Thor Cheston, a co-founder of Right Proper, says a proposed bottle- and can-deposit bill could lead to unsustainable cost increases for the brewery. (Shedrick Pelt)
Every Friday morning, the staff at Right Proper Brewing Company gather around a big board on the wall of their Brookland facility. It looks like a big Excel spreadsheet, with boxes of numbers written in erasable marker that detail how much the brewery is spending, what it’s making, and what the next month might look like.
If labor costs increase, the numbers change. If the price of raw materials suddenly goes up, the new costs are scribbled in. “We have to do the math, constantly,” says co-founder Thor Cheston. “If not, we don’t exist.” And those numbers have been at the top of his mind recently.
The D.C. Council is considering a new law that would require a 10-cent refundable deposit on bottles and cans sold in the city, touting it as a boon for recycling and a solution for litter that pollutes the Anacostia River. But some local producers say it will add costs that could threaten the survival of businesses already operating on slim margins.
“It could be devastating,” Cheston says.
Cheston knows that this might put him on the wrong side of environmentally conscious customers, but he says Right Proper bakes environmental sustainability into much of what it already does.
“What I want people to know is how dedicated we are to being an environmentally responsible company and we have put our dollars behind our words on this,” he says, noting that the facility has solar panels on the roof and is exploring how to repurpose some of the carbon dioxide produced during brewing. “What other brewery has measured their carbon footprint? We have to take that risk to be judged in the court of public opinion because if we do not fight this, we do not exist.”
An ‘extraordinary’ problem
If that sounds dramatic, so too is the problem that proponents of the bottle bill are trying to fight.
Trey Sherard, who leads advocacy efforts for Anacostia Riverkeeper, slowly motored a boat up the river on a late September afternoon, pointing out floating piles of plastic bottles that had collected along the banks. The tour for reporters had been organized by Ward 1 Councilmember Brianne Nadeau, the main author of the bottle bill, to put a visual point on a legislative debate that’s just getting started.
“The scale of the problem is extraordinary,” Sherard said.
Plastic bottles, according to Nadeau, make up 60 percent by weight of all the trash that’s pulled from the river, much of which is captured by trash traps. Sherard told the boatful of reporters that most of the bottles in the water started as litter on sidewalks and streets, and ultimately ended up in the city’s storm drains and flushed into the Anacostia.
“The solution is not getting bottles out of the water. The solution is getting them off the ground,” he said as the boat quietly glided past RFK Stadium and towards Kenilworth Aquatic Gardens. “If you have to pick up a bottle, something is already wrong. If a bottle is worth 10 cents, you won’t see a lot of bottles on the ground.”
That’s the thinking that underlies the bill. As written, it would require consumers in D.C. to pay a 10-cent deposit every time they buy a bottle or can – with exceptions for dairy, medicine, and baby formula. (More than 600 million bottles and cans are sold in D.C. every year, per Nadeau’s office.) Once they return it to a designated retailer or redemption center, they’d get their dime back.
“The District’s bottle bill is projected to increase recycling rates by more than three times and cut the number of containers that end up in the incinerator, landfill, or the environment by five times,” Nadeau said in her opening remarks during a daylong hearing in the D.C. Council last week, also noting that it will provide opportunities for people to earn money by collecting bottles.
Ten states – including California, Michigan, Massachusetts, and Maine – have bottle-deposit laws on the books. In some of those, the return rate for bottles exceeds 70 percent, compared to 24 percent in D.C.
An effort to launch a similar program was defeated at the ballot box in D.C. almost 40 years ago, in part because of record spending by the beverage industry. A similar campaign is underway again. The Alliance for an Affordable D.C., a group funded by the American Beverage Association, has been texting residents and organizing retailers to oppose the bottle bill. The group (which was first created in 2019 to fight an extra tax on sugary drinks) says the bill would increase costs for residents.
That’s the same position that Mayor Muriel Bowser’s administration has taken. “Our economy is in a tenuous position, and now more than ever, every action has an impact. D.C. already has higher burdens on businesses and labor and higher tax costs than our regional peers,” said Ryan Nicholas, the legislative director for the Office of the Deputy Mayor for Planning and Economic Development, during the council’s hearing.
Plastic bottles often end up in the Anacostia River. (Martin Austermuhle)
‘It’s unsustainable’
Proponents of the bottle bill say claims of increased costs are overblown. They point to a study from Massachusetts showing no increase in drink prices there. A more recent study of New York’s experience is more nuanced, though: Prices on most bottled water went up slightly when a bottle-deposit fee was instituted, except for the largest bottles (which also experienced an increase in sales).
