Who’s Really Winning the War on Plastic Bag Bans and Fees?

It’s easy to get caught up in the daily intrigue of Washington politics, these days.

With the appointment of Scott Pruitt as chief of the Environmental Protection Agency, much attention has been focused on the future of federal environmental policies, regulations, and laws. Speculation stems from Pruitt’s track record in Oklahoma and his recent comments on the links between CO2 and climate change. The greatest eye-opener was the introduction of H.R. 861 which calls for the elimination of the EPA in December 2018. Granted, introducing a bill is no guarantee it will come to fruition as law. However, that the concept is even being considered is a reality check.

Amidst the tweets, executive orders and investigations swirling around us, we shouldn’t lose sight that in our industry legislative changes occur more commonly at the state and local level. Indeed, in spite of the federal moves toward deregulation, state and local waste- and recycling-oriented bills and ordinances, have been causing controversy all on their own.

No product is under greater legislative debate right now than single-use plastic bags, and often paper ones as well. Closely related legislation targets take-out food containers, but those bills are not as pervasive nor as intense as the battle of the bags. The reasoning behind these proposed laws is not always crystal clear. Like container deposit laws, bans and fees are often introduced to combat litter. The large commercial recycling industry wants them out of the single stream because of their adverse effect on equipment and operations.

Viewpoints vary on the effectiveness of bans versus fees. Others suggest a combination that utilizes both as the only successful way, because it allows for flexibility in various circumstances. Recycling is the answer for those more focused on waste diversion. If you look deeper, recycling proponents often have a vested interest in the continued production of plastic bags, or are those organizations who may benefit from industry funding. It is safe to say there is no one answer that is conclusive thus far.

If you think the environmental premise and the program structure seem confusing, the political motives and outcomes are even less transparent.

From Revelry to Reality

After a long, hard and rather cash intensive fight in California, the nation’s first statewide ban on single-use plastic bags is now a reality. Its purpose is to encourage shoppers to rely on their own reusable sacks. Large food retailers, pharmacies, corner markets and liquor stores can offer paper bags and thicker plastic bags, but they must charge at least 10 cents for each of those items. Restaurants and department stores are exempt.

California’s war on plastic bags was originally waged on the local level and it seemed it would easily be overcome by the plastics industry. As mounting numbers of local ordinances were adopted, the battle escalated. The popularity of banning plastic bags spread throughout the entire state. Every deflective maneuver commonly used to defeat consumer product legislation was implemented. In the end, despite an industry war chest estimated at $6 million, the state won.

Environmental legislation tends to have a trickle-down effect. Advocated point to a local need they have seen resolved in a nearby state. Lawmakers become emboldened when their peers in another area remain elected in spite of introducing new mandates. Based on California’s success, the introduction of more statewide bans and fees would be expected. Instead local jurisdictions stepped forward. Rather than support, they were or still are being meant with strong opposition from their own state legislators.

Granted the expected sources of opposition are influencing the push back. Plastic manufacturers, retailers and restaurant associations are all involved. Apparently, after failing in California, these groups learned to intervene at an earlier stage before even one local ban or fee became policy.

Strategic Offense

To defeat an issue, it’s common to use diversion tactics like alternative legislation. One might introduce another set of issues to indirectly compete for attention with the desired policy. Trade associations do this when tasked with keeping the more emotional and environmental issues off the table. It is also useful in deflecting attention away from any profits which might be affected. It is likely legislators have been coached by industry advocates successful in preventing local ordinances.

The real question is whether the early defeat of these local ordinances is truly a win for the plastics industry or a classic case of “Be careful what you wish for.” There are strong sentiments that these are temporary victories. The evidence may be in the very arguments waged by state leaders.

Bag legislation proponents find it interesting that for the most part, legislators are not questioning the environmental harm caused by single-use plastic bags. It’s not about the loss of revenue or the negative impact on job, which you would expect. Nobody seems to be arguing whether fewer bags are used once bans and fees are introduced. Instead the sole platform is one of state and local rights and whether it is legally appropriate for a local jurisdiction to levy such a fee.

Politics and Posturing

What’s so suspicious about this approach? First, most of the states where these actions occurred did not have a single community with a ban or a fee. A few had one proposed ordinance. They were all under majority Republican governance at the time. A trend to usurp local rights is a total about face in GOP dominant legislatures more apt to push policies and costs downward.

This has prompted serious mud-slinging at legislators who are accused of maneuvering current laws to their future advantage. Remember, the bills resulting from this argument only stop local governments from adopting bans and fees. They don’t go so far to preclude the state from introducing similar legislation for their own benefit.

Since conspiracy theories are in vogue these days, let’s look at two separate plots. In the first hypothesis legislators see a future opportunity to funnel statewide plastic bag fees into state coffers. To protect that option, it is essential to obstruct the creation of local ordinances, which could interfere in the state’s desire to capture the full revenue stream.

Die-hard skeptics see it from an entirely different perspective. They say the only funds being funneled are those going to lobbyists or into political campaigns. The skeptics believe state bans or fees will never be a reality where these bans on local ordinances were targeted. Why? They point to the presence of the plastics industry in each state where the ban on bans has passed successfully. One or more Novolex facilities operate in Wisconsin, Arizona, Michigan Iowa, Idaho, Indiana and Iowa.

Novolex (aka Hilex) is a national player in the plastic bag industry with more than 7,000 employees. When all divisions are considered (not all manufacturer plastic bags), Novolex operates in 49 states with international operations, as well. With that many assets to protect, one would expect the company to be proactive against bans and fees as a good business practice.

Novolex was a major financial contributor to the California battle. Novolex also sponsors the Bag the Ban web sites. It should be noted, although headquartered in South Carolina, a law to prevent local bans and fees recently failed in that state by a one vote margin. It seems that physical location isn’t everything.

A Fight for the Fee

If there is any irony in all of this, it is in New York, a traditionally strong Democratic stronghold. Allegations of state meddling are being voiced loudly after a disgruntled Senate Democrat introduced a bill nixing New York City’s proposed bag fee. Then the Republican controlled State Senate approved it.

Governor Andrew Cuomo (D) has now intervened expressing criticism that New York City’s retailers were to keep the proposed fee. He is calling for a delay of action by the City and the State Assembly. A task force will be formed to study the issue. The findings of the governor’s proposed task force will be telling. Any bets on who controls the fee when the smoke clears?

Michele Nestor is the President of Nestor Resources Inc., based in the Greater Pittsburgh area, and chair of the board of directors, of the Pennsylvania Recycling Markets Center, Penn State, Harrisburg. She helps private and public sector organizations develop strategic plans to survive in a transitioning marketplace.