Recycling and Resource Recovery:
State and Municipal Legal Impediments

Michael D. Halgren*

Reclamation, commonly understood to mean both recycling and
resource recovery**, is detrimentally affected by a variety of state
and municipal laws. This paper identifies several of those laws, de-
scribes their effects on reclamation, and suggests Ways of reforming
them.

I. THE SOLID WASTE PROBLEM

The volume of solid waste is growing. The United States is an-
nually discarding solid waste at a rate that is increasing five times
faster that its population.1 At the same time, much of the country
is running out of sanitary disposal sites. Almost half of our cities in
1973 were expected to exhaust their then current disposal capacity
within five years. 2 Each year, this country must add 500 new

* Associate, Culp, Dwyer, Guterson & Grader, Seattle, Wash.; B.A. St. Olaf College

(1975); J.D. University of Washington (1980).
** Reclamation is a generic term for both recycling and resource recovery. See

COUNCIL OF STATE GOVERNMENTS, SUGGESTED STATE LEGISLATION FOR 1973, at
65 (1972). Recycling, however, is different from resource recovery. For the purposes
of this paper, recycling means the process by which discarded materials are made
reuseable or transformed into new products. A glass bottle, for example, has been
recycled when either cleansed and refilled or crushed and used as road paving mate-
rial.

Resource recovery, on the other hand, is defined in this paper as the process of ex-
tracting energy resources from discarded material. An example of resource recovery
is the burning of solid waste to create heat and ultimately electricity.

In this paper, "solid waste" shall mean discarded materials with insufficient liquid
content to be free flowing. The terms "secondary materials" and "recycled materi-
als" will be used synonymously. And the term "primary materials" will refer to
virgin materials, those made from natural resources.

1. NATIONAL LEAGUE OF CITIES & UNITED STATES CONFERENCE OF MAYORS,
CITIES AND THE NATION'S DISPOSAL CRISIS 1 (1973) [hereinafter cited as NATIONAL
LEAGUE OF CITIES]. In 1973 daily per capita municipal waste generation (which
does not include industrial, commercial, mining or agricultural wastes) was approxi-
mately 5.5 pounds. L. KIRKLAND, MUNICIPAL RECYCLING-A CONCEPT COME OF
AGE 18 (1973) [hereinafter cited as L. KIRKLAND]. Given its growth rate, it should be
8 pounds today. Id.

2. NATIONAL LEAGUE OF CITIES, supra note 1, at 1.



COLUMBIA JOURNAL OF ENVIRONMENTAL LAW

landfill areas. 3 And of the existing landfills, nearly two-thirds fail to
meet either federal or state pollution standards. 4

The country's continuing reliance on virgin materials unnecessar-
ily consumes energy and pollutes the environment. If secondary
materials were used by industry as raw material sources, there
would be an energy savings of 95% in the production of some
products. 5 Also, the air pollution associated with the manufacturing
of certain products would be reduced by as much as 86%, and
water pollution by 76%.

By discarding rather than reprocessing our waste, the country
depletes its virgin resource supply and correspondingly becomes

3. [1978] 9 ENVIR. REP. (BNA) 1059.
4. OFFICE OF TAX ANALYSIS, U.S. TREASURY DEP'T, FEDERAL TAX POLICY AND

RECYCLING OF SOLID WASTE MATERIALS 79 (1979) [hereinafter cited as OFFICE OF
TAX ANALYSIS]. See [1979] 9 ENVIR. REP. (BNA) 2303 (one half of the nation's
landfills leak contaminants into the ground water).

5. 122 CONG. REC. 22206-05 (1976) (statement by Senator Gravel) [hereinafter
cited as CONG. REC.]. The Senator's statement was based on a report prepared for
Congress by the Environmental Protection Agency. The report stated that the indus-
trial use of recycled materials would reduce the energy consumed in aluminum
smelting by 95%, in paper manufacturing by 66%, in steel manufacturing by 55%, and
in copper smelting by 65%. It is unclear whether the cited figures represent a net
energy savings for society or simply for the industries involved. Presumably, the fig-
ures represent the energy savings for industry because of what would seem to be the
impossible task of calculating the amount of energy expended by everyone involved
in recycling. For example, a net energy figure for society would require a calculation
of the energy consumed by each household in transporting its waste to a recycling
center. The data for such a computation is probably non-existent. Without that data,
it is impossible to determine whether there is a net energy savings for society. But if
calculable, a net energy figure for society would probably be positive, given the
magnitude of the net savings for industry.

