1. Managing Post-Consumer Paint Alison Keane, Counsel Government Affairs National Paint and Coatings Association

2. California Integrated Waste Management Board Strategic Policy Development – December 4, 2007 NPCA The National Paint and Coatings Association is a voluntary non-profit association, originally organized in 1888 The National Paint and Coatings Association is a voluntary non-profit association, originally organized in 1888 NPCA represents approximately 300 manufacturers, distributors, and raw material suppliers to the industry NPCA represents approximately 300 manufacturers, distributors, and raw material suppliers to the industry Paint and other Coatings Paint and other Coatings Adhesives Adhesives Sealants Sealants Caulks Caulks Serve as advocate, compliance assistance resource and community liaison Serve as advocate, compliance assistance resource and community liaison Legislative Legislative Regulatory Regulatory Judicial Judicial

3. California Integrated Waste Management Board Strategic Policy Development – December 4, 2007 Background Paint identified as the #1 issue by cost and volume for Household Hazardous Waste Programs Paint identified as the #1 issue by cost and volume for Household Hazardous Waste Programs NPCA worked with individual states on issue for decades NPCA worked with individual states on issue for decades PPSI formed w/facilitation by Product Stewardship Institute PPSI formed w/facilitation by Product Stewardship Institute capable of effectively coordinating multi-stakeholder and multi- state approach to the issue capable of effectively coordinating multi-stakeholder and multi- state approach to the issue NPCA joined PPSI in 2002 NPCA joined PPSI in 2002 Coordinated approach versus state-by-state approach Coordinated approach versus state-by-state approach Provide better information to state and local governments Provide better information to state and local governments Gain better information from non-industry stakeholders Gain better information from non-industry stakeholders Goal was to find a resolution Goal was to find a resolution Status Quo not adequate to address challenge Status Quo not adequate to address challenge

4. California Integrated Waste Management Board Strategic Policy Development – December 4, 2007 Background Cont. NPCA signed 1 st MOU in 2005 outlining dialogue participation and pilot projects NPCA signed 1 st MOU in 2005 outlining dialogue participation and pilot projects Projects address the potential to eliminate or lower leftover paint volume and cost Projects address the potential to eliminate or lower leftover paint volume and cost Projects address data gaps Projects address data gaps NPCA sponsored projects NPCA sponsored projects Reuse Guidance Document Reuse Guidance Document Education Survey/Recommendations Report Education Survey/Recommendations Report HSE White Paper HSE White Paper Lifecycle/Cost Benefit Analysis Report Lifecycle/Cost Benefit Analysis Report New “Paint Wise” Earth 911 website New “Paint Wise” Earth 911 website Lifecycle/Cost Benefit only project not yet complete Lifecycle/Cost Benefit only project not yet complete

5. California Integrated Waste Management Board Strategic Policy Development – December 4, 2007 March 2007 Resolution Building off 1 st MOU NPCA’s Board approved a resolution in March 2007 to: Building off 1 st MOU NPCA’s Board approved a resolution in March 2007 to: To continue participation in the PPSI To continue participation in the PPSI Enter into a new MOU (1 st expired March 2007) Enter into a new MOU (1 st expired March 2007) Begin development of a new nationally coordinated system for the management of post-consumer waste paint Begin development of a new nationally coordinated system for the management of post-consumer waste paint Key Elements Key Elements Consumer Education Consumer Education No Mandatory Retail Take-Back No Mandatory Retail Take-Back Cost Effective Cost Effective Industry Operated Product Stewardship Organization Industry Operated Product Stewardship Organization Consumer Fee Based Financing Consumer Fee Based Financing Begin w/Pilot Project Begin w/Pilot Project

6. California Integrated Waste Management Board Strategic Policy Development – December 4, 2007 New MOU Outlines continued participation in the PPSI Outlines continued participation in the PPSI Pilot Project in the State of Minnesota in 2008 with systematic roll-out to other critical states Pilot Project in the State of Minnesota in 2008 with systematic roll-out to other critical states California in 2010 California in 2010 Consumer-based cost recovery system for financing Consumer-based cost recovery system for financing Fee passed on to consumer through retailer Fee passed on to consumer through retailer Industry-run Product Stewardship Organization Industry-run Product Stewardship Organization No Mandatory Retail Take Back No Mandatory Retail Take Back Provision for legislation/regulation to address potential anti-trust and fairness issues Provision for legislation/regulation to address potential anti-trust and fairness issues

