Bill will up product prices without upping recycling rates

It is well documented that Colorado’s environmentally oriented residents have an abysmally low rate of recycling. According to 2020 numbers published by the Colorado Public Interest Research Group, just 15% of goods are recycled or composted in our state, making Colorado one of the 20 most wasteful states in the nation.

But a proposal in the Colorado General assembly will increase costs for consumers while giving too much power to a newly created private entity that would be entrusted with enforcing state law.

House Bill 1355 will have an enormous impact on the cost of packaged goods, at a time when residents are already paying more for groceries and household goods.

By July 2025, every business that uses packaging materials to distribute products to consumers in Colorado will be mandated to join the Producer Responsibility Organization (PRO) and become a dues-paying member.

For Colorado producers, which include our small businesses, those dues will add up. The Colorado Brewers Guild projects that a single medium-sized brewery will pay $50,000 or more a year in dues to the PRO, and large retailers or manufacturers will pay tens of millions. Those are our estimates based on programs in Canada, where more recycling infrastructure was already in place, but we don’t really know what the cost will be — the bill doesn’t outline a rate structure and leaves that critical decision to the unelected PRO board. It does, however, outline punitive fines on businesses that don’t join the PRO.

For Colorado consumers, these costs will appear at the grocery store, the bar and the online marketplace. A study done by York University in Ontario on enhanced producer responsibility estimated that in New York and Quebec, where similar programs are in effect, the cost of a basket of goods has increased by 4% to 6%. Let me remind you that the current rate of inflation in the Denver metropolitan area is 7.9% already.

This bill is an indirect tax on consumers at a moment when goods and the cost of living are a headline-grabbing issue. And the proposal would offer no guarantees of better recycling rates.

The issues with House Bill 1355 go well beyond the tone-deaf response to inflation. In creating a third-party, nongovernmental entity to oversee this program, legislators have generated a slew of questions around the bill’s constitutionality. By 2025, every producer will be mandated to join this PRO if they wish to sell packaged products in the state and producers will pay this PRO for all materials recycled. The program also seems to circumvent rules passed by voters just last year requiring new fees to be approved at the ballot box.

In effect, House Bill 1355 forces businesses to join the PRO if they want to do business in the state, and in establishing the PRO,

House Bill 1355 authorizes a nongovernmental agency to collect a tax on an entire industry, without any legislative or voter oversight or accountability. This should be setting off alarm bells for anyone interested in the duties and limitations of government.

What’s to stop the legislature from creating more nongovernmental bodies to regulate any given industry? Who is responsible for oversight of these groups?

How do Colorado’s voters intervene if they go too far?

The legislature has developed a real habit of delegating authority, first to departments and agencies, and if House Bill 1355 passes, now to entities that exist entirely outside of public view. This unconstitutional delegation of authority leaves Coloradans without any way to hold the organization they’ll ultimately be paying for accountable for any real results, all while driving up costs and putting our businesses at a competitive disadvantage.

House Bill 1355 is a constitutional disaster, a bloated bureaucracy, and a consumer liability.