The operation of a resource recovery system is also reported to have a positive net
energy balance. See COR-MET, METROPOLITAN SERVICE DISTRICT SOLID WASTE

MILLING-TRANSFER STATIONS, ENVIRONMENTAL ASSESSMENT (1974); P. LOVE, NET

ENERGY SAVINGS WASTE MANAGEMENT OPTIONS (Sept. 1976). Twenty units of en-
ergy is recovered for each unit of energy expended in operating a resource recovery
system. DEP'T OF ECOLOGY, STATE OF WASHINGTON, MARKET ANALYSIS OF RE-
COVERED MATERIALS AND ENERGY FROM SOLID WASTE 6-3 (1977) [hereinafter cited
as DEP'T OF ECOLOGY].

The resource recovery system in Akron, Ohio, which generates electricity by
incinerating solid waste, has reduced the energy costs of Akron's inhabitants by 20%
and yearly produces the energy equivalent of 500,000 barrels of oil. [1979] 10 ENVIR.
REP. (BNA) 1661. As a result, Akron's landfill needs have dropped by 70%. Id.

6. CONG. REC., supra note 5, at 22206. The Environmental Protection Agency re-
ported to Congress that industrial use of recycled raw materials in place of virgin
ores or pulpwood results in 60 to 86% less air pollution and 44 to 76% less water
pollution. Id. The variation is due to the differing industrial processes used. As was
stated in note 5 supra, it is unclear whether these figures represent a net savings for
society or only for the industries involved.



Recycling and Resource Recovery

more dependent on foreign nations to meet its resource needs. The
Bureau of Mines projects that by 1985 the United States, unless it
actively begins reclamation, will be dependent on foreign nations
for more than 50% of its requirements of nine of the most critical
virgin ores and metals. 7 That list will grow to include thirteen basic
ores and metals by the turn of the century, with the United States
being self-sufficient in the production of only a few metals.' Should
this metal import scenario materialize, the deficit side of our bal-
ance of payments will expand over the next ten years by $30 bil-
lion. 9

These problems of waste disposal, pollution and dwindling virgin
resources could be ameliorated by reclamation. Yet over the past
decade our national rate of recycling has steadily declined, 10 so
that the country recycles proportionately less of its paper waste to-
day than it did thirty years ago. 1 We convert less than 2% of our
waste into useable products and energy, unlike several countries in
Western Europe which convert 60% of their waste. 12 Instead, we
spend $5.5 billion annually to bury waste' 3 which, if recycled,
would be worth $5 billion 14 or, if converted to energy, would be
equal to 400,000 barrels of oil per day.15

7. Id. at 22205.
8. Id.
9. Id.
10. Id. at 22204.
11. 121 CONG. REC. 2646 (1975) (statement of Congressman Burke).
12. [1979] 10 ENVIR. REP. (BNA) 1661 (statement of Barbara Blum, EPA Deputy

Administrator; Denmark and Switzerland convert 60% of their waste into useful ma-
terials or energy).

13. [1979] 9 ENVIR. REP. (BNA) 2303.
14. Solid Waste: Disposal and Reuse Present Major Problems, 31 CONG. Q.

WEEKLY REP. 1019, 1020 (1973). The cited figure represents the gross value of
buried recyclable material. But several communities that recover and sell the
recyclable material in their waste have reported significant net savings in the opera-
tion of their collection and disposal systems. Benton County, Tennessee, by recov-
ering the recyclable products in its waste has reduced its waste disposal costs by
half. 124 CONG. REc. S5433 (daily ed. Apr. 12, 1978) (statement of Senator
Hathaway). In Marblehead, Massachusetts, the sale of recovered goods has consis-
tently produced a net savings of $3,000 per month in disposal operations. ENVIRON-
MENTAL PROTECTION AGENCY, FOURTH REPORT TO CONGRESS ON RESOURCE
RECOVERY AND WASTE REDUCTION 35 (1977) [hereinafter cited as RESOURCE RE-
COVERY].

15. [1979] 10 ENVIR. REP. (BNA) 1661. The figure does not represent the net en-
ergy potential of our waste. Regarding the amount of energy consumed by a resource
recovery system, see note 5 supra. As to the cost of recovering the energy contained
in our waste, a study performed for Portland, Oregon, concluded that it might be
lower than the average cost of sanitary landfilling. DEP'T OF ECOLOGY, supra note 5,

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COLUMBIA JOURNAL OF ENVIRONMENTAL LAW

Our failure to reclaim more energy and products from our waste
is fundamentally the result of our modified free market system.
American industries needing raw materials will use secondary ma-
terials only when their purchase price is competitive with the price
of virgin materials. Because of a national heritage of abundant natu-
ral resources, virgin materials have been inexpensive relative to
secondary materials. 16 This, by operation of the free market sys-
tem, has had the dual effect, on the one hand, of encouraging ex-
tensive use of virgin materials and energy and, on the other, of dis-
couraging competition from secondary materials. 17

These natural and market forces have been aggravated, however,
by certain local laws, public policies, and the market pricing sys-
tem. These laws, policies, and practices have made the use of
virgin materials and fuels economically and psychologically more
attractive than their reclaimed counterparts. The effects of these
specific discriminatory measures and the suggestions as to how to
reform them are considered below.

