Great Lakes Article:

Michigan bottle law a messy success
By Larry P. Vellequette
The Toledo Blade
11/30/03

LAMBERTVILLE - With a blue Navy lanyard hanging from his neck and a straight-billed baseball cap angled slightly to one side, Dick Evilsizer is one of the men behind the success of Michigan’s bottle law.

He had nothing to do with the citizen-backed initiative - first implemented 25 years ago Wednesday. - which puts a 10-cent return value on every carbonated beverage and beer container sold in the state. He can’t even remember if he voted for the measure, a unique experiment in populist environmentalism that has created thousands of jobs and helped clean up roadways by transforming trash into a valuable commodity.

But in so many ways, the largely hidden labors of Mr. Evilsizer and others like him have helped Michigan’s bottle law achieve the highest recycling rate for bottles and cans of any state in the nation.

"You have to keep these things clean or they shut down," the 77-year-old retired truck driver-turned-stock boy says, pointing at the four large reverse vending machines on the wall of the Lambertville Kroger Store. People with bottles and cans to return for deposits put their used containers in the machines and receive a small white receipt that they redeem at the store for cash.

The containers - all too often with pop and other liquids still inside - are crushed by the machines for recycling. "With all that pop and beer and junk, they get to be a real sticky mess," Mr. Evilsizer said. "It’s a constant job to keep up with it."

There are an estimated 4 billion beer and soft drink containers sold annually in Michigan that are subject to the 10 cent deposit. An additional 651 million drink containers (juice, water, spirits) sold in the state each year are exempt from the law.

Ohio has no bottle law. Across the state line, the sticky, yucky part of Michigan’s bottle law is in the back of grocery stores, markets, and other businesses that must accept the recyclables.

"The current deposit law has taken the trash off Michigan’s roads and put it in the backroom of my store," said Jeff Miller, owner of George’s Market in Tecumseh. "You’re asking me and my people to handle some of the filthiest stuff that I’ve ever seen."

However, it’s not just pop and beer residue that coats the floors and walls of his small backroom that worries him. It’s the other stuff found inside the recyclable containers: gasoline, needles, used condoms, tobacco juice.

"To me, the health issue far outweighs the profit issue or the amount of money we’re losing. We’ve got to find a better way of doing this than in our food stores," Mr. Miller says.

Linda Gobler, president of the Michigan Grocers Association, agrees. "What’s happened is that people are bringing in all kinds of substances that are in those containers."

Ms. Gobler says stories abound of rodent infestations and store employees stuck with used needles while handling container returns. While the political reality is that Michigan’s container law remains very popular among the general population, her association would like to see some changes.

"What we’re saying is get it out of the grocery store," Ms. Gobler says. "We really are compromising the food environment. Shoppers would be outraged if we said, ‘Bring in your bag of garbage and drop it off before you shop,’ but that’s what is essentially happening."

Michigan’s container law was enacted by 64 percent of the voters in November, 1976. It reached the ballot via a citizen’s initiative led largely by environmentalists as a way to encourage recycling and clean up a huge litter problem across the state.

William Milliken, who served as Michigan’s governor from 1969 to 1983, was in office when the initiative was presented to voters. He remembered how he became one of the proposals primary advocates.

"I asked a couple members of my staff to arrange for a pickup of throwaway cans and bottles along a certain one-mile section of highway around Lansing so we could get a feel for the problem," the former governor said from his Traverse City home.

The next thing he knew, Mr. Milliken said, he was in the middle of a staff meeting when staffers "brought in several of these huge gunnysacks full of bottles and cans, and it brought home the need that we had to do something."

Within two years of being implemented, a Michigan Department of Transportation study found that the number of roadside litter items collected per mile had been reduced by 48 percent. The department now estimates that there is 84 percent less litter per mile today than when the bottle law began.

"It had remarkable results. It led to quite an impressive cleanup of our roadways and pathways and the whole state," Mr. Milliken said. "It was one of the better things that I think we accomplished."

Michigan leads the nation in the rate at which beverage containers are recycled: between 95 and 98 percent, a full 15 to 20 percentage points higher than the 10 other states with bottle deposits and double or triple the rates in states without a deposit law.

"I just think someone in Michigan was very forward thinking," said Pat Franklin, executive director of the Container Recycling Institute, a Virginia-based organization that advocates a nationwide bottle bill.

"Michigan is sort of at the head of the class in terms of having the highest [deposit return] value, and Maine has the most expansive law," Ms. Franklin said. "The [materials] markets are strong for beverage container materials, glass, [plastic] bottles, and cans. There are businesses that can’t get enough of those materials."

