RMA reports tiremakers call New York scrap tire plan 'unacceptable'

March 5, 2003

"Tire fees should be used to clean up scrap tires, not state budget deficits," says the Rubber Manufacturers Association's (RMA) Senior Technical Director Michael Blumenthal.

He was speaking out concerning a proposal to help close New York State's budget deficit with a fee on new tires. Tire manufacturers oppose the plan, and say that any fee should be used solely to clean up old tire stockpiles.

At a Senate Finance and Assembly Ways and Means joint committee hearing in Albany, N.Y., yesterday, the RMA outlined tiremakers' concerns with New York's proposed scrap tire plan that would impose a $2.50 fee on every new tire sold in the state.

In the proposal, which is included in New York Governor George Pataki's state budget, $2 of the fee would go to the state's general fund, where it can be spent on any state government program. Another 25 cents would go to the Department of Environmental Conservation and 25 cents would be kept by tire retailers to cover administrative costs associated with collecting the new fee.

However, tire retailers would not be allowed to charge the consumer any additional fees for tire disposal.

"We find the governor's plan to be unacceptable," said Blumenthal. "The funding level in this plan is wholly inadequate to solve the state's scrap tire problems."

New York generates some 20 million scrap tires a year and has an estimated 40 million to 50 million tires in stockpiles -- the second highest in the nation after Texas. New York also is facing a reported budget shortfall of $12 billion in fiscal year 2003-2004, says the RMA.

The RMA has been involved in the development of scrap tire legislation in New York since 1998, when it helped organize the New York State Consensus Roundtable, a group of stakeholders representing diverse group of scrap tire interests. RMA provided information to the 17 members of the New York State Scrap Tire Council, who were appointed by the governor to recommend the mechanics for developing a dedicated fund and a strategy to address the development of scrap tire markets in New York.

The RMA has worked with many states to achieve effective and appropriate scrap tire management legislation and regulations. According to the RMA, the components of an effective state scrap tire program are a dedicated fee, stockpile abatement and development of viable markets that can use scrap tires for other purposes such as fuel, civil engineering projects and products such as playground coverings.

In testimony provided to the joint committee, the RMA's Blumenthal made five specific recommendations for a state scrap tire program in New York:

1) The funds designated for scrap tire programs be $1 per tire per year.

2) The funds generated be placed in a dedicated fund and used exclusively to provide information on viable scrap tire markets, the abatement of abandoned scrap tire piles and the enforcement of regulations.

3) A "sunset" date is included.

4) The State assess whether the fee is needed for an additional period of time at least one year before the prescribed the sunset date. This assessment can be done every five years.

5) Tire dealers be allowed to charge a separate disposal fee on old tires at a price determined by market conditions.

Blumenthal concluded, "RMA has worked with New York in the past and we would embrace the opportunity to work with public and private stakeholders to employ a scrap tire program that all New Yorkers can support."