II. DISCRIMINATORY COST-PRICING

A. Social Costs: Internalization vs. Externalization

Many of the costs of using a product are not included in its
price. Absent legislative intervention, none of the following costs
are reflected in a product's price: the costs of remedying the air
and water pollution created by the production of the product; the
costs of unnecessarily having used primary rather than secondary
materials in the production process; and the costs of collecting and
safely disposing of the product after it is discarded. These costs and
others not included in a product's price are commonly called "so-
cial costs."

The social costs are partially paid for either through waste dis-
posal fees or indirectly and collectively through general real estate
taxes. 8 Individual producers are seldom charged for the later dis-
posal of their products or the pollution generated by their creation
and use.

at 5-2. In a similar study for Seattle, Washington, it was estimated that if the city
burned its garbage to produce power, it could annually produce 1.5 million tons of
steam and 502 million kilowatt hours of electricity, while disposing of its waste at
one-half the cost of landfilling. Seattle Post-Intelligencer, May 3, 1980, at A2, col. 1.

16. RESOURCE RECOVERY, supra note 14.

17. Id.
18. Id. at 89.



Recycling and Resource Recovery

The failure of the product price to reflect the social costs is both
inequitable and inefficient.19 It is inequitable to require the tax-
payer who may not have used the product to pay for its disposal,
while the manufacturer and the actual user enjoy the benefits of
the disposal and a clean environment. It is inefficient in that when
the full costs of using a product are not reflected in its price, con-
sumers and producers lack a direct monetary incentive to minimize
those costs. Instead, consumers perceive the cost of using products
to be lower than it actually is. This encourages them to purchase
more goods and not to recycle. Under full-cost pricing, consumers
might shift their purchasing more toward low-waste items, such as
returnable commodities and longer-lived durable goods, and would
be more likely to recycle purchased items. Producers, in turn,
might use more secondary materials in production or redesign
products to reduce material requirements or to improve recycla-
bility. Thus, the failure of consumer product markets to reflect all
waste management costs amounts to an implicit subsidy for physi-
cally and economically wasteful production and consumption habits.

Because of this cost-pricing deficiency, several state and munici-
pal laws impair reclamation. As discussed below, the pricing sys-
tem causes the ubiquitous legal requirement of "competitive bid-
ding" to reduce both the supply of and demand for reclamation
services.

B. Cost-pricing and Competitive Bidding Laws

1. Competitive Bidding and Governmental Procurement
of Reclamation Services

Most states require their communities, when contracting for the
collection and disposal of waste, to award the contract to the lowest
bidder.20 Because land is still relatively inexpensive and the social

19. Id.; L. KIRKLAND, supra note 1, at 60-61.
20. E.g., WASH. REV. CODE § 35.23.353 (1979) ("The contract shall be awarded to

the lowest responsible bidder."); OHIO REV. CODE ANN. §§ 307.86, 735.05 (Baldwin
Supp. 1979) ("contract with the lowest and best bidder"). Only 30% of residential
wastes are collected by public utilities. ANNUAL SURVEY OF UNITED STATES COL-
LECTION PRACTICES, WASTE AGE 6 (1977). The remainder is collected by public or
private contract.

An additional barrier to reclamation contracts is the length of time for which a dis-
posal contract can be granted. Many laws limit the period to one year. See, e.g., ANN
ARBOR, MICH. CODE § 26.2.5(1) (1957); INGLEWOOD, CAL. CODE § 5220 (1966). A
very short contract period does not allow the operator of a resource recovery facility
to recoup its investment. Since a resource recovery facility may cost $75 million to

1980]



COLUMBIA JOURNAL OF ENVIRONMENTAL LAW

costs of burying our waste are not reflected in the price of landfill
disposal, the lowest bid invariably involves landfilling. 21 When a
landfill proposal is accepted, the social costs of wasted land, natural
resources, and energy are borne by the public. If the landfill pro-
posal included these costs, a reclamation bid might be the low-
cost proposal.

