As repetitive as a cicada brood hatch but even more frequent, a new bottle deposit-and-return bill has appeared before the General Assembly this year, nearly on the finish line of the 2024 legislative session.

If passed, the bottle bill, H8312, would place a 10-cent refundable deposit on many beverage containers, not including milk, baby formula, or nutritional supplements. The bill would apply to bottles sized from 1.7-ounce (50-millimeter) nips to up to 3-liter bottles. If passed, the law would go into effect July 1, 2026.

Significantly, the bill is almost silent on the topic of where empty containers would be returned, a huge point of contention for liquor and grocery store managers. These businesses have fought all proposals to return empties to the stores, saying this poses big problems of storage space, cleanliness, and staff time, along with inequities for smaller stores that might decline to accept empties.

The current bill says only that a producer responsibility organization, which manages the deposit-and-return system, must create a plan “for beverage container redemption and processing mechanisms that provides equitable and convenient access across the state.”

Environmentalists and supporters of a bottle bill have previously said that return to retail — along with various forms of freestanding redemption centers — is essential for successful deposit-and-return systems because it provides an important element of convenience.

The purpose of a deposit-and-return system is to get valuable and reusable materials out of landfills, roads, beaches, and waterbodies, where pollution is a growing problem. Using recycled materials for new products or packaging can reduce the pollution and waste of creating virgin materials, especially plastics, a product of the petrochemical industry.

Bottle bills also reduce littering because the empties have a cash value. States with deposit-and-return systems have a significantly lower level of litter than states without them. Many Rhode Islanders are particularly aggrieved by the thousands of nips — single-serving liquor bottles — scattered along roads and beaches.

“By putting a price on the bottle we will have more hands out there picking them up,” Bill McCusker of Friends of the Saugatucket said.

The basic deposit-and-return system is simple; the execution is complex. A retailer pays a deposit per container to a beverage distributor and the consumer pays the deposit to the retailer. When the consumer returns the empty container to the retailer, he gets his deposit back; in turn, the retailer gets his deposit back from the distributor. The cost of handling is paid by producers or distributors, and in some places through handling fees. Distributors may re-use containers or sell them to a materials market that reduces plastic, glass, and metal to their raw form, and then sells it to industry.

The new bill would create a producer responsibility organization (PRO), a nonprofit group that manages the system, with required reporting to the state and the public. (A producer can be the maker of the beverage container, the party that is licensed to offer beverages for sale, the brand owner of the product, or the party that packages and ships beverages for sale.)

The PRO bears the cost of operating the system, through a fee upon its members that is based on the quantity of beverages any member sells.

The bill says that “retailers or redemption centers would be reimbursed a handling fee,” which the bill did not specify.

The bill creates goals that the PRO must meet, both for managing the system and for reducing environmental degradation from containers. First, the PRO must increase the percentage of containers sold and redeemed to 90% in the eighth year of operation. The state has the power to raise the refund amount to 15 cents if the PRO fails to reach its redemption goals to the 90% level.

Next, in a move to incentivize producers, they and the PRO must increase, over several years, the proportion of containers that are reusable. Finally, producers of containers must achieve higher and higher levels of postconsumer (previous recycled) materials when making new containers.

New this year

Failed bottle bills are a recurring feature of the state’s annual legislative sessions, but a new factor this year was nine months of research by a special study commission composed of supporters and opponents of a bottle bill: senators, representatives, environmentalists, store managers, and officials from the Rhode Island Department of Environmental Management and the Rhode Island Resource Recovery Corporation, which operates the state landfill.

Since last September, the commission has been learning everything it can about bottle bill systems in the United States, and hearing presentations by officials and private entrepreneurs from Maine to Oregon. Partisans on all sides have liked some of the innovations they have learned about.

Rep. Carol McEntee, D-South Kingstown, who co-chairs the commission along with Sen. Mark McKenney, D-Warwick, has been pushing for a bottle bill for years. “A bottle bill is coming one way or another,” McEntee said. “We have got to move forward; we’ve got to be part of the solution.”

The main job of the commission was to learn how beverage container deposit-and-return systems — the long name for bottle bills — are functioning now in 10 states, with varying management systems and degrees of success.

The second job was to assure that everyone with skin in the game felt that their needs and concerns about a deposit-and-return system were thoroughly heard and recognized.

This second task was aimed in particular at the most persistent opponents of past bottle bills: managers of retail food stores and liquor stores. Besides their objections due to problems with taking back empties, they have argued that the added deposit fee on the price of beverages would send customers scrambling into Massachusetts for lower prices. (Massachusetts has a 5-cent bottle bill.)

“We have to make sure retailers can be competitive at the cash register,” said Nicholas Fede, a commission member and official with the Rhode Island Liquor Collaborative.

