How Do I Comply with the New Ban on Single Use Plastic Bags on the Barrier Islands of Dare, Currituck and Hyde Counties?

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1 How Do I Comply with the New Ban on Single Use Plastic Bags on the Barrier Islands of Dare, Currituck and Hyde Counties? G.S. 130A : An act to reduce plastic and non-recycled paper bag use on North Carolina's outer banks Please note that while this document is intended to help you comply with this new North Carolina law, it is in no way intended to serve as legal advice. Please consult a licensed attorney to address more specific questions which may arise concerning this issue. Despite an exhaustive effort by North Carolina Retail Merchants Association s (NCRMA) lobbying team, legislation has passed and been signed by the Governor to ban plastic bags along the barrier islands of Currituck, Dare and Hyde Counties. Thanks to the persistent lobbying efforts of NCRMA, the legislation is a much milder version of the original bill which would have banned plastic bags statewide. SB 1018 sets forth new requirements on some retailers with store locations along the barrier islands of Dare, Currituck and Hyde Counties. The bill was the initiative of Senator Marc Basnight (D-Dare), President Pro-Tempore of the Senate and sponsored by Senator Josh Stein (D-Wake). Effective SEPTEMBER 1 retailers are prohibited from providing plastic bags as defined in this legislation, and instead retailers may only provide either a durable, reusable (cloth or plastic) bag or a paper bag made of 100% recycled content (as defined in the law). The recycled paper bags must be both recyclable and made from 100% recycled materials. Additionally, the statute requires that the bag display specific language describing the recycled material content. A reusable bag is defined as a durable plastic bag, at least 2.25 mils thick with handles, specifically designed and manufactured for multiple re-use. Or, the reusable bag may be made of cloth (or other machine washable fabric with handles). Retailers providing paper bags as defined in the law must provide a reward program for customers bringing their own reusable bags. The retailer must offer either: a cash refund, store coupon for general store use, or a value or reward under the retailer s loyalty program for general store use. The incentive must be equal to or greater than the cost to the retailer of providing a recycled paper bag, multiplied by the number of reusable bags filled with the goods purchased by the customer. NCRMA always strives to provide our members with ample information and resources to comply with all legislation, this time including a process for bags purchased.

2 Questions about the Bag Legislation on the Barrier Islands of Currituck, Dare and Hyde Counties 1. Where does this bill apply? This bill applies to the barrier islands (not the mainland) of Dare, Currituck and Hyde Counties in North Carolina. Common cities and towns located on the barrier island portions of these counties include: Currituck Dare Hyde Corolla Avon Ocracoke Sanderling Buxton Collington Duck Frisco Hatteras Kill Devil Hills Kitty Hawk Nags Head Rodanthe Salvo Southern Shores Wanchese Waves It does not appear that the barrier islands of Hyde County contain any retail operations that would be impacted so this law is most likely only applicable to the barrier islands of Currituck and Dare Counties. 2. What Retailers are regulated? There is a two-part test that must be answered to determine if a business is affected by this new law. Test 1: The first test is whether a business is a retailer. A retailer is any person who offers goods for sale on the barrier islands of these three counties. Test 2: If a business meets the definition of a retailer, the second test is whether the retailer falls within one of two classifications to which the new law applies. The two classifications are linked to the size of retail floor space or whether there are five North Carolina stores operating under common ownership or a franchise agreement. If you meet either of these two classifications, your business is subject to this new law.

