Canada markets closed
  • S&P/TSX

    20,928.10
    +108.16 (+0.52%)
     
  • S&P 500

    4,471.37
    +33.11 (+0.75%)
     
  • DOW

    35,294.76
    +382.20 (+1.09%)
     
  • CAD/USD

    0.8086
    +0.0001 (+0.01%)
     
  • CRUDE OIL

    82.66
    +1.35 (+1.66%)
     
  • BTC-CAD

    75,437.77
    -1,009.21 (-1.32%)
     
  • CMC Crypto 200

    1,464.06
    +57.32 (+4.07%)
     
  • GOLD FUTURES

    1,768.10
    -29.80 (-1.66%)
     
  • RUSSELL 2000

    2,265.65
    -8.52 (-0.37%)
     
  • 10-Yr Bond

    1.5760
    +0.0570 (+3.75%)
     
  • NASDAQ

    14,897.34
    +73.91 (+0.50%)
     
  • VOLATILITY

    16.30
    -0.56 (-3.32%)
     
  • FTSE

    7,234.03
    +26.32 (+0.37%)
     
  • NIKKEI 225

    29,068.63
    +517.70 (+1.81%)
     
  • CAD/EUR

    0.6966
    -0.0001 (-0.01%)
     

Four per cent raise for bottle depots won't cover ballooning costs: association

·3 min read

Bottle depots will be getting a raw deal after the province recently proposed a four per cent handling fee increase set for April next year, according to the association that represents redemption centres in New Brunswick.

Bruce Rogers, executive director of the Eastern Recyclers Association, said in addition to the increase not being high enough to cover the current cost of operating a bottle depot, it's coming five years after the last one – instead of the typical three-year increase schedule.

"Interestingly the fee schedule proposed back in 2015 to 2017 was for a higher fee than is being proposed today," Rogers said. "Unfortunately, the recommended fee was cut in half by the government."

Handling fees are the primary source of revenue for bottle redemption centres.

Bottle depot owners, especially those in rural areas – the majority of whom are small business owners – are losing on two fronts, he said.

"They don't get an increase for five years and their volumes have historically plateaued or gone down," he said.

From 2010 to 2020, the volume of units being processed at bottle depots across the province decreased to 305 million units from 313 million, at times falling as low as 278 million units, Rogers said.

"During that time, you basically have a five-year spread where's there's absolutely no increase in handling fees at all," he said.

There are other factors causing the cost of operating a bottle depot to spike, according to the association.

Significant cost increases since 2017, such as the minimum wage jumping and a CPP increase, means many bottle depots are struggling to make ends meet, said Rogers.

"The owners don't have any money to reinvest back into their business," he said. "So the infrastructure and facilities are slowly eroding and going downhill."

Rogers noted in New Brunswick, bottle depots are also at a disadvantage because they don't receive the incentives other Atlantic provinces do.

In Newfoundland and Labrador, for example, if an owner processes three million units or fewer, they receive what's called a "presence fee," ranging from $4,800 up to $12,000 a year, he said.

The province implemented the beverage containers program almost 30 years ago to reduce the amount of waste going into landfills, or getting littered along roadsides and waterways.

According to the Government of New Brunswick website, there are currently 78 beverage container redemption centres processing approximately 300 million empty beverage containers annually.

Alysha Elliott, a spokesperson with the Department of Environment and Local Government, said in an email handling fees are set by regulation.

"The 2021 assessment is indicating that the handling fee should be increased by four per cent to bring redemption centre revenue in line with their costs," she wrote.

She said in July the department engaged stakeholders on a proposed handling fee increase, and is currently reviewing and considering feedback from stakeholders.

Robert Cole, who operates a bottle depot in the village of Harvey, about 35 kilometres southwest of Fredericton, said the system in the province is broken.

The handling fee increase is lower than the current cost of running a bottle depot business, forcing many into survival mode, he said.

"Our costs are just skyrocketing, and we have no control over setting our prices the way other small businesses can," Cole said. "The only way we can increase our revenue is by convincing the government to give us a raise, and that's what's falling on deaf ears."

The system needs to be updated, he said as increasingly consumers don't see the value in returning their bottles with a return of five cents per bottle.

"If you go to Alberta and you buy two litres of Pepsi, you pay a 25 cents deposit, and you get 25 cents returned to you when you get the bottle back. That's massive," he said. "They have a much higher return rate. Their system works."

Robin Grant, Local Journalism Initiative Reporter, Telegraph-Journal

Our goal is to create a safe and engaging place for users to connect over interests and passions. In order to improve our community experience, we are temporarily suspending article commenting