The effect of not awarding the community disposal contract to a
reclamation enterprise is that very little residential waste is re-
cycled.2 2 Several factors prompt people to use the government
sponsored waste services rather than to recycle voluntarily. 23 First,
for reasons discussed later, recycling centers are usually located at
relatively far distances from residential areas.24 This makes re-
cycling more costly and inconvenient than the government pro-
vided door-step service. Additionally, the household has the bur-
den of storing its waste until it can be transported to a recycling
center, while at the same time being charged a monthly rate for
city disposal services no longer used.2 Studies suggest that no ap-
preciable increase in recycling will occur until the government pro-
vides reclamation services or voluntary recycling is made more
convenient and inexpensive.2 6

To encourage recycling by individuals, the fixed collection fees
should be altered to reflect actual use of the city collection service.
In an attempt to encourage the use of recycling, Seattle, Wash-
ington, reduced the fees assessed households in certain areas which

construct, see CONG. REC., supra note 5, at 22205, a contract length of 15 to 20 years
is necessary. PROSECUTING ATTORNEY, SNOHOMISH COUNTY, WASH., LEGAL ISSUES
RELATING TO RESOURCE RECOVERY IN SNOHOMISH COUNTY, WASHINGTON "132
(1978). At least one state has remedied the problem by allowing contracts for unlim-
ited durations. DEL. CODE ANN. tit. 7, § 6420(e) (Supp. 1978).

21. SPOKANE COUNTY, WASH., COORDINATED COMPREHENSIVE SOLID WASTE
MANAGEMENT PLAN FOR SPOKANE COUNTY 9-11 (1971) [hereinafter cited as

SPOKANE COUNTY).
22. Less than 15% of all recycled material is derived from residential solid waste.

See DEP'T OF ECOLOGY, supra note 5, at 5-9.
23. See SEATTLE RECYCLING, FINAL REPORT FOR THE SORT PROJECT, app. 6

(Aug., 1979) (report by private contractor on Seattle's program to recycle a portion of

its collected waste; on file at University of Wash. School of Law) [hereinafter cited
as SEATTLE RECYCLING]; Hecox, Urban Solid Waste Streams-Can Voluntary
Recycling Solutions Work?, 2 ENVT'L AFF. 614 (1972) (hereinafter cited as Hecox].

24. See text accompanying notes 105-16 infra.
25. See SCS ENGINEERS, SEATTLE SOLID WASTE PILOT PROGRAMS, SOURCE

SEPARATIONS, AND VARIABLE RATE (Jan., 1980) (on file at University of Wash.

School of Law) [hereinafter cited as SCS ENGINEERS].
26. SEATTLE RECYCLING, supra note 23, at app. 6; Hecox, supra note 23.



Recycling and Resource Recovery

did recycle.2 7 A study of the Seattle plan revealed that varying dis-
posal rates would influence recycling, but concluded that the
Seattle fees did not vary enough to eliminate the disincentive to
recycle.

28

As to increasing reclamation among city collection contractors,
the competitive bidding impediment could be remedied in three
ways. One approach involves enforcing the existing statutes that
define the contours of the competitive bidding laws. Most states
require counties and municipalities to act in the best public inter-
est.29 Since the federal and many state governments recently have
declared reclamation to be in the public's best interest, 30 a com-
munity, applying the competitive bidding law in the public inter-
est, should have to consider the disposal alternative of reclamation.
A community should not be able to award a landfilling contract un-
til the social costs have been evaluated.

A second approach, also involving the reconciliation of several
laws, is available in a few states. In Washington, for instance, mu-
nicipalities and counties have legal authority to operate recycling
and resource recovery facilities. 31 Although they still are bound to
award all contracts for solid waste processing to the "lowest respon-
sible bidder," 32 the authority to operate reclamation facilities
implies that there would be no malfeasance if the community re-

27. SCS ENGINEERS, supra note 25, at 51.
28. Instead of being assessed a fixed monthly fee, certain "test area" households

were charged according to the number of garbage containers they used. A.household
that used one can was charged $1 monthly, whereas the user of two to four cans was
assessed $5.60. Id. Even though the variable rate caused only a six percent reduction
in container usage, two studies of the project concluded that increasing the rate dif-
ferential would induce more recycling. Id.; SEATTLE RECYCLING, supra note 23,
at 19.

