There is a proposal making its way through the Vermont House of Representatives to raise and expand Vermont’s bottle deposit law (H.175). The bill would double the cost of a standard bottle deposit from 5 cents to 10 cents, and it would apply the deposit to “water bottles, wine bottles and containers for all noncarbonated and carbonated drinks, except for milk, rice milk, soy milk, almond milk, hemp seed milk, and dairy products.” It would also create a 15 cent deposit requirement for liquor bottles.

Of course, this would mean the added up-front cost for a 24 case of beer or soda would increase from $1.25 to $2.50. More dauntingly, a $3.98 40-pack of 16 oz. bottled water at Walmart would require a newly added $4 deposit fee, more than doubling the upfront cost. (Water is arguably the healthiest option for a human to drink, so why would we exempt milk and related products and not water? Hmmm….)

And, while it’s true the customer can redeem the beverage containers to get that money back, a lot of folks -- for whatever reasons related to time, inconvenience, or forgetfulness -- just don’t or can’t do it. Remembering my days as a little league coach, I would bring one of those forty packs of water to a game or practice, and I know I would not likely see those bottles again. They go home in cars, get tossed into back packs, or thrown away in trash cans nobody wants to dig through, etc. Practically speaking, I would just be out most if not all of that added four bucks.

A Stealth Tax

Our legislators know a big chunk of redeemable bottles never get redeemed, creating a big pile of tempting cash. In fact, in 2018 they passed legislation in which the state confiscated the money from unclaimed deposits from beverage distributors, who had been allowed to keep the money for use in meeting recycling mandates, so the politicians could spend it themselves. Thus, in practice, the bottle bill ceases to act like a fee to pay for the service it supports, and become a general revenue stream like a tax – a stealth tax, as it were.

In 2018, this money grab represented about $2 million a year to the state. If this new increase and expansion becomes law, that number will likely rise significantly. Just a back of the napkin calculation: that $2 million would double to $4 million with the hike to 10 cents and that $4 million would likely double again with the expansion to $8 million or more (A least. I don’t know the actual data but imagine the number of non-carbonated beverage containers I the stream is larger than for carbonated.) All of this is coming out of Vermonter’s pockets.

The stated reason for the bottle bill is to encourage recycling. However, a recent study by GreenPeace determined that less than 30 percent of plastic beverage containers are actually recyclable, and for that amount, the market for purchased recyclable plastic is declining to nearly non-existent. Most of it ends up in landfills anyway. As testimony from the Chittenden Solid Waste District on H.175 warned, “In summary, expansion of the bottle bill will not move the needle on keeping recyclables out of the landfill and will add cost to the current recycling system at a time when costs are higher than ever.”

Given where we are geographically, it might seem that bottle deposit laws are the norm, but that’s not the case. In fact, there are only 10 states with bottle deposit laws at all:  California, Connecticut, Hawaii, Iowa, Maine, Massachusetts, Michigan, New York, Oregon, and Vermont. Delaware had one for a while but repealed it. They might be onto something.

- Rob Roper is president of the Ethan Allen Institute