State considers 10-cent deposits on recyclable beverage containers

A proposed 10-cent fee for bottles, cans and other beverage containers would boost Minnesota's recycling volume by some 1.9 billion containers per year but could also saddle consumers or beverage firms with $29 million in new costs as beverage prices rise.

The projections, released Thursday, were prepared by the Minnesota Pollution Control Agency (MPCA) at the request of legislators seeking ways to increase Minnesota's recycling of bottles, cans and cartons. The state's recycling rate has been stuck at 45 percent, but state officials would like to raise that to 80 percent.

The study, which sets the stage for debate during the 2014 Legislature, underscores winners and losers in a container-deposit system and already has pushed advocates and critics into well-drawn corners.

Advocates insist the deposit fee and recycling program could increase recycling rates, save municipalities money, cut the state's energy consumption, raise $469 million in deposit fees and create 1,064 jobs in the recycling and related industries.

But the proposal has triggered a swell of angry reaction from grocers, retailers and some recyclers, who claim that it could scare off pop, beer, wine and juice consumers — and divert valuable containers from the current waste management firms who depend on a steady stream of beverage containers.

They also say a new collection system would create hardships for stores and supermarkets that would begin collecting used containers.

The MPCA will hold a public hearing Jan. 14 at the state Department of Corrections office in St. Paul, then send a report with public comments to the Legislature by early February.

Thursday's study gives a glimpse of what a more-ambitious state recycling program might look like. It would charge consumers a 10-cent deposit on each beverage container less than a gallon in size. The state would also hire a nonprofit company to manage recycling and to set up collection centers where spent containers could be brought for the 10-cent refund.

There would be at least one redemption site in each county and at least one center for every 15,000 residents. Redemption sites may include supermarkets, if they want to participate, and other retailers, solid-waste facilities and even "reverse vending machines," which would take cans and bottles and spit out refunds.

The report estimates that 77 percent of beverage containers would be returned to redemption centers by the public or would be collected by redemption centers from bars, restaurants and schools. Another 7 percent of containers would be expected to come from private recyclers, nonprofits and materials recovery facilities.

If the projections are accurate, Minnesota's recovery rate could shoot to 84 percent, MPCA officials said.

Even at this stage, the plan is contentious.

"All of this progress in recycling has been accomplished without an onerous bottle deposit system, which places added costs and lots of inconvenience on the backs of consumers," Wilkin said.

Gjerde noted that the net cost to consumers would be only about six-tenths of a penny per beverage container. "It would cost less than penny a can to implement the new system," he said.

Susan Collins, president of the Container Recycling Institute in California, said such a cost is considered "reasonable" and "efficient." Her state, one of about 10 states with container deposits, adopted a deposit refund system in the 1980s. She has worked nationally to research the issue for other states, including Minnesota.

"Minnesota has the chance to have a world-class system," even if costs rise as a result, she said. "If you imagine buying a 24-pack of soda, your price would go up 14 cents on average, that is if the beverage producers decided to pass all of their [new deposit] costs onto you, the consumer," Collins said.

Other findings suggested that current waste and recycling haulers firms risk losing $4.6 million in disposal and recycling revenues. They may also be forced to cut 136 residential-recycling jobs plus another six workers at waste collection centers and landfills.

Paul Gardner, executive director of Recycling Reinvented in Shoreview, said he can understand why people would like or criticize the proposed change.

"Deposits create clean streams of a lot of beverage containers, which the aluminum, glass and PET plastic industries want. But consumer brands end up paying for it, more or less. This is typical of the many trade-offs in recycling," Gardner said. "Everyone wants the benefits but not the costs. The report does a good job of showing costs and benefits as well as showing who benefits and who has the costs."