29. C. RHYNE, MUNICIPAL LAW 343, 377 (1957).
30. E.g., Solid Waste Disposal Act, 42 U.S.C. § 691 (1976 & Supp. 1978); Solid

Waste Authority Act, DEL. CODE ANN. tit. 7, § 6401 (Supp. 1978); Solid Waste
Recycling Authority Act, WiS. STAT. § 499.03 (Supp. 1979); see also Wisconsin Solid
Waste Recycling Authority v. Earl, 70 Wis. 2d 464, 494, 235 N.W.2d 648, 665 (1975)
(creating a state agency to further recycling is "pursuant to a legitimate public pur-
pose of preserving the health, safety and welfare of the people").

There is no evidence that anyone has ever challenged a landfill contract on the ba-
sis that it is contrary to the public interest. Presumably, a lawsuit could be brought
by the residents of any community, alleging that the municipal corporation abused
its discretion by not considering the recycling alternative.

31. WASH. REv. CODE § 35.21.152 (Supp. 1980); see OHIO REv. CODE ANN. §
6123.02 (Baldwin 1980).

32. WASH. REv. CODE § 35.23.353 (1965); see OHIO REV. CODE ANN. § 307.86
(Baldwin 1980).

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COLUMBIA JOURNAL OF ENVIRONMENTAL LAW

fused to let a contract to a lowest bidder who uses a landfill. The
cogency of that conclusion is increased by the presence of another
statute, often found as a companion to the above law, that requires
communities to use recycling and resource recovery to the maxi-
mum extent possible.33 In fact, these two laws, where they occur,
suggest that full consideration of the costs of landfilling is a condi-
tion precedent to awarding any landfill contract. 34

A third solution, proffered by the Council of State Governments,
necessitates the passage of a law that requires the contract's effect
on reclamation to be considered before any disposal contract is
awarded. 3 The law envisions an investigation into the environmen-
tal and energy costs of any disposal contract. The primary virtues
of this proposal are that the deficiencies of the present pricing sys-
tem would be exposed and a decision could be made which would
maximize resource allocation. Moreover, the method used, the
cost/benefit/effect analysis, is one with which governmental agenc-
ies are familiar.

2. Competitive Bidding and Governmental Procurement of
Recycled Goods

The competitive bidding requirement applies to governments
not only when they contract for waste disposal services, but also
when they purchase goods. 36 Since virgin resources are cheaper

33. E.g., WASH. REV. CODE § 70.95.020 (Supp. 1980).
34. There is no evidence that this suggestion has been accepted anywhere.
35. COUNCIL OF STATE GOVERNMENTS, SUGGESTED STATE LEGISLATION FOR

1973, at 75 (1972) (an environmental impact statement is required for all "actions
which significantly affect this state's ability to recover and recycle resources from
solid waste") [hereinafter cited as COUNCIL OF STATE GOVERNMENTS]. Most states
require an environmental assessment of any project "significantly affecting the qual-
ity of the environment." See, e.g., WASH. REV. CODE § 43.21C.030(e) (Supp. 1980).
The Council's suggestion would insure that a disposal contract would receive the
same evaluation.

For a discussion of the problems with cost/benefit analyses, see Wildavsky, The Po-
litical Economy of Efficiency: Cost-Benefit Analysis, Systems Analysis, and Program
Budgeting, in POLITICAL SCIENCE AND PUBLIC POLICY 55, 57-64 (A. Ranney ed.
1968). The primary problem with cost/benefit analysis is the assumption that all ef-
fects can be quantified and categorized as either costs or benefits. In the context of
requiring a small community to conduct such an analysis before granting a disposal
contract, there may be a point where the cost of preparing such an evaluation ex-
ceeds the benefit it confers.

36. E.g., WASH. REV. CODE § 35.23.353 (1965); Mo. ANN. STAT. § 34.040 (Vernon
1969); see also RESEARCH DEP'T, ARK. LEGISLATIVE COUNCIL, RECYCLING WASTE
PAPER app. A (1974) (surveys state procurement laws) [hereinafter cited as RE-
SEARCH DEP'T].



Recycling and Resource Recovery

than recycled materials under the market pricing system, partially
because the social costs of using virgin materials are not included,
the competitive bidding law has the effect of requiring governmen-
tal agencies to buy goods of virgin rather than recycled content.

