Inside Augusta

Lawmakers exploring a $23 million ‘pack tax’

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On Wednesday, lawmakers on Maine’s Environment and Natural Resources Committee held a public hearing on LD 2104, “An Act to Support and Increase the Recycling of Packaging.” The bill is sponsored by Rep. Ralph Tucker of Brunswick.

LD 2104 would establish a new recycling stewardship program where producers are responsible for the costs associated with recycling packaging materials they use in selling their products. As described by the Press Herald, “The packaging material producers would establish a third-party organization that would pay fees to municipalities based on the type, amount and design of their packaging. If municipalities dispose of readily recyclable materials, then producers would repay their costs.” The third-party organization would be contracted by the Department of Environmental Protection (DEP).

If packaging materials used by producers are not easily recyclable, producers would pay higher fees to cover the costs of their proper disposal. Maine taxpayers currently pay about $17 million annually to dispose of packaging, according to the Maine DEP.

LD 2104 amounts to a $16 million to $23 million cost increase for Maine businesses according to Amy Volk, director of communications and public relations at Volk Packaging. That’s because the bill would make producers, not consumers, responsible for the cost of recycling packaging. The bill simply shifts the cost of recycling to producers – it doesn’t actually propose a legitimate solution to the state’s recycling problems.

In an op-ed published in the Press Herald on Wednesday, Christine Cummings, executive director of the Maine Grocers & Food Producers Association, discussed some of the many pitfalls of the proposed legislation.

“While increased recycling and the minimization of waste are important, this legislation seeks to mandate that the thousands of unique producers, brand owners or sole distributors of packaged goods sold at retail in Maine must compensate municipalities for the cost of recycling packaging introduced to the market. The proposed policy is laden with flaws, making it impossible for Maine’s businesses to comply,” Cummings wrote.

One of the primary flaws of the bill, as Cummings sees it, is the definition of “readily recyclable,” noting that commonly used materials like glass, mixed-paper and plastic, cardboard and plastic film do not meet the definition under the bill. Producers would also pay higher costs in disposal and recycling while the process itself would remain optional for municipalities.

“Producers will be forced to pay the $23 million ‘pack tax’ with no requirement for changes to the recycling system. In some instances, producers may pay two times their current cost of disposal or recycling, while recycling will still remain optional for municipalities.”

She also pointed to failed attempts by California, Washington and Connecticut to establish similar programs. “If the worlds’ fifth largest economy, California, could not effectively implement a program of this nature, we are concerned for Maine’s capacity to successfully and singlehandedly execute an all-encompassing packaging stewardship program.”

LD 2104 is just the latest example of regulatory overreach in Augusta, where lawmakers think the actions they take occur in a vacuum without impacting businesses or the livelihoods of their employees.

About Jacob Posik

Jacob Posik, of Turner, is the director of communications at Maine Policy Institute and the editor of The Maine Wire. He formerly served as a policy analyst at Maine Policy. Posik can be reached at jposik@mainepolicy.org.

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