OFVGA Response to Bill 151 and Waste-Free Ontario

Photo by Jason Paris, Creative Commons

Executive Summary
1.  The OFVGA supports legislation that will enhance the viability and sustainability of the sector and emphasizes the need for transparent legislation.

2.  The OFVGA requests that a Regulatory Impact Analysis be performed to assess the full impact of this legislation on agricultural and horticultural production and that this analysis be made available to all stakeholders across the value chain.

3. The OFVGA requests to be included in ongoing stakeholder discussions regarding the designated packaging materials regulated under the new Waste Free Ontario Act, in recognition of the unique packaging challenges facing the edible horticulture sector.

4.  Fruit and vegetable growers in Ontario are often not in control of determining the type of packaging being used for their products; this is often dictated by retailers. With this is mind, OFVGA requests the government to recognize and quantify the cumulative impact (financial and environmental) this Act could have on purchasers of packaging.

5.  The OFVGA requests that consultation documents use clear definitions, the same terminology and be consistent with that found in the proposed Act to avoid confusion between documents for public consumption and legislation (e.g.  Producer in the consultation v.s. Brand Holder in the Act).

6.  The OFVGA recommends that the management of on-farm organic waste continue to be considered a normal farm practice, including the use of nutrient management applications and approved technologies (e.g. biodigesters, composting) and that these practices be eligible for offset credits under the proposed Cap and Trade program.

Members of the Ontario Fruit and Vegetable Growers Association (OFVGA) are strongly committed to providing safe and sustainable food to consumers and strive to be stewards of the environment. Ontario edible horticultural producers understand the need to most efficiently use resources to provide consumers with high quality products that support health, minimize waste, and lead to prosperity. These three tenets of production must be observed in order to sustain a competitive and profitable horticultural sector in the province of Ontario. In addition, as participants in the global market place, regulatory burdens, such as the Waste Free Ontario Act, represent an additional cost that cannot be simply passed on to the consumer. 

There are a number of ambiguities in this document that makes it difficult to interpret and further to assess the impact on the horticultural sector directly.  This document posits that the “produce, use, dispose” linear model of waste management is environmentally harmful, financially risky, and unsustainable. The Ministry of the Environment and Climate Change (MOECC) is recommending that a shift in thinking to a circular economy will bring about innovation. However, without further defining the roles and responsibilities throughout the value chain it is difficult to comprehend how the drivers of innovation will be actualized.

Waste management is currently organized under the Waste Diversion Act (2002) using industry funded organizations or IFOs to implement recycling programs. Currently, so called ‘brand owners’ are responsible for bearing the cost for the IFO’s diversion of waste but have limited influence over how materials are collected and/or recycled. This results in a reduction of incentive for producers to improve packaging design to more biodegradable or recyclable options.

There are two goals within Ontario’s circular economy strategy; the first is zero waste in the province and the second is zero greenhouse gas emissions from the waste sector over 10 years. It is with this in mind that the OFVGA is providing comments on the proposed Bill 151: Waste Free Ontario Act

The OFVGA is supportive of legislation that supports sustainable production (environmental, economic and social) and would like to contribute our thoughts on the implementation of Bill 151.  The OFVGA supports a stakeholder-led, science-based approach to environmental stewardship. Ontario’s farmers have a long history of being stewards of the land and have every intention of continuing this tradition.

Within the context of this proposed legislation, it is the understanding of OFVGA that the province of Ontario is trying to achieve the following goals:

1. Increase resource productivity to reduce waste
2. Enable an efficient and effective recycling system
3. Create conditions to support sustainable end-markets

Replacing the Waste Diversion Act of 2002 with a new producer responsibility framework will affect importers, wholesalers, retailers, and e-tailers. This will require them to reach a zero waste goal in one decade and leave them responsible for resource recovery and reduction of waste through forced innovative thinking.  The OFVGA considers this goal to be unrealistic and would request more information on the proposed scheduling for the zero waste goal as well as the details with the timelines and costs of the entire program.

Development of the Resource Productivity and Recovery Authority (The Authority)

The activities of the Authority need to be clarified with regard to interactions with the horticultural sector. There are numerous questions that have been raised which need answers. Included in the description of the power of the Authority are compliance tools at their disposal including inspection powers, administrative penalties, issuance of compliance orders, and data collecting and sharing.

