Recycling Fail: CVS Faces $3.6 Million Penalty

California's recycling officials are making an example of drugstore giant CVS, accusing the chain of balking at redeeming cans and bottles in-store and failing to pay recycling fees to the state.

CVS Pharmacy and CVS Health together face a record $3.6 million in fees and fines for violations detailed in an enforcement action, CalRecycle announced Monday.

In an email, CVS Pharmacy spokesman Mike DeAngelis said, "CVS Pharmacy is committed to contributing to healthier, more sustainable communities and we are currently reviewing the state of California's filing."

It's the largest fine ever sought by the agency that oversees California's can and bottle recycling program, and an indication of how the global collapse in recyclables pricing is making it harder for the average person to get that nickel or dime back on a soda bottle or beer can.

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CVS is not the only store that has balked at paying California's $100-per-store daily fees as an alternative to redeeming recyclable beverage containers in stores, but it is the biggest, said CalRecycle spokesman Lance Klug.

"CVS owes the most for choosing not to redeem in stores," Klug said. "And this action comes after multiple conversations. Contact with CVS failed to resolve the issue."

WHY SUCH A LARGE FINE?

Under California's 1986 bottle recycling bill, stores that sell drinks in recyclable containers are supposed to collect a deposit of a nickel or dime, depending on the size of the container. Then they are supposed to return the money when people redeem the empties. The deposits are required on drinks like beer, soda, water, juice, and sports drinks, but not milk, wine or distilled spirits.

But it's a labor-intensive business, requiring inventory tracking, trucking, pest control, and dealing with all manner of urban recyclers and gleaners.

If the store didn't want to handle sticky wet soda bottles and smelly beer cans, they could send customers to a local certified recycling center if one was located within a half-mile in urban areas. Often a recycling center would be in a store's own parking lot. The recycling center would handle the containers and pay the refunds, and be reimbursed by the state.

The state Legislative Analyst has tracked flaws in the program, and so has the advocacy group Consumer Watchdog, complaining that too few stores redeemed bottles and cans.

In August, RePlanet, the state's largest chain of recycling centers, closed, reducing by 20 percent the number of urban centers where you could take a bag of recyclables and swap them for money.

If your local recycling center closed, the burden to redeem the containers was back on the store, though it had the option to instead pay CalRecycle $100 per day per store.

CalRecycle says drugstore giant CVS did not redeem bottles and cans at 81 of its 842 California stores. And it also failed to pay the $100 per store fee over several months of 2017. The chain racked up more than $1.8 million in unpaid fees, according to an enforcement action filed Dec. 5 and made public on Monday.

In addition, the company faces an equal amount of fines as a penalty for ignoring the fees, so the total fine CalRecycle is facing amounts to $3.6 million.

"This is a big thing and an excellent sign," said Liza Tucker of Consumer Watchdog, who has researched flaws in the state's recycling program by going to 50 stores in a week, documenting how few of them were willing to redeem bottles and cans. The group has long complained that CalRecycle was too lax in enforcing its rules.

The fines are "exactly what they should have been doing all along," she said.