June 7, 2007
Culver water bottler sees new Bottle Bill flaws
By Barney Lerten, KTVZ.COM
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| Home/office delivery of larger water bottles is growing part of Earth2O's business - and will escape new deposit |
Earth2O prepares for higher costs; president seeks task-force seat
A Central Oregon company that's ridden the crest of the bottled water wave for 15 years doesn't expect the first expansion of Oregon's 35-year-old bottle bill to leave it high and dry on the beach.
But Earth2O President Steve Emery does say the legislation signed Thursday by Gov. Ted Kulongoski is all wet, in several respects, with some particularly sticky elements not likely to leave a good taste in the mouths of even the greenest Oregonians.
"I think it's more symbolic" than a big step forward, Emery told KTVZ.COM from the company's Culver offices, a short time after Senate Bill 707 was signed into law.
Like the grocers who will have to make extra room to take in thousands more bottles a week, Emery sees a direct financial impact of the new nickel-a-bottle law, due to take effect Jan. 1, 2009, on his 42-employee company, Oregon's largest seller of bottled water.
Like many a piece of legislation, successful or not - and a good share of citizen initiatives - the devil lies in the details.
This from a company ( www.earth2o.com) that touts the purity of its Opal Springs water, and the green way it sells more than two million cases of water a year. For example, Emery said, it spent 2 ½ years developing a special "over-wrap" to eliminate cardboard from their packaging, saving 400,000 pounds of cardboard a year.
When Emery went to Salem to testify about his concerns over the bottle bill expansion, it wasn't from the position of a hard-pressed company, trying to stay afloat by selling a product that must compete with everyone's kitchen tap.
In fact, Earth2O is doing so well, it just bought a 62,000-square-foot-building that SeaSwirl Boats was using before it shut its Culver operations this spring. That will let the company put all of its operations in one spot, and not have to lease 30,000 square feet any more.
"If they (lawmakers) were really trying to address post-consumer recycling, it would be beyond expansion of the nickel deposit to bottled water," said Emery, who also serves as a member of the state Economic Development Commission.
"I lived in Germany - I've seen curbside recycling at its best," Emery said. "I think if that (a bottle deposit) is the way to go, are they truly addressing post-consumer recycling?"
Emery said he doesn't believe the goal of diverting more plastic water bottles from the landfills will be reached, to any large degree: "People conscientious enough to take it back to the grocery store are the same ones who recycle at the curb."
The basics facing bottled water companies, Emery said, are simple: "I'll have to charge the grocer a nickel, and then I have to pay a third-party recovery company to go to the grocery and collect that bottle, pay them a nickel, plus a handling fee."
That handling fee is why the price for a case of water will go up more than just the $1.20 to pay for the deposit, Emery said.
"There's incremental costs to being involved," he said. "Consumers are going to have to pay for the costs."
But besides that, Emery also pointed to some parts of the legislation nobody's really focused on yet, and why he's asked to be named to the governor's Bottle Bill Task Force, which will be charged with making recommendations on other changes by Nov. 1, 2008 - just two months before the new law will take effect.
"Here's the unfortunate thing changed with the bill, a subtle one nobody is aware of," the Earth2O president said.
"Right now, Rudy (Dory of Newport Market) only takes back the same brand, kind and size (of bottle) he sells," and can refuse others, under current law, Emery said.
Under the new rules, Emery explained, "he has to take back Fred Meyer, Safeway" - anyone's bottles and cans, though there's still a limit of 144 items per person, per day, per store.
"The unfair thing is on smaller retailers, like Rudy - people go to Costco, make bulk purchases, they're not going to take the bottles back to Costco," he said.
Emery said that's why he went to Salem and lobbied, without success, to at least have the expanded bottle-return law exempt schools and health care facilities.
"The scary one is by (lawmakers) writing it that way, schools have now become redemption centers," he said. "A school has to take back anybody's water, soda pop. ... Home Depot becomes a redemption center. Lowe's becomes a redemption center. Babies R' Us."
Since the law covers only bottles less than a gallon it size, it won't affect Earth2O's growing home and office delivery of five-gallon water bottles.
And another thing: While lawmakers rejected expansion to include items like fruit juices, bottles that held flavored water also are covered by the new Bottle Bill. But only if they are labeled specifically as such, Emery said, adding, "You expect a store clerk to figure this out?"
"Our company will be just fine," Emery said. "The unfortunate part is the retailers, schools, health care facilities."
Grocers have been talking about referring a measure to the ballot that would get grocers out of the bottle-return business and instead create stand-alone recycling centers.
But Emery sees one main reason the governor's task force is being created - to lay the groundwork to double the deposit, from a nickel to a dime per bottle, to cover the rising costs.
"It's going to go up," Emery predicted. And the bottled-water guy doesn't see that as a very good idea, either.
"Then, our biggest concern becomes fraud," he said. "It becomes financially lucrative for people to come over the border from Washington" with their pop and water bottles.
http://www.ktvz.com/Global/story.asp?S=6628245
