Community and Economic Development Committee November 19, 2024 AGENDA REPORT TO: Jestin D. Johnson FROM: Shayna Hirshfield-Gold City Administrator Climate Program Manager, City Administrator’s Office SUBJECT: DATE: October 7, 2024 Informational Report Regarding Implementation of City’s 2023 Reusable Foodware Ordinance City Administrator Approval Date: RECOMMENDATION Staff Recommends That The City Council Receive An Informational Report Regarding Implementation of the City’s 2023 Reusable Foodware Ordinance. EXECUTIVE SUMMARY On December 19th, 2023, City Council adopted Ordinance No. 13773 C.M.S., mandating that prepared food vendors use reusable food serviceware for dining on premises, f ul f i l l i ng Act i on MCW-3, “Eliminate Single-Use Plastics & Prioritize Reuse in Food Preparation, Distribution, and Sale” of O a k l a n d ’ s Equitable Climate Action Plan. This Informational Report assesses the potential impacts and feasibility of implementing the Reusable Food S e r v i c eware Ordinance (“Reusables Ordinance”) within Oakland's diverse food service sector. From 2023 through S p r i n g 2 0 2 4 , staff in the City Administrator’s Office Sustainability and Resilience Division (SRD), Economic and Workforce Development Department (EWDD), and Environmental Services Division of Oakland Public Works (Recycling) conducted a preliminary Equity Landscape Analysis of Oakland’s Food Service Sector, which includes racial and economic factors and is incorporated as an Attachment to this Report. This analysis found that Oakland’s restaurants are facing multiple overlapping threats including ongoing impacts of the COVID19 pandemic, acute crime along commercial corridors, rising prices and shrinking profit margins. Against that backdrop a r e i n c r e a s i n g r e g u l a t o r y r e q u i r e m e n t s a n d insufficient resources for public education and empowerment-based enforcement. Based on this analysis, staff find that many Oakland restaurants will need additional support to comply with the Reusables Ordinance, specifically education, incentives, and rewards; that the City and/or its partners need additional resources to equitably implement and enforce the Ordinance; and that additional analysis is needed to ensure equity and economic viability of implementation. Key considerations include compliance costs, supply chain readiness, public education, and effective enforcement mechanisms. Continued coordination among City departments is c r i t i c a l t o e n s u r e e f f e c t i v e a n d equitable implementation, ultimately aiming to support local businesses while advancing environmental sustainability goals.
Community and Economic Development Committee November 19, 2024 November 19, 2024 Jestin Johnson (Nov 5, 2024 11:23 PST)
Nov 5, 2024
To: Jestin D. Johnson, City Administrator Subject: Informational Report Regarding Implementation of Reusable Foodware Ordinance Date: October 7, 2024 Page 2 Community and Economic Development Committee November 19, 2024
BACKGROUND / LEGISLATIVE HISTORY The City of Oakland is a leader in ambitious and equity-driven climate action. Resolution No. 82129 C.M.S. (2009) directed staff to develop Oakland’s first climate strategy, the 2020 Energy and Climate Action Plan. In 2018, Oakland City Council adopted Resolution No. 87397 C.M.S., declaring a climate emergency and calling for regional collaboration and a “citywide just transition and urgent climate mobilization effort to reverse global warming.” In July 2020, City Council adopted the 2030 Equitable Climate Action Plan (ECAP) (Resolution No. 88267 C.M.S.). The ECAP details 40 Actions to improve climate resilience, advance equity, and reduce local GHG emissions on a path projected to exceed adopted targets. Simultaneously, City Council adopted a 2045 full carbon neutrality target (Resolution No. 88268 C.M.S.). The ECAP integrated climate, resilience, health, and equity, and includes six Actions to reduce material consumption and waste and nurture circular economies. These include MCW-3: “Eliminate Single-Use Plastics & Prioritize Reuse in Food Preparation, Distribution, and Sale.” California has numerous laws to reduce the amount and impacts of plastic pollution statewide, summarized in Attachment 1. Building on these, MCW-3 calls for collaboration with the public agency StopWaste to shift from single-use plastic to reusable foodware. StopWaste is governed by the Alameda County Waste Management Authority (ACWMA) Board, Alameda County Source Reduction and Recycling Board, and Energy Council (co-located Joint Powers Authorities). StopWaste helps Alameda County businesses, residents, and schools waste less, recycle properly, and use resources efficiently. It provides research, collaboration, and technical assistance, and develops policy frameworks where regional consistency is useful or individual regulations are infeasible. In March 2023, the ACWMA Board accepted the model Disposable Food Service Ware Reduction and Reuse Ordinance. On December 19, 2023, Council adopted Ordinance No. 13773 C.M.S. to dramatically reduce the use and distribution of s i n gle-use plastic items at City facilities, food e s t a b l i s h m e n t s , a n d events. The “Reusable Foodware Ordinance” draws on StopWaste’s model ordinance and: • Requires "prepared food vendors” to use only reusable items for on-premises d i n i n g, accept customer-provided reusable containers for takeout, and only provide disposable to-go ware accessories such as utensils, napkins, condiments, and straws on request; • Requires large events and venues to provide reusable beverage cups; • Prohibits the City purchasing or distributing packaged water at City facilities; • Prohibits use and distribution of disposable food service ware made of compostable/bio-plastics, and items containing H i g h P r i o r i t y T o x i c F o o d P a c k a g i n g C h e m i c a l s w h e n alternative products are commercially available; when alternatives free of these chemicals are not available, fiber or conventional plastic items may be distributed; • Requires Food Ordering Platforms to facilitate the rules, list available condiments and to-go ware options, and allow customers to select their condiments and accessories; and • Includes a waiver for instances where compliance would constitute an undue hardship, with a requirement that waiver recipients make “diligent efforts” to become compliant. Adoption of Ordinance No. 13773 C.M.S. complied with ECAP Action MCW-3. In early 2024, the City Administrator’s Office requested a one-time Informational Report describing the feasibility of implementation of the Ordinance and any salient economic or equity considerations.
