EIA, CEA Applaud Gov. Davis for Veto of Misguided 'Tech Tax' Legislation; Tech Assns to Work with CA EPA on Electronics Recycling

10/1/2002

From: Kerry Fennelly of the Electronics Industries Alliance, 703-907-7792

ARLINGTON, Va., Oct. 1 -- Dave McCurdy, president of the Electronic Industries Alliance (EIA) and Gary Shapiro, President of the Consumer Electronics Association (CEA), today praised California Governor Gray Davis for his veto of the "tech tax" bill.

"We thank Governor Davis for recognizing the serious negative ramifications of the Sher bill," said McCurdy. "We all agree that electronics recycling is important. But a California-only tax that creates competitive disadvantages within our industry and is harmful to the state's economy is not the solution."

Beginning in 2004, the Sher bill (SB 1523) would have imposed a fee of $10 on TVs and desktop computer monitors bought in California. The funds would have been directed to the California Integrated Waste Management Board (CIWMB), which would distribute the grants to waste haulers, recyclers and cities statewide.

However, the legislation could have been legally imposed only on companies with a bricks-and-mortar presence in California; Internet sales cannot be affected unless the company in question has a nexus in the state. This would have forced retailers on the ground in California and consumers making purchases in California stores to shoulder the economic burden. It would have given manufacturers and retailers who sell only online a substantial competitive advantage in California and it would have also saddled Californians with extra costs just for shopping in their own state.

Governor Davis also vetoed a companion bill, SB 1619, which was opposed by the electronics industry for creating unrealistic goals and timeframes for increasing the amount of recovery and recycling of electronics in California.

"A better solution should focus on reducing the regulatory barriers that currently exist in California for electronics recycling; increasing the recycling opportunities for California consumers; and educating consumers on how to recycle their used electronics," said Shapiro.

"In addition, it's important that a workable model in California complement any national solution as we move forward. The electronics industry is committed to finding a national solution for electronics recycling."

"Our industry is working hard to provide Californians with several immediate options to help with the creation of a recycling infrastructure. Sony, Panasonic and Sharp have agreed to sponsor 20 recycling events in the state of California, and all three companies will pay for the recycling of their products that are collected during these events. Gateway offers a rebate for consumers who recycle their used computers. HP, IBM, and Dell also all have mail-back programs that allow consumers to send in any brand of computer and be assured that the products are recycled."

"We look forward to working with the California EPA, the legislature and all the stakeholders involved to address the complexities of this issue and develop a solution that really works," McCurdy continued. "Let's go back to the drawing board. We can do better."

------ The Electronic Industries Alliance (EIA) is a national trade organization that includes the full spectrum of U.S. manufacturers, representing more than 80 percent of the $550 billion electronics industry. The Alliance is a partnership of electronic and high tech associations and companies whose mission is promoting the market development and competitiveness of the U.S. high tech industry through domestic and international policy efforts. EIA, headquartered in Arlington, Va., comprises more than 2,500 member companies whose products and services range from the smallest electronic components to the most complex systems used by defense, space and industry, including the full range of consumer electronic products. The industry provides more than 2 million jobs for American workers. For more information about EIA, please visit: www.eia.org.

The Consumer Electronics Association (CEA) represents more than 1,000 corporate members involved in the design, development, manufacturing, distribution and integration of audio, video, mobile electronics, wireless and landline communications, information technology, home networking, multimedia and accessory products, as well as related services that are sold through consumer channels. Combined, CEA's members account for more than $80 billion in annual sales. CEA's resources are available online at www.CE.org, the definitive source for information about the consumer electronics industry.

CEA also sponsors and manages the International CES -- Defining Technology's Future. All profits from CES are reinvested into industry services, including technical training and education, industry promotion, engineering standards development, market research and legislative advocacy. For more information about CEA, please visit www.ce.org.