Bottle Bill Expansion – The Truth
The New York legislature recently passed the 2009-2010 state budget. There are numerous provisions within the budget that will increase consumer prices and dramatically impact local beer distributors' growth as well as their ability to invest in their respective local community.
DEPOSIT LEGISLATION PRIOR TO BUDGET
- A 5-cent deposit placed on beer and soda
- On containers that were redeemed beverage distributors paid a 2-cent handling fee per container to the retailer, plus the 5-cent deposit for a total of 7-cents per container paid by the distributor to the retailer
- Beverage distributors kept unredeemed deposits to off-set the costs of the redemption system
- Beverage distributors are responsible for the pickup and recycling of the redeemed containers
- The system is labor intensive and requires trucks, fuel, insurance and machinery to implement
- The unredeemed deposits off-set the costs of the system
- Beverage distributors are responsible for the pickup and recycling of the redeemed containers
DEPOSIT LEGISLATION POST-BUDGET, MORE EXPENSIVE AND COMPLEX
- Besides beer and soda, a 5-cent deposit has now been added to water
- Beverage distributors' handling fee has increased 75% from 2-cents to 3.5-cents per container
- Usually a Reverse Vending Machine accepts the empty containers, so the State has just given a machine a 75% increase in pay, jeopardizing real jobs
- Beverage distributors will now pay 8.5-cents per container on containers that are redeemed
- The state will seize 80% of the unredeemed deposits for the general fund, leaving 20% for the beverage distributor to run a now larger system and pay for a more expensive handling fee
- To offset the seizure of 80% of the money used to pay for the labor and technology to implement the redemption system, distributors will be forced to pass the costs on to consumers
Deposit legislation is not a simple nickel exchange. The backend system distributors implement to pick up and recycle empty, redeemed containers is vast and costly. Below is a brief explanation of how this system really works and ultimately how you, the consumer, will be burdened with a hidden tax.
The Nickel Myth
Myth: Unredeemed nickels are a windfall of cash for the beverage industry.
Fact: The unredeemed nickels allow the beverage industry to comply with the recycling mandates of the initial deposit law, to pick up, sort and recycle redeemed containers. Beverage companies use the unredeemed nickels to pay for the labor (salary and benefits), trucks and fuel necessary to pick up the empty containers at retail locations, along with facilities to unload, sort and process the containers.
If 80% of the unredeemed nickels are seized by the state, yet the universe of containers has expanded and the handling fee paid per container is now 75% more expensive, the redemption process has just become more expensive. The unredeemed previously used to off-set the costs are no longer available resulting in an increase in consumer prices to make up the difference.
Consumers will be hit with a food tax and businesses that previously used the unredeemed nickels to implement a State mandated system will see these nickels, 80% of them, seized, creating a money shortfall and potentially resulting in lay-offs.
Speak out against a food tax and potential lay-offs - Contact your lawmakers NOW!
Expensive Expansion
Due to the seizure of 80% of the unredeemed nickels and the 75% increase in handling fee per container from 2-cents to 3.5-cents, the beverage industry is projecting beer and beverage prices will increase. Potentially a case of water may double in cost.
For example, a case of water pre-expansion costs around $4.99. This same case post-expansion could cost as much as $9.98. Only $1.20 is refundable. The remaining $3.79 is the increase the beverage industry has to impose to make up for the State's seizure of the unredeemed deposits and increase in handling fee.
Say NO to hidden taxes - TAKE ACTION NOW!
No more taxes!
Imposing hidden grocery taxes on consumers in an economy that is facing some of the highest unemployment rates in decades, all time low consumer confidence and already record high grocery prices is only going to worsen the recessive spiral.
Nationally small businesses create about 70% of new jobs. Beer distributors are small businesses that provide stable and solid wage earning jobs within their communities. Seizing 80% of the money distributors currently use to off-set the cost of the pickup and recycling of empty containers and increasing the handling fee the distributor pays per container by 75% (most often paid to a machine and jeopardizing jobs!) will result in costs being passed down to consumers. When costs increase people buy less, resulting in businesses reevaluating their payroll and laying off workers.
Earlier this year New York State's unemployment phone lines crashed from receiving over 10,000 calls per minute. Your voice matters. It's important your Assembly Member and Senator know that you do not support hidden taxes on groceries or hidden taxes on local businesses.
Say NO to hidden taxes! Let your legislator know you want these provision amended.