Recognizing the disadvantage suffered by secondary materials,
several states and municipalities have, either by statute or regula-
tion, authorized their agencies to purchase recycled paper.3 7 Most
of these enactments, however, fail to remedy the procurement
preference for primary goods. First, simply authorizing the agenc-
ies to buy recycled paper does not alter its price competitiveness.
As long as the competitive bidding law remains, the agencies must
purchase virgin products.38 In states where both laws exist, the
agencies continue to purchase paper of virgin fibers.3 9

A second problem with the "remedial" laws is their definition of
"recycled products." Recycling will not be stimulated when its def-
inition is so broad as to allow industrial/production scrap, the mate-
rial discarded at the factory, to constitute the recycled fiber rather
than post-consumer waste. The former, because it is easily collecta-
ble and homogenous, is very price competitive and generally re-
cycled. 40 Post-consumer paper waste, however, lacks those attrib-
utes and thus comprises only 20% of all the paper recycled. 41 The
original General Services Administration standards ordering federal
agencies to buy recycled paper were flawed in this regard, defining
recycled fibers so broadly that the paper mills were able to meet
the standards by continuing to recycle their home scrap, their
woodwaste, rather than use post-consumer waste.4 2

Oregon and New York City have attempted to overcome the ob-
stacles to the procurement of recycled materials. Oregon, exempli-
fying a moderate approach, allows its agencies to purchase recycled

37. In a 1974 survey, 12 of the 41 responding states indicated that they had either
statutory or administrative provisions for purchasing recycled paper products. RE-
SEARCH DEP'T, supra note 36, at 9-10.

38. California and Missouri, for example, statutorily encourage their agencies to
purchase recycled paper. But the agencies are not permitted to buy recycled paper if
its price exceeds the cost of virgin paper. CAL. Gov'T CODE § 14784.3 (West 1980);
Mo. ANN. STAT. § 34.032 (Vernon Supp. 1981).

39. Wis. LEGISLATIVE COUNCIL STAFF, STATE'S POLICIES AND PROGRAMS ON

RECYCLED PAPER 2 (1976).
40. L. KIRKLAND, supra note 1, at 37-39; see DEP'T OF ECOLOGY, supra note 5, at

5-18 to 5-21.
41. L. KIRKLAND, supra note 1, at 37-39.
42. LEAGUE OF WOMEN VOTERS, RECYCLE 30 (1972) [hereinafter cited as

RECYCLE].

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COLUMBIA JOURNAL OF ENVIRONMENTAL LAW

materials even though their prices exceed the lowest bid sub-
mitted, provided the recycled good's price does not exceed the
lowest bid by more than 5%.43 The Oregon statute also defines
recycled paper to be paper composed of not less than 50% second-
ary waste materials or 25% post-consumer waste. 44 New York City,
by ordinance, requires its agencies to purchase products with re-
cycled components. 45 Moreover, the paper purchased must have a
minimum of 20% post-consumer recycled fiber.4 6 Because the New
York City ordinance requires the purchase of recycled products
made from post-consumer waste, it should be more effective than
the Oregon statute in remedying the disadvantage suffered by re-
cycled goods under the present pricing system.

C. Remedy: Product Disposal Tax

One solution, more encompassing than those already identified,
is the product disposal tax. Such a tax would be similar to an excise
tax. 4 7 It would be exacted from either the manufacturer or the re-
tailer, equal to the products' prospective waste collection and dis-
posal costs. 48 This tax would insure that those whose production

43. OR. REV. STAT. § 279.739(2)(a) (1979).
44. OR. REV. STAT. § 279.731(2) (1979).
45. ENVIRONMENTAL PROTECTION ADMINISTRATION, CITY OF NEW YORK, MEM-

ORANDUM RE: PREFERENTIAL PURCHASE OF ENVIRONMENTALLY BENEFICIAL

PRODUCTS 284 (1971).

46. Id.
47. An excise tax is "[a] tax imposed on the performance of an act, the engaging

in an occupation, or the enjoyment of a privilege." BLACKS LAW DICTIONARY 506
(5th ed. 1979).

48. The legal problems that can arise with implementing a product disposal tax
scheme are identified in Soc'y of Plastics Indus., Inc. v. City of New York, 68 Misc.
2d 366, 326 N.Y.S.2d 788 (1971). Involved in that case was a New York City ordi-
nance which provided for a tax of two cents to be paid by the retailer or its whole-
saler on the sale of every "rigid or semi-rigid" plastic container. It further provided
for an allowance of one cent for each taxable container manufactured from recycled
materials. This scheme, on several grounds, was held invalid.

In so ruling, the court indicated that a properly drafted disposal tax would be con-
stitutional. It began by stating that if a municipality intends to implement a disposal
tax, there must be specific legal authority delegating such power to the municipality.
A municipal corporation does not possess inherent power to assess and levy taxes.
Further, the court pointed out that the municipality must take the categories of taxes
identified in the enabling legislation as a package, not exempting items or activities
to be taxed which are not exempted by the terms of the enabling legislation.

