California Senate Bill 54: Producer Rules, Fees, and Deadlines

California’s SB-54, the Plastic Pollution Prevention and Packaging Producer Responsibility Act, is the state’s plastic packaging law, and it shifts the cost of packaging waste from local governments and consumers onto the companies that put packaging into the market. By January 1, 2032, all single-use packaging and single-use plastic food service ware sold in California must be recyclable or compostable, 65% of it must actually be recycled, and the total volume of single-use plastic packaging must drop 25% against a 2023 baseline.¹ Producers also owe $5 billion collectively over ten years starting in 2027. If you sell packaged goods into California, the law almost certainly applies to you.

The Three 2032 Targets

SB-54 sets three separate goals, and they measure different things.

100% recyclable or compostable. Every piece of single-use packaging and single-use plastic food service ware sold in California must be designed so it is compatible with available recycling or composting infrastructure.
65% recycling rate. Of all single-use plastic packaging and food service ware, 65% must actually be recycled. Interim rates are 30% by 2028 and 40% by 2030.¹
25% source reduction. Total single-use plastic packaging sold or distributed in the state must drop 25% by weight and by plastic component against a 2023 baseline. By 2030, the reduction must reach at least 20%, with no less than 4 percentage points coming from a shift to reusable or refillable systems.

The source reduction requirement is the piece that distinguishes SB-54 from ordinary recycling mandates. It doesn’t only ask for easier-to-recycle packaging. It requires that less plastic packaging exist, and a portion of the reduction has to come from genuinely reusable systems rather than from thinner plastic.

Who the Law Treats as a Producer

SB-54 defines “producer” in a cascade designed to catch someone regardless of where they sit in the supply chain. The primary target is the company that manufactures a product using covered packaging and owns or licenses the brand under which it is sold in California. If that entity isn’t in the state, responsibility falls to the brand owner or exclusive licensee in California. If neither is present, the person who sells, offers for sale, or distributes the product into California is treated as the producer.

One narrow carve-out applies: a person who produces, harvests, and packages an agricultural commodity on the same site where it was grown or raised is not a producer under the law. Everyone else in the packaging supply chain should assume SB-54 applies until confirming otherwise.

The regulated material, called “covered material,” includes single-use packaging and single-use plastic food service ware.² That runs from shipping boxes and blister packs to takeout containers and plastic cutlery. CalRecycle maintains a covered material categories list.

Small Business and Category Exemptions

Producers, retailers, and wholesalers with California gross sales under $1 million in the most recent calendar year can apply for an exemption from most SB-54 requirements.³ The exemption isn’t automatic. CalRecycle can deny it if exempting a particular small business would undermine the ability of a covered material category to meet the law’s requirements.

CalRecycle can also exempt specific covered materials that present unique compliance challenges or cannot comply for health and safety reasons or because they are unsafe to recycle.³ Under amended draft regulations published in early 2026, a producer claiming a categorical exemption must submit a notice to CalRecycle explaining why no compliant alternative packaging exists that meets all applicable safety, structural, and legal requirements.

The EPS Food Service Ware Ban

One category has already tripped the law’s enforcement mechanism. Expanded polystyrene (EPS) food service ware producers were required to demonstrate a 25% recycling rate by January 1, 2025. They did not meet it. Producers are now prohibited from selling, distributing, or importing EPS food service ware into California, and single-use EPS takeout containers and cups are no longer legal to sell in the state.²

Joining the Producer Responsibility Organization

SB-54 required producers of covered material to form and join a producer responsibility organization (PRO) by January 1, 2024. The PRO is a 501(c)(3) nonprofit created specifically to develop and carry out a plan for meeting the law’s recycling, composting, and source reduction targets.⁴ CalRecycle has approved the Circular Action Alliance (CAA) as the first PRO under the law.²

The PRO develops and submits a producer responsibility plan and annual budget to CalRecycle, maintains records of all covered material sold or distributed in the state by its members, submits annual reports on plan implementation and compliance, and provides producer contact information to CalRecycle on request.⁴ The CAA is expected to submit its program plan to CalRecycle by mid-2026.

Producers must register with the PRO and report the types and quantities of packaging they introduce into the California market. If you sell packaged products into California and meet the producer definition, joining the PRO isn’t optional.

What Producers Will Pay

The largest financial obligation under SB-54 is the $5 billion producers owe collectively over ten years starting in 2027, at $500 million per year. The money goes toward addressing the environmental impacts of plastic pollution and aiding environmental justice communities most affected by single-use plastic waste.¹ That is separate from what the PRO charges its members for operational costs.

Eco-Modulated Fees

SB-54 directs the PRO to charge eco-modulated fees, meaning each producer’s fee moves up or down based on how sustainable their packaging is. The law identifies nine adjustment factors. Producers earn credits for using higher percentages of post-consumer recycled content, standardizing packaging formats, and including labeling that helps consumers sort materials correctly. Surcharges apply to packaging containing chemicals on California’s Proposition 65 list, such as certain phthalates in PVC or problematic inks and dyes.

The exact fee schedule has not been set. The CAA’s assessment of base fees and eco-modulated adjustments is projected for late 2028 or early 2029, so producers won’t know their precise per-unit costs for several years. A company using 50% recycled content in standardized, clearly labeled packaging will pay meaningfully less than a competitor using virgin plastic in a hard-to-recycle format.

Compliance Dates Through 2032

January 2024: Producers required to form and join the PRO.
January 2025: CalRecycle established the 2023 baseline for the 25% source reduction target; the EPS recycling rate deadline passed, triggering the EPS food service ware ban.
January 2027: $500 million annual payments begin.
January 2028: All covered material must reach a 30% recycling rate.
January 2030: Recycling rate target rises to 40%. Source reduction must reach at least 20%, with 4% from reusable or refillable systems.
January 2032: All three final targets apply: 100% recyclable or compostable, 65% recycling rate, 25% source reduction.

CalRecycle published amended draft regulations on January 29, 2026, after withdrawing a previous draft earlier that month, and a public comment period ran through February 13, 2026. The amended rules did not change any of the statutory deadlines above.¹ CalRecycle has also published producer reporting guidance on covered material category reporting and source reduction reporting.²

Penalties for Noncompliance

CalRecycle can impose administrative civil penalties of up to $50,000 per day per violation against any entity that fails to comply with SB-54 or its implementing regulations. For small producers who meet the small business exemption criteria but don’t qualify for the full exemption, the cap is $25,000 per day per violation.

Penalties don’t start accruing immediately. A producer or the PRO gets 30 calendar days after notice of a violation before penalties begin. For a first offense CalRecycle doesn’t consider egregious, the department is directed to consider capping the penalty at $25,000 per day.

Reporting violations carry their own penalties. Refusing or failing to submit required information carries a civil penalty of $500 to $5,000 per violation, with each day of a continuing violation counted separately. Filing a false report or obstructing CalRecycle’s inspections or examination of records rises to $500 to $10,000 per violation per day. Each product that uses non-compliant covered material counts as a separate violation regardless of how many units were sold, so the numbers compound quickly.

1
CalRecycle. SB 54 Plastic Pollution Prevention and Packaging Producer Responsibility Act Permanent Regulations
2
CalRecycle. Plastic Pollution Prevention and Packaging Producer Responsibility Act – SB 54
3
California Legislative Information. California Public Resources Code PRC 42060
4
Department of Resources Recycling and Recovery (CalRecycle). SB 54 Informational Session – Producer Responsibility Organization Application