Nickels from heaven

In these hyper-tight budget times, would it surprise you to know that there’s a couple million bucks just sitting there, waiting for the State of Vermont to pick it up?

This isn’t just one-time money either; it’s an ongoing, steady source of revenue. And yet the Legislature hasn’t made a single move to grab it.

“What is it?” you might be asking.

It’s the unclaimed nickels from deposit bottles that never get redeemed. Right now, that money goes back to the bottling industry — an estimated $2 million per year.

Free gift for the bottlers? The PYT’s from VPIRG certainly think so. They’ve been lobbying, without success, to revise the Bottle Bill and get that money into public coffers.

Ten states have Bottle Bills. In four, the state gets all the unclaimed money. In three, the state gets the lion’s share but a slice goes to retailers, bottlers, or distributors. Only in Iowa, Oregon and Vermont do private companies get all the money. And since yjomhd seem to work in those seven other states, I think it’s safe to assume that the companies don’t need the extra revenue to collect and process the containers.

In fact, they get more money than they need from another source: selling the containers on the recycling market. A lot more money. But we’ll get to that that later.

Okay, so why isn’t the Legislature falling over itself to get those nickels? Two reasons; one immediate, one more far-reaching.

The immediate: the creaky inner workings of the Legislature. The more far-reaching: unresolved questions about Vermont’s looming mandate for universal recycling (part of Act 148), which takes effect on July 1.

The immediate first. House Bill 104 would give the unclaimed nickels to the state “to provide grants to businesses engaged in solid waste management and recycling.” This makes sense because right now, there’s no funding mechanism for the new universal recycling mandate. July 1 is likely to bring higher tipping fees (possibly much higher) for many Vermonters, especially in rural areas.

H.104 was referred to the House Natural Resources and Energy Committee, which is searching for ways to ease the cost impact of Act 148. But, as committee chair Tony Klein explains, “When it became clear that [the money] would either be absorbed into the General Fund or maybe into water cleanup, the committee said, ‘Well, that’s for other people to deal with.'”

They have a point. While House Natural Resources was dealing with Act 148, the Ways and Means Committee was tackling the General Fund, and the Fish, Wildlife, and Water Resources Committee was dealing with water cleanup. They were operating on parallel tracks.

Klein notes that another committee could have pursued the unclaimed nickels, but H.104 was before his committee. In that situation, the other panels may have assumed that the money was off limits. After all, if two different committees appropriated the same funds, that’d be a problem.

House leadership could have cleared up the confusion. It could have given assurances to Klein that the Bottle Bill revenue would go to its intended purpose under H.104. Or it could have given Ways and Means the go-ahead to take up the nickel issue after Klein’s committee backed away.

Maybe those possibilities were simply overlooked in the crush of a very busy session. But I think it also has to do with the larger issue I mentioned above.

There is sentiment at the Statehouse for repealing the Bottle Bill. With universal recycling about to take effect, the logic goes, there’s a lot less reason to have a special deposit system for beverage containers. Plus, to paraphrase The Old Prospector, “Thar’s gold in them thar containers.”

Under the Bottle Bill, the bottlers and distributors collect the used containers and sell them for recycling. As it happens, the only materials that fetch good prices in today’s market are plastic and aluminum — the vast majority of the containers covered by the Bottle Bill.

Other recyclables — paper, cardboard, glass, etc. — return little or no revenue. Some materials are fobbed off at a loss. Effectively, the Bottle Bill diverts the valuable stuff back to bottlers and distributors, and leaves the unsellable stuff in the hands of trash haulers.

People who’d like to repeal the Bottle Bill don’t want the state to get its hands on the unclaimed nickels, because the state will quickly get used to the revenue. It’ll become harder to amend or kill the Bottle Bill. And if you buy the reasoning, it’d be better environmentally to have a robust universal-recycling system with solid funding than to keep the Bottle Bill.

There’s a worm or two in that apple, of course. The Bottle Bill does a hell of a lot better job of capturing recyclables than our solid waste handling system. The Bottle Bill’s capture rate is about 85%, while the solid waste system captures roughly half of the potential material.

That might increase after July 1, but as Tom Moreau of the Chittenden Solid Waste District told me, “If we get to 70%, we’re clickin’ our heels.”

The 85% success rate comes with a high price tag; according to Moreau, the Bottle Bill system costs about $8.75 million per year in handling fees. You could argue that the money would be better spent elsewhere, especially after the universal recycling mandate begins. From that viewpoint, repeal makes sense.

But then there are social and cultural issues. The Bottle Bill is a long-established thing; it’s part of our self-image as a green state. And it’s a great fundraising tool for school groups, community causes, scout troops, and others. There’s a network of retailers around the state who probably wouldn’t exist without the deposit business. Politically, it’d be difficult to argue for eliminating a system that’s widely viewed as a public good.

Given all of that, repealing the Bottle Bill seems like a longshot — even if you think it’s a good idea. Which makes me wonder if it’s really worthwhile for the state to forego that $2 million a year.

Still, as it looks from here, that’s why that $2 million is just sitting there, waiting to be taken.

I’ll have more to say about the price of recyclables and the impact of Act 148 in a subsequant post. I think this one is plenty long already, thanks.

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