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January 1, 2010

Silicon Valley Mercury News

Recycling centers fall victim to state's budget woes

Alan Tetenbaum still remembers the golden age of collecting cans, back in the '70s when people were free and easy with their trash, and the streets were lined with aluminum.

Tetenbaum roamed the byways and alleyways of San Jose, often for 12 hours a day, trailing a giant plastic bag behind him that looked like a zeppelin when it was filled with discarded beverage containers. But in 1987, California created a government recycling bureaucracy — nickel and diming consumers for every bottle and can — and in the process, opened a deep pocket for the Legislature to pick.

During the past several years of state budget shortfalls, that's exactly what the state did, borrowing more than $400 million from the California Beverage Container Recycling Fund, the proceeds of the nickel and dime deposits consumers pay on aluminum cans, plastic and glass bottles.

The fund ran out of money and on Nov. 1 stopped paying a recycling material handling fee, about half of the redemption center operators' income. That, say the large recyclers, has led to fewer neighborhood centers and shorter hours.

Now there are fewer recycling centers like the NexCycle "microsite" where Tetenbaum now works and was weighing bottles and cans over the weekend in a supermarket parking lot on Hamilton Avenue. Santa Clara County has lost six redemption sites since mid-June.

"I guess the state can do whatever it wants to do," said Tetenbaum, handing a receipt for $18.04 to Bobby Papadatos of San Jose, who then headed happily into Safeway to a cashier who gave him what he called "free money." He wasn't particularly happy to hear that such small collection sites, which the state defines as a "convenience zone," might soon be going away.

"They're hard enough to find at a time when they're open as it is," Papadatos said.

Californians bought 21.9 billion beverage containers last year and dumped $1.15 billion into the state bottle fund, according to the California Department of Conservation. Consumers pay a nickel deposit on each container less than 24 ounces and 10 cents for the larger ones. They may return those containers to authorized California recyclers and get their money back.

"The beverage deposit is a social contract," said Susan Collins, executive director of the nonprofit Container Recycling Institute in Culver City. "When the state charges a deposit on a container and says you can get it back, but they make it difficult for you to get it back, then that's not OK."

Major recyclers Tomra Systems, NexCycle and Bigfoot Recycling sued California, calling the state's payment suspension illegal. They predict widespread closures of recycling centers and worker layoffs.

"We just reduced the operating days at 97 sites (statewide) from five days a week to two and three days a week," said Sunnyvale-based NexCycle President John Ferrari. "Everyone tells us there will be a fix, but I don't know. If this continues, I will have to look at more cuts."

Ferrari, among others, thought the fix was Senate Bill 402 by Sen. Lois Wolk, D-Linden, and Assemblywoman Nancy Skinner, D-Berkeley. But Gov. Arnold Schwarzenegger blocked the legislation in October, saying he opposed a provision that would expand the type of beverage containers that would come under the deposit requirement.

Recycling advocates say the closures are bad news for consumers and cast a pall over California's successful program.

Not everyone is worried about the cutbacks, however. Saulman Valani, manager of Ranch Town Recycling Center in San Jose, points out that consumers will still be able to redeem bottles and cans for cash at businesses such as his.

"It's just the big companies that are affected," he said. "I have to pay a mortgage, while those guys are just sitting in a parking lot at Safeway or Lucky. Then the state pays them a bonus of $1,500 to $2,000 a month. That's a lot of money." Valani said cutbacks at big Silicon Valley companies, where free bottled water and meals were a standard pre-recession perk, have reduced his business by nearly 25 percent over the past year.

Hayward resident Jennifer Bittikofer, who dropped off $33.92 worth of recyclables at Union City's lone redemption center last week, was unhappy to hear of closures. She uses her recyclable redemption cash for food. "I'm a starving college student," said Bittikofer, who is preparing to transfer to a school in Southern California.

As Tetenbaum sifted through the contents of another garbage bag — "I don't pay for apple juice," he said, tossing a crushed container aside — Filmon Hailu fretted that his next Dumpster run might not be so lucrative. "It definitely would be a hardship for me if it closes," he said. "I want to help the environment, but the money is also important."


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