Who will run California’s groundbreaking textile EPR program?

California’s Responsible Textile Recovery Act (SB 707) establishes the nation’s first statewide extended producer responsibility (EPR) framework for apparel and other covered textiles. The law aims to reduce landfill disposal, advance reuse and repair, spur recycling markets, and shift end-of-life management costs from taxpayers to producers.

For brands, retailers, and textile manufacturers, SB 707 will fundamentally restructure how textiles are designed, financed, and circulated in California’s market. Companies in affected industries seek practical clarity on what SB 707 will mean operationally, especially as many are only now beginning to map textile flows with the granularity CalRecycle will expect. A recent constitutional challenge to certain shared features of Oregon's packaging EPR law has had temporary success in federal court, injecting further uncertainty for all EPR laws.

Selecting a producer responsibility organization (PRO): To implement the law, CalRecycle has until March 1, 2026 to approve a single PRO that can most effectively implement the program. The selected PRO must also have the following features:

• A governing board comprising producers that are diverse in size and type and that represent the diversity of covered products placed in the market by those entities. Its board may include ex officio members involved in the collection, sorting, repair, reuse, recycling, or management of covered products.


• Adequate financial responsibility and financial controls in place, including fraud prevention measures and an audit schedule, to ensure proper management of funds.

Once the PRO is approved, all producers must join by July 1, 2026, with penalties for failing to do so by the earlier of July 1, 2030 or CalRecycle's approval of a comprehensive PRO plan for achieving the statute's textile waste reduction aims. The selected PRO must have the capacity to develop the plan, subject to CalRecycle’s approval, before implementing it by late 2030.

Three organizations submitted applications by the January 1, 2026 deadline: the Circular Textile Alliance (CTA), Landbell USA, and the Textile Renewal Alliance (TRA). In reviewing the three submissions, a key point to keep in mind is that the PRO will be the de facto architect of California’s textile circularity infrastructure, subject to input from CalRecycle. CalRecycle is thus not only choosing an administrative body but also the governance model that is expected to shape future collection networks, repair and reuse pathways, and the cost curves for compliance over the next decade.

This alert compares the submissions through the lens of the approval criteria listed above.

The applicants

Ongoing discussions with brands, retailers, and recyclers suggest that producers are focused on how each applicant would affect their near-term compliance lift, long-term fee stability, and influence over program direction. These considerations are guiding early internal alignment conversations for many apparel companies that are active in California. The three PRO applicants’ different approaches to textile recycling could thus have a significant impact on these business-critical considerations.

• CTA is a newcomer founded by industry professionals with backgrounds in social and environmental advocacy. The organization holds letters of endorsement from industry participants and proposes a pathway to broaden producer participation and advisory input from California’s textile ecosystem, including collectors and recyclers.


• Landbell USA is part of the Landbell Group, which provides EPR compliance solutions internationally. Landbell highlights plans to work closely with California PROs for packaging (the Circular Action Alliance) and carpet (Carpet America Recovery Effort) to leverage shared education, logistics, and recycling infrastructure, with co-benefits for reduced greenhouse gas emissions and streamlined operations.


• TRA is an initiative of three major industry groups – the California Retailers Association (CRA), American Apparel & Footwear Association (AAFA), and National Retail Federation (NRF) – and founding members including major US retailers. TRA emphasizes California experience across its board and advisors, sustained engagement with CalRecycle, and a large group of producer and stakeholder support letters, positioning itself as a producer-centric choice with deep California ties.

Governance composition and producer diversity

All three applicants propose producer-led governance with structures designed to reflect diversity of company size, business models, and covered product categories. But they operationalize this goal in distinct ways.

• CTA proposes to expand its founding board into voting Producer Members, non-voting Affiliate Members from related non-producer backgrounds, and non-voting Advisory Members, with a governance and nominating process designed to ensure diversity by size, product category, and supply-chain role. Initially disclosed directors include representatives of prominent apparel and retail brands.


• Landbell USA describes a Producer Board composed predominantly of California-founded producers and reserves 20 percent of seats for large international producers. Landbell's proposal emphasizes that its Producer Board collectively covers about 90 percent of covered material categories defined in the statute, with a slate of initial members disclosed in an appendix.


• TRA’s board of directors includes (a) 16 founding member representing producers and trade associations spanning apparel, footwear, home textiles, accessories, and institutional and commercial textiles; (b) up to two seats reserved for California-based small businesses (each with a global annual revenue of less than $100 million); and (c) overall member revenues ranging from roughly $5 million to over $500 billion annually to mirror the diversity of covered products and producer sizes the law contemplates. TRA's proposal includes a table with details of the initial board members, including their title and affiliation.

PRO governance is more than a procedural exercise. Board composition can drive real-world outcomes on fee structures, eco-modulated incentives, and how aggressively the PRO invests in collection, sorting, and repair capacity – all of which directly affect producers’ compliance experience. The applicants’ governance models could therefore preview how burdens and benefits will fall across product categories, including apparel versus home textiles, fast fashion versus durable goods, and luxury versus value segments.

Board structure, tenure, and compensation

Board design choices vary in term length and administrative approach, with potential implications for retention and alignment with nonprofit governance norms.

• CTA’s directors serve three-year terms with eligibility for re-election, plus staggered initial terms (one, two, and three years) for continuity. Directors serve without compensation by default, but the board may adopt reasonable compensation by resolution. Officers are appointed by the board for one-year renewable terms, with salaries set by the board.