To: Jestin D. Johnson, City Administrator Subject: Informational Report Regarding Implementation of Reusable Foodware Ordinance Date: October 7, 2024 Page 3 Community and Economic Development Committee November 19, 2024
ANALYSIS AND POLICY ALTERNATIVES Most institutional, fast food, and fast casual dining, a n d v i r t u a l l y a l l t a k e o u t a n d d e l i v e r y, u s e disposable foodware. Before t h e C O V I D-19 pandemic, nearly 1 t r i l l i o n p i e c e s o f s i n g l e-use foodware and packaging (mostly plastic) were used annually by U.S. food service operators: 21 percent on-site and 79 percent for takeout and delivery. Usage increased dramatically during the pandemic as takeout and delivery became the main forms of prepared food service. California’s SB 270, passed in 2016 (described in Attachment 1), aimed to reduce plastic pollution by prohibiting most grocery stores and common retail outlets from providing single-use plastic carryout bags. Retailers were permitted to o f f e r c e r t i f i e d r e u s a b l e g r o c e r y b a g s o r recycled paper bags for a minimum charge of $.10 each. Yet consumer advocacy group CALPIRG found that the tonnage of discarded bags increased from 4.08 per 1,000 people in 2014 (before SB 270 enactment) to 5.89 per 1,000 people in 2021 – a record high. This is due in part to thicker composition of newer plastic bags designed to meet technical requirements for "reusability,” highlighting the need to forecast a policy’s feasibility and potential impacts. The rise in home deliveries in the COVID-19 lockdown further increased the p r o l i f e r a t i o n o f plastic bags and containers for t r a n s p o r ting g r o c e r i e s a n d r e s t a u r a n t o r d e r s . With the food service industry still recovering from the pandemic, some stakeholders are concerned about the City’s new Reusables Ordinance. To assess its p o t e n t i a l effects on Oakland businesses, this Report shares the results of the Equity Landscape Analysis of Oakland’s Food Service Sector (see Attachment 2 for the full A n a l y s i s ); d e s c r i b e s current resources and challenges f o r enforcement; and suggests next steps for effective and equitable implementation. Summary of Oakland Food Service Equity Analysis Oakland’s Food Service sector includes more than 860 businesses, including full-service dining establishments, cafes, fast-food restaurants, and bars, as well as caterers and food trucks. The range indicates the types of resources businesses may seek in shifting to Reusables. Food service businesses are owned by, and employ, a diverse array of Oaklanders, including many immigrants and people of color. Among the 63 percent of Oakland’s food service businesses owners who self-reported their race, 37 percent are Asian or Asian-American. White, African-American, and Latina/o owners each account for a p p r o x i m a t e l y 1 5 p e r c e n t o f businesses. The sector as a whole employs more than 12,200 people. Most Oakland b u s i n e s s e s, including restaurants, are “microbusinesses,” often vulnerable to persistent inequities in access to capital. A recent analysis by the Federal Reserve showed that, nation-wide, more white applicants (35 percent) get the full amount the financing they apply for compared to Latino/a (19 percent), Black (16 percent), and Asian (15 percent). This inequity, combined with notoriously low profit margins, put restaurants in precarious financial positions. Local data is insufficient to produce equivalent figures for Oakland-based businesses. Property crime and heightened security expenses add to escalating costs of supplies and labor. Accommodation and Food businesses across the City have reported decreased revenue in recent years, stemming in part from customers’ safety concerns as well as business crime on the site of their business or property. Commercial burglary rose four-fold from 2017 to 2023 – To: Jestin D. Johnson, City Administrator Subject: Informational Report Regarding Implementation of Reusable Foodware Ordinance Date: October 7, 2024 Page 4 Community and Economic Development Committee November 19, 2024
from just over 400 to just over 1,600. There is currently inadequate data to assess variations in crime impacts based on the race, ethnicity, or language of business owners and managers. Existing and Pending Requirements All food-service businesses must comply with various regulations aimed at protecting public health, reducing strain on the sewer system, and minimizing waste (i.e. compliance with existing bans on plastic straws a n d b a g s , polystyrene, waste contamination, recycle and compost requirements and more). Many of these are included i n Attachment 1. Waste sorting requirements have been in place for all food service establishments in Oakland since January 1, 2022. These businesses must also prepare to meet new and forthcoming policies: • Minimum wage: On January 1st, 2024, Oakland's minimum wage increased to $16.50 per hour for all employees, regardless of their position, who work more than two hours in a calendar week. Additional increases are anticipated in 2025. • Edible food recovery: Oakland Municipal Code (OMC) 8.28, which implements SB 1383, requires certain l a r g e “ e d i b l e f o o d generators” to “safely recover for human consumption the maximum amount of edible food that would otherwise be disposed” and work with partners to redistribute that food to those who need it. Most Oakland food service establishments are below the minimum size for this requirement to take effect. • Reusable F o o d W a r e : Ordinance O.M.C. 8.07 (Reusables Ordinance) w i l l b e c o m e effective July 1, 2025; the Ordinance does not specify w h e n e n f o r c e m e n t w i l l b e g i n. O.M.C. 8.07 includes multiple individual requirements, detailed in Attachment 3. Current Education and Enforcement Resources Public education about existing requirements happens through various means, including multi-lingual informational materials in waste hauler bills, site inspections, news media coverage, and one-on-one technical assistance through the City’s Business Assistance Centers. City staff have updated the City’s website and Oakland Recycles website with information on the new requirements, including the following: • Disposable Foodware Purchasing Guide • Information about the problem with compostable plastic • Multilingual signage t h a t b u s i n e s s e s c a n d o w n l o a d a n d p o s t , i n c l u d i n g p r o p e r w a s t e sorting (“Bags to