New York State had enacted legislation enabling its cities to tax "the sale of con-
tainers made in whole or in part of rigid or semi-rigid paper board, fibre, glass,
metal, plastic or any combination of such materials. ... But since the city ordi-
nance applied to only plastic containers, the court concluded that it was a different



19801 Recycling and Resource Recovery

and consumption decisions determine the quantity of solid waste
not only will be consciously aware of but must directly bear the en-
vironmental costs resulting from their choices. By so internalizing
the social costs on a product by product basis, economic incentives
would arise to stimulate economically efficient waste reduction and
recycling efforts by both consumers and producers. Such a frame-
work of incentives would please both the environmentalist and the
economist, and relieve the energy and environmentally conscious
consumer from having to make ad hoc guesses as to the full costs of
using any non-reuseable good. 49

A few states in attempting to control littering are utilizing the
disposal charge concept. 5° In those schemes, a fee to cover the cost
of collecting and disposing of litter is assessed from the manufac-
turer and/or retailer doing business in the state. The amount of the
fee may be based on either the quantity or value of sales, 51 the na-

tax than the one authorized by the legislature. Hence, New York City had exceeded
its authority.

The ordinance was also found unconstitutional as violate of the equal protection
clause since it only taxed plastic containers. The court found that classification to be
arbitrary, bearing no reasonable relation to the objective of the legislation. The ob-
jective of the ordinance was to promote the recycling of containers and to reduce the
cost of solid waste disposal. But the evidence showed that the ordinance would
cause an increased use of paper, metal, and glass containers which under the city's
disposal practices were more costly to dispose of and no more recyclable than plastic
containers.

Because the ordinance was arbitrary and economically detrimental to the plastics
business, it was also held violative of due process. The fact that it was revenue
producing was not sufficient to save it from a conclusion of arbitrariness. The court
stressed that revenue production was not its purpose.

The terms "rigid or semi-rigid" were also held to be vague, constituting another
ground for holding the ordinance violative of due process. But the court did state
that such an ordinance would not impose an undue burden on interstate commerce
in violation of the commerce clause.

For a thorough discussion of the product disposal tax concept, see RESOURCE RE-
COVERY, supra note 14, at 89.

49. RESOURCE RECOVERY, supra note 14, at 90.
50. E.g., Model Litter Control Act, WASH. REV. CODE ANN. § 70.93.130 (Supp.

1981); Litter Control, Recycling, and Resource Recovery Assessment, CAL. REV. &
TAX. CODE §§ 42000-42703 (West 1979); Litter Control Act, CONN. GEN. STAT. ANN.
§§ 22a-77 to 22a-59 (West Supp. 1980). The laws have been effective in reducing the
amount of litter along the highways. See C. STERN, IMPACTS OF BEVERAGE CON-
TAINER LEGISLATION ON CONNECTICUT AND A REVIEW OF THE EXPERIENCE IN
OREGON, VERMONT AND WASHINGTON STATE (1975).

51. See WASH. REV. CODE ANN. § 70.93.120 (1979) (a fee of one and one-half
hundredths of one percent of the gross sales of a Washington business, which applies
only to wholesalers and retailers; for manufacturers, the fee is that percentage of the
value of products manufactured and sold).



COLUMBIA JOURNAL OF ENVIRONMENTAL LAW

ture of the product or the number of employees. 52

Although they use the disposal charge mechanism, the Litter
Acts only partially remedy the deficiency of the current prcing sys-
tem. They merely internalize the costs of collecting and disposing
of waste. The assessed fees do not reflect all the social costs of
using non-reuseable products, such as the costs of consuming large
quantities of energy and natural resources when virgin rather *than
recycled goods are used. The excluded costs are those which make
virgin products economically preferable to recycled goods when not
reflected in the prices. By not incorporating these costs into the
fee, the Litter Acts only minimally promote reclamation.

The failure of the Litter Acts to internalize costs fully could be
remedied by a suggestion from the Environmental Protection
Agency that any item capable of being recycled or containing
recycled material be exempted from the schemes or taxed at re-
duced rates. 53 The costs of non-reclamation then would be re-
flected in the price of any commodity not capable of being recycled
or lacking recycled content.

