Thursday, June 04, 2009


The state's effort to collect unredeemed nickle deposits has hit the skids-thanks to the intervention of Judge Griesa: "The law would allow the state to begin collecting 80 percent of unclaimed deposits on all beverages that require deposits, including water. Bottlers have been keeping that money. The state budget assumed $115 million in revenue for the year, including $29 million from water, during the 2009-10 fiscal year."

But in spite of this reprieve, some deposit originators have decided to begin charging a "recycling tax" for all of the potentially lost nickels that the state had planned to grab-even through the law may not go into effect until next April. One large beer franchise, Manhattan Beer, is looking to up charge its customers 6 cents a container under the guise that this new fee would be devoted to picking up the cost of recycling.

The implication here, lacking in any degree of veracity, is that the unclaimed deposits were being used to defray the cost of the company's redemption system. The truth? At the inception of the deposit law, Manhattan Beer, along with all of the other beer franchises, raised the price of a case of beer by about $3 a case! The rationale? To pay for the cost of redemption.

In the interim 27 years, the Manhattan Beers of the world have pocketed hundreds of millions of a windfall profit in unredeemed cans and bottles. Yet now, having pocketed the cash and gouged New York's consumers, they have the temerity to tack on a fee so that the beer drinkers of the state pay the unredeemed nickels that the company's will lose-and do so upfront!

This is the same beer company that has been able to cadge millions in tax subsidies from NYC to build a Bronx warehouse that it would have, even absent the public money, built anyway. Which is why we believe that the NYS Attorney General should look into this latest beer increase-an indication of monopolistic behavior from an industry that lacks any real price competition because of its consolidation.

Still, even for Manhattan Beer, this latest move is outrageous. To charge beer drinkers an extra tax-as the state has done-in order to help balance the books, is one thing; to do do so in order to maintain a windfall profit is quite a different thing altogether.