• Landbell USA has a Board of Directors with potentially renewable five-year terms. Directors cannot be compensated as such, but the board can retain them for services by contract, and stipends will be available beginning in 2027 ($40,000 for board members and $20,000 for Advisory Council members) in recognition of the time commitment and to promote consistent participation. This structure creates a nuance to be resolved in implementation.


• TRA’s bylaws provide for each Founding Member to designate a director who serves until they are replaced, resigned, or removed, with additional term structures to evolve over time. Officers serve one-year terms with no cap on consecutive terms. Directors, including when serving as officers, are not to be compensated “for services as such,” but they may receive reasonable compensation for serving in other capacities with board approval.

Ex officio and value-chain participation

Each application also contemplates non-producer participation in alignment with SB 707’s allowance for ex officio members involved in collection, sorting, repair, reuse, recycling, or management of covered products.

• CTA is to be governed by a board of directors in three classes: (a) Producer Members, including brands, manufacturers, importers, and license holders of textile products sold in California; (b) nonvoting Affiliate Members, which include collectors, repair organizations, recyclers, thrift organizations, logistics companies, nongovernmental organizations, and academic institutions; and (c) nonvoting Advisory Members comprising technical experts, community representatives, scientists, and policy advisors appointed by the Board.


• Landbell USA's Producer Board comprises predominantly California-founded producers and an Ex Officio Board with practitioners across the value chain (including collection, sortation, repair, reuse, recycling, hauling professionals) and the California Product Stewardship Council (CPSC) Director of Advocacy serving in an ex officio capacity.


• TRA expects to transition the three industry associations (the CRA, AAFA, and NRF) to nonvoting ex officio roles after PRO approval. The proposal emphasizes that the bodies will convene committees that incorporate perspectives from entities involved in the collection, sorting, processing, or management of textiles post-use.

Financial responsibility: Audits, fraud controls, and reserves

The PRO will be entrusted with collecting and managing significant sums of money from producer fees, making financial responsibility critical. In their submissions, the applicants respond to these requirements with detailed financial control frameworks, including independent audits, segregation of duties, dual authorization for expenditures, and reserve fund policies consistent with the statute’s six-month reserve requirement.

• CTA proposes a staged audit approach (comprising a formation-year review and annual independent audits thereafter) under Generally Accepted Auditing Standards (GAAS), quarterly board-level financial reviews, robust fraud prevention (i.e., segregation of duties, dual authorization thresholds, conflict-of-interest and whistleblower policies, and secure financial systems), and a six-month reserve target governed by a board-adopted Reserve Policy and annual reporting to CalRecycle.


• Landbell USA outlines a financial oversight model that includes a Finance Committee, Audit Committee, and Oversight Committee, with routine monthly account reconciliation, quarterly reporting, external audit oversight, and cost allocation benchmarks derived from its European programs.


• TRA commits to annual independent financial statement audits conducted in accordance with GAAS, periodic internal control reviews, and special audits as warranted. Governance safeguards also include a board‑approved Reserve Fund Policy requiring six months of operating reserves to be maintained in segregated, interest‑bearing accounts, oversight by a Finance and Audit Committee, and detailed delegation‑of‑authority matrices.

For producers, financial controls will generally determine predictability of annual fees, resilience to financial disruptions, and CalRecycle’s reliance on the PRO’s reporting. Programs with robust reserve policies and dual-authorization guardrails could see smoother onboarding and fewer mid-cycle fee adjustments, an issue that has created challenges in early-stage EPR programs in other sectors.

Implementation readiness and digital infrastructure

Implementation credibility may turn on the PRO's ability to register producers; map needs across California; manage fee collection and modulation; contract for collection, sortation, and processing; and deliver auditable, secure reporting.

• CTA describes programmatic pillars for producer education, collection and recycling infrastructure partnerships, data and reporting support, and research and development paired with governance and compliance structures (e.g., bylaws, conflict-of-interest policy, board committees) to scale statewide operations.


• Landbell USA uses Loamist Validator and Explorer, an internal digital platform, to manage producer registration, brand lists, fee modulation, needs assessment mapping, route optimization, audit logs, and annual reporting, with SOC 2 Type II and ISO 27001 alignment and immutable backups.


• TRA presents a five-year “start-up plan” keyed to statutory deadlines for implementing producer education and outreach, a registration portal, and a functional organizational structure that includes Producer Services, Program Operations, Finance and Administration, Technology and Data Systems, and Communications and Stakeholder Engagement.

Companies may want to monitor how each applicant intends to balance near-term operational buildout with longer-term cost stabilization. Globally, textile EPR programs have sometimes struggled when PROs underinvest early, leading to unplanned fee escalations. California’s model could afford producers an opportunity to influence that trajectory at the outset.

Going forward

All three applicants speak directly to SB 707’s governance and financial responsibility requirements and propose paths to statewide implementation. They differ, however, in many particulars. CalRecycle’s choice will depend on which model it believes can most credibly scale producer enrollment and compliance by July 1, 2026, while maintaining auditable financial integrity and inclusive governance reflective of California’s diverse textile market.

Notably for producers, the chosen PRO will design and implement California’s textile circularity infrastructure, shaping collection networks, repair and reuse pathways, fee structures, and eco-modulated incentives for the next decade. Producers are encouraged to closely monitor the selection because early-stage PRO decisions on governance and infrastructure investment could drive near-term compliance burdens and long-term fee stability – and potentially avoid or mitigate challenges that textile EPR programs in other jurisdictions have faced.

DLA Piper’s EPR team is monitoring this process closely. For more information about how SB 707, the three PRO proposals, or EPR more generally may affect your business, please contact the authors.