State Senate bill would increase can and bottle deposits

The state Senate is proposing to double the 5-cent deposit on bottles and cans as part of an effort to increase the redemption and recycling rates for the tens of millions of containers used by Hawaii consumers each year.

The state Department of Health reports the redemption rate for the beverage container program averaged 66 percent for the past three years, down significantly from a peak rate of 77 percent in 2012.

Oregon increased its container deposit to 10 cents from 5 cents when its redemption rates dropped, and “we believe that the 5-cent per container increase will significantly improve the recovery rate,” according to the Glass Packaging Institute. The institute is the North American trade association for the glass container industry.

Lawmakers apparently found that testimony compelling, with members of two Senate committees reporting they found the Oregon example to be “a useful model to “follow.”

The Senate committees on Agriculture and Environment and Commerce, Consumer Protection and Health approved Senate Bill 3099, Senate Draft 2, which would automatically double the container deposit when redemption rates drop below 80 percent for two consecutive years.

“Your committees find that five cents is not a sufficient incentive for the public to recycle their plastic beverage containers, but that a ten cent refund value will incentivize consumer recycling if other measures prove ineffective,” according to a report issued by the two committees.

The leaders of those committees, Sens. Mike Gabbard (D, Kapolei-Makakilo) and Rosalyn Baker (D, West Maui-South Maui) declined requests for interviews on the subject Thursday.

The state collects a 5-cent refundable deposit on bottles and cans along with a 1-cent nonrefundable fee that covers the cost of running the redemption program. Hawaii has been collecting container deposits since 2004, and consumers began redeeming their bottles and cans to get back their nickel deposits the following year.

Last year consumers made deposits on more than 952 million containers, but many don’t return their bottles and cans to get back their money. For the year ending June 30, the program collected $48.3 million in deposits but paid out only $30.4 million for containers that were returned for recycling, according to statistics provided by the Health Department.

Darren Park, coordinator of the Health Department’s Office of Solid Waste Management, said in a written statement that the state is conducting studies including interviews of consumers to gather more information on the best way to improve the program.

The proposal to increase the container deposit is supported by the Sierra Club of Hawaii and Kokua Hawaii Foundation but opposed by the International Bottled Water Association.

The bottled water association argued in written testimony that “a 5-cent increase in the current Hawaii bottle deposit fee would essentially be an increased tax that would further negatively impact consumers, particularly the elderly and others who live on fixed incomes.”

The measure was later unanimously approved by the 25-member Senate, and is now being considered in the House.

The House Committee on Energy and Environmental Protection held a hearing on the Senate proposal Thursday, and committee Chairman Chris Lee said he plans to remove language from the bill that would automatically cause the deposit amount to increase if the redemption rate is too low.

Lee (D, Kailua-Lanikai-­Waimanalo) said other states have higher deposits and higher redemption rates. Michigan, for example, has a 10-cent deposit and reports redemption rates greater than 92 percent.

However, Lee said he wants to see more evidence that increasing the deposit will actually cause the redemption rate to increase. Oregon increased its deposit only in April, and testifiers said there are no published data available yet on how that change affected the container return rate.

“It’s clear that the bottle bill as it was originally intended is ripe for review at this point,” he said. “We want to make sure that we’re hitting redemption rates that make sense here in Hawaii, that keep bottles and litter off our streets, and that’s something that this bill begins a conversation on.”

The measure now goes to the House Finance Committee for further consideration.