Bag fees: Where does the money go?

I’ve been terrible at updating this summer. Plus I get asked this question a lot, so it seems like I should document it for posterity.

So you are shopping in DC or Montgomery County, and you forgot your reusable bag and opt to buy a disposable one. You pay your nickel to the cashier, and you’re on your way. But where does the nickel go?

In DC, the store keeps 1 or 2 cents. The remainder is collected by the Office of Tax and Revenue and managed by the District Department of the Environment in the Anacostia River Cleanup and Protection Fund. This fund is used for the following:

– administration and enforcement of the law
– public and business outreach and education about the law (including distribution of reusable bags)
– restoration activities on the Anacostia River (including trash traps, stream restoration, and an anti-litter public education campaign)

How funds from the DC bag bill were spent in Fiscal Year 2012

DC collects about $1.8 million each year this way.

In Montgomery County, the store keeps 1 cent. The remainder is collected by the Department of Finance and managed by the Department of Environmental Protection in the Water Quality Improvement Fund. The WQIF is primarily funded by the stormwater utility–bag fee revenues are an offset to that charge (i.e., utility charges go down if the bag revenues are higher than expected). The Fund is used for a variety of stormwater mitigation programs, including retention swales that collect stormwater as well as trash. This fund also pays for reusable bags for distribution to the public.

Montgomery County collected about $2.3 million last year.

The way the Maryland statewide bag bill is written, the store would keep 1 cent. The remainder would be collected by the Comptroller. Small portions would go to the Department of Human Resources for distribution of reusable bags, the Department of Labor, Licensing, and Regulation for enforcement, and stay with the Comptroller for administration. The remainder would be split, with half going to the Chesapeake Bay Trust for grantmaking to local organizations and jurisdictions, and half being returned to counties (apportioned based on population size) for use in water quality improvements.

In other ordinances around the country, the store retains the entire fee (in which case it usually ends up being called a “charge” instead of a “fee”).

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