Bottle bill proposals leave Iowans holding their cans

Iowa lawmakers seem poised, with their latest effort to update the state’s popular but long-struggling bottle bill, to give everyone what they want.

Everyone, that is, except consumers.

What do consumers want? Most simply want the convenience of returning their empties to their grocery stores or nearby redemption centers. They also want to keep bottles and cans out of the ditches and the landfills.

That’s according to a poll taken in early February by Selzer & Co. for Cleaner Iowa, a group that promotes recycling. Selzer & Co. is the same trustworthy pollster who conducts the Des Moines Register/Mediacom Iowa Poll. The poll of 814 active registered voters in Iowa found that 86% want to expand the number of places bottles and cans can be returned so consumers can get their deposits back.

The legislation passed by the Iowa Senate last week may be a dream bill for the well-funded interest groups that donate big bucks to lawmakers and have long been agitating for changes in the state’s 40-year-old bottle deposit law. But legislation being considered so far would do the opposite of creating more locations for container returns. It would instead leave many Iowans holding their bag of cans with nowhere to get back their nickels.

Grocers and other retailers that sell alcohol and carbonated beverages have long pushed to get rid of what is an admittedly dirty process of accepting and handling empty containers. There’s never been any evidence of serious issues with bottle- or can-related health hazards in stores.

There are, however, well-documented health hazards that some grocery-based restaurants have been cited for in recent inspections, including numerous unsafe food storage temperatures, soiled equipment in the meat department, week-plus-old deli tomatoes, and a black buildup of filth in the Asian food department. No mention of bottles or cans in these and other inspection reports.

The Senate bill would let retailers “opt out” of accepting empty bottles and cans and repaying deposits. They can simply stop taking back bottles and cans, no matter how far away a consumer might have to drive to redeem them. Some grocery chains and other retailers have already illegally opted out of the program, without any consequences from the state. The House bill, which is on hold pending negotiations with the Senate, also offers ample opportunity for grocers and other retailers to refuse container returns.

Beverage distributors would have to pay a higher handling fee per container under the Senate bill – an increase from 1 cent to 3 cents. But that cost would be offset for the beer distributors by a per-barrel tax cut on beer that is expected to save the industry $4.3 million a year starting in 2024. This industry also gets the scrap value by selling the containers.

It’s also offset by the fact the Senate bill would enshrine in Iowa law the current practice that distributors or wholesalers get to keep the money from any unredeemed deposits. Lawmakers have tried to find out exactly how much money that is, but the distributors won’t tell them. Estimates are in the tens of millions of dollars.

Finally, the redemption centers. These scrappy businesses that accept and recycle containers have been struggling to get by on a 1-cent handling fee per container. There are only about 60 operating centers left in Iowa, which is far less than one for each of 99 counties. The Senate bill will triple that fee for redemption centers, and this is an enormous improvement for existing businesses.

But will it be enough to replace the 2,000-some locations where current law now specifies that containers can be returned?

Recycler: Increased fee won’t be enough

Mick Barry, president of Mid America Recycling, isn’t invested in how people return their containers. He just wants them to be recycled. He says the extra handling fee may not even provide a 10th of the current number of locations for container returns. “I don’t see us getting (200) to 300 redemption centers because of the 3 cents,” he said. “You know, will there be more? Yes. Will there be enough to make up the difference? No. And that’s where I’m hung up at it.”

Barry also coaches the water polo club at Iowa State University. He said he discussed with college students the possibility of taking their empties across town to a redemption center instead of walking to the grocery store where they bought their beverages.

“And they said, ‘What? We don’t want to do that.’ Here’s a college kid that, you know, a nickel’s a pretty big deal. They don’t have any money to do anything. But they they’re like, ‘Well, we’re not going to take them back’ …” if they have to drive to a redemption center, Barry said.

Troy Willard, owner of the Can Shed, a redemption center with locations in Cedar Rapids, Hiawatha and Iowa City, is celebrating 25 years in the business this week.  He said increasing the handling fee will help his business expand and there will likely be new centers popping up in communities that haven’t had one for a long time.

Even so, he believes it won’t give consumers enough places to return their empties.

“We’re kind of venturing into some uncharted waters here with the plan to kind of replace one system with another. It hasn’t been done anywhere else before,” he said. “I’m concerned that there’s going to be some major stumbling blocks coming up because everything happens at once.”

Give more time for redemption centers to open

The Senate bill would obligate retailers to keep accepting containers until 2023. Willard suggests extending that period a year or two to see how many new redemption centers can be established before stores are let off the hook. It’s a prudent idea and the longer wait would keep everyone at the table through the transition. Even then, I think retailers should have to keep taking returns until there is an acceptable, nearby alternative.

Willard also suggests retailers, whose handling fee stays at a penny under the Senate bill, should also get a raise to encourage some stores to set up their own redemption facilities. It will be a competitive advantage if some retailers invest in redemption facilities in their parking lots or keep their current arrangements, and that should be encouraged.

Lawmakers also should revisit the idea of clawing back some the unredeemed nickels back from the beverage distributors. Maybe they can keep some to prevent a liability in the unlikely event a bunch of long-lost, unredeemed cans show up. The rest should be available as seed money for start-up or expanding redemption centers and for retailers who want to establish a redemption site.

The bottle bill is a house of cards, and it has been for a long time, mainly because retailers are refusing to hold up their end of the bargain and lawmakers are too timid to do what’s needed to update the law without interest group buy-in.

Sen. Jason Schultz, floor manager of the Senate bill, said during a subcommittee meeting last month that it’s time for everyone to give a little.

“I think we’re to the point where Iowans have to win and everybody else at the table may have to take a measured loss,” Schultz said. “We’re going to have to pick a position, we’re gonna have to make it work.”

I couldn’t agree more. But then Schultz rewrote the bill to make sure everyone wins except Iowans. When I asked him specifically about consumers giving up the most, he said there “wasn’t support” for legislation that would keep more retailers in the program.

Democrats suspect that’s by design. “This legislation is about killing the bottle bill. It’s not about reforming the bottle bill; it is not about modernizing the bottle bill. It’s about killing it,” Sen. Herman Quirmbach, D-Ames, said during Senate debate last week.

When the system collapses in a year or two because of too few redemption centers, the stakeholders can just claim it’s time to scrap the law. Then Iowans can deal with the cost of littered ditches, overloaded landfills and oceans full of plastic waste.

Note to readers:  My husband is a lobbyist and one of his clients is an association of landfill operators. They don’t want to see bottles and cans in their facilities, either, but my opinions on this issue are my own.

Iowa Capital Dispatch is part of States Newsroom, a network of news bureaus supported by grants and a coalition of donors as a 501c(3) public charity. Iowa Capital Dispatch maintains editorial independence. Contact Editor Kathie Obradovich for questions: Follow Iowa Capital Dispatch on Facebook and Twitter.

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