The California Department of Resources Recycling and Recovery (CalRecycle) has released its July 2013 quarterly report on its Beverage Container Recycling Fund, and the outlook is not encouraging.
Echoing CalRecycle’s April 2013 report, the latest numbers indicate that, without major reforms to the current bottle deposit system, the recycling fund will be insolvent by March 2015. The latest data, in fact, projects month-by-month funding levels for the coming years that are below the levels laid out in the April report. In short, the most recent forecast shows cash levels in the account falling below the “prudent reserve” level sooner than was previously envisioned.
“It already was a challenging situation,” Susan Collins, president of the Container Recycling Institute (CRI), told Resource Recycling, “and it looks like it is getting worse.”
The recycling fund collects all the deposits paid for covered containers and then pays out when bottles get redeemed. The system relies on a percentage of containers remaining unredeemed, using that surplus to pay for the program’s logistics, grant programs, market development and payments to cities.
Because containers are now recovered at such a high rate in the state (recently pushing beyond 80 percent), the surplus has steadily dwindled and future funding is uncertain.
If no remedy is found, the report indicates, the fund would need to be cut its support to recycling programs by 75 percent during fiscal year 2014-2015 and 100 percent by FY 2015-2016, effectively ending program funding. Reductions of that magnitude would endanger numerous services including redemption centers, according to Collins.
CalRecycle has proposed a series of reforms to the program, but it’s unclear how effective the proposed initiatives could be in terms of solving the funding problem.
Redemption rates neared 83 percent for beverage containers during FY 2011-2012. That figure far exceeds the “break-even recycling rate of approximately 70 percent,” from the report.
Fraud has also been an issue for the fund, as out-of-state beverage containers have had an impact on California’s already-overloaded redemption system.