McKenney said it was not the responsibility of government to make sure that all businesses prosper. But, he added, “When government puts its thumb on the scale and there’s a possibility that someone gets shortchanged — we want to avoid that.”

During the nine months of informational meetings and hearings by the commission, a ray of hope for compromise opened during some presentations by operators from other states. Mostly, this came in the form of alternate ways to accept empty containers at automated, stand-alone redemption centers that could take much of the task out of stores.

“The commission is trying to take all concerns into consideration and lessen the impacts on various interests,” said commission member Jed Thorp, state director of Clean Water Action Rhode Island. “We need a little compromising by everyone.”

At one meeting, Nicole Gasparro, president of Phil Gasparro Liquors in East Providence, said, “We [store owners] definitely want a bottle bill but it has to work for everybody. It’s not that we don’t care about the environment. But don’t make it just our problem when it is the entire state’s problem.”

Thicket of complications

Passing a bottle bill raises a huge array of topics and diversions. Among them, in addition to environmental degradation, are the effectiveness of existing recycling systems; how diverting recyclables from the central landfill could reduce its revenues from selling the recyclables; the need for public education; and the need to eliminate littering.

Liquor store and supermarket managers have a full basket of complaints: the problems of storing dirty empties; the higher sticker price from the deposit, which they incorrectly call a “tax” and say will depress sales; the cross-border competition with retailers in Massachusetts; and a competitive imbalance for smaller retail stores, which may be exempted from taking back empties but may also see customers and dollars flow to competing stores that take empties.

Ten U.S. states, including every New England state except Rhode Island and New Hampshire, have some sort of bottle deposit-and-return system for beverage containers. The effectiveness of state systems, measured by rates of container returns, varies widely, from highs of 89% in Michigan, 86% in Oregon, and 84% in Maine, to lows of 43% and 44% in Massachusetts and Connecticut, respectively, the two worst performers in the country. Success depends on a few big factors, including the amount of the deposit, which experts say now needs to be at least 10 cents.

Experts say the strength of these systems sits on two pillars: incentive, meaning the chance to get cash back; and convenience of use. Usually, convenience is understood to include returns at retail stores, among other off-site options, like reverse vending machines, which accept hand-fed containers and spit out cash, and stand-alone redemption centers.

Management of the system may be done by an industry group, like the Oregon Beverage Recycling Cooperative (OBEC), a nonprofit group of beverage distributors. Management also may be done by a department of the state, such as Maine’s Department of Environmental Protection. Regardless of who is managing the system, the state maintains oversight.

Possibility of compromise

During nine months of meetings by the commission, two notable bright spots appeared, both with elements that move at least some of the empties out of the hands of retailers.

A Maine-based business called CLYNK, founded in 2005, operates large and efficient redemption centers in several states. At the centers, consumers can leave their bags of bottles and cans through a “bag drop” system. To use the bag drop, consumers must open an account with CLYNK and affix to each filled bag a sticker that has a bar code linked to the consumer’s account. The system reads the bar codes and inserts the deposit refund into consumers’ accounts. CLYNK carries away the empties and returns them to beverage distributors or to a raw materials recycling business.

CLYNK also operates reverse vending machines, where customers feed containers into the machine, and manned recycling centers where containers are hand-counted and customers can be paid immediately.

Bridget O’Brien, chief operations officer of CLYNK, told the commission in April that the system has been enormously popular in Maine, where “CLYNKing” has become a local verb for returning containers.

The other stand-out moment in the commission’s work came at its January meeting, with a presentation about Oregon’s deposit-and-return system by Jules Bailey, a former Oregon legislator who is intimately familiar with the system. It is considered among the most successful in the United States.

Oregon’s system started in 1971 with a simple framework that set a “refund value” for containers, Bailey said. Rules were sparse and management was left to grocers and beverage distributors.

In 2008, stewardship of the system was placed in the hands of distributors through the new Oregon Beverage Recycling Cooperative. In later years, state-operated BottleDrop Redemption Centers were created, now totaling 26 centers around the state. Also, in later years the deposit was raised to 10 cents and a Green Bag drop-off program was expanded.

Fundamental principles of the system, Bailey said, are that the beverage industry pays for the program and gets no public funding, and industry keeps unclaimed refunds above the target redemption rate to invest in improving the system.

Oregon has fully staffed BottleDrop Redemption Centers in the center of geographical “convenience zones” that radiate outward from the centers. Stores within redemption center zones that enter a contract with OBEC for a fee are allowed to accept fewer returned containers, a feature that seemed to appeal to Rhode Island retailers on the commission.

Recycling isn’t getting the job done

Arguments for a bottle bill are familiar and mostly pertain to the impact of trash on the environment. Recycling rates in Rhode Island — pertaining to all recyclable materials, not just bottles and cans — are low. According to a report in April by the Rhode Island Resource Recovery Corporation (RIRRC), the statewide recycling rate was 29.6%, well under the target of 35% set in a 2012 state law.