3 Class 1: The first classification is whether the retailer has more than 5,000 square feet of retail or wholesale space. If the retailer has more than 5,000 square feet of retail or wholesale space, the law applies to that retailer. Class 2: If the retailer has less than 5,000 square feet, the second classification of retailer this law applies to is determined by asking whether the retailer is one of a retail chain (defined as more than 5 stores under common business name, ownership, management or franchisee agreement in North Carolina). If the retailer is one of a retail chain then the new law applies to that retailer. Note that this classification is based on whether there are five or more locations located anywhere within North Carolina, not just on the barrier islands of the three named counties. If the retailer does not fall into either of these two classifications then the retailer is exempt from the new law. 3. What kinds of bags are prohibited? Carryout bags made primarily of thermoplastic synthetic polymeric material which is provided by a store to a customer at the point of sale and incidental to the purchase of other goods. These are generally plastic bags that are less than 2.25 mils thick and are often seen in groceries, pharmacies, convenience or auto supply stores, etc. 4. Are there any types of plastic bags that a retailer can continue to utilize? A retailer may provide reusable plastic bags meeting specific requirements. The bag must meet the definition of a reusable bag which means the bag is made of: Durable plastic bag least 2.25 mils thick, contains handles and is specifically designed and manufactured for multiple reuse; or Cloth or other machine washable fabric with handles. Otherwise, the retailer will need to provide a paper bag made of 100% recycled material (see below). 5. Does the law apply to my store if I only provide plastic bags that are more than 2.25 mils? A business that provides plastic bags that are greater than 2.25 mils in thickness with handles is exempt from the new law and would not have to provide a refund or incentive to the customer, provide paper bags made of 100% recycled material, or post a sign. 6. I know that I am prohibited from providing or giving plastic bags less than 2.25 mils to customers but can I sell these bags to customers? The law prohibits impacted retailers from providing or giving plastic bags less than 2.25 mils to customers but the retailer is not prohibited from selling these bags to customers.

4 7. What is considered a Recycled Paper Bag? A paper bag is considered a Recycled Paper Bag if it: Is manufactured from 100% recycled content, including post-consumer content, postindustrial content, or a mix of post-consumer; and Also displays the words "made from recycled material" and "recyclable" 8. Can traditional plastic bags be used for any products? Yes, plastic bags of any thickness can be provided if used solely to hold sales to an individual customer of otherwise unpackaged portions of the following items: (1) Fresh fish or fresh fish products. (2) Fresh meat or fresh meat products. (3) Fresh poultry or fresh poultry products. (4) Fresh produce. 9. Can I provide boxes to customers instead of paper bags made of 100% recycled material or thicker reusable plastic bags? The new law allows a retailer to provide customers with packaging materials (empty boxes) that were originally used for goods delivered to the retailer from wholesalers or suppliers. 10. Is a restaurant required to provide reusable cloth or plastic bags? Many restaurants will meet the definition of a retailer (as defined by the statute) who has five or more locations. In order to comply with food sanitation or handling standards or best practices, a prepared foods retailer may refuse to package prepared foods in a reusable cloth or plastic bag. The retailer may for sanitation reasons package prepared foods in a paper bag made of 100% recycled material that is labeled appropriately. In this case, the prepared food retailer would not be required to provide a rebate or incentive to the customer for the use of a reusable cloth or plastic bag. 11. How does the law define a prepared foods retailer? A retailer primarily engaged in the business of selling prepared foods to consumers (defined in G.S ). (It is unclear as to whether or not this definition would apply to a grocery or convenience store retailer which also sells prepared food.)

5 12. How do I respond to a customer that brings in his own reusable bag? The law requires retailers to create a financial incentive program to encourage customers to provide reusable bags. If a customer provides his own reusable bags (instead of the retailer s paper bags), the retailer must provide one of the following customer of incentives: 1) a cash refund; 2) a store coupon or credit for general store use; or 3) a value or reward under the retailer's customer loyalty or rewards program for general store use. The amount of the incentive must be equal to or greater than the cost to the retailer of providing a 100% recycled content paper bag, multiplied by the number of reusable bags filled with the goods purchased by the customer. Example: Customer provides 3 reusable cloth or plastic bags. Retailer cost of one recycled paper bag is 5. Multiply 3 x 5 = financial incentive of Must retailers post a sign? Impacted retailers (other than a prepared foods retailer) are required to display a sign in a location viewable by customers containing the following notice: "[county name] County discourages the use of single-use plastic and paper bags to protect our environment from excess litter and greenhouse gases. We would appreciate our customers using reusable bags, but if you are not able to, a 100% recycled paper bag will be furnished for your use." NCRMA has signs available that meet the statutory requirements. 14. Penalties? Failure to comply with the plastic bag ban can result in fines: First violation $100 Second violation within a twelve month period $200 Subsequent violations within a twelve month period $500