7. California Integrated Waste Management Board Strategic Policy Development – December 4, 2007 Up-Front Funding NPCA has agreed to provide funding for the design of the PSO NPCA has agreed to provide funding for the design of the PSO Implementation will not be undertaken without sustainable financing system Implementation will not be undertaken without sustainable financing system NPCA has agreed to provide funding for the design of the MN project: NPCA has agreed to provide funding for the design of the MN project: MN Collection/Disposal Business Plan MN Collection/Disposal Business Plan Education/Marketing Campaign Proposal Education/Marketing Campaign Proposal NPCA has committed funding for PSI (shared w/Government Groups) NPCA has committed funding for PSI (shared w/Government Groups) NPCA has committed funding for completion of LCA/CBA of paint disposal methods NPCA has committed funding for completion of LCA/CBA of paint disposal methods

8. California Integrated Waste Management Board Strategic Policy Development – December 4, 2007 MN Demonstration Project Contracted with Product Care for assistance with MN Demonstration Project Contracted with Product Care for assistance with MN Demonstration Project Canadian non-profit industry Product Stewardship Organization Canadian non-profit industry Product Stewardship Organization Established Programs Established Programs British Columbia British Columbia Nova Scotia Nova Scotia Saskatchewan Saskatchewan Pending Programs Pending Programs Manitoba Manitoba Alberta Alberta

9. California Integrated Waste Management Board Strategic Policy Development – December 4, 2007 MN Demonstration Project Cont. PSO design PSO design Governance Governance Administration Administration Risk Management Risk Management MN Business Plan MN Business Plan Capital Requirements Capital Requirements Budget Budget Collection Systems (Current and New) Collection Systems (Current and New) Processing methods (Reuse, Recycling, Disposal) Processing methods (Reuse, Recycling, Disposal) Performance Measurements Performance Measurements Stakeholder Reporting Stakeholder Reporting

10. California Integrated Waste Management Board Strategic Policy Development – December 4, 2007 MN Demonstration Project Cont. Will contract with Marketing firm for Education/Outreach Will contract with Marketing firm for Education/Outreach Label Changes Label Changes Retail Displays Retail Displays Reactivated Website Reactivated Website PSA’s PSA’s Contracted with ERG (Consulting Firm) for Completion of LCA/CBA Contracted with ERG (Consulting Firm) for Completion of LCA/CBA Comparison of post-consumer paint management methods Comparison of post-consumer paint management methods

11. California Integrated Waste Management Board Strategic Policy Development – December 4, 2007 Sustainable Financing 2 nd MOU and Nationally Coordinated System contingent on sustainable financing system 2 nd MOU and Nationally Coordinated System contingent on sustainable financing system Model is successful Canadian paint programs Model is successful Canadian paint programs Producers and/or Retailers pay fee into PSO based on sales of paint and pass this cost to consumers through visible or invisible fee Producers and/or Retailers pay fee into PSO based on sales of paint and pass this cost to consumers through visible or invisible fee Utilizes shared responsibility approach Utilizes shared responsibility approach Paint is not an inherent waste product Paint is not an inherent waste product Latex paint is not a hazardous waste Latex paint is not a hazardous waste

12. California Integrated Waste Management Board Strategic Policy Development – December 4, 2007 Retail Participation Key component of sustainable financing system is retail participation Key component of sustainable financing system is retail participation NPCA, PSI, PPSI participants working with retail partners now to educate and garner support NPCA, PSI, PPSI participants working with retail partners now to educate and garner support Post-consumer paint issue Post-consumer paint issue Canadian paint product stewardship programs Canadian paint product stewardship programs Must partner with retail to reach consumer Must partner with retail to reach consumer Fee Fee Education/Outreach Education/Outreach Legislation may be necessary to address level playing field and potential anti-trust issue Legislation may be necessary to address level playing field and potential anti-trust issue

13. California Integrated Waste Management Board Strategic Policy Development – December 4, 2007 Next Steps Signature on MOU is first step – much more work to be done to accomplish ultimate goal! Signature on MOU is first step – much more work to be done to accomplish ultimate goal! Continue discussions with Retail Industry to come up with an agreement on a consumer based sustainable financing system Continue discussions with Retail Industry to come up with an agreement on a consumer based sustainable financing system Establish framework for PSO Establish framework for PSO Design MN Demonstration Project Design MN Demonstration Project Complete LCA/CBA Complete LCA/CBA All to be coordinated through the PPSI stakeholder group All to be coordinated through the PPSI stakeholder group