Newsom Vetoes SB 1180, Blocking Reforms to $5 Billion Plastic Pollution Fund

California Gov. Gavin Newsom on Sunday vetoed SB 1180, a bill that would have set new spending requirements and eligible entities for the Plastic Pollution Mitigation Fund — a pot expected to reach $5 billion over the next decade.

The fund was originally created by SB 54, California's extended producer responsibility and source reduction law. In his veto message, Newsom commended the intention to direct money to communities most burdened by plastic pollution but said SB 1180 might complicate ongoing work to implement SB 54.

The Flexible Packaging Association, the Foodservice Packaging Institute and the Plastics Industry Association opposed the bill. Plastics News reported a recent industry push for a veto over concerns the bill could stymie plastics production. Environmental advocacy groups supported it.

What would SB 1180 have changed?

State Sen. Ben Allen, who authored SB 54 — the Plastic Pollution Prevention and Packaging Producer Responsibility Act adopted in 2022 — introduced SB 1180 in February to give the fund a more detailed and transparent framework. An August bill analysis described it as "More seats at the table, same sized pie." The Senate passed it 29-5 in May; the Assembly followed with a 27-10 vote in August.

Under SB 54, the Plastic Pollution Mitigation Fund would collect $500 million per year from producer responsibility organization Circular Action Alliance from 2027 through 2037, including a potential $150 million from plastics manufacturers. Some 60% of that money would go toward reducing environmental justice and public health harms from plastics; 40% would limit impacts on animal and human health.

SB 1180's proposed parameters included:

• Expenditures would have to improve public or environmental health.
• Funded programs would need outreach efforts informing the public of their purpose and scope.
• Spending would have to benefit communities most burdened by plastic pollution and California Native American tribes.
• Newly eligible agencies such as utilities could receive grants only in collaboration with tribes, NGOs or land trusts.
• Grants would have to offer technical assistance to eligible applicants.
• State administrative and program support costs, excluding technical assistance, would be capped at 10% of funds allocated in any fiscal year.
• Fund money generally could not cover producer responsibility organization obligations.
• The California Environmental Protection Agency would have to post an annual list of expenditures.

Why did Newsom veto it?

Newsom said his administration is "working through the complex, foundational work of implementing [SB 54], including its core producer responsibility requirements and ensuring compliance clarity for the regulated community."

"Much of the work to ensure the funding reaches the most appropriate entities is already underway," Newsom said, adding that SB 1180 "risks complicating implementation" of both the EPR act and the mitigation fund.

What happens next for SB 54?

The veto lands on a compressed implementation timeline. Newsom had CalRecycle revisit the SB 54 regulations last year rather than finalize them, and the rules were not finalized until May of this year.

Circular Action Alliance intends to submit the final draft of its California program plan by Oct. 13, targeting approval and kickoff on Jan. 1, 2027. CAA anticipates remitting the first Plastic Pollution Mitigation Fund fees on March 1, 2027 — meaning brands and packaging producers will see the veto's practical consequences in their first invoices within six months.