October 28, 2008
Deposit law fraud costs Michigan millions
Michigan's dime deposit law on carbonated-beverage cans and bottles is credited with helping recycle 97 percent of such items.
But there is a dark side to the deposit law: people who buy beverages out of state, without paying a deposit, then bring the containers to Michigan to claim their money for returning them.
The problem is particularly acute in communities along the state border, and it adds up to a substantial sum. State officials estimate that Michigan loses at least $10 million a year because of deposit law fraud.
Lawmakers are looking into ways to combat the problem, and there are various actions which might be taken.
Perhaps most promising is technology that would allow machines to reject out-of-state cans and bottles. Proposals have been made to require Michigan-deposit bottles and cans to bear a special dot, symbol or other code that could be read by the machines. It's not a perfect solution. First, who would pay the cost of retrofitting the return equipment to read the special symbol? Also, most bottling companies serve multi-state regions, so how could the symbol be restricted to only Michigan-bound bottles and cans?
Maine has had some success with a system that requires bottle and can deposit transactions on a debit card-like account, requiring consumers to provide their names, addresses and other personal information in order to receive a card. People who are out to scam the system usually are reluctant to provide such information, Maine officials say.
Law enforcement officials broke up several smuggling rings last year that were bringing bottles and cans from Ohio into southeast Michigan. A trial for 12 of those arrested is scheduled to get under way this week.
With millions of dollars being lost to fraud, we hope an effective system can be put into place to ensure that only those who pay an extra dime when they by a can or bottle of pop or beer get that money back when they return the container.
http://www.battlecreekenquirer.com/article/20081028/OPINION01/810280301/1014/OPINION