Speaking of only beverage containers, Jared Rhodes, director of policy and programs for RIRRC, said that in 2022 the landfill’s Materials Recycling Facility (MRF) recycled 23,000 tons and landfilled 13,400 tons of plastic, glass, and metal bottles and cans, for a score of 63% recycled to 37% landfilled.

Rhodes noted that these figures included only materials delivered to the MRF; only municipal — not commercial — waste, which is handled by private haulers; and no litter. The sorting capabilities of the MRF cannot capture the single-serving nips bottles, which can pass through the finest sorting screens in the MRF.

“We have significant tonnage of material being recycled, but there is still way more quantity that is not being recycled because people put [containers] into the trash,” Rhodes said.

(The state conducts curbside pickup for a single-stream recycling system, in which all recyclables go into one barrel, and they are then sorted at the MRF. Until 2012, residents separated paper and cardboard from other recyclables at home, in a multi-stream system. The state moved to single-stream in 2012 to save money by reducing curbside collection and to make participation easier for residents.)

Rhodes said the state’s MRF is aging and needs a major and expensive upgrade. Asked about the small but vastly annoying problem of nips, Rhodes said, “The corporation is planning a complete retrofit or replacement of this facility in the near future and will be assessing how best to apply modern sorting approaches.”

Rhodes also said an effective deposit-and-return system that diverts a lot of plastic, glass, and metal back to distributors and raw materials recyclers “would likely result in a loss of revenue” for the RIRRC. In 2022, the corporation earned $7,541,440 from the sale of recycled plastic, glass, and metal. That figure includes sources that are not beverage containers, but an estimated 85% of PET plastics, glass and aluminum came from beverage containers and 20% of HDPE plastics came from containers. The figures do not include commercial trash or litter.

Bailey, the expert from Oregon, called curbside systems “the recycling of last resort” because it offers conveniences but no incentive. “The highest-performing curbside systems fail to get back more than around 40% of beverage material, and often much less,” she said.

Bill’s opponents worry about business

Managers of food markets and liquor stores say accepting empties for return to distributors eats up space and staff time. Managing the empties, said Jackie Mancini, a commission member and member of the National Beer Wholesalers, “is very manual. It adds a full layer of process and activity” for stores.

Second, owners say that the high number of liquor stores in Rhode Island near the Massachusetts border would lose customers to Massachusetts when they see the higher sale price of beverages.

Rhode Island has a 7% sales tax on beer. The sales tax on wine and spirits was eliminated in 2013, but there is an excise tax on wine and spirits. (Investopedia explains: “Excise taxes are primarily for businesses. Merchants … pay excise taxes to wholesalers and consider them in product pricing which increases the retail price overall.”)

Fede, speaking for the Rhode Island Liquor Collaborative, presented the group with charts that sort out the comparable taxation costs for Rhode Island and Massachusetts, based on a 10-cent and a 5-cent deposit, respectively.

Fede’s charts show that Massachusetts has no sales tax on beer or wine. It has excise taxes on wine and spirits that are lower than Rhode Island’s. Massachusetts has a 5-cent deposit for beverage containers, but it is considering raising the deposit to 10 cents.

According to Fede, a 30-pack of domestic beer costs $29.49 in Massachusetts and $32.95 in Rhode Island when taxes and deposits are all considered. The Massachusetts-Rhode Island cost difference for mid-range wine is $13.65 and $13.98. Comparison prices for 1.75 liters of spirits are $29.84 and $30.70.

Robert Swartz, a commission member and member of the Rhode Island Alcohol Beverage Distributors, echoed the view of several liquor store owners, saying that the products are “very price sensitive. Higher prices will shift purchases out of state.”

Store managers say a bottle bill places the blame and solution and sacrifice for littering on only one industry, beverage sellers, and doesn’t touch other kinds or sources of litter. In place of a bottle bill, store owners strongly favor anti-littering policing; mechanisms, like more trash cans in public places; and anti-littering public education.

Beverage distributors and retailers are particularly aggrieved about two fees that they have been paying — one of them eliminated in 2023, after 39 years in effect — that they say are not being used as originally intended to fight littering. A beverage container tax of 8 cents per case is imposed on beverage wholesalers.

Second, a litter control tax imposed on retailers was passed in 1984, with the expressed intention of using the proceeds on anti-littering programs. Annual fees were $25 to $125, depending on the size of the business, and were directed, in the early years, to a restricted receipts account to the Ocean State Cleanup and Recycling (OSCAR) program. In 1995, that tax income was directed to the state’s general fund. As of 2022, the annual proceeds from the litter control tax were $3.5 million, according to the Rhode Island Division of Taxation. The General Assembly eliminated the litter control tax last year.