Bins”) and “Accessories on Request” In early 2024, through the place-based Oakland Fresh initiative, City staff conducted intensive, in-person outreach and engagement in three frontline neighborhoods that contained important small business corridors. To support that effort, staff created informational materials explaining key requirements and resources for restaurants (see Attachment 4). That effort led to improved partnership across t h e C i t y ’ s E c o n o m i c a n d W o r k f o r c e D e v e l o p m e n t D e p a r t m e n t ( E W D D ) , Neighborhood Services Division (NSD), and OPW’s Recycling Team. Staff resources are limited for ongoing proactive awareness campaigns focused on business corridors. An equitable approach to enforcement – w h a t t h i s R e p o r t calls empowerment-based enforcement – i n c l u d e s a n i n i t i a l e q u i t y a n a l y s i s ; public education; a n d s t r a t e g i c a s s i s t a n c e where appropriate. Traditional enforcement, in the form of citations and penalties for non- To: Jestin D. Johnson, City Administrator Subject: Informational Report Regarding Implementation of Reusable Foodware Ordinance Date: October 7, 2024 Page 5 Community and Economic Development Committee November 19, 2024
compliance, follows l a s t. The following l i s t d e s c r i b e s t h e C i t y ’ s f o u r m a i n a v e n u e s o f enforcement, which often (but not always) incorporate education: The Business Stormwater Inspection Program (Watershed and Stormwater Management Division, OPW) i n s p e c t s i n d u s t r i a l a n d c o m m e r c i a l b u s i n e s s e s t h a t could pollute stormwater with chemicals and trash. San Francisco Bay Regional Water Quality Control Board regulations require the City to conduct these inspections, and to ensure that businesses follow O a k l a n d Municipal Code Chapter 13.16.070 (Creek Protection, Storm Water Management and Discharge Control). Since adoption of the City’s 2007 ban on polystyrene foodware, Business Stormwater Inspectors have also inspected r e s t a u r a n t s for compliance with service ware requirements; proper disposal of fats, oils, and grease (FOG); waste sorting and container maintenance; and compliance with other food service ware prohibitions. One staff position i n t h e W a t e r s h e d Division and an external contractor are responsible for this activity, which also includes direct education and enforcement. As needed, the Watershed Division refers compliance issues related to waste sorting and hauling or food packaging to OPW’s Recycling Program. Wh e r e violations are discovered, the City can reinspect at additional cost, time, and inconvenience to the business. The City can enact progressive enforcement as needed, though the first approach is to work collaboratively on compliance with the businesses. The Alameda County Department of Environmental Health (DEH) Food Safety Program inspects food services establishments for relevant compliance. OPW’s Watershed Division and DEH mutually cross-refer for reinforcement needs, and occasionally conduct joint inspections in cases of serious and credible complaints. OPW's E n v i r o n m e n t a l E n f o r c e m e n t U n i t conducts outreach, monitoring, and enforcement actions to prevent and deter illegal dumping. Staff monitor illegal dumping “hot spots,” conduct forensic investigations, cite dumpers, coordinate abandon waste removal, and collect data to inform and improve their enforcement efforts. Code Enforcement Services (Oakland Planning and Building Department) administers an enforcement program to address Oakland Municipal Code and land use violations. This includes building code violations or unpermitted changes of occupancy; blight, hazardous waste, and illegal dumping; garbage cans stored in public view; zoning violations for unpermitted business in residential neighborhoods or illegal signs; and vacant, deteriorated, abandoned, foreclosed, or hazardous buildings and lots. Feasibility of Transitioning to Reusable Food Ware This Ordinance will have financial and operational implications for most affected businesses, which m a y i n c l u d e increased labor costs ( m o r e s t a f f h o u r s o r a d d i t i o n a l s t a f f t o w a s h a n d process reusables), upfront costs of new reusable products, increased water and energy use for dishwashing, and/or subscription costs for r e u s a b l e w a r e r e n t a l s e r vices. T h e e x p e r i e n c e o f shifting to reusables will range based on business models, demographics, geography, and compliance pathways. A prevailing misconception is that disposables are cheaper. A 2021 report f r o m the n o n p r o f i t Upstream Solutions summarized research and case studies from nearly 300 Bay Area and Los Angeles food service establishments that transitioned from to reusable ware for on-site dining. They found that initial investments in reusables consistently translated to financial savings within To: Jestin D. Johnson, City Administrator Subject: Informational Report Regarding Implementation of Reusable Foodware Ordinance Date: October 7, 2024 Page 6 Community and Economic Development Committee November 19, 2024
weeks or months, depending on use. Their analysis accounted for purchasing and delivery costs, additional dishwasher capacity, and added labor. Some businesses may choose to contract w i t h o f f s i t e s e r v i c e s instead of s h i f t i n g i n-house practices. There is a growing market for businesses that support circular models with collection, washing/sanitization, and restocking of reusable foodware. Partnering with t h e s e service providers, especially for to-go ware, could increase flexibility for some businesses. Overall, factors affecting the feasibility of implementing new requirements will include: • Supply chain: The Ordinance will increase demand for generic and branded reusable service ware, fully compostable to-go ware, a n d T h i r d-Party platforms that provide reusables-as-a-service. Reusables and compliant to-go ware must b e affordable and meet restaurants’ unique needs. Studies from ReThink Disposable and San Francisco Department of the Environment suggest that switching to reusables will cost an average food service business about $500, and, to date, sourcing materials has not been a challenge in v o l u n t a r y t r a n s i t i o n s . Yet little is known about the local supply chain for these products and services in the context of a mandatory requirement. • Infrastructure: Dishwashing capability