Bottle Bill Expansion
Dear friends,
Oregon's Bottle Bill is an icon of our state's progressive heritage. As one Oregonian said in committee this week, "it's in our DNA." Born in the early 1970s, the Bottle Bill was the brainchild of a few passionate Oregonians who saw a creative solution to roadside litter. Our state's political leaders had the vision and courage to make it law, and the Bottle Bill subsequently became the model for container deposit programs in a dozen states.
Unfortunately, in its 36-year history, the Bottle Bill has proven notoriously difficult to expand. Session after session, legislators have introduced legislation that would add containers and/or increase the deposit rate. Session after session, those efforts have failed. In 1996, a coalition of recycling advocates collected signatures and went directly to the ballot with a measure that would have added most non-carbonated beverages to the bill. That effort failed after industry lobbyists spent several million dollars on misleading advertisements that turned an 80-20 lead into a narrow loss during the final weeks of the campaign.
This year, the Oregon Legislature is poised to make the first significant changes to the Bottle Bill since its inception. Senate Bill 707, which passed the Senate 23-7, is being heard this week in front of the House Committee on Energy and the Environment, on which I serve. If it becomes law, SB 707 would add "water and flavored water" to the list of beverages covered under the Bottle Bill. It would also set up a task force to look at other issues, including raising the deposit, expanding to additional containers, and setting up a more convenient collection system.
If SB 707 passes, millions more water bottles will go to recycling centers instead of landfills. Our state's recycling rate for water bottles (50%) pales in comparison with our recycling rate for beverage containers covered under the current Bottle Bill (90%). SB 707 will help Oregon combat our once-again growing problem with waste on roadsides, in streams, and on beaches. Jack McGowan, executive director of SOLV, reported to committee that volunteers participating in a recent beach cleanup found several thousand empty water bottles on a single two-mile stretch of Oregon beach.
Even though SB 707 represents a significant expansion, it falls short of where I, and many of you that I have heard from, would like to see the Bottle Bill head. I began this session hoping that we would be able to cover all beverage containers, not just some. Moreover, it seemed like a no-brainer to increase the deposit to $0.10 per container (after all, with inflation, that nickel would now be $0.25).
So why aren't we going that far? The answer has partly to do with the structure of how Oregon's Bottle Bill works - a structure that is quite a bit more complicated than most Oregonians realize - and partly to do with politics. This issue, like so many we deal with in Salem, gets complicated very quickly.
For the consumer, the Bottle Bill is pretty simple: you pay an extra $0.05 per container at purchase, and you get the deposit back when you return the empty container to the grocery store. What goes on behind the scenes, however, is quite a bit more complicated, and works roughly as follows:
The nickel deposit originates with the wholesaler or distributor, which tacks on an extra five cents per container when it sells the beverage to the grocer.
The grocer passes the five-cent deposit on to the customer, "making the grocer whole."
The customer returns the container to the grocer, which sorts the container by distributor and gives the customer five cents of store credit.
The distributor picks up the empty containers from the grocer and pays the grocer five cents for each.
The distributor sells empty containers to a recycler at market prices.
This system has worked pretty well over the last 36 years, especially as grocers and distributors have innovated to increase efficiency. Distributors in the Willamette Valley have pooled resources to form co-ops that collect every empty container within a given area, thereby eliminating the need for each distributor to run its own collection system. Grocers have benefited from reverse vending machines that help automate the system and move it outside the store (unfortunately, this was not a particularly welcome innovation from the consumer's point of view, in my opinion).
But the existing system has had its detractors, too. Some grocers complain that they receive no compensation for a service they are required to provide. Critics have rightly asked, without getting an answer, how much money distributors are pocketing in unredeemed deposits. Consumers who choose to recycle their containers curbside - rather than hauling them to a grocery store - wonder whether there shouldn't be a way to get their nickel back.
Expanding the Bottle Bill beyond beer and soda containers creates additional complications. The beverages covered by the existing Bottle Bill are distributed under an "exclusive territory" system, meaning that there is a single distributor of Pepsi, for example, for any given area of the state, and a retailer would violate the law if it obtained Pepsi products from any other source. By contrast, retailers are allowed to purchase a single water bottle brand from any number of different vendors: wholesalers, large grocers, or distributors, to name a few. For grocers, this may create uncertainty about where to go to be reimbursed for the nickel paid back to consumers. This problem is compounded by the number of brands of bottled water, including many private or specialty labels that are not generally available (think Kirkland, Target, etc.). The difficulty increases with each additional beverage type we might add.
Passage of SB 707 will require grocers and distributors to work creatively to find ways to surmount these and other challenges. Part of what makes Oregon's Bottle Bill beautiful is that it provides a flexible framework within which industry operates to make the system work. Remarkably, it does not involve a single state dollar or state employee. Just as grocers and distributors found innovative ways to make the system work after the requirements were originally imposed in 1973, I am confident they will plan and cooperate for the inclusion of water bottles beginning in 2009.
The politics of Bottle Bill expansion are truly head-spinning. The powerful grocery industry has fought expansion for years, and refused to support any of the proposals brought to the Legislature at the start of the session. Suddenly yesterday, the Grocery Association spun around and announced, with great fanfare, its own plan to expand the bill to all beverage containers by 2010, in return for moving the redemption centers out of grocery stores and into "independent redemption centers" that would be funded by a $0.03 per container fee paid by the grocers. I have serious concerns about this approach, including diminished convenience for consumers. Nevertheless, it was heartening to see the Grocery Association finally willing to work constructively on expansion, and the Task Force that SB 707 sets up to look at further expansion will undoubtedly consider its proposal.
I believe the 2007 Legislature has the will to make a modest expansion to the current Bottle Bill, even though it appears unwilling to raise the deposit or go beyond water beverages. If SB 707 passes, I think we can expect the Grocery Association to pursue a ballot initiative, either to repeal SB 707 or replace it with a different system altogether. So, as is so often the case in Oregon, voters may get the final say.
Be well,
State Representative Ben Cannon
PS: I'll be at Karma Cafe, SE 82nd & Harrison, for a neighborhood visit from 10 to 11 am next Saturday May 19. I hope to see you!
900 Court St. NE, H-487
Salem, OR 97301
rep.bencannon@state.or.us
http://www.repbencannon.com
(503) 986-1446
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