The product disposal tax suggested by the Environmental Pro-
tection Agency would be assessed only on paper products and
nonpaper packaging materials, since these categories comprise
about 80% of the total non-food product materials in the municipal
waste stream.54 The charge would be based on the weight of the
product, since that criterion would be easy to apply and for most
products would appropriately reflect the cost of their disposal.55

The charge would equal the cost of disposing of a ton of waste, cur-
rently $26 per ton. 56 To regulate the use of light materials, such as
nonrecyclable plastic, the scheme would offer reduced rates on
goods capable of being recycled or which contain recycled materi-
als. 57 The Agency concluded that this scheme, by making the use
of virgin resources bear its full social costs, would mitigate the dis-
advantage suffered by recycled products under the present cost-
pricing system. 58

52. See CONN. GEN. STAT. ANN. § 22a-84 (West Supp. 1980).
53. RESOURCE RECOVERY, supra note 14, at 89.
54. Id. at 90.
55. Id. at 91.
56. Id. at 92.
57. Id. at 89.
58. Id. at 94-95. The EPA estimated that under its proposed scheme the amount

of recycling in glass, steel, and aluminum packaging would double the amount
recycled in 1970. Id. And paper recycling would increase from 8.5 to 10 million tons
per year. Id.



1980] Recycling and Resource Recovery

III. DISCRIMINATORY TAX POLICIES

Several state tax laws, by reducing the tax burden on virgin re-
source industries, encourage the utilization of primary instead of
secondary materials. One allows timber growers to apply a reduced
tax rate to their income from the sale of timber, to report their ex-
penses prior to the realization of the income, and to deduct their
expenses from ordinary income.59 Another statute permits the min-
ing industries to realize a flat percentage of their income and to de-
duct exploration and development costs from ordinary income
rather than from capital gains.60 These tax provisions, by lowering
the price of virgin materials, weaken incentives for reclamation.

The actual impact of these state tax laws on reclamation is un-
known. But according to one report the corresponding federal tax
laws, after which most of the state provisions are patterned, give
the virgin resource industries the equivalent of a cash grant rang-
ing from 8 to 12% of the value of the output of coal, copper and
iron ore mining and from 35 to 45% of the value of standing tim-
ber.61 In 1975, these federal tax provisions subsidized the timber

59. E.g., CAL. REV. & TAX. CODE §§ 17711, 18181, 18182 (West Supp. 1980).
60. E.g., UTAH CODE ANN. § 59-14-4(h) (1974); CAL. REV. & TAX. CODE §

17690, 17689.5 (West Supp. 1980).
61. OFFICE OF TAX ANALYSIS, supra note 4, at ii. The corresponding federal tax

provisions are I.R.C. §§ 613, 6 3 1(a), 631(b). Notwithstanding the magnitude of the
federal tax subsidies, there is no consensus as to whether recycling is harmed by
them. Compare MIDWEST RESEARCH INSTITUTE, PAPER RECYCLING, THE ART OF
THE POSSIBLE 1970-1985 (1973) (a study conducted for the American Paper Institute,
concluding that the federal tax policies substantially impair recycling) with OFFICE
OF TAX ANALYSIS, supra note 4. The Treasury Department concluded that elimina-
tion of the federal tax subsidies would increase recycling by only one to five percent.
Id. at 49. Its research indicated that primary and secondary materials are alternative
sources of inputs for production, with low substitutability; that the subsidized virgin
materials comprise only a fractional part of a finished product, and hence the re-
moval of the subsidy would only marginally add to the cost of the final product; that
world demand and supply determine the prices of raw materials, and the removal of
the subsidy would not substantially affect world prices; and finally, that the supply
of recyclables only minimally reacts to the price fluctuations of virgin materials. Id.
at i-ii. On the basis of these findings, the Department recommended that the federal
tax subsidies not be eliminated and that reciprocal tax incentives for recycled materi-
als not be provided.

The Treasury Department study is, however, susceptible to criticism. It did not
consider how removal of the federal tax subsidies would affect recycling if some or
all of the other identified legal barriers to reclamation were also removed. For exam-
ple, the effect of removing both state and federal tax subsidies was not considered,
nor how elimination of freight rate disparities, see text accompanying notes 88-104
infra, in combination with removal of these tax provisions would alter demand for
secondary goods. Furthermore, its conclusion that the demand for secondary materi-



COLUMBIA JOURNAL OF ENVIRONMENTAL LAW

industry by $260 million and mineral extractors by $3.2 billion. 62

A. Capital Gains Treatment for Timber

Several states have tax laws that allow the taxpayer who owns or
has a contract right to cut standing timber to treat the cutting of
that timber as a sale or exchange subject to capital gains treat-
ment. 63 No actual sale or exchange of the timber is necessary, and
the gain is measured by the difference between the taxpayer's ad-
justed cost basis and the fair market value of the timber on the first
day of the taxable year in which it is cut. 64 The law is intended to
encourage conservation and reforestation, and eliminate ta' dis-
crimination between taxpayers who dispose of timber by cutting
and those who sell it outright.65

The capital gains treatment reduces the cost of standing timber
in two ways. First