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Statewide carryout bag fee begins Jan. 1

Retail stores in Colorado will be required to collect a disposable carryout bag fee beginning Jan. 1, according to a state law passed last year, and towns or cities can charge more if they choose.

Several area cities, concerned about plastic pollution in waterways and natural areas, already have bag-fee ordinances on the books. Boulder, for example, passed its version in 2013 and is considering raising its fee to 20 cents, while Fort Collins followed in May of this year with a 10-cent fee of its own after voters approved the measure in 2021.

Some major retailers have taken their own actions as well. Beginning Jan. 1, for instance, Walmart stores will no longer provide single-use plastic or paper bags at checkout or pickup, shifting to paper bags.

Without a single Republican vote, the Colorado General Assembly in 2021 enacted House Bill 1162, the Plastic Pollution Recovery Act, which requires stores to charge the 10-cent disposable bag fee at the time of sale. With Gov. Jared Polis’ signature, Colorado became the 10th state to crack down on most single-use plastic shopping bags and the eighth to ban foam food containers.

Under the terms of the law, during 2023, retail stores will charge the 10-cent fee for each single-use plastic or recyclable paper carryout bag provided to customers, which will be added to the total sale. A retail store is defined as a grocery store, supermarket, convenience store, liquor store, dry cleaner, pharmacy, drug store, clothing store or other types of retail establishments where carryout bags are provided to customers.

The stores must collect and remit the fee on a quarterly basis – either to the finance department or division or equivalent agency of the city or town where the store is located, or — if the store isn’t located within a municipality — to the equivalent agency in the store’s county.

The 10-cent fee is split into two parts, with 60% remitted to the municipality or county and 40% remaining with the retail store. The bill says cities, towns or counties can use their portion of the revenues to pay for administrative and enforcement costs and any recycling, composting or other waste-diversion programs or related outreach or education activities.

But wait. There’s more.

Beginning on Jan. 1, 2024, according to House Bill 1162, retail stores will be able to furnish only a recycled paper carryout bag, not a plastic one, to customers at the point of sale for 10 cents per bag. Also on that date, retail food establishments will be banned from using polystyrene or other foam containers for ready-to-eat food, whether for dine-in or carryout meals. The law says any inventory purchased before then can be used until it’s used up. 

Bag fees will not be enforced for individuals who can prove they participate in a state or federal food assistance program, and the fee does not apply to packaging used for pharmaceutical drugs, medical devices or dietary supplements.

The act authorizes local governments to enforce the laws and specifically authorizes a county to impose civil penalties of up to $500 for a second violation or up to $1,000 for a third or subsequent violation. However, the bill says, a local government can’t enforce a violation committed by a retail food establishment located within a school.

Customers can avoid paying the bag fee by bringing in their own reusable carryout bags.

At the beginning of the COVID-19 pandemic in March 2020, the city of Boulder briefly rescinded its 10-cent bag fee over concerns that reusable bags could spread coronavirus. However, city officials reinstated the fee three months later after receiving guidance from Boulder County health officials that there was a low risk of spreading COVID-19 through reusable bags.

A bag fee does not apply to some bags, such as those used to package bulk items, produce, meat, fish, medications, medical devices, dietary supplements or laundry/dry-cleaning/garment bags.

Certain small stores that operate solely in Colorado, have three or fewer locations, and are not a part of a franchise, corporation, or partnership that has a physical location outside of Colorado, don’t have to collect the carryout bag fee. 

The fee does not apply to a customer that provides evidence to the store that he or she is a participant in a local, state or federal food assistance program. Everyone else, including tax-exempt organizations, such as governments or other 401(c)(3) organizations, must pay the fee if the store provides them with a carryout bag.

Source: BizWest

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