The initial consultation paper doesn’t clearly state how the initiative will be independently adjudicated or whether a third party will be made available to mediate disputes.   Currently the Act states that the Authority will establish a dispute resolution process, but nothing is stated on the independent perspective of this process, leading to the Authority mediating its own disputes (a conflict of interest).

It is concerning the lack of information provided on how the data clearinghouse side of operations will be used and shared. What is the purpose of the submission of data to the Authority?  For inspectors to request data from the brand holder, there is no indication as to the timing of requests and the speed at which such requests must be addressed.  OFVGA would like to discourage the use of these data to force packaging producers into making unnecessary changes in packaging.

On the domestic level, for instance, suppliers could be at a competitive disadvantage through virtue of their packaging needs. One example of this would be to compare tender fruit packaging with greenhouse packaging. Greenhouse cucumbers require a plastic sleeve to ensure the acceptability of the product to the consumer, whereas field cucumbers do not require this intervention.  Similarly, apples may be held in loose packaging without impact to product quality, but peaches require a specific container to prevent bruising and spoilage.  Comparing the two needs might create a negative customer reaction even though it may be unjustified.   Some products simply need packaging in order to maintain the integrity of the product making it to the market.

It is recommended that the Authority utilize incentives rather than punitive measures to increase compliance and drive innovation. Investing research dollars into alternative packaging sources and materials and offering cost-share incentives to entice packagers to meet this niche is preferable. Further, utilizing communications to the public as avenues to encourage packaging changes and desires at the consumer level would close the gap between what the consumer wants and the functional requirements of the packaging.

The OFVGA supports the transparency of the Authority, and is supportive of publication of both the financial statements.  We are concerned about the amount of information to be shared concerning compliance and enforcement activities that could lead to competitive disadvantage.

Brand Holder versus Producer
The initial strategy consultation paper referred to the “producer” of the product as the entity required for end of life funding.  “Who are producers?  Producers are brand holders and/ or others with a commercial connection to designated products and packaging in Ontario, such as first importers, wholesalers, retailers and e-tailers” (page 15).   In the Bill 151 Act published on the Government of Ontario website, producer of products is removed and wording has changed to “Brand Holder”.  This has significant implications to edible horticultural growers as it extends the definition of who is accountable for the end of life fees and related responsibilities.   From the Act, “brand holder” means a person who owns or licences a brand or who otherwise has rights to market a product under the brand; (“titulaire de marque”).  Because some growers are required to use certain types of packaging because of retail demand, these decisions are outside the control of the grower.

Current Costs of Recycling
There are numerous methods for generating revenue for current recycling programs, including fees and taxes. Currently, half of the costs of the Blue Box Program are currently born by the taxpayer; whereas, this legislation proposes to move all of these costs to the producer.  What will happen to the revenue stream that already exists to cover waste?

For the costs of retailer organic waste disposal, these should not be passed back to the grower. These lie outside their responsibility and their ability to effectively influence change. 

Internationally Generated Packaging
Made in Ontario recycled containers should have some preference for use since package producers will be responsible for its entire lifecycle.  A key concern lies in the payment for packaging that will be exported, and therefore not complete its lifecycle here in Canada. This will add costs to exported product where there is limited to no opportunity for cost recovery. This will put us at a competitive disadvantage in export markets. Products that are going outside of the country must not be subject to any of these fees, since it would not be recycled in our system and there is no opportunity to recover the costs.

For products that are being imported into Canada, the Act states that the first importer will pay for the products entire lifecycle, including disposal. The OFVGA recommends that careful thought be given as to who will bear the associated fees for products coming into the country to ensure the cost of disposal is covered. OFVGA cautions that trade retaliation of imported goods could be detrimental to the rather open trade we currently have.  The development of retaliatory tariffs based upon the costs of packaging recovery from imported products is a serious consideration and could impact Ontario’s ability to export commodities to other jurisdictions (particularly the United States).  Some of our commodities have significant export markets, which must not be jeopardized by this legislation.

Data Management
There are concerns about how data collected by the Authority will be managed throughout this process. The discussion document poses that the Authority will be acting as a data clearinghouse with the intent to use the data received from producers of packaging to “effectively monitor and assess producer performance and more. (17)”.  There are many questions that are being raised regarding the use of these data.  Would the data then help form targets over the 10-year net zero policy? Different industries utilize different types of packaging depending on their product. Would targets be representative of industry/product? The discussion paper is vague on the types of information the Authority will require and the frequency of reporting.  How will the privacy of the data be protected?  Who will have access to the data?  How will the data be managed, interpreted and to what other uses will the data be put?  Will growers be compensated for the added time that will have to be invested to meet these new regulations?