is often absent i n f a s t-food, mobile, and fast-casual restaurants w h e r e foodware i s d i s p o s a b l e a n d h i g h v o l u m e s o f c u s t o m e r s a r e served. Some b u s i n e s s e s w i l l n e e d t o retrofit t h e i r s p a c es or contract with external dishwashing services. • Labor: Reusables require more labor for dishwashing and reverse logistics. However, the labor from regularly ordering and restocking reusables will be avoided. • Business Ecosystem: Restaurants seeking alternative compliance m o d e s w i l l n e e d affordable reusables s y s t e m / s e r v i c e p r o v i d e r s and/or h i g h-capacity wash hubs. T h e potential impact of the Ordinance on this emerging market is unknown. • Behavior change: Transitioning to reusables may present a behavior change hurdle for businesses and consumers alike. Resources Available to Support the Transition to Reusables Business community partnerships, education campaigns, technical assistance, incentives, and support for r e u s e e c o s y s t e m s c a n ease the transition t o r e u s a b l e f o o d w a r e. StopWaste provides free technical assistance and mini-grants to help businesses switch from single-use to reusable foodware (see Attachment 5). They also provide a list of Reusable foodware system and service providers on their website. The traditional array of small business grants and loans can help s o m e b u s i n e s s e s with the upfront cost of transitioning to reusables, but their terms may be prohibitive for others. The City has no dedicated funds for grants, loans, or education specific to the Reusables Ordinance. Finally, Oakland’s Community Ambassador Program, which was re-funded in the most recent Budget and serves multiple business corridors such as Downtown, KONA, Fruitvale, and East Oakland, could be a powerful engagement vehicle. The Ambassador program is different in every neighborhood, reflecting community needs as well as the priorities of the City partners that oversee each group. In Q3 and Q4 2024, EWDD, the CAO, and OPW are partnering to train Ambassadors on certain City requirements that affect neighborhood businesses – including the transition to reusables and proper waste sorting.
To: Jestin D. Johnson, City Administrator Subject: Informational Report Regarding Implementation of Reusable Foodware Ordinance Date: October 7, 2024 Page 7 Community and Economic Development Committee November 19, 2024
Summary of Needs for Empowerment-Based Enforcement of the Reusables Ordinance Effective implementation of this Ordinance will require f u r t h e r a n a l y s i s t o e n s u r e e q u i t y a n d adequate supply chains; culturally appropriate educati onal to ensure that affected busi nesses understand requirements and resources; a n d adequate e n f o r c e m e n t m e c h a n i s ms. T h e following list summarizes the needs: Equity Analysis: While the Reuse Wins report found universal cost savings from transitioning to reusables, it was conducted pre-pandemic, did not disaggregate findings by business type or demographics, and was p r e d i c a t e d o n v o l u n t a r y s h i f t s. P r e v i o u s s t u d i e s m a y n o t f u l l y r e f l e c t current labor and supply costs or post-pandemic consumer behavior. More inquiry is needed to clarify costs and payback periods for smaller restaurants in Oakland’s frontline communities, particularly those that face other challenges or have never offered reusables. This analysis can build on the Equity Landscape Analysis of Oakland’s Food Service Sector (Attachment 2) to understand the financial and logistical challenges and payback periods for the most vulnerable restaurants, including those owned by Black, immigrant, system-impacted, and limited-English Oaklanders; and those facing structural, legal, or physical compliance barriers. T h e a n a l y s i s must include direct consultation with representative business owners about these challenges. Economic Viability Analysis: A l o c a l s u p p l y c h a i n a n a l y s i s, including assessment of Oakland’s production capacity, can clarify w h e t h e r t h e l o c a l m a n u f a c t u r e r , w h o l e s a l e r , a n d retailer ecosystems can meet anticipated demand for reusables across all affected businesses by the time the Ordinance goes into effect. Targeted investment in local supply chains can help ensure that this Ordinance contributes t o l o c a l b u s i n e s s g r o w t h . The supply chain analysis should therefore detail where additional investment, preferences for local or national supply chains, or other supportive policies are needed. Finally, more needs to be understood about the viability and impact of these requirements on third-party food delivery services. Coordination: Planning for implementation of this Ordinance is ongoing via collaboration among t h e C i t y A d m i n i s t r a t o r ’s Office, EWDD (Business Development Division), and OPW (Environmental Services and Watershed Divisions). Combined with the recommended analyses, continued c o o r d i n a t i o n will support effective and fair i m p l e m e n t a t i o n. The Business Development Division is particularly critical for effective education and partnership development. Education: Robust public education for restaurants and customers is needed. Ideally this will be conducted in partnership with community organizations that can provide information in culturally- and linguistically-appropriate ways, and in conjunction with other relevant resources. Oakland’s high rate of i m m i g r a n t restaurant ownership makes non-English engagement essential for success. Funding and Technical Assistance: Many restaurants may need technical assistance, including training on what products are needed and how to set up back-of-house logistics. Low-interest loans and mini-grants to purchase reusables o r d i s h w a s h e r s o r t o i n i t i a t e third-party services could support compliance. StopWaste offers mini-grants to encourage r e u s e county-wide, but not enough to support a citywide mandate. The countywide Green Business Program is another potential avenue for education and a s s i s t a n c e; this has been an under-utilized partner, and more funds would be needed to expand t h e i r s e r v i c e s . F i n a l l y , s m a l l b u s i n e s s assistance may b e n e e d e d for e n t r e p r e n e u r s l o o k i ng to provide reusables services. Several such businesses have operated in the East Bay in recent years, with significant turnover.