Over at Right Proper – which produces the equivalent of 1.8 million beers a year, 1 million of which are canned – Cheston’s views on the bottle bill are similarly nuanced. He supports the idea in concept and did not sign on to a letter opposing the bill organized by the beverage industry. (Neither did the city’s two other big local brewers, D.C. Brau and Atlas Brew Works.)
His biggest concern is with his cans. Under the bill, producers would have to add new labels or codes to cans and bottles to distinguish them from their counterparts sold in Maryland and Virginia. (This is to stop people from collecting bottles and cans outside D.C. and trying to redeem them in the city.) That, he says, would be logistically challenging and expensive.
“Maintaining separate inventories so that people could determine whether a can was sold in D.C. or outside of D.C. is not just a logistical nightmare, but the costs alone would be tremendous because every time we order cans it’s $20,000,” he says. “If we have to have double the inventory of cans, we are paying double our storage costs. For our business model, it’s unsustainable.”
In written testimony, Brandon Skall, the co-founder of D.C. Brau, pointed to a related concern.
“D.C. does not exist in isolation. Maryland and Virginia do not have bottle bills. If D.C. passes this bill alone, D.C. breweries and D.C. retailers will be at a permanent disadvantage,” he wrote. “Consumers and retailers can simply cross the border to buy beer without paying deposits or dealing with returns. That means fewer sales for local businesses, less tax revenue for the city, and a shift in consumer spending to our neighbors.”
Proponents of the bottle bill counter that D.C. led on banning smoking in bars and in charging five cents for plastic bags at supermarkets without any measurable negative impacts, they say. And Nadeau says there’s power in D.C. setting an example.
Backers of the bill also say that the experiences in other states and countries show that bottle-deposit laws can work and are sustainable.
“Vermont is the number one state in the country for craft breweries, and it is also a long-standing bottle bill state,” says Susan Schorr, who leads efforts to fight plastic waste for the local chapter of the Sierra Club. “There are many experiences from jurisdictions, not only in the country but from around the world that we can draw on… There's no reason why the program wouldn't be able to work here.”
Maybe, counters Cheston. But D.C. isn’t Vermont. “It’s very expensive to operate a brewery in Washington, D.C. because Washington, D.C. real estate is extremely expensive, I assume much higher than in Vermont,” he says. “When you have very high occupancy costs, it reduces the margin of error on literally every other line item.”
Justin Cox, the founder of Atlas Brew Works, told lawmakers that while national brewers or even big craft brewers like Sam Adams and Sierra Nevada could likely manage costs related to a bottle deposit, D.C.’s brewers can’t. “If you add $2.40 per case in deposits to the equation, Atlas is not in a financial position to absorb that cost,” he said. “But Budweiser probably is.”
Moving forward
The bottle bill is in the early stages of its legislative journey through the council. It’s currently with the Committee on Business and Economic Development, which is chaired by At-Large Councilmember Kenyan McDuffie, one of the only lawmakers who didn’t co-sponsor the measure. In mid-November, the bill moves to the Committee on Transportation and the Environment, chaired by Ward 6 Councilmember Charles Allen, who supports it.
“The idea and the concept is good,” he says. “I also have talked with a number of small businesses, our local brewers who have brought up legitimate issues that I think there are solutions for. And I’m trying to work on what those might look like.”
Nadeau is open to changing the bill; in fact, she already has, exempting retailers smaller than 2,000 square feet from having to serve as centers where people can drop off bottles and cans and get their reimbursements. (Bars and restaurants that sell drinks for on-site consumption would also be exempted from having to charge the 10-cent deposit.) “The goal is not to create hardship for local producers. It's to get big companies to pay for their litter,” she says.
Still, environmental advocates say they don’t want lawmakers to take too big a swing at the bill. “D.C. is a very unique place, so I think we're open to minor tweaks to accommodate our uniqueness,” says Lora Nunn, who volunteers time cleaning up the Anacostia River and is a leader in the coalition pushing for the bottle bill. “But I think on the whole the bill was really written pretty tightly.”
Cheston says he will remain engaged throughout the process, hoping to constantly remind lawmakers of how local producers like Right Proper might be impacted. “At some point you have to say, ‘What’s the value of products that are exported out of the city that say Made in D.C.?’” he says. “We think there is great value to it. We think we serve a wonderful purpose.”
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