Thank you to Senator Downing and Chairman Keenan, and through you to the Committee. On behalf of the Patrick-Murray Administration and the Department of Environmental Protection, I appreciate the opportunity to testify before you today in strong support of an Expanded Bottle Bill in Massachusetts.
Like the Committee, MassDEP has sought to better understand the likely effects of passing an expanded Bottle Bill, and the effect it will have on the environment and the economy of Massachusetts. When I became Commissioner in January, one of my first priorities was to meet with all the stakeholders and hear their concerns and arguments firsthand, including representatives from the food and beverage industries. I listened to all with an open mind, and learned a lot from both supporters and opponents. And as a follow up, I asked my staff to gather additional information, which I will discuss in a moment. But after that review, and like Governor Patrick, who has included the expanded bottle bill in his budget the last several years, I have found the arguments for implementation of an expanded bottle bill to be compelling.
First and foremost, an expanded bottle bill will be good for the environment of Massachusetts. MassDEP tracks this information, and has concluded that the bottle bill reduces litter by generating a high recycling rate. Because of the nickel incentive, beverage containers that require the deposit are recycled at an 80 percent rate here in Massachusetts, almost twice the rate of containers that don't require the deposit. That's well better than the national average recycling rate. We estimate that there are approximately 1.5 billion non-deposit bottles sold in Massachusetts per year; expanding the bottle bill would increase the number of these bottles recycled from 600 million (40 percent) to 1.2 billion (80 percent).
That means a lot less trash in public places. All you have to do is attend a community cleanup, or walk in a park, or peek at a public trash can. If you see four discarded bottles in public places, three out of these four don't have a deposit even though non-deposit bottles are only about one-third of the total bottles sold.
And less trash translates into savings for our cities and towns. Putting a deposit on these bottles means that cities and towns don't have to pick up these bottles in public places and dispose of them. We estimate that these avoided collection and disposal costs amount to about $6-7 million in savings per year. Cities and towns face tough budget decisions every day - this bill will make those decisions just a little bit easier. That's why 199 of our 351 cities and towns support the expanded bottle bill.
Opponents of the bottle bill have argued that it is a new tax on consumers. This is clearly not the case. I know this committee is fully familiar with the difference between a tax and a deposit, but to be clear, the 5-cent deposit is refunded to the consumer once the container is returned. I know of no other tax that is refundable. And the principal reason for the bill is not to raise revenue, but rather to increase recycling and reduce litter.
Now when I met with opponents of the bill, I heard three things. I heard that an update of the Bottle Deposit Law (BDL) will cost retailers, consumers, and the state money. Also, that the expansion will further reduce consumer choice. And that it will impose significant new burdens on retailers. I took those claims very seriously, because the last thing we want to do is cost consumers money or impose difficult burdens on our companies in Massachusetts. And so I sent my staff on a fact-finding mission. Our neighboring states have a variety of bottle deposit laws. My staff went to retailers in New Hampshire, where there is no bottle deposit law, and also to Maine and Connecticut, where they have versions of an expanded bottle deposit law, and they also went to stores right here at home in Massachusetts. Staff compared prices in the stores and online and they interviewed managers. Our informal survey found that:
- The BDL results in no difference in price between beverages;
- The BDL results in no difference in consumer choice; and
- There already exists sufficient infrastructure and capacity to handle the additional beverage containers of an expansion.
All of that research is documented in a preliminary survey, which I am providing to you today. The goal of this survey was to get a sense of how bottle deposit laws affect product cost, consumer choice, and vendors' ability to handle increased recycling volume. Here is what we found from the survey.
Supermarkets with regional operations have remarkably consistent beverage pricing for both deposit and non-deposit beverages across states, regardless of whether the state has a BDL. For example, a 12-pack of Coke at the Shaw's supermarkets that we visited costs $4.99 whether you purchase it in New Hampshire, Maine, or Massachusetts, even though New Hampshire does not have a bottle deposit law.
With regard to consumer choice we found that, despite an expanded bottle deposit law, Maine customers had access to all of the same types of products we have access to here in MA, and even more variety than we do. Our data shows that the size of the store, and not a bottle deposit law, determines how wide a range of products one will find.
Finally, we interviewed store managers, the Reverse Vending Machine vendors, and state officials, and they suggested that the states that have expanded their bottle deposit law have sufficient capacity to absorb the newly added beverage containers. Reverse vending machines effectively process about 90 percent of the beverages that have deposits in Maine. And if we excluded juices and bottles larger than three liters from our bottle bill, we would be at nearly 100 percent.
Further, many large grocery stores have machines designed to handle 12,000 or more containers a day. They typically process only a fraction of that number. Clearly, the capacity to handle more containers exists.
In summary, our survey suggests that you're not paying more for your Coke if you buy here in Massachusetts than if you buy it in New Hampshire. And if we do expand our bottle deposit law, you're going to find all the same products in the store that you do today, and the hassle for yourself and for retailers just does not seem to be a problem for the people managing the program on the ground.
Senator Downing, Chairman Keenan, we know that the bottle bill gets containers out of our rivers, parks, and public ways, and gets them recycled. It just makes sense.
Nevertheless, those who are concerned with the expansion of the bottle bill have raised legitimate issues concerning container size limitation, exclusion of certain beverage segments that are difficult to manage under the program, methods and means to limit fraud, allowing small retailers to opt-out of redemption responsibilities, and other reasonable and smart measures to help this law succeed to the maximum extent feasible. We are willing and eager to discuss specific provisions in a bill that can address these and other issues.
Thank you for your time and for the opportunity to testify. I would be happy to answer any questions you may have at this time.
Commissioner Kenneth Kimmell