Lawmakers inch closer to bottle bill compromise

Iowa’s can and bottle redemption law is closer than ever to a long-awaited update, House Speaker Pat Grassley said Thursday, but negotiations are ongoing between the House and Senate.

“I think we’ve made as much progress in the Legislature this year than we had in my time that I can remember, and probably before that,” Grassley, R-New Hartford, said. “We want to make sure we’re getting this right.”

Two “bottle bill” proposals are on the move at the Capitol: Senate File 2378, which passed the Senate on Tuesday, and House File 2571, which is eligible for floor debate.

Grassley said House lawmakers delayed debate on their version of the bill this week as Republicans work to find a compromise.

“We want to give time to see if there’s some places where we can find a solution and actually get something to the governor’s desk,” he said.

How would the House and Senate proposals change Iowa’s bottle return law?

For consumers, Iowa’s bottle redemption law seems simple: A customer pays an additional 5 cents for each can or bottle they buy. If the customer returns the empty containers to the store or to a redemption center, they get that money back.

But the full system is more complicated – and the subject of decades-long controversy.

Many grocers don’t want to accept can and bottle returns anymore, citing sanitation issues and undue burden. Retail lobbyists raised concerns that beverage distributors are allowed to keep nickels paid for containers that are not returned. Redemption centers — businesses that exist specifically to collect and return containers — say they need more than 1 cent per can to stay profitable. And the representatives for distributors argue proposed changes will complicate the system and make it more costly to the state and private businesses.

Both the House and Senate plans would introduce a higher handling fee for redemption centers and options for more retailers to opt out of the program. Sen. Jason Schultz, R-Schleswig, said it was time to stop looking for a solution to satisfy every stakeholder.

“I think we’re to the point where Iowans have to win and everybody else at the table may have to take a measured loss,” Schultz said in a mid-March meeting. “We’re going to have to pick a position, we’re gonna have to make it work.”

Bills expand grocery store opt-outs

Iowa retailers have long been critical of the bottle bill, with lobbyists arguing grocery stores should not have to take back empty containers. Both bills give additional options for stores to opt out of accepting returns.

The Senate proposal allows any retailer to stop accepting can and bottle returns. This means customers may need to return the container at a redemption center, regardless of how far away that might be.

Senate Minority Leader Zach Wahls said the Senate proposal would result in “dramatically fewer opportunities to Iowans to recycle their cans and bottles… especially in rural communities.”

“Our view is that the Republican bill that they put forward would effectively end the bottle bill,” Wahls, D-Coralville, said.

The House bill specifies that retailers that sell fresh produce or prepared foods or that sell fewer than 3,500 beverage containers a year may refuse the returns. The bill also allows stores to opt out if they have a mobile redemption center, or if the store is within a certain distance of a redemption center.

Chambers propose different handling fee

Redemption center operators called for additional handling fees to make the program sustainable. Currently, a redemption center receives 6 cents for every can or bottle they return to a distributor — 5 cents to reimburse the deposit and an additional penny handling fee.

The House bill increases the handling fee from 1 cent to 2 cents. The Senate would raise the handling fee to 3 cents.

Proponents of both bills say the additional handling fee will encourage more redemption centers to open across the state. Schultz said the Senate proposal was “an attempt to save the bottle bill.”

But opponents say the increased fee will not be enough to counteract the additional demand on redemption centers when more grocery stores are able refuse container returns.

“We’re asked to believe in this mythology that somehow redemption centers will all of a sudden pop up across the countryside. I think that’s ridiculous,” Sen. Herman Quirmbach, D-Ames, said.

Proposals include enforcement

In the summer of 2020, just a few months into the COVID-19 pandemic, the state ordered grocery stores to begin accepting empties again. Fareway stores disobeyed, the Des Moines Register reported, but faced no apparent state penalties for months afterwards.

Lawmakers say the grocery chain isn’t the only retailer that has refused to comply with the law.

“There is plenty of dirty hands and a lot of people not following the law, from the distributors, retailers and redemption centers,” said Rep. Brian Lohse, R-Bondurant.

Both bills would introduce new civil penalties for scofflaws.

“Right now, I think that’s part of the problem with the system,” Grassley said. “Not all the laws and the rules that are on the books are being enforced, so I think it’s making the system not work the way it was intended to.”