Governor Paterson and legislators in Albany are trying to reach compromises to close the yawning gap in New York’s budget. Although the proposal to sell wine in grocery stores is back on the table, there is another drinks-related area our officials have yet to uncork: bottle deposits.
Last year, a reform bottle bill passed–largely unnoticed–that included significant changes, notably extending the deposit to include water containers and sport drinks. Further, and more importantly, the system for unredeemed deposits was redirected to send 80% of those funds to the state’s Department of Finance; previously, unredeemed funds rested with the deposit initiators (often beer and soda distributors). This long-overdue reform will bring in an estimated $90 million this year to the state.
But at five cents per container, the deposit remains low, unchanged since the program started in 1982. During the first decade of the bottle bill, redemption rates hovered around 80%. As inflation has eroded the value of the deposit amount, the redemption rate has fallen (details in this pdf).
Raising the deposit rate to ten cents (about even with inflation) even twenty cents per container would have the effect of raising recycling rates and raising revenues for the state through unclaimed redemptions. In 2006 (before water and sport drink bottles were included), deposits collected totaled $289 million while $196 million were redeemed, a 67.8% rate. Doubling the per bottle deposit to 10 cents, would mean $600 million in deposits, while raising the rate to 20 cents would gross $1.2 billion. Even assuming that were to bring the redemption rate back to 80 percent, that would still result in an additional $96 million or $192 million in uncollected deposits for the states coffers. (Raising the state’s share of unredeemed deposits to 90% or higher, would boost state revenues even further.)
That’s a kind of win-win we don’t see too often in Albany. And one that legislators and the governor could proudly raise a glass to.