Question: What happens to the bottle fees collected but not redeemed? Do they get used by the city for other purposes? It seems wrong to collect the fees with the understanding that the consumers will be given back the money when in fact they will not, unless they go to a recycling center.
Answer: The state Department of Health, not the city, oversees the Deposit Beverage Container Program, which imposes a 5-cent redeemable fee and a nonrefundable 1-cent handling fee on recyclable containers.
The fees are meant to be an incentive for people to recycle, with unredeemed deposits used to fund the program. Although consumers are charged a 1-cent handling fee, the state pays recyclers a 2- to 4-cent handling fee per container, so the program is designed to operate on money from unredeemed containers.
However, although handling fees and unredeemed deposits amount to millions of dollars every year, they are not enough to support the program. Expenses have exceeded revenues since 2008.
Because of that, the state needs to raise the nonrefundable fee by 0.5 cent on Aug. 1 to stay viable through the 2013 fiscal year, said Darren Park, coordinator of the Health Department’s Office of Solid Waste Management.
The additional half-cent per container is expected to increase revenue by about $4.5 million.
However, Park said several factors, including House Concurrent Resolution 202 and House Resolution 156 now before the state Legislature, “may hinder the increase of the container fee.”
The resolutions urge the Health Department “to refrain” from raising the fee until an “updated management and financial audit of the entire program” is completed.
As of Feb. 29 the Deposit Beverage Container fund stood at $13.6 million, before “encumbrances” (financial liabilities that may be charged to the program).
During the 2011 fiscal year, which ended June 30, expenditures were $59.4 million and revenues were $55 million, with an outstanding encumbrance of $3.3 million. During that period, 907.1 million containers were sold and 686.9 million were redeemed, for a redemption rate of 75.72 percent.
Since the 2009 fiscal year, unredeemed deposits, container fees and cash reserves have supported the program’s operations, which include personnel, operations, enforcement, audits, training and educational/ community outreach, Park said.
The fund provides 100 percent funding for DBC contracts with Kauai and Hawaii counties for redemption services, as well as 100 percent funding and management of a contract with a private recycler for redemption services on Lanai.
Unredeemed deposits also are used to subsidize the shipment of beverage containers to recyclers on the mainland and in Asia.
Park explained that recycling firms that operate redemption centers keep 100 percent of the proceeds from containers turned in, which are then shipped for recycling overseas. Proceeds from HI-5 containers recycled through Honolulu’s curbside recycling program are shared by the city and the local recycler.
That’s one reason Honolulu doesn’t receive DBC funding, Park said. Neither does Maui County, because of past state general contract provisions.
However, the state is “actively working” with Maui County to provide it some funding so it can take over managing recycling services on Lanai and possibly other remote areas, such as Hana.
“Each county is unique and require differing levels of support from the DBC Program,” Park said.
Mahalo
To Peter, manager of Zippy’s McCully. On March 16 I picked up a takeout order and didn’t discover they had given me the wrong order until I got home. When I called, Peter apologized and went “beyond the call” in resolving the issue. I’m extremely grateful for his compassion. — Appreciative Senior Citizen
——— Write to “Kokua Line” at Honolulu Star-Advertiser, 7 Waterfront Plaza, Suite 210, 500 Ala Moana Blvd., Honolulu 96813; call 529-4773; fax 529-4750; or email kokualine@staradvertiser.com.
