Meeting Public Comments

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A bill for an act relating to accounting of unpaid beverage container refund value.(See SF 565.)
Subcommittee members: Koelker-CH, Mathis, Williams
Date: Tuesday, February 2, 2021
Time: 2:30 PM - 3:00 PM
Location: 217 Conference Room
Comments Submitted:
The purpose of comments is to provide information to members of the subcommittee.
Names and comments are public records. Remaining information is considered a confidential record.

Nancy Porter []
As an organizer for the LWVIA I have been a part of many conversations involving the Bottle Bill. Forty years ago it made a positive impact on our state in many ways including fund raising projects for student and community groups and the view of the horizon. Any steps that you can make to keep the process alive and financially healthy is appreciated. The LWVIA hopes you communicate with all involved. The Redemption Centers, the distributors, the businesses that sell the product all need to give input so no one is put in jeopardy and economic and environmental positive needs are met. Increasing the deposit might be a good first step.
Chip Baltimore [Fareway Stores, Inc.]
Under Iowas bottle bill system, when a grocery store or other retailer purchases soda or beer or other eligible beverage from one of its distributors, the grocery store pays that distributor 5 cents for every can or bottle. When the grocery store sells that beverage to a consumer, the consumer pays a 5 cent deposit to the grocery store, and IF the consumer returns the can or bottle, the redemption center or retailer pays the consumer the 5cent deposit. When the distributors pick up the redeemed cans from the redemption centers and retailers, the distributor reimburses the redemption center or the retailer for the 5 cents paid back to the consumer.This sounds like a very simple system, and from a theoretical perspective, none of the participants in the system make or lose money from the 5 cent deposit. Unfortunately, that is certainly not the case. Why not? Because Iowans are not redeeming all of the cans and bottles for which they were charged a 5 cent deposit. And under our current system, it is the wholesale distributors who are making a healthy windfall from the unredeemed cans. How is this possible? Because although the distributors are paid by the grocery stores and retailers 5 cents for every can sold in Iowa, they only have to give the 5 cents back if a can is redeemed. So the distributors keep the 5cent deposit for every can or bottle that is not redeemed by Iowa consumers. By last count in 2017, nearly 2 billion cans and bottles were sold in Iowa that were subject to the deposit requirements of Iowas bottle bill. The last estimate from the Department of Natural Resources indicated that Iowans were only redeeming approximately 65% of the eligible cans and bottles. A redemption rate of 65% means that Iowas distributors are keeping approximately $35 million PER YEAR because of the unredeemed cans. After 40 years of existence, Iowas bottle bill has generated billions of dollars for a handful of distributors.However, because there is no requirement that the distributors report the accurate percentage of cans and bottles that are actually redeemed, the public does not know what the true redemption rate is. We believe the DNRs redemption rate estimate is too high. We have reason to believe that Iowans only redeem between 2050% of the eligible cans and bottles, meaning the distributors make $5080 million every year off of this broken system. But because there is no requirement that the distributors actually report the true redemption rate, an accurate count has never been completed.SSB1087 will finally require the only participant in the system with accurate information the distributors to account for how many cans and bottles go unredeemed each year. This information will provide Iowans with information about the true rate of redemption under the bottle bill and the level of windfall profits kept by a handful of distributors. After hearing from so many that there simply isnt enough money in the system to sustain Iowas bottle bill into the future, shedding light on where the existing money goes will be helpful in understanding how effective or ineffective Iowas bottle bill is working. And that is why we support SSB1087.Chip Baltimore, on behalf of Fareway Stores, Inc.
Pam Mackey-Taylor [Iowa Chapter of the Sierra Club]
Let's pull back the curtain this is one step in dismantling and repealing Iowa's bottle deposit law. Yes, distributors are pocketing nickels on bottles that are tossed in the garbage and not recycled. However, this bill does not indicate what the plan is once everyone has an idea of how large the uncollected deposits are. And certainly it does not solve the problems that are needing to be addressed in order to keep the bottle deposit law strong the biggest problem is a need to increase the handling fee from 1 cent to 2 cents. This does not address the outright refusal by some stores to accept the empty bottles and cans, even though they are required by law to accept the empties, and the corresponding punishment that needs to be given to them. This bill is unnecessary and does not solve the problem vote it down.
Linda Schreiber [League of Women Voters of Johnson County - LWVIA]
See attached