To: Jestin D. Johnson, City Administrator Subject: Informational Report Regarding Implementation of Reusable Foodware Ordinance Date: October 7, 2024 Page 8 Community and Economic Development Committee November 19, 2024
Enforcement: The City has not identified which work unit will enforce the Reusables Ordinance. Internal options include C o d e E n f o r c e m e n t , the Environmental Enforcement Unit, or the Business Stormwater Inspection Program. Alternatively, enforcement can be contracted through a Third Party such as StopWaste or a specialized firm. Enforcement should occur after and in conjunction with a sufficient effort to educate a f f e c t e d b u s i n e s s e s, understand compliance barriers, and identify appropriate resources to address those barriers. Infrastructure: Updates to building codes to require installation of dishwashers at food service establishments as part of new construction and tenant improvement projects could help facilitate adoption of reusable foodware for on-site dinning. Citywide Priorities Efficient and equitable enforcement of the City’s Reusables Ordinance will advance t h e s e Citywide Priorities: • Holistic Community Safety: Ordinance implementation will reduce the amount of litter in Oakland, which disproportionately impacts frontline neighborhoods and the ecosystem health of Oakland’s creeks, parks, and shoreline. Clean streets and open spaces mean improved access to nature for frontline community members, along with associated mental health and safety benefits. Equitable enforcement of this Ordinance will also allow more Oakland businesses to thrive, contributing to vibrant, safe business corridors. • Housing, Economic, and Cultural Security: Enforcing the Reusables Ordinance equitably will help Oakland’s food service business thrive, supporting overall economic security. This will also benefit their employees, who are disproportionately from frontline communities. • Vibrant, Sustainable Infrastructure: Equitable and consistent enforcement of this Ordinance will keep Oakland restaurants, cafes, and other small enterprises in business, which is fundamental to this priority. • Responsive, Trustworthy Government: While Oaklanders are concerned about litter, plastic pollution, and the climate impacts of both, they are equally or more concerned about local business and economic development. This report marks the first time the City has conducted a rigorous assessment of a key local economic sector from both an equity and sustainability lens. That Equity Analysis, in turn, paves the w a y f o r Empowerment-Based Enforcement – a holistic approach that will demonstrate the City’s commitment to equitable outcomes and government follow-through.
FISCAL IMPACT A detailed analysis of anticipated costs to t h e C i t y has not been conducted. Cost categories include development of educational materials; economic analyses; outreach, engagement, technical assistance (in-house or contracted), and partnership development; and enforcement. Non-compliance fees could constitute a revenue source, though these have been insignificant for similar programs. The City and County o f S a n F r a n c i s c o e s t i m a t e s FY 24-25 implementation costs for similar requirements to be approximately $ 1 5 0,000, plus a t e a m of up to nine m u l t i-lingual outreach associates to provide education and technical assistance.
To: Jestin D. Johnson, City Administrator Subject: Informational Report Regarding Implementation of Reusable Foodware Ordinance Date: October 7, 2024 Page 9 Community and Economic Development Committee November 19, 2024
PUBLIC OUTREACH / INTEREST Prior t o a d o p t i o n o f Ordinance No. 13773 C . M . S., Council Member Kalb’s office conducted restaurant engagement around potential requirements. S i n c e a d o p t i o n , s t a f f h a s conducted limited outreach, including updating the City’s website with Reusables Ordinance requirements, in-person engagement along portions of Internati onal Bl vd., and promoting StopWaste’ s mi ni-grants via social media, solid waste bill inserts, a n d n e ws l e t t e r s. Staff are wo r k i n g with o t h e r Bay Area communities developing similar ordinances to learn best implementation practices.
COORDINATION Information in this report was coordinated with EWDD; OPW Recycling Team and Watershed and Stormwater Management Division; City Administrator Office, Sustainability and Resilience Division; City Attorney’s Office; and Department of Race and Equity.
SUSTAINABLE OPPORTUNITIES Economic: • Medium- and long-term savings: Restaurants that switch to reusable foodware could see annual savings of $3,000-$22,000, inclusive of labor and water expenses. A minority of restaurants may struggle to realize these savings o r make appropriate u p f r o n t investments. This is more likely for microbusinesses that focus on take-out and delivery, lack dishwashing facilities, and/or cannot a c c e s s r e u s a b l e s s e r v i c e s. Funding o r technical assistance may be needed to ensure equity. • New business opportunities: Recycling and reuse c r e a t e 9-30 times more jobs compared to landfilling. Facilitating an equitable transition to a food service ecosystem predicated on reusables could facilitate new local entrepreneurship and economic development by increasing demand for reusable foodware systems and services. Environmental: • ECAP alignment: Transitioning away from single-use foodware will advance ECAP goals, specifically MCW-3 and MCW-4. • Reduced plastic pollution: Transitioning from single-use foodware t o r e u s a b l e alternatives will benefit the environment in Oakland and t h e b r o a d e r B a y Area b y reducing litter and marine pollution, in turn protecting wildlife, increasing biodiversity, and lessening challenges with localized flooding (due to obstructed storm drains) and waste management. Reduced demand for single-use plastic will also lower demand for fossil fuels, including oil drilling and fracking. Race & Equity: • Frontline wealth generation: The Reusables Ordinance could empower marginalized communities economically by creating opportunities for new businesses, particularly those owned by people of color. Additional economic equity benefits will accrue if the City hires multi-lingual outreach associates for community education and t e c h n i c a l To: Jestin D. Johnson, City Administrator Subject: Informational Report Regarding Implementation of Reusable Foodware Ordinance Date: October 7, 2024 Page 10 Community and Economic Development Committee November 19, 2024
