It’s not easy being green…or being a policymaker trying to advance green policy.
Most leaders in the Golden State, especially in an election year, want to promote a clean and healthy environment alongside a thriving business and jobs climate. But sometimes legislation that seems “on the right track” is barreling down an unintended course of destruction.
Senate Bill 811, authored by Senator Anna Caballero, is one such bill. If approved by the Legislature and signed by the Governor, it could push California’s small, family-owned metal recycling businesses out of the market while handing a lasting competitive windfall to the state’s largest multinational shredding operations.
There’s still time to fix it. But with lawmakers returning August 3 for the final weeks of the 2026 session, the clock is running out.
Metal Recyclers: Important Community Partners
Two Very Different Businesses
But not all shredders are alike, and the difference is the heart of this debate.
Large-scale operations, the “mega shredders,” feed whole automobiles and even buses directly into their machines – fluids, gas tanks, engines and all – processing between 50,000 – 110,000 tons a month. For decades these facilities handled the leftover material, auto shredder residue, not under the permits everyone else must obtain but under so-called “F-letters”: bespoke agency classification letters that allowed them to chemically treat the residue – a hazardous waste - and send it to ordinary municipal landfills as if it were household trash. That relaxed, discretionary arrangement operated outside the hazardous waste permitting system, and it is precisely what produced the contamination problems and enforcement settlements now driving this legislation.
Small shredders operate at a fraction of that scale, 3,000 to 5,000 tons a month, and cannot physically shred a whole vehicle. They use no chemical treatment whatsoever, and they never asked for special treatment either. When their operations generate hazardous residue, they manage it by the book under the Hazardous Waste Control Law: fully characterized, manifested, hauled by state-registered hazardous waste transporters, and disposed of at permitted hazardous waste facilities, at full cost.
Small recyclers already answer to an alphabet of regulators, including state toxics officials, local hazardous materials agencies, regional air districts, water boards overseeing stormwater permits, and local fire and land-use authorities. The dichotomy could not be sharper: small shredders comply with the letter of the law, while the mega shredders long operated under letters from regulators. Only one of those pathways caused the environmental incidents behind SB 811, and it wasn’t that of the small guys.
SB 811: Right Target, Wrong Net
SB 811 responds to a legitimate problem. State regulators identified real oversight gaps at the large chemical-treatment facilities: no permits, no closure planning, no financial assurances, all products of the old F-letter arrangement. Establishing modern standards for that treatment pathway is an understandable and laudable objective.
The problem is that the bill sweeps small facilities into the same net, even though the gaps it targets never existed for them. For small, non-treating recyclers, SB 811 doesn’t fill a regulatory hole. It duplicates. Its operational requirements for container standards, contingency plans, employee training, inspections, and emergency notification map almost requirement-for-requirement onto the hazardous waste rules small shredders already follow today, now with a second permit and a second set of fees stacked on top.
Worse, the bill gets the incentives backwards. It writes the mega shredders’ cheaper treat-and-landfill disposal method into statute while piling new costs on the facilities that pay premium rates for full hazardous waste disposal. Under SB 811, the easiest way for a small recycler to absorb the new regulatory burden would be to start chemically treating its own waste, precisely the practice the bill’s supporters say needs more oversight, not more participants.
The long-term stakes for Main Street
Because SB 811 is a fee-funded permit program layered on top of existing compliance obligations, small facilities will effectively pay twice for the same protections, amounting to millions of dollars per facility over time in duplicative fees, permitting, and compliance costs.
Many small facilities simply won’t survive that math. Those that close will send their customers, from schools and hospitals to military installations, construction companies, and independent recyclers who make their living at these yards, driving longer distances to the remaining large facilities. That means more trucks on more highways emitting more pollution, and a metal recycling market consolidated into fewer corporate hands. A bill meant to protect communities shouldn’t legislate a monopoly into existence.
The Solution: Mend it, Don’t End it
There is a path that lets Senator Caballero, the Governor, and state leaders strike the right balance between a cleaner recycling industry and a thriving Main Street economy.
Amend SB 811 to focus where the problem actually lives: the chemical treatment of auto shredder residue, performed only by large-scale facilities. That preserves the centerpiece of the author’s original intent, modern standards and real accountability for the treatment operations that prompted the bill, while allowing already-compliant small recyclers to keep their lights on, their workers employed, and their communities served.
Now is not the time to burden fragile small businesses with duplicative regulation covering ground existing law already covers. SB 811 can still be good, durable policy. By narrowing it to the facilities whose practices it was written to address, lawmakers can protect California’s environment and its number one job creators alike, and make sure our “mom and pop” recyclers keep growing and thriving instead of being left on the scrap heap.
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