Legislation creating a free market, plastic buyback program did not pass the Spring 2021 legislative session in Texas, as neither Republican controlled chamber in the state legislature advanced Senate bill 1276 nor House bill 4022 from their respective committees. The Senate bill was authored by a Republican and co-authored by a Democrat while the House bill was authored by a Republican. The proposed “Free Market, No-Tax Rebate Program” for often-littered objects had measures similar to a traditional deposit system, though the bill was designed to have greater flexibility and more comprehensive coverage, according to Texans for Clean Water. If passed, consumers would have paid a one cent fee at the cash register on qualifying items, with rebates available for returned items. However, the legislation would have implemented different financial models than other deposit programs, as the one cent fee would not be raised across the state, and neither companies nor materials recovery facilities (MRFs) would have been mandated to collect or store such recyclable materials.
Ultimately, the legislation aimed to increase the quantity of clean bales produced and total recyclable items recovered. In the first year, if passed, the program was expected to generate roughly $253 million per year in total revenue fees that retailers would have paid through existing tax collection systems. Specifically, consumers were expected to have been paid out $14 million in refund redemptions on retuned eligible items at 25 cents per pound. Around $36 million in handling payments were also estimated to cover a consortium payment in the first implementation year. Urban MRFs would have received 60 cents per pound while rural recyclable processing operators would have received 90 cents per pound before the consortium sold these bales to end markets, who would have provided confirmation these materials were being recycled.
While Texas has a strong recyclable end market for such film, plastic cups and polyethylene terephthalate (PET) bottles, there is still no state deposit program and capture rates remain low, around 12 percent for certain recyclable items. The state further prohibits local jurisdictions from implementing plastic bag bans. Roughly $30 million in community grants targeting abatement and enforcement around litter and illegal dumping, $50 million in infrastructure improvements and $10 million for education, communication and system administration efforts across the state would have been expended in the program’s first year. Finally, the estimated remaining unspent $113 million in funds from the first year’s implementation would have been reserved for public health emergency prevention, mitigation and recovery programs. Additionally, a state fund balance would have been established understanding the expected growing future recycling rates and rebate payouts. In other states with comparable rebate programs, participation rates have varied from 67-97 percent while Texans for Clean Water estimates that free market incentives for the Texas program would have increased recycling rates by six times throughout the state.
Read more in Resource Recycling here.