Budget and Spending:

Potential Effects of a National Mandatory Deposit on Beverage Containers

PAD-78-19: Published: Dec 7, 1977. Publicly Released: Dec 7, 1977.

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Proposals have been introduced in Congress since 1970 to require refundable deposits on all beverage containers in order to reduce litter and waste. A mandatory deposit system would change the national beverage system from about 25 percent to 100 percent deposit containers.

Some changes expected to result from required deposits on beverage containers are: reductions in litter and solid waste; a rise in empty container handling costs for retailers, wholesalers, and beverage producers; and increased income for industry due to failure of consumers to return all containers. Changes which would be dependent on the number of new containers manufactured are reductions in raw material consumption, energy use, and system costs for containers, and increases in system costs for using more refillable bottles. There would be increases in capital and labor costs, but these would be more than offset by the decrease in new container purchases and retained deposits. After the initial capital costs, there would be a considerable decrease in costs. There would probably be decreases in bottle production which would cause job losses, but these would be offset by increased employment in beverage industries and retail stores.

Recommendation for Executive Action

  1. Status: Closed

    Comments: Please call 202/512-6100 for additional information.

    Recommendation: If legislation for a mandatory deposit on beverage containers is enacted, it should include: a deposit imposed on all beverage containers, a lead-in period for implementing the law to help industry convert its facilities, funds to inform the public about the need to return containers, enhanced access to retraining programs and unemployment compensation for areas with employment problems resulting from the legislation, some money from unredeemed deposits placed in a fund for municipalities to clean up litter and solid waste, analyses of effects after implementation, and a mechanism to encourage can recycling.

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