OLR Research Report

April 25, 2007




By: Joseph R. Holstead, Associate Analyst

You asked several questions about sSB 1289, An Act Concerning the Expansion the Beverage Container Redemption Provisions.

We address them below.

1. If schools act as redemption centers, how do they receive the funds to pay consumers who redeem containers and how does the school store the redeemed bottles?

In an earlier version of sSB 1289, private and public educational institutions and municipalities qualified to become redemption centers (this was not a requirement) by applying to the Department of Environmental Protection (DEP). Under that version, private and public educational institutions and municipalities that opened redemption centers were not required to pay consumers the refund value for beverage containers, if the refund value was used for the institutions' benefit. Presumably, schools would have redeemed the beverage containers they received at another redemption center or a grocery store to collect the refund value, similar to organizations that currently have “bottle and can drives” to raise money. However, the Finance, Revenue and Bonding Committee favorably reported a substitute for sSB 1289 on April 10, 2007 that does not contain the school or municipality redemption center provisions. A school could still hold a bottle and can fund raising drive. We have attached for your reference a copy of the bill analysis for the latest version of sSB 1289, current as of April 24.

2. How does a smaller manufacturer of a drink product that is included under the bill's expanded redemption provisions provide refunds if not all stores carry the product?

Under current law, redeemable bottles and cans include only beer, other malt beverages, mineral waters, soda water, and similar carbonated soft drinks intended for human consumption. If a smaller manufacturer produces beer, for example, any store that sells the brand must (1) take back the bottles and pay the consumer the deposit refund or (2) be within one-mile of a redemption center that takes back that brand. The bill expands the beverage container redemption law to include water and other non-carbonated, non-alcoholic, non-dairy drinks intended for human consumption and the laws redemption requirements apply. Under both current law and the bill, a store that does not carry a particular brand does not have to take back that brand's containers.

3. Who initiates the nickel in the redemption process?

Under current law, Connecticut's deposit system works as follows:

1. a retailer (dealer) pays beverage container distributors 5 for each beer or carbonated soft drink container that the distributors deliver;

2. the consumer pays the dealer 5 for each beer or carbonated soft drink container that he or she purchases from the dealer;

3. the dealer or redemption center pays the consumer 5 for each container that he or she returns;

4. the distributor reimburses the dealer or redemption center 5 for each beer and carbonated soft drink container, plus a handling fee of 1.5 on each beer container and 2 on each carbonated soft drink container returned;

5. the distributor keeps the 5 for each unclaimed deposit.

The law defines a “distributor” as anyone who sells beverage containers to a state dealer, including (1) any manufacturer who also sells and (2) a dealer who sells beverages containers on which no deposit has been collected before retail sale. The bill specifies that the latter provision applies when the manufacturer has not initiated the deposit, making the next entity to sell the product a distributor.

The bill raises the handling fee to 3 for all redeemed containers, effective October 1, 2007.

By law, anyone who violates the law's deposit and redemption requirements is subject to a fine of between (1) $50 and $100 for a first offense, (2) $100 and $200 for a second offense, and (3) $250 and $500 for a third offense.