MASSPIRG Submits Testimony to Increase Bottle Bill Handling Fee

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Key Provision Would Keep Local Redemption Center Businesses Afloat


Testimony from the Massachusetts Public Interest Research Group (MASSPIRG) delivered to the Executive Office of Energy and Environmental Affairs (EOEEA), March 13, 2013

Submitted by:  Janet Domenitz, Executive Director, MASSPIRG

In re: EOEEA’s proposal to amend 301 CMR 4.05(4) to increase the bottle bill “handling fee” from 2.25 to 3.25 cent

MASSPIRG supports Secretary Rick Sullivan’s proposal to increase the bottle bill “handling fee” by one penny, from 2.25c per container to 3.25c per container.  The handling fee is what the distributor pays the retailer for handling the empty containers, a key part of making the bottle bill work (the handling fee has nothing to do with the deposit, which consumers pay, and get redeemed when they return the container).

This is a common sense and long overdue proposal.  Among many, the three main reasons MASSPIRG stands behind this:

1-Nothing with a price stays the same for 20+ years. The handling fee, (which bottlers pay the handlers of the empty containers covered by the container deposit law known as the bottle bill) has been the same since 1991. You do not have to be an economist or any kind of policy expert to know that someone is getting the very short end of the stick in this equation. If I told you that there was somewhere you could pay 1991 prices to purchase a car or a house, or even buy a 16 oz beverage, you’d think I was being ridiculous, and you’d be right. But it’s not a laughing matter that redemption centers are being paid what they were in 1991 for handling a container.

2-Redemption centers, like any other small business, can’t be maintained, never mind thrive, being paid prices for their services from 1991. We need redemption centers to thrive to make the bottle bill work; and the bottle bill is the single most effective recycling tool we have. Approximately one third of all containers with a deposit move through the recycling system via redemption centers. Approximately half the redemption centers which existed a decade ago have closed up shop. This puts a big dent in the successful operation of recycling which the bottle bill enables.

3-The bottlers warn that consumer prices will go up if they have to pay an additional penny per container. This is a lose/lose argument.

a-The Department of Environmental Protection’s 2011 study of beverages in several New England states, including states with and without a deposit law, proved  that prices are the same, if not higher in non-bottle bill states. So it put to rest the claims bottlers were making that the Bottle Bill makes consumer prices higher.

b-Let’s say for the sake of argument that the price of purchasing a beverage would increase by the same additional one penny we’re asking for in the handling fee. I assert that it would be difficult, if not impossible, to find  any data anywhere, or studies of consumer habits, that show that a single consumer would either stop purchasing the beverage, or that the financial standing of a single consumer would be somehow hurt by paying an additional cent for a beverage. If you are a consumer of beverages covered under the deposit law, and you purchase two such beverages every single day for a year, and the price of the beverage goes up one penny in a ‘pass along’ the bottlers charge as a result of the handling fee going up, you will be shelling out $7.30 a year more than you are now.

The public supports the Bottle Bill (a 2011 poll conducted by MassINC Polling Group showed that 86% of the public supports the bill), and although most people don’t know every single operational part of what makes the Bottle Bill work,  it can’t work much longer if we don’t catch up with the reality of 20+ years of neglect. We need to raise the handling fee in order to keep this popular law functioning.

Thank you for your consideration.