MMSW Requests Government Extend Stewardship Program Commencement Date

Last week you were advised that on December 18, 2014 the Saskatchewan government made a number of significant changes to MMSW’s approved Waste Packaging and Paper Stewardship Plan due to be launched on January 1, 2015. These changes announced with no advance notice or consultation, alter some fundamental principles underlying the MMSW’s program plan. (Read the announcement here and accompanying fact sheet).

As a result, MMSW is asking the Minister of Environment for an extension to the program commencement date in order to provide adequate time for MMSW and the Ministry to agree to program plan amendments, recalibrate our financial obligations, and re-strike new commercial contracts with municipalities that take into account a revised funding obligation.

Our request for an extension ensures that MMSW members remain in compliance with the Household Packaging and Paper Stewardship Program Regulations while we work with the Saskatchewan government on a way forward. In the interim, MMSW has terminated the funding agreements with the Saskatchewan municipalities effective immediately.

What did the Minister Recently Announce?

On December 18, 2015 the Minister announced a series of exemptions to the MMSW’s approved stewardship plan for waste packaging and printed paper including:

• An exemption for any business that generates less than $2 million in gross annual revenue, or generates less than one tonne of packaging and paper produced annually or operates as a single point of retail;
• A two year exemption for all businesses with annual revenue between $2 and $5 million and all larger newspapers. During this two year period, these businesses would not be required to report with MMSW and would be required to pay a $500.00 flat fee.
• During the two year period, all fees (other than the $500.00 flat fee) must be submitted to the Minister for approval prior to taking effect.

What are the implications of these changes for MMSW stewards?

MMSW is very concerned that the recent announcement fundamentally changes MMSW’s program plan in two very important ways:

1. The exemption of several categories of businesses from fully contributing to MMSW’s recycling program changes the economic underpinnings of the program.  Granting some businesses preferential fee rates undermines MMSWs ability to raise the necessary revenue to fund our commitments to municipalities in Saskatchewan.
2. It shifts authority for setting stewardship fees from the stewards that are paying the fees to the Minister of Environment for two years.

MMSW’s stewardship plan is founded on fairness and a level playing field for all involved – meaning businesses pay fees based on the cost to manage the amount of packaging and paper that they supply to Saskatchewan residents. The program plan, as approved by the government in December 2013, seeks to impose equitable financial terms on all obligated businesses ensuring that some classes of stewards are not disadvantaged at the expense of others.  Exempting newspapers and mid-sized businesses (with the exception of a token annual flat fee of $500) the government has effectively transferred recycling costs from these businesses to the rest of the MMSW member companies.   In addition, with these exemptions the government has reduced the number of businesses that are required to pay fees from the current 370+ to approximately 200 MMSW members. This requires MMSW to recalibrate the financial obligations of the remaining companies and as such MMSW is not in a position to launch the program on January 1, 2015 as originally planned.

MMSW is also very concerned about the intention of the government to shift authority for setting stewardship fees from the stewards to the Minister of Environment.   MMSW is responsible for setting its budget, entering into commercial funding arrangements with municipalities, entering into financial arrangements with stewards and developing the fee methodology necessary to calibrate fees. The fact that the government has signalled its intention to take on authority for fee setting takes this from a previously-approved producer responsibility plan to a politicized government-run taxation scheme.

What is MMSW’s request to the Saskatchewan government?

Today, MMSW requested that the government grant a 180 day extension to the MMSW program commencement date.  If granted this would effectively change the launch date to July 1, 2015.

What are next steps?

• MMSW will meet with the Saskatchewan government early in the New Year to find solutions that work for both MMSW members and the government.
• Steward invoices will not be released on January 1, 2015 as originally scheduled. We will communicate with stewards early in January about a revised invoice schedule.

Please contact Stewards Services at 1-888-980-9549 if you have any questions.