2. Consideration of Manufacturer Requests for Exemption for Inability to Obtain Sufficient Quality or Quantity of Post-Consumer Material for Regulated Trash Bags during the 2003 Reporting Period

3. Manufacturer Compliance Requirement Manufacture Trash Bags with Post-Consumer Material (PCM) Content of at least: Manufacture Trash Bags with Post-Consumer Material (PCM) Content of at least: 10 percent in regulated trash bags, or 10 percent in regulated trash bags, or 30 percent in all plastic products 30 percent in all plastic productsOR Demonstrate that there was insufficient quantity or quality of APCM that met Board Standards Demonstrate that there was insufficient quantity or quality of APCM that met Board Standards

4. Four Manufacturers Requested An Exemption for 2003 Manufacturers requesting exemptions Manufacturers requesting exemptions Glad Products Glad Products Trans Western Polymers Trans Western Polymers Poly-America Poly-America Pactiv Corporation Pactiv Corporation

5. Basis for an Exemption Demonstrated lack of quality PCM Demonstrated lack of quality PCM Met Board quality standards? Met Board quality standards? Demonstrated reasonable efforts were made to obtain and use PCM Demonstrated reasonable efforts were made to obtain and use PCM Documented efforts to work with suppliers Documented efforts to work with suppliers Changes to manufacturing processes Changes to manufacturing processes “Degree of compliance” and PCM usage “Degree of compliance” and PCM usage

6. Reasonable Efforts To Obtain Post-Consumer Material Include: Contact available PCM suppliers Contact available PCM suppliers Identify tests and specifications used—seek mutual agreement Identify tests and specifications used—seek mutual agreement Document quality testing results Document quality testing results Document reasons for rejecting of samples Document reasons for rejecting of samples Document actions to resolve quality issues Document actions to resolve quality issues PCM certification from supplier PCM certification from supplier

7. Glad Products 2003 Exemptions granted in 1999-2001; denied in 2002 Exemptions granted in 1999-2001; denied in 2002 Purchased 6 tons PCM in 2003 Purchased 6 tons PCM in 2003 0.1 % recycled content 0.1 % recycled content Conducted lab and plant tests of PCM samples from several suppliers Conducted lab and plant tests of PCM samples from several suppliers Modified production process to increase use of PCM Modified production process to increase use of PCM Still searching for PCM/suppliers Still searching for PCM/suppliers

8. Poly-America 2003 Exemptions granted in 1999-2002 Exemptions granted in 1999-2002 Purchased 1,027 tons of PCM in 2003 Purchased 1,027 tons of PCM in 2003 4.3 % recycled content 4.3 % recycled content Purchased PCM from 25 suppliers and processed into pellets Purchased PCM from 25 suppliers and processed into pellets Supplied receipts documenting purchases Supplied receipts documenting purchases Has secure long-term supply of PCM Has secure long-term supply of PCM

9. Trans Western Polymers 2003 Exemption granted in 2001; denied in 2002 Exemption granted in 2001; denied in 2002 Purchased 60 tons of PCM in 2003 Purchased 60 tons of PCM in 2003 1.9% recycled content 1.9% recycled content Strategic Plan; consistent supply Strategic Plan; consistent supply Upgraded equipment and modified processing techniques Upgraded equipment and modified processing techniques Secured long-term supply for 2004/05 Secured long-term supply for 2004/05

10. Pactiv Corp. 2003 Exemption granted in 2002 Exemption granted in 2002 Used 130 tons of PCM in 2003 Used 130 tons of PCM in 2003 2.5% recycled content in bags 2.5% recycled content in bags Purchased PCM and processed into pellets Purchased PCM and processed into pellets Tested and rejected PCM samples from several suppliers Tested and rejected PCM samples from several suppliers Focus on Renew bags Focus on Renew bags

11. Staff Recommendations: Based on review of submitted documentation, follow up discussion with manufacturers, and supplier interviews, staff recommends: Select Option 1 and approve the exemptions for: Glad Products Company Poly America, LP Trans Western Polymers Take No Action: Pactiv Corporation

12. 2003 Exemption Requests Requestors of Exemptions: Requestors of Exemptions: Four of the 10 largest manufacturers Four of the 10 largest manufacturers Account for 42 percent, by weight, of all regulated trash bags Account for 42 percent, by weight, of all regulated trash bags Account for 13 percent of PCM used in trash bags Account for 13 percent of PCM used in trash bags