assistance. Advancing e q u i t a b l e a c c e s s t o r e u s a b l e m a t e r i a l s can also boost local circular economies, keeping resources in the community. • Reduced environmental inequities: Reuse protects vulnerable communities living near extraction, manufacturing, and waste disposal sites. These communities are subject to disproportionate health burdens and economic harm including elevated rates of cancer and respiratory disease, and contaminated soils and drinking water. • Awareness: I m p l e m e n t i n g r e u s a b l e f o o d w a r e p r o g r a m s c a n i n v o l v e c o m m u n i t y outreach and education initiatives that raise awareness about the environmental and health impacts of single-use plastics. This can empower communities to make m o r e informed choices and advocate for other environmental justice initiatives. ACTION REQUESTED OF THE CITY COUNCIL Staff Recommends That The City Council Receive An Informational Report Regarding Implementation of the City’s 2023 Reusable Foodware Ordinance. For questions regarding this report, please contact Shayna Hirshfield-Gold, Climate Program Manager, City Administrator’s Office, 238-6954. Respectfully submitted, Shayna Hirshfield-Gold, Climate Program Manager, City Administrator’s Office Reviewed by: Rebecca Parnes, Recycling Program Specialist III, Public Works Department Reviewed by: Shawnee Keck, Urban Economic Analyst III, Economic and Workforce Development Department Reviewed by: Jacque Larrainzar, Program Analyst Department of Race and Equity Attachments (5): 1: California’s Legislative Timeline Relevant to Oakland’s Reusables Ordinance 2: Equity Landscape Analysis of Oakland’s Food Service Sector 3: City of Oakland Disposable Food Service Ware Requirements 4: Restaurant-Focused Informational Flyer 5: StopWaste Assistance to Date in Oakland Supporting Reusables To: Jestin D. Johnson, City Administrator Subject: Informational Report Regarding Implementation of Reusable Foodware Ordinance Date: October 7, 2024 Page 11 Community and Economic Development Committee November 19, 2024
Attachment 1: CA Legislative Timeline Relevant to Oakland’s Reusables Ordinance California’s Department of Resources Recycling and Recovery (CalRecycle) is responsible for oversight and rule setting for waste, recycling, and composting; administering recycling programs; and providing grants and incentives for recycling and waste management projects. SB 270 prohibited most grocery stores, retail outlets with pharmacies, convenience stores, food marts, and liquor stores from providing single-use plastic carryout bags. Retailers may offer certified reusable grocery bags or recycled paper bags at checkout for a minimum 10¢ charge. 2016 SB 1383 a i m e d t o r e d u c e s h o r t-lived climate pollutants, focusing on methane emissions from improper disposal (landfilling) of organic material, including wasted food. It set targets to reduce the amount of organic waste disposed of statewide 75 percent from 2014 levels by 2025. Effective January 1, 2022, the law includes ambitious targets for cities to increase the amount of finished compost used locally. In response, City staff has conducted outreach to residents, businesses, and apartment building managers to ensure everyone has compost and recycle service and is knowledgeable about participation; expanded support for edible food recovery, redistributing 1 , 4 2 6 , 0 1 0 p o u n d s o f e d i b l e i n f o o d 2 0 2 2 in partnership with thirty-nine community organizations; and launched free compost giveaways in priority neighborhoods. 2018 SB 1335 (Sustainable Packaging for the State of California Act of 2018) ai ms t o i mpr ove food service packaging and foodware t o fit state recycling and composting systems, encourages packaging improvements to protect public health and wildlife, and creates more take-back and reuse options at state facilities. The law requires CalRecycle to maintain a List of Approved Food Service Packaging t h a t m e e t s p e c i f i c r e u s a b l e , r e c y c l a b l e , o r compostable criteria. AB 1884 (2019) mandated that full-service restaurants only provide single-use plastic straws upon request. AB 1276 (2022) broadened the scope to additional single-use accessories and third-party delivery platforms, prohibiting f o o d f a c i l i t i e s f r o m f u r n i s h i n g a n y s i n g l e-use accessories or condiments to patrons unless expressly requested. Such items must not be bundled in ways that impede consumers from selecting only certain items. 2019 and 2022 Governor Gavin Newsom signed the Plastic Pollution Prevention and Packaging Producer Responsibility Act, SB 54, into law o n J u n e 3 0 , 2 0 2 2. It aims to tackle p l a s t i c w a s t e and improve the living environment for disadvantaged, low-income, and rural communities and wildlife hurt most by plastic waste. SB 54 shifts the plastic pollution burden from consumers to producers by establishing a new extended producer responsibility (EPR) program for packaging and single-use foodware. Producers can design and market products to be more easily reused or recycled. By 2032, SB 54 requires that: • 100 percent of single-use foodware and packaging be recyclable or compostable; • At least 65 percent of single-use plastic foodware and packaging be recycled; and • Single-use plastic foodware and plastic packaging be reduced by 25 percent. 2024 In 2024, after statewide data showed that the tonnage of discarded bags increased a f t e r passage of SB 270, California announced new bills that would prohibit all plastic shopping bags at grocery stores by 2026: AB 2236 (Bauer-Kahan) and SB 1053 (Blakespear).
