Proposed expansion of New York's bottle bill makes industries anxious

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Machines that accept bottles and cans for deposit would need to be retrofitted or more likely replaced if an expanded version of New York's bottle bill becomes law. Existing machines cannot accommodate the many different shapes of the hundreds of container styles of beverages that would be newly redeemable under the proposed bill.

Canned cocktails from Albany Distilling Co. are among the beverages not currently subject to a container deposit but would be under and expansion of New York's bottle bill.

ALBANY — Advocates of expanding New York's recycling program to include containers for more types of beverage and increase the deposit from a nickel to a dime were disappointed last week when Gov. Kathy Hochul failed to include it in her proposed executive budget for the next fiscal year. Opponents expressed relief that they have more time to argue against the bill or for modifications.

Having it as part of the budget, instead of as a separate bill needing to be passed by the state Legislature, would speed up the implementation of what's known as the Bigger, Better Bottle Bill, proponents believe. They said it would move New York toward a more environmentally mindful future of increased recycling, less glass and plastic in landfills, reduced roadside litter, lower emission of greenhouse gases and tens of millions in savings to municipalities from the diversion of many more containers from the waste stream into recycling programs.

New York's bottle bill, among the first 10 nationwide, was approved in 1982, 11 years after Oregon passed the debut measure. Since the implementation 40 years ago, deposits have been collected on the sale of cans and bottles of beer and soda; water was added in 2009, and all carbonated drinks are now covered. The expanded bill would extend deposits to bottles and cans of wine, liquor, hard cider, wine and spirits coolers, sports drinks and a spectrum of non-carbonated beverages, including coffee and tea drinks and vegetable and fruit juices containing less than 100 percent pure juice.

But opposition to the proposed bill, from complete rejection to varied reservations, exists across industries, including restaurants, retailers and manufacturers of wine, spirits and other beverages that would be newly subject to refundable deposits under the proposed legislation. Concerns include storage space, labeling changes, lack of infrastructure and the logistical problems for businesses small and large to get empty containers back to each of the scores of distributors that provided them.

And all sides agree that consumers are almost guaranteed to see higher beverage prices if the bill is passed.

In connection with the release last month of a Siena College Research Institute poll showing that nearly three-quarters of New Yorkers favor a bigger scope for recycling beverage containers and a higher refundable deposit, more than 150 organizations across the state signed a letter encouraging Hochul to include the measure in her executive budget.

"Expanding a Bottle Bill would be a major financial benefit both for New York's municipalities and the state as a whole," the letter said.

Among the signatories was the the New York Public Interest Research Group, which commissioned the Siena poll.

Calling the bottle bill "the state's most effective litter prevention and enhanced recycling," Ryan Thoresen Carson, NYPIRG's environmental campaign coordinator, said in a statement, "In the face of New York's mounting solid waste crisis, the state must boost its recycling and waste-reduction efforts. A modernized Bottle Bill achieves both of those important goals and has a 40-year track record of success."

Carson said NYPIRG is "hopeful" that the bottle bill will be included in the final version of the budget after negotiations and, if not, "confident" it will pass before the end of the session. Assemblywoman Pat Fahy, D-Albany, is a co-sponsor of the version of the bill in the Assembly, where the legislation lost its principal sponsor after Long Islander Steve Englebright was defeated in his bid to be re-elected last fall to his 4th Assembly District seat. Fahy said she didn't expect the bottle bill to be part of the budget but is "fully supportive" of its passage later in the session.

While representatives of the retail, restaurant and beverage-manufacturing fields generally lauded the environmental goals of increased recycling and acknowledged the improvements created by the original bill, they worry that advocates and elected officials have not considered the enormous ramifications of the expanded program.

"Where are we supposed to put all the (returned) bottles until somebody comes to pick them up? Most of our members are small stores without enough room as it is to store the full cases. Now we'd have to deal with cases of empties?" said Stefan Kalogridis, president of the New York State Liquor Store Association and owner of Colvin Wine Merchants in Albany. He said his 1,200-square-foot store has no separate storage area and is already using every available space.

"I've even got stuff stored in the bathroom," Kalogridis said.

Space concerns were echoed by the restaurant industry, where surplus storage is a rarity.