13. Reasons Cited For Lack of Availability of Quality PCM Manufacturers reported the following: Manufacturers reported the following: Fewer suppliers in business in 2003 Fewer suppliers in business in 2003 Insufficient collection of LLDPE feedstock Insufficient collection of LLDPE feedstock Contamination of recycled material Contamination of recycled material Suppliers can not certify as PCM Suppliers can not certify as PCM Available LLDPE going to other markets Available LLDPE going to other markets Customer specifications (color & strength) make use of PCM difficult Customer specifications (color & strength) make use of PCM difficult

14. Summary of Manufacturers 2003 Reporting Period Manu. Name Reg. Bags (tons) PCM (tons) Percent Glad 6,285 6,285 6 0.1 % 0.1 % Pactiv 5,181 5,181 130 130 2.5 % 2.5 % Poly-America24,0171,027 4.3 % 4.3 % Trans Western 3,205 3,205 60 60 1.9 % 1.9 %

16. Exemption Summary Glad PCM 6tons, 0.1% Conducted lab and plant samples in 2003/04 Modified manufacturing process Pactiv PCM 130 tons; 2.5% Purchased PCM and processed own pellets Contacted suppliers/rejected loads PolyAmerica PCM 4.3% Process PCM Did not test samples in 2002 Trans Western PCM 1.9% New equipment/process Secure supply

17. Process for Confirming “Reasonable Efforts” Reviewed certification form/exemption request and supplement written material Reviewed certification form/exemption request and supplement written material Adequacy of documentation verified through: Adequacy of documentation verified through: Individual and conference calls with manufacturer Individual and conference calls with manufacturer Discussions with suppliers Discussions with suppliers Focus was on confirming that “reasonable efforts” were made Focus was on confirming that “reasonable efforts” were made

18. Factors Limiting Purchases As Reported By PCM Suppliers PCM price must be lower than virgin PCM price must be lower than virgin No follow up on: No follow up on: Phone calls offering PCM, or samples submitted Phone calls offering PCM, or samples submitted What quality standards samples failed on What quality standards samples failed on Potential purchase orders not completed Potential purchase orders not completed Lack of feedback about steps to improve quality Lack of feedback about steps to improve quality

19. Issues Raised At Workshop New standard of review New standard of review Not given adequate notice Not given adequate notice Suppliers not contacting manufacturers Suppliers not contacting manufacturers There is no PCM available There is no PCM available Board suppliers lists are not up to date Board suppliers lists are not up to date

20. Phone Survey of Suppliers and Compliant Manufacturers Staff phoned several PCM suppliers and compliant trash bag manufacturers Staff phoned several PCM suppliers and compliant trash bag manufacturers Confirm supplier ability to meet demand; both quality and quantity Confirm supplier ability to meet demand; both quality and quantity Confirm with compliant manufacturers how they were able to meet 10 percent PCM requirement Confirm with compliant manufacturers how they were able to meet 10 percent PCM requirement

21. How Did Other Manufacturers Achieve Compliance Made compliance with 10 % PCM an important goal: Made compliance with 10 % PCM an important goal: Purchased PCR from several suppliers Purchased PCR from several suppliers Used the 1.2 credit for using CA PCR Used the 1.2 credit for using CA PCR Stayed in regular communication with suppliers Stayed in regular communication with suppliers Culture was one of achieving compliance Culture was one of achieving compliance

22. Manufacturers must document that available PCM failed to meet Board quality standards: Each APCM supplier contacted Each APCM supplier contacted Mutually agreed upon tests and specifications Mutually agreed upon tests and specifications Independent test results, or a certification from the APCM supplier, showing that the material does not meet quality standards Independent test results, or a certification from the APCM supplier, showing that the material does not meet quality standards A discussion of reasons for rejecting each sample or shipment A discussion of reasons for rejecting each sample or shipment A statement from the supplier describing the quality of the material that was rejected A statement from the supplier describing the quality of the material that was rejected Each APCM supplier contacted Each APCM supplier contacted Mutually agreed upon tests and specifications Mutually agreed upon tests and specifications Independent test results, or a certification from the APCM supplier, showing that the material does not meet quality standards Independent test results, or a certification from the APCM supplier, showing that the material does not meet quality standards A discussion of reasons for rejecting each sample or shipment A discussion of reasons for rejecting each sample or shipment A statement from the supplier describing the quality of the material that was rejected A statement from the supplier describing the quality of the material that was rejected