To: Jestin D. Johnson, City Administrator Subject: Informational Report Regarding Implementation of Reusable Foodware Ordinance Date: October 7, 2024 Page 12 Community and Economic Development Committee November 19, 2024
Attachment 2: Equity Landscape Analysis of Oakland’s Food Service Sector Oakland is home to approximately 53,000 business licenses (including residential landlords), including 1,162 Oakland businesses which self-report as Food and Accommodation. Food and Accommodation industries were the largest source of taxable sales i n O a k l a n d i n 2 0 2 3 , according to City sales tax records. These had the second-highest rate of growth in 2022-23. Although business, jobs, and sales decreased in 2020 and 2021, rehiring and reinvestment helped these sectors regain their losses to underpin Oakland’s economic stabilization by 2023. Figure 1 describes the subsectors with which each of these businesses identify. Figure 1: 2023 Accommodation and Food Service Business License Sectors Subsector Number of Business Licenses Cafeterias, Grill Buffets, and Buffets 506 Rooming And Boarding Houses 186 Hotels (except Casino Hotels) And Motels 115 Caterers 86 Full-Service Restaurants 74 Restaurants and Other Eating Places 52 Drinking Places (alcoholic Beverages) 46 Mobile Food Services 43 Limited-Service Restaurants 33 Snack and Nonalcoholic Beverage Bars 20 Food Service Contractors 1 Total 1,162 Source: Oakland Business License Data, 2023 Oakland is home to at least 861 establishments that sell prepared food. Mobile Food Services data is incomplete, as many of these businesses do not get a City Business License. More than half of the total i s a c c o u n t e d f o r b y “ C a f e t e r i a s , G r i l l s , a n d B u f f e t s , " a b r o a d c a t e g o r y t h a t includes franchises and businesses with multiple locations. As a result, that category accounts for the majority of businesses, but not the majority of employers. Figure 2 descr i bes t he concent r at i on of empl oyer s and empl oyees i n each subsect or . Hot el s and Rooming and Boarding Houses account for less employment compared to the number of business licenses. Actual food service employment accounts for 12,226 people. Figure 2: 2022 Accommodation and Food Service Employers and Employee Sectors Sector Employers Employees 722511 Full-Service Restaurants 390 5,227 722513 Limited-Service Restaurants 306 3,869 721110 Hotels (except Casino Hotels) and Motels 53 1,562 722515 Snack and Nonalcoholic Beverage Bars 141 1,380 722410 Drinking Places (Alcoholic Beverages) 60 602 722310 Food Service Contractors 28 589 722320 Caterers 40 424 To: Jestin D. Johnson, City Administrator Subject: Informational Report Regarding Implementation of Reusable Foodware Ordinance Date: October 7, 2024 Page 13 Community and Economic Development Committee November 19, 2024
722330 Mobile Food Services 15 73 721214 Recreational and Vacation Camps (except Campgrounds) 2 34 722514 Cafeterias, Grill Buffets, and Buffets 4 28 721120 Casino Hotels 1 17 721310 Rooming and Boarding Houses, Dormitories 1 4 721199 All Other Traveler Accommodation 1 0 Total 1,042 13,809 Source: CA Employment Development Department (EDD), 2022 Because Figure 1 i s b a s e d o n s e l f-reported categorizations, it does not match the totals in Figure 2. 559 business license holders self-identify as Cafeterias, G r i l l B u f f e t s , a n d B u f f e t s ; Limited-Service Restaurants; and Snack and Nonalcoholic Beverage Bars, which is closer to the total (451) of the same categories in State EDD data. These data indicate the level of challenge businesses may face, and types of assistance they may seek, in shifting to Reusables. Figure 3: Race and Ethnicity of CEOs/Owners Source: Oakland Business License Data, 2023 Oakland’s Business License application asks for Race/Ethnicity as well as other demographic information. In all categories, the most common responses are Decline to State or Blank. The data for Accommodation and Food industries is stronger than for other categories, with a 62 percent response rate. Figure 3 shows report ed Race/ Et hni ci t y of Oakl and’ s Accommodat i on and Food business owners. Self-report data suggest that Asian Americans own about 2 3 p e r c e n t o f A c c o m m o d a t i o n a n d Food related businesses. There is a nearly even split across White, Black, and Latino/a owners, at 9-10 percent for each. Actual figures may be higher or lower depending on differential rates of self-reporting. The multiracial ownership base in Food and Accommodation reflects Oakland’s population as a whole, which is described in Figure 4. Figure 4: Race Distribution of Oakland Residents
To: Jestin D. Johnson, City Administrator Subject: Informational Report Regarding Implementation of Reusable Foodware Ordinance Date: October 7, 2024 Page 14 Community and Economic Development Committee November 19, 2024
Source: American Community Survey, 2021 In addition to its high racial and ethnic diversity, nearly a third (34 percent) of Oaklanders are non-U.S. citizens. The same proportion (35 percent) speak a language other than English at home (see Figure 5). This validates observed high rates of small business owners who are limited-English speaking. Figure 5: Languages Spoken in Oakland Homes Source: American Community Survey, 2021 Oakland is the 11th m o s t e n t r e p r e n e u r i a l c i t y i n t h e c o u n t r y a c c o r d i n g t o t h e 2 0 2 3 A m e r ican Community Survey, with some of the highest rates of resident self-employment. The city’s large immigrant population is one factor in this designation. A 2 0 2 2 s t u d y from t h e A m e r ican Economic Review found i m m i g r a n t s c r e a t e m o r e b u s i n e s s e s o f e v e r y s i z e c o m p a r e d t o t h e general population. They are 80 percent more likely to establish a business than U . S .-born citizens, and their firms employ one percent more employees than those of U.S.-born residents. Yet business ownership does not necessarily mean e c o n o m i c s e c u r i t y . A c c o r d i n g t o 2 0 2 1 Business License data, 84 percent of Oakland businesses had annual revenue under $250,000. This is an estimate, as not all registered businesses report their revenue. The same data indicates that 54 percent of Oakland businesses have fewer than 10 employees. The Small Business Administration defines “small business” as a firm with revenue between $1 million to $40 million, and by employment from 100 to 1,500 employees. By this definition, the
To: Jestin D. Johnson, City Administrator Subject: Informational Report Regarding Implementation of Reusable Foodware Ordinance Date: October 7, 2024 Page 15 Community and Economic Development Committee November 19, 2024
