As you all know the Iowa grocers association and the distributors won another battle. Our legislators once again decided to follow the money instead of doing what is right. All we can do is hope that the next session brings some common sense to these people and they see just how important the bottle bill is to the state of Iowa.
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Eldora - Director, Mike Hoppman
From: Jerry Fieagle [jfieagle @ iowagrocers.com] S»nt: Friday, September 21, 2007 11:58 AM To: Eldora - Director, Mike Hoppman Subject: RE: Can Redemption
Hi Mike,
IGlA's position has been to oppose an increase on the handling fee. Here is an excerpt of an email I sent a Redemption Center owner last spring, which would still! hold true today.
Appreciate hearing from you. IGIA has offered a compromise on the handling fee, but so far nobody seems to be "latching on to it".
A concern we have had on a one cent increase was that it would increase the cost of the product another 24 cents a case (it will get passed on, I don't know any company that can just "suck it up"). This is particularly hard on Iowa retailers in border communities and counties (about 40% of the population in Iowa), as they become even more uncompetitive with surrounding state retailers. Just this session already, we have increased minimum wages higher than surrounding states, and I am sure you have seen the press about the massive flux of Iowa consumers of tobacco now going out of state (particularly Missouri) because the tobacco taxes in Iowa are now higher, rather than lower than surrounding states.
A reasonable compromise seems to us that:
1. Recognize the consumer will pay for any increase in the handling fee (see above).
2. A need to protect border Iowa retailers from further financial harm.
3. Change the redemption value from 5 cents to 4 cents. A consumer will still pay 5 cents, but when they bring it back for redemption, they will get 4 cents.
4. Dealers and redemption centers would still receive five cents from the distributor.
5. This will create a 2 cent spread (if you are sorting you will still get the one cent handling fee from distributors, plus the extra penny from the four cent to five cent spread).
This gives the equivalent of a two cent handling fee, and protects border Iowa retailers. It seems to me, everyone gets what they want. Frankly, I can't figure out why the Redemption Centers of Iowa and the Iowa Recycling Association would not agree to this. IGIA could support this.
The problem seems to be that the Redemption Centers want exactly what they want, and won't settle for anything less. I think the approach above is reasonable, and transparent to the consumer. The consumer who have to pay the higher fee so let's be up front about it. However, the Redemption Centers so far would like to avoid that, because they know it will hurt the bottle bills' popularity.
Hy-Vee has been one IGIA member that has been adamant (so far) against any handling fee increase, per Rose Mitchell.
If you have any further questions, please feel free to contact me.
9/21/2007 | 