32. Smuggling of Out-of-State Cans into Michigan Costs State $10 Million (Michigan) Detroit News
September 6, 2007
The smuggling of illegal out-of-state bottles and cans into Michigan so they can be redeemed at retailers for a dime apiece is a $10 million annual problem that is hurting state businesses and environmental cleanup efforts, according to a bipartisan group of lawmakers who this morning announced legislation to cut down on the problem.
"This is smuggling, plain and simple, robbing Michigan one can at a time," said Rep. Steve Bieda, D-Warren, a sponsor of the two-bill package. He was joined by more than a dozen lawmakers and environmental advocates at a news conference in the state Capitol.
The problem is particularly troublesome along Michigan's southern border because Ohio and Indiana are among the states that do not charge a bottle deposit.
The lawmakers said that people from those neighboring states will purchase beer and pop in their home state and later make the short drive to Michigan to collect the deposit. A 2000 study by the Michigan Department of Environmental Quality estimated that 100 million cans and bottles are illegally returned to Michigan stores each year, at a cost of $10 million.
Mike Miller, CEO of Floral City Beverage, a Monroe-based beer distributor, said the smuggling ranges from the person who cashes in an out-of-state 12-pack to more organized efforts in which pickup trucks filled with empty out-of-state bottles and cans pull up to Michigan stores to collect the 10-cent redemptions.
He said it causes a "significant negative cash flow problem" for Michigan retailers and wholesalers. He said that Michigan retailers along the Indiana border have seen more than a 17 percent decline in sales due to Michigan residents going across the border to make purchases and later returning the empties at Michigan stores. Indiana taxes are also lower, creating a further incentive to buy goods there, he said.
Under the proposed legislation, a drink manufacturer would be required to place special labels on bottles and cans sold in Michigan. It would also require reverse vending machine manufacturers to upgrade their equipment to be able to readily identify cans and bottles that were sold in other states so they couldn't be redeemed in Michigan. Violators of either measure would be subject to a $10,000 fine and/or 180 days in jail.
Michigan voters overwhelmingly approved the bottle deposit law in 1976, becoming one of the first states in the nation to do so. The law has been heralded as the chief reason why roadside litter of empty bottles and cans has virtually vanished in Michigan.
Blue Skies will be the first Minnesota restaurant with the Enomatic system, which preserves wine for several weeks after a bottle is opened.
Brian Gruis and Brent Mayes, partners in Cesare's Wine Bar in Stillwater, are bringing a new, technologically advanced wine bar to northeast Minneapolis.
Blue Skies will feature the Enomatic, an Italian wine-serving system that will allow customers to sample 100 different wines in portions as small as an ounce, not just by the glass or bottle. The device, which looks like a high-tech espresso machine, uses nitrogen-infusion technology to preserve wine for several weeks after a bottle is opened, allowing the restaurant to offer the smaller portions without worrying about waste.