While these data provided to the Authority is necessary for oversight, OFVGA does not see the benefit of providing such data to the public. In fact, it could be a detriment to competitiveness in both domestic and foreign markets.

Impact on the Horticultural Sector

This legislation is seen as an added cost to the growers of fruit and vegetables in Ontario. The cumulative regulatory impact will have a negative impact on the sector’s ability to meet the Premier’s challenge of 120,000 jobs and doubling the rate of growth of the sector.

On page 22, the document states that “The government would designate new materials under the proposed producer responsibility regime through regulations,” and “to help ensure we designate the right materials, the province would work with producers, municipalities, service producers, and stakeholders to gather data and to inform decision making.” Recognizing that the edible horticulture sector uses numerous, diverse forms of packaging and has unique concerns regarding the packaging type, the OFVGA requests to be included in these discussions on behalf of our members. We provide valuable insight and perspective for this sector and it is likely to be significantly impacted by this legislation.

Increased Regulatory Burden
The MOECC is recommending the creation of a third regulatory body, the Resource Productivity and Recovery Authority, within the span of a year, which will impact farmers. The increased costs and time associated with compliance actions under this more comprehensive regulatory regime are not nominal and it is critical that growers not bear the full expense of implementation across the value-chain.  The OFVGA insists that when legislation is brought forward that impacts the cost of production that growers be fully consulted to minimize the impacts on competitiveness and profitability prior to implementation.

Key Questions on the Legislation

Development of the Resource Productivity and Recovery Authority (The Authority)
1. What is meant by enforcement? 
2. Who will pay the fines for improper product disposal? 
3. How will this initiative be funded?
4. Will there be a third party outsider made available to mediate disagreements?
5. As a data clearinghouse, how can large industry be sure that the data will not be used publically to shame packaging creators into making changes?

Current Cost of Recycling
6. What will happen to the revenue stream that already exists to cover waste?

Internationally Generated Packaging
8. Will we be paying for packaging that is exported where there is no value put on the collection of materials? 
9. If producers of packaging will be responsible for payments, will they separate out those costs for those products that are exported.

Data Management
10. How will privacy be protected? 
11. Who has access to the data? 
12. How will the data be managed, interpreted, and to what use? 

The Ontario Fruit and Vegetable Growers’ Association appreciates the opportunity to comment on this proposed legislation. The OFVGA recognizes the value that the Government of Ontario is trying to bring forward in its efforts to enhance the recyclability of packaging and the desire to eliminate waste. However, we collectively must also recognize the costs associated with increasing recyclability and the goal of zero waste.  The OFVGA is supportive of policies that are comprehensive, science-based and economically sound.  Without the provision to evaluate a regulatory impact analysis and the science behind the policies being brought forward, it is not possible for the OFVGA to support the current status. Policies that are brought forward must keep each of these things in mind for Ontario to have a stable, secure supply of locally produced food.   The OFVGA requests that further consultation include these parameters.

The OFVGA supports efforts that will improve packaging containment in a comprehensive and consistent manner.  The OFVGA recommends that successful strategies currently used by growers serve as the basis for expanded and enhanced programming.  An example would be the Clean Farm’s model, where used pesticide containers are being recycled into fence posts. 

The OFVGA insists that decisions must be based upon a full evaluation of science-based research with the inclusion of the significant, open and transparent Regulatory Impact Assessment. The OFVGA would further request that industry be able to comment on this assessment prior to legislation moving forward.

About the Ontario Fruit and Vegetable Growers’ Association (OFVGA)
OFVGA was established in 1859, which makes it one of Ontario and Canada’s oldest farm commodity organizations.  As the voice of Ontario’s fruit, vegetable and greenhouse farmers, the OFVGA is a nationally recognized not-for-profit association that advocates on behalf of Ontario fruit and vegetable farmers and the edible horticulture industry, representing its members provincially, nationally, and internationally. 

The sector supports 30,000 farm-based, non-family jobs in Ontario, as well as a further 8,700 jobs specific to horticulture and specialty crops. Over 125 different fruit and vegetable crops are grown in Ontario with an estimated annual farm gate value of $1.6 billion (2013).