Coquitlam-based KMS Tools facing third fine over recycling infractions

Coquitlam’s KMS Tools is facing another potential administrative penalty after provincial inspectors found the retailer remains out of compliance with B.C.’s recycling regulations – the latest development in a years-long dispute that has already resulted in $47,300 in fines.

In a July 2 inspection report, the Ministry of Environment and Climate Change Strategy determined KMS Tools continues to sell or distribute packaging and paper products without an approved Extended Producer Responsibility (EPR) plan or membership in an approved stewardship program.

The latest violation has been referred for an administrative penalty, although the report does not specify how large that penalty could be.

The finding comes little more than a year after KMS Tools was fined $28,300 for the same violation type – a penalty the company is currently appealing. That fine covered non-compliance between November 2022 and May 2024.

The company has previously vowed to continue fighting the regulations, which owner Stan Pridham has described as unfair and ill-suited to KMS Tools’ business model. Following the $28,300 penalty last year, Pridham told the Tri-Cities Dispatch the company would appeal and “continue to fight this nonsensical and unfair regulation.”

Under B.C.’s Recycling Regulation, companies considered producers of packaging and paper products are required to take responsibility for the materials they put into the marketplace. They can do so by submitting their own approved EPR plan or appointing an agency to carry out those responsibilities.

The province considers KMS Tools a producer because the company distributes materials carrying its trademarks, including cardboard boxes, paper bags and receipts through its retail locations throughout B.C.

According to the July inspection, KMS Tools still has not submitted its own EPR plan. An environmental protection officer also confirmed with Recycle BC in January that KMS Tools was not a member of its program and therefore had not appointed an agency to fulfil its obligations.

“Therefore, KMS is determined to be out of compliance with this requirement,” the report states.

The ministry separately found the company in violation of a requirement to formally submit an EPR plan, noting an internal review found no such plan had been filed.

The province directed KMS Tools to either submit a plan to the ministry or appoint an agency to carry out its responsibilities.

The latest referral adds another chapter to a regulatory dispute stretching back years.

Ministry inspectors warned KMS Tools about its non-compliance in 2021 before referring the company for an administrative penalty later that year. A $19,000 penalty was eventually imposed in March 2023 for violations occurring between June 2021 and November 2022.

KMS Tools appealed, arguing, among other things, that the regulation should not apply to its business, that it had effectively been exempted in the past and that the province had failed to explain how it could comply.

The Environmental Appeal Board rejected those arguments in May 2024 and upheld the $19,000 penalty.

Board chair Linda Michaluk found ministry staff had repeatedly advised the company of its obligations before enforcement action was taken and that KMS Tools had failed to provide persuasive evidence that it should be exempt. The board also found there was no evidence the company had ever received an official or unofficial exemption from the rules.

The $19,000 penalty has since been paid in full, according to the latest inspection report.

But the dispute has continued.

In May 2025, the province imposed a second penalty of $28,300 after determining KMS Tools continued operating without an approved EPR program between November 2022 and May 2024.

That penalty included a $10,000 base amount as well as increases for factors including repeated and deliberate non-compliance and an estimated $8,800 in recycling program fees the province determined the company had avoided.

Pridham disputed the ministry’s characterization of the company’s conduct. He told the Dispatch last year that KMS Tools had made repeated attempts to determine how it could comply and argued the rules were designed primarily for the food industry and large national retailers rather than an industrial distributor.

He also accused the province of inconsistent enforcement, claiming competitors were not being subjected to the same requirements.

The company appealed the $28,300 penalty, and the Environmental Appeal Board proceeding remains underway, according to the July inspection report.

Despite that appeal, the province’s latest review found KMS Tools remains in violation, and referred it for another administrative penalty.

No new fine has yet been imposed as a result of the July referral.