majority of Oakland’s businesses can be considered microbusinesses, and they are vulnerable due to persistent inequities in access to finance. A recent analysis by the Federal Reserve showed that more white applicants (35 percent) get the full amount the financing they apply for compared to Latino/a (19 percent), Black (16 percent), and Asian (15 percent) applicants. Property Crime Threats Property crime and heightened security expenses add to escalating costs of supplies and labor to reduce t h e p r o f i t m a r g i n s o f f o o d-service business. Accommodation and Food businesses across the City have reported decreases in revenue partially from customers being deterred by safety concerns as well as business crime on the site of their business or property. Burglary, theft, and vandalism comprised the majority of Oakland crime in 2023, at over 65 percent of incidents. Oakland Police Department data show that citywide, robberies (including six sub-categories) and burglaries (five sub-categories) were at five-year highs in 2023, at 3,690 robberies and 17,256 burglaries. In commercial areas, which include restaurants, entertainment, retail, and care businesses, commercial buildings and their patrons are the most common crime victims. Figure 6 shows the rapid rise in commercial burglary since 2017. Figure 6: Oakland Commercial Burglary 2017-2023 Oakland Police Department, 2023
To: Jestin D. Johnson, City Administrator Subject: Informational Report Regarding Implementation of Reusable Foodware Ordinance Date: October 7, 2024 Page 16 Community and Economic Development Committee November 19, 2024
Attachment 3: City of Oakland Disposable Food Service Ware Requirements Ordinance As Of Impacted Exemptions
8.07.030 - Reusable Food Service Ware Required for Dining on Premises 7/1/25 Prepared Food Vendors (1) Mobile or Temporary Food Facilities as defined by California Health and Safety Code Sections 113831 and 113930 (2) Prepared Food Vendors without Dishwashing Capacity may request a waiver or partial waiver of Subsections (B) and (F) of this Section 8.07.040 - Customer-Provided Reusable Beverage Cups and Food Containers for Take-Out Now Prepared Food Vendors Large Venues and Events 8.07.050 - Accessories Only Upon Customer Request Now Prepared Food Vendors/ Food Ordering Platforms None 8.07.060 - Reusable Beverage Cups at City Facilities 7/1/25 City Employees/ City Facilities Members of the public or organizations renting an enterprise facility for a one-time event
8.07.070 - Reusable Beverage Cups at Large Venues 7/1/25 Large Venues Large Venue operators may petition for a full or partial waiver if the operator can demonstrate that the application would create undue hardship or practical difficulty that is not generally applicable to other Large Venues in similar circumstances. 8.07.080 - Reusable Beverage Cups at Events 7/1/25 Events/ Event Producers Any Event Producer may petition for a full or partial waiver of the requirements of this Section as they apply to a particular Event 8.07.090 - City Purchase, Sale or Distribution of Packaged Water Prohibited Now All City Facilities Emergency Exemptions
8.07.100 - Encouragement of Accessible Water Bottle Refill Stations 1/1/26 City Facilities used for Events & other than Office Buildings; Large Venues without drinking water Any person subject to this section may petition for a full or partial waiver
8.07.110 - Compliant Disposable Food Service Ware for Food Service Now Prepared Food Vendors Prepared Food Vendors may petition for a full or partial waiver if they can demonstrate compliance will impose a unique problem not generally applicable to others in similar circumstances that will result in undue economic hardship 8.07.120 - Distribution of Non-Compliant Food Service Ware Prohibited Now Everyone Any person may petition for a full or partial waiver of the requirements of this Section 8.07.130 - Polystyrene Foam 7/1/25 Everyone None To: Jestin D. Johnson, City Administrator Subject: Informational Report Regarding Implementation of Reusable Foodware Ordinance Date: October 7, 2024 Page 17 Community and Economic Development Committee November 19, 2024
Attachment 4: Restaurant-Focused Informational Flyer Developed for Oakland Fresh
To: Jestin D. Johnson, City Administrator Subject: Informational Report Regarding Implementation of Reusable Foodware Ordinance Date: October 7, 2024 Page 18 Community and Economic Development Committee November 19, 2024
Attachment 5: StopWaste Assistance to Date in Oakland Supporting Reusables StopWaste supports Alameda County broadly and Oakland specifically in adoption of reusables, in the following categories: • Technical Assistance: A c o n t r a c t w i t h R e t h i n k D i s p o s a b l e provides c o u n t y w i d e business support for switching to dine-in reusables, including incentive funding to launch small projects quickly. While funding is insufficient for countywide door-to-door outreach, the team is responsive to leads and can follow up with businesses that have an identified opportunity. The team recently completed a project with businesses in Oakland’s Fruitvale district funded through a National Oceanic and Atmospheric Agency (NOAA) grant to prioritize woman- a n d m i n o r i t y-owned businesses. StopWaste s t a f f e n g a g e directly with high volume and high impact opportunities, providing hundreds of hours of support to date to specific Oakland businesses working to adopt reusables and/or comply with the City’s ordinance. This has included the Oakland Arena and Coliseum, Fox Theater, and Paramount Theater. • Outreach Support: StopWaste has developed leave-behind information for businesses and may be able to support translation to additional languages. These materials include information on safe use of reusables, AB 1276, and the Rethink Disposable assistance. The program is currently i n t h e f i n a l s t a g e s o f p r e p a r i n g a c o u n t y w i d e o u t r e a c h campaign designed to support norming of reusables for takeout, with a call to action of residents to ask their favorite restaurants to try out DeliverZero, Okapi, or other reusable takeout services. City and StopWaste staff are exploring ways to amplify this campaign through social media channels. • Funding: StopWaste has awarded more than $160,000 i n g r a n t s t o s e v e r a l O a k l a n d organizations to support the use of r e u s a b l e s, including those listed below. Many of these projects are currently in progress or are s t i l l r a m p i n g u p t o t h e i r f u l l p o t e n t i a l . StopWaste is discontinuing the reusable foodware category in 2025, but will continue to consider opportunities for projects that offer potential for larger impact or significant expansion of reuse infrastructure on a case-by-case basis. • $25,000 to Oakland Arena • $20,000 to Northeastern University (Mills College) • $15,000 to Laurel District Association (for outreach to local businesses in several districts) • $33,000 to DeliverZero (promoting reusable takeout service in Oakland and other Alameda County cities) • $25,000 Okapi Reusables Service (for expansion in Oakland, Albany, and Berkeley) • $20,000 SPARKL Reusables (for catering support in partnership with Port Kitchens in Oakland) • $25,000 Spectrum Community Services (for a program feeding seniors on reusable foodware)