December 19, 2008

Michigan targets illegal can redemptions
by David Eggert

Jill McLane Baker | Kalamazoo GazetteKasey Makowski, of Portage, returns cans and bottles Wednesday at the Hardings store in Woodbridge Hills in Portage on August 18, 2008.

LANSING — Smugglers and others soon may have a tougher time redeeming out-of-state pop cans and beer bottles for 10 cents in Michigan, a phenomenon once joked about on "Seinfeld."

The Legislature early Friday gave final approval to bills aimed at stopping beverage containers not sold in Michigan from being returned in the state. The practice is common in border areas and costs a state environmental cleanup fund $10 million a year.

When deposits are paid on bottles and cans sold in Michigan but the containers aren't returned, the leftover money goes to the cleanup fund. The fund has been depleted, though, because people can get 10 cents a container for out-of-state cans and bottles for which no deposit was paid.

"We're losing money, giving money away. We can ill afford to do that, especially when we're talking about such a significant sum," said Republican Sen. Cameron Brown, a bill sponsor from Fawn River Township in St. Joseph County.

Each can and bottle sold in Michigan would be marked with a special code under the legislative package's main measure. Stores in border areas would retrofit their reverse vending machines to scan the dot or symbol to ensure only Michigan-sold containers get a refund.

The upgrades would be required only if the state covers the cost, however. The retrofits, which can cost up to $5,000 per machine, would be needed in all counties bordering other states and, in the Lower Peninsula, the second row of counties north of border counties.

The Senate also passed a bill letting stores without machines limit the number of containers returned by someone to 100 a day, or $10. Those with machines could restrict returns to 250 a day, or $25. The House appeared unlikely to approve those restrictions, though.

Another bill headed to Gov. Jennifer Granholm would increase penalties for redeeming out-of-state containers.

While no major problems are expected to arise when the bills reach the governor, money would need to be appropriated by Granholm and lawmakers before any machines are retrofitted.

Michigan is the only state with a dime deposit on all carbonated beverage containers -- other states have a nickel deposit on most cans -- so people buy drinks in Indiana, Ohio and Wisconsin and redeem the containers in Michigan.

In some cases, smuggling rings have collected and crushed millions of cans in Ohio, selling them to several stores in southeast Michigan. When buyers don't return the bottles to get their deposits back, states or distributors get to keep the money, and store owners pocketed more than $1.5 million by redeeming cans for which a deposit had never been paid. Law enforcement broke up the rings last year.

Because of regional distribution patterns, cans sold in non-deposit states often have a deposit stamp on the lid anyway. That makes it tough to stop people from intentionally or accidentally placing out-of-state containers in stores' machines.

http://www.mlive.com/news/index.ssf/2008/12/michigan_targets_illegal_can_r.html