A 32-year-old law is draining money and energy from Hillsdale businesses, all in the name of recycling.
Chris Wingate, co-owner of Broad Street Market, has his employees spend at least 10 hours changing, cleaning and maintaining the recycling machine connected to Broad Street Market. He said the machine must be updated weekly in order to accept cans that are sold at Broad Street, costing him time, money and possibly the health of his customers.
Michigan's 1978 recycling law states that a 10 cent deposit is to be placed on all recyclable plastic, aluminum and glass bottles as an incentive to recycle. The law also states that any store which sells bottled beverages must have a recycling receptacle within 100 yards of the building. "It's a very costly program that was mandated on Michigan groceries back in 1978," Linda Gobler, president of Michigan Grocers Association said. "Michigan is one of the only States which has a bottling law that doesn't compensate a grocer."
Gobler said reverse vending machines cost at least $14,000, which usually comes out of the retailer's funds. She said maintenance and bottle storage are also attached to bottler's responsibilities.
"If you look at the area in a grocery store where the reverse vending machines are the area is typically a space that a retailer would use for selling," Gobler said. "As a retailer you're forced to provide a service, but don't get anything back from it."
Gobler said she talked to one retailer who calculated that the reverse vending machine cost his store upwards of $50,000 a year in time, maintenance, space and opportunity cost.
The machines also make spaces dirty.
"One thing I don't like about it is that we're turning our grocery stores into a dumpsite," Wingate said. "It's hard to keep the area sanitary, which is why we have our bottle machine outside and completely separate from the store."
Wingate said he believes Broad Street is the only grocery store, which keeps its machine in a separate building in Hillsdale. Bottle distributors, too, are affected by bottle laws. Mike Lashbrook, president of the Michigan Beer and Wine Wholesalers Association said distributors must take back all bottles they sell and have them recycled.
"It certainly is an added expense. All of the distributors in the state of Michigan had to purchase larger size trailers," Lashbrook said. "You have to leave the warehouse at the beginning of the day to add space for empties."
Lashbrook said retailers used to sort cans by distributors, such as Pepsi and Coca-Cola, but that changed with the advent of the reverse vending machine.
"Sixty to 70 percent of the empties now flow through a more automated system," Lashbrook said. "It helps the retailer, but again it comes at a cost to the distributor paying for that service."
Wingate suggested the city of Hillsdale should adopt a curbside recycling program in an effort to alleviate the opportunity cost on small businesses while creating more jobs. He said he talked to State Representative Kenneth Kurtz about his idea, but it didn't go far.
"It'd make things a lot more sanitary," Wingate said. "For example: our stock boy goes and handles the bottles - who knows what he's handling - and then he has to turn around to restock our shelves."
The recycling law has critics within the college as well.
"The value of recycling bottles is very low, so is the environmental damage done by bottles or by making new glass - the deposit wouldn't be necessary if this recycling were cost effective," Assistant Professor of Economics Charles Steele said an in e-mail to The Collegian.
Steele said Michigan is a unique case, where bottle deposits run 10 cents instead of the usual 5 cents.
"Predictably, this creates an incentive for people to return bottles in Michigan instead of elsewhere, so people bring bottles here. The state then foolishly treats this as a problem and a crime, instead of recognizing that its own deposit is unnecessarily high," Steele said.
That exact scenario is called "The Seinfeld Effect," after an episode of Seinfeld where two characters discover Michigan's 10-cent deposit, and plan on taking a truck-load of cans to cash in the difference. A funny premise, sure, but in Michigan, it's also illegal.
Michigan's law states it's illegal to bring in out-of-state bottles for recycling. In 2007, clickondetroit.com reported ten men were arrested for importing out-of-state cans to be recycled in Michigan. They made over $500,000 of Michigan taxpayer money.
Gobler said Michigan has just passed legislation that will help prevent such fraudulent acts with a special stamp printed on every recyclable bottle.
"Our recycling rates are lower, too, which is interesting," Gobler said. "Some states that have the highest recycling rates don't have a bottle law."
Lashbrook said now third party recycling companies come and pick up empties for large retail establishments, recycle them and settle the deposits between the wholesaler and retailer.
But for distributors there isn't much choice.
"There's some who argue that bottle bills are a thing of the past, but the public still supports the bottle bills significantly in the state of Michigan," Lashbrook said. "And as long as they continue to do so distributors will work to make sure it works."
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