They’re not hard to spot, the people who make their living off Michigan’s bottle bill. They push carts brimming with a hodgepodge of cans and bottles of all types, as if they had bought their beverages ala carte, and they walk out of Michigan’s retail stores with padded wallets.

"We have a lot of people that make a living at this," Mr. Evilsizer says. "They can get 25 or 50 bucks like nothing, and as long as [the containers] say Michigan on them, we can’t do nothing."

In a comprehensive study of Michigan’s bottle bill in 2000, the state of Michigan estimated that about 100 million cans and bottles are fraudulently redeemed each year for 10-cent deposits. That’s $10 million paid out that isn’t paid in.

A lot of that fraudulent trade involves Ohio. Michigan stores, especially those relatively close to the border, receive containers from Ohioans who cross the border with their recyclables as well as from Michigan residents who buy cheaper beverages in the Buckeye state and then recycle their empties in their home state for the return money.

The Michigan stores post signs warning that those redeeming "Ohio" cans can be prosecuted under Michigan law. But in practice, such prosecutions are rare.

While it might be physically possible for beverage manufacturers to somehow differentiate which of their containers are sold in Michigan and which are sold elsewhere, the logistical costs would far exceed what’s being lost through fraudulent returns, officials say.

"The cola you buy and beer you buy is in a uniform can that’s used nationwide. If you tried to put a special bar code on it for each state, the logistical problems would be enormous," says William Lobenherz, president of the Michigan Soft Drink Association.

To see the impact of the bottle bill, one need only shop at similar stores on each side of the Ohio-Michigan line. The regular price of a 12-pack of Coca-Cola at the Farmer Jack Supermarket on Laskey Road in Toledo is $3.59. The same 12-pack at the Farmer Jack Supermarket in Monroe is $3.99, plus $1.20 bottle law deposit. Similarly, a 24-pack of Budweiser cans at the Toledo store costs $16.49, but sells for $17.49 at the Monroe store plus $2.40 deposit.

The association estimates that Michigan’s bottle law adds at least 4.4 cents to the cost of every can of pop and every bottle of beer that is sold in Michigan in addition to the dime deposit.

Despite the fraudulent returns, Michigan’s bottle deposit fund has never paid out more than it’s taken in. The difference in the two amounts - referred to by the state as the escheat - is divided up each year, with 75 percent of the remaining funds used by the state to pay for environmental clean-ups and the other 25 percent returned to retailers for their time and trouble.

In 2002, there were $443.9 million in deposits paid and $425.8 million in refunds, leaving an escheat of $18.1 million. Of that, retailers will get $4.5 million, according to the Michigan Department of Treasury.

But retailers say the money in the escheat fund doesn’t begin to cover the costs they incur as a result of the legislation.

"At best, it’s break even for the stores," says Dennis Hybarger, vice president of the Michigan Beer and Wine Wholesalers Association. "Part of that is that your employee doesn’t have to spend time then determining whose containers are whose."

While fraudulent redemption and ongoing health concerns continue to plague bottle return systems, the Michigan legislature appears poised to weigh in with some changes to the state’s bottle bill.

State Sen. Cameron Brown (R., Sturgis), chaired a legislative task force on the topic that this year took testimony during nine public meetings around the state, including one in Adrian. Among other things, they heard thoughts on expanding the bottle bill to also cover the estimated 651 million non-carbonated beverage containers sold in the state each year. It also heard discussion of relieving retailers of their collection responsibilities, or at least better compensating them for their trouble.

Task force members have begun introducing about 40 new bills into the legislature that aim to make a number of changes to the bottle bill. But the chief goal of their proposals, Mr. Brown says, is to improve Michigan’s recycling rate for all materials by providing funding mechanisms for such amenities as curbside recycling pickup.

Michigan recycles just 20 percent of its entire municipal waste stream, ranking it 28th nationwide, according to the U.S. Environmental Protection Agency. That figure puts Michigan below Ohio’s recycling rate of about 22 percent and below the 26 percent average for all Great Lakes states.

Among the proposed legislation is measure that would put a $3-per-ton surcharge on waste going into Michigan landfills. The money generated by the surcharge would be used to expand existing recycling programs and introduce them statewide.

"Before we can responsibly talk about expansion, there are some problems with the current container law, most notably with the redemption [system]," Mr. Brown says. "We’re going to set in force a public policy which is going to make Michigan a leader in public recycling, make Michigan a proper steward of our natural resources."