When I introduce the First Law of Thermodynamics to my students I use the metaphor of money. That’s because, at least to broke college students who haven’t had classes on high finance, it is easy to understand. Like energy being conserved, money has to come from somewhere and go somewhere. This property lets you track it through a process to understand it better.
That’s why I find Colorado’s new Producer Responsibility Program (PRP) so confusing to try and follow. I’m not alleging a conspiracy or bad behavior, it’s just that it doesn’t seem clear to me who is likely to pay and who is likely to benefit. Advocates, of course, are pushing this as a low-impact way to get people to recycle. Consumer goods companies, those that sell or make things that use lots of packing material (think pop cans and cardboard boxes) will simply pay a fee, recycling will happen, God will be in His heaven and so on. Common sense should be telling you at this point to be skeptical, and trying to assess the reasonableness of this claim is where things are muddied.
In contrast with proposed laws like House Bill 24-1311, which would just take your money directly and give it to someone else, or things like the current crop of measures that merely up government spending so there’s less TABOR surplus to give refunds from, the PRP doesn’t take directly from taxpayers. Consumer goods companies like Walmart, Pepsi and others formed a national nonprofit, which then conducted a study around Colorado and proposed a fee program which charges the companies that created them. The fees would be used to, among other things, create recycling programs around the state.
Magic money
That’s the first question I have. Smaller and local companies fought this measure and got themselves exempted. Surely the global/nationwide corporations with more resources could have fought harder; are we to believe, too, that they’re happy to assess fees on themselves to create recycling programs? If they were that jazzed about creating community recycling, why wait for a law to force the issue?
The PRP was created back in 2022, and as is usually the case, it’s taken a bit of time for the program to get up and running. It was only recently that the Joint Budget Committee approved the nonprofit’s plan and fees. Soon enough companies will start paying into a program with the (ambitious) goal of developing “…a convenient, cost-effective program that provides free and equitable recycling of packaging and paper products for all Coloradans.” Oh, and in case you were worried, advocates like Suzanne Jones of the Eco-Cycle remind us that “…results from other countries that have charged similar packaging fees [as those proposed by Colorado] show costs at only fractions of a penny per package, with no impact on consumers.”
Yet more questions. We have a statewide program estimated to assess between $260 and $310 million per year in fees by 2035, then firehose that money around the state, with only a fraction of a penny per package in added cost. This won’t affect me other than making my curbside recycling dreams a reality? Free money appears in the system, scoots around creating programs, and is somehow regenerated or just given as a gift to consumers?
Who benefits?
Advocates claim that the PRP would create new recycling companies around the state and the jobs that would go with them. It’s also supposed to help create a new market. With Colorado suddenly flush with reusable materials after consumers rush to recycle, companies will be swooping in to scoop them up and put them to use. These things, they claim, are how the program will help support itself.
This seems to ignore a pretty fundamental fact. Coloradans by and large don’t recycle. I wonder whether or not having it be “free” would make a difference. In my little town of about 16,000 on the Eastern Plains, we have three different locations where you can drop off your cardboard, tin cans, what have you. I am not sure how much this free service gets used, but I bet that if hundreds were frustrated (even tens) in their desire to recycle because of the locations being full, I’d know about it.
It’s reasonable to make the argument that having recycling being curbside will increase the recycling rate and undoubtedly it would tick up. Will this be enough to provide the economic impetus advocates claim will happen to make the program pay for itself? I have my doubts.
Undoubtedly someone, somewhere will make money at this. That’s a given, that’s always a given. Who though? Large corporations have entire departments whose job is to make sure that, no matter what public policy there is, they come out okay, and I can’t help but think this is no different.
If you forced me to wager, here’s where I would put my money. I think that this program will will raise recycling rates around the state a little, and it will not be self-sustaining. We consumers will foot the bill with higher prices to offset the fees the companies charge themselves. As for the extra material that is recycled and secondary markets, I bet the companies keep that money. Said another way, I think the overall effect of this bill and this program will be to allow companies to set up new companies and charge us more.
I wish I shared the complete faith that the more progressive lawmakers under the gold dome have about their ability to mold and shape both markets and consumer habits. I wish I could somehow convince them that there is no change, no choice without consequence. At this point, about all I can hope for about the PRP is that I’m wrong.
Cory Gaines is a regular contributor to Complete Colorado. He lives in Sterling on Colorado’s Eastern Plains and also writes at the Colorado Accountability Project substack.