"One of our members said he had to build a shed just for his empty beer bottles. Would he have to build another shed or two for all the wine and liquor bottles?" said Melissa Fleischut, president and CEO of the New York State Restaurant Association. She said she heard "a lot of concern" when discussing the issue with members in town Tuesday for lobbying efforts. Another fear cited was that storing large quantities of empty alcohol bottles, even if rinsed, would attract vermin, and fruit flies in an establishment is grounds for being cited for a violation by the State Liquor Authority.

Further, "It's bad enough just sorting what goes back to (which distributor) for the beer. Now we'd have to do it for all the different places for wine and liquor?" said Tess Collins of McGeary's Pub in Albany. The law requires returns be accepted for all products an entity sells but not those it doesn't. McGeary's bottled and canned beers are provided by four main distributors, Collins said, while another six supply its wine and spirits. Other restaurants that offer a more boutique range of alcohol often deal with dozens of small distributors, each of which could stipulate the return only of its products, a process that would require inspection. Kalogridis said he didn't know where he'd set aside returns for each of the 15 distributors that serve his store.

"I can't even think about the nightmare it would cause from a logistical standpoint," said Joe Armstrong, who for 25 years has worked as an Albany-based representative for wine and spirits wholesalers, selling to restaurants and liquor stores. His employer for the past 14 years, an importer and distributor named Winebow, offers 6,000 products from manufacturers around the nation and world. While Winebow uses it own trucks for daily upstate runs from its New Jersey warehouses, smaller distributors share space in contracted trucks.

Citing one trucking company that carries for 25 or more distributors on many deliveries upstate, Armstrong said, "Those (drivers) are supposed to know who gets what returns at every stop? I just don't know how it's possible."

"As a citizen, I feel (the expansion) is long overdue. From a business perspective, it would be just one more regulation ... we'd have to deal with," said John Curtin, co-owner of Albany Distilling Co. and vice president of the New York State Distillers Guild. Albany Distilling makes whiskey, rum, vodka and canned vodka cocktails. None is presently subject to a refundable deposit; all would be under the new bill. More onerous, Curtin said, is that Albany Distilling reaches consumers mostly through distributors, but bottles and cans the company sells directly would need a separate UPC bar code on their labels, and the respective stocks would have to be kept separate.

Concerns extend throughout the spectrum of retail sales, from corner liquor and convenience stores to Schenectady-based Golub Corp., which has more about 130 supermarkets in six states under the Price Chopper, Market 32 and Market Bistro brands.

"There's so much that would need consideration (in an expanded bottle bill)," said Mona Golub, the company's vice president of public relations and consumer services. She cited lack of space — "Our stores are generally maxed out as it is," she said — added expenses, additional staff and the invention of new equipment, because the stores' current state-mandated "reverse vending machines" that allow for self-service returns cannot accommodate the many different shapes of the containers of hundreds of beverages that would be newly redeemable.

Worse, Golub said, echoing language used by others in independent interviews, "It would be a logistical nightmare" for the company's supermarkets to have to separate products by state, because UPC codes needed for redemption must be New York-specific under the expanded bill.

New Yorkers currently redeem about two-thirds of bottle and can deposits. Prior to 2009, distributors — who initiate the deposit process by charging 5 cents per container to retailers, who then pass it along to consumers — were allowed to keep all unredeemed deposits. A change in law that year mandated that 80 percent be remitted to the state, with most going to New York's Environmental Protection Fund. The law also requires distributors to pay retailers that collect returns a handling fee of 3½ cents per container, meaning, for example, that for every beer can Price Chopper returns to Guilderland-based distributor Remarkable Liquids, the company pays Price Chopper 8½ cents for the deposit plus the handling fee.

Under the expanded bill, the handling fee would increase to 6 cents.

"That's basically going to double our costs," said Spencer Noakes, founder and general manager of Remarkable Liquids. The company, primarily a beer distributor, handles products from more than 60 breweries and importers of international beers, selling about 600,000 cases annually. It currently pays $80,000 a year in handling fees. Noakes said he expects that would reach at least $150,000 under the expanded bill because of the higher fee and an increase in the numbers of products it distributes that would be subject to deposit, such as Albany-based Nine Pin hard cider, not presently part of the bottle bill.

"The costs are absolutely going to roll through to the consumer. They have to," said Noakes.

He said it is his impression that legislators have been sold the vision of the expanded bottle bill without fully understanding its implications.

"We have the most complex economy in the world, and they can't be experts in everything," Noakes said. "But it's like, Here they come with the noblest of intentions, telling us to get something done but not how we're supposed to do it."