in rubberized asphalt within the state. However, adding scrap tires to asphalt does cost more, and Amirkhanian says that many people have trouble seeing beyond the initial cost to the long-term savings: better, longer lasting pavements and reduced tire disposal costs.
Fester says that while he feels Missouri has sufficient end markets at this time, things are subject to change. "Since the majority of our tires are being used for tire derived fuel, if something would happen to that market or to those facilities, if some other constraint were put on them, I don't know that they would be sufficient," he says. "Which is one of the reasons we try to encourage additional markets as much as we can, even though we don't really have enough funding."
Terry Leveille, editor and publisher of California Tire Report, Fair Oaks, Calif., is a consultant to the tire recycling industry. "I always see the products and the technologies that are involved with tire recycling in a state of flux." Other asphalt additives and fuel sources could present themselves, displacing tires. "You never know if there will be other fuel sources that might eclipse the cost and the efficiency of tires," Leveille says. Political ramifications are a concern, too. "That's always been an issue in California with the use of TDF."
Leveille adds, "The way I see it, there's nothing wrong with always looking to try to find new technologies, new markets, and there will probably be a need in the foreseeable future for a tire fee." However, he questions whether the fee should come from tire manufacturers, at the federal level or at the point of first sale, saying the issue still needs to be considered.
Virginia's Lassiter says that it's going to take time before markets can be established to a point where user fees are unnecessary. He adds that when Oregon's fee reached its sunset date in 1992, ending its reimbursement program, most of its major end markets collapsed within a year.
Gildart says because tires are so durable and well constructed, a cost will always be associated with their recycling. "I think it is unlikely that it will get to a point where we don't need a fee, just because it takes so much energy, so much effort. The equipment has to be maintained so carefully, that if we're going to be recycling tire rubber into new products, it's going to require financial support." She adds, "Maybe I'll be lucky and proved wrong someday."
THE HOTTEST STATE
To read about a tire processor's view of the reimbursement program in Louisiana, visit www.RecyclingToday.com.
The author is assistant editor of Recycling Today and can be reached at dtoto@RecyclingToday.com
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|Date:||Oct 1, 2002|
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