Stop the Theft of Bottle and Can Deposits by Private Industry: Oppose Michigan House Bill 4443


This bill is being rushed through the Michigan Legislature, so FLOW is urging you to take action today by asking your State Senator to vote NO on HB 4443 and HB 4444.

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Revenues from one of Michigan’s most successful environmental laws, the 10-cent bottle and can deposit, are at risk of being diverted from public to private uses.

Enacted by an overwhelming majority of voters in 1976, the deposit law enjoyed strong support by then-Governor William Milliken and environmental groups.  It has made a remarkable, positive difference in reducing roadside litter and boosting recycling.

Equally important, deposits that are not claimed by consumers go into a public fund and the majority of that money goes to clean up some of Michigan’s backlog of thousands of contaminated sites impacting the land and water. Currently, 75% of unreturned bottle deposit funds are disbursed to the state Department of Environment, Great Lakes, and Environment for cleanup while 25% are given to retailers.

Unfortunately, the same special interests that fought the deposit law in vain in the 1976 election are back. Beverage distributors who opposed the law back then are trying to take more of the unclaimed dimes (also known as “escheats”) away from cleanup to compensate themselves for what they claim are the costs of handling deposit bottles and cans.

As passed by the Michigan House and headed to the Senate, here’s how their scheme would work:

In addition to the 25% of unclaimed deposits that already go to retailers, House Bill 4443 would establish a half-cent income tax credit to be given to beverage container distributors for every returnable container sold in Michigan during the tax year. According to a House Fiscal Analysis, a half-cent income tax credit on four billion bottles annually would cost the state more than $20 million each year. With steadily increasing numbers of bottles sold in the state each year, that number will only increase over time.

For 2020, 2021, and 2022, when the unclaimed deposits total at least $50 million, House Bill 4444 (H-1) would use the unclaimed dimes to pay back the general fund for the income tax credits claimed under HB 4443—money that mostly would have supported cleanup of contamination.

This diversion of money from public to private purposes would squander a unique opportunity to clean up many of Michigan’s contaminated sites. Michigan has more than 24,000 contaminated sites, and we are continually discovering more. Michigan’s bottle deposit system is a substantial source of funding for Michigan’s contaminated site clean up program. To shrink the vast number of contaminated sites that exist in every county across the state, we must increase our capacity (dollars, staff, and preventative policy) to clean up the sites—not raid the fund just as it receives a surprise windfall.

The 2020 state-mandated COVID-19 shutdown of the beverage return system, coupled with various other economic and social COVID-19 impacts, led to large amounts of unreturned bottles, and correspondingly, record high amounts of unclaimed deposits. For 2020, Michigan will receive $107 million in unclaimed bottle bill deposits, $81 million of which would be made available to EGLE for contaminated site clean up under current law.

Proponents of these two House bills claim this money from the state will be reinvested into the (privately owned) bottle-return infrastructure. But the bills include zero provisions to protect the public interest in ensuring that will happen. Proponents actually asked the legislature to just “trust them” during committee testimony.

Michigan residents can’t allow Lansing to jeopardize our public health and safety. We need to be putting more money into cleanup, not gutting one of the funds that pays for it.

This bill is being rushed through the Michigan Legislature, so FLOW is urging you to take action today by asking your State Senator to vote NO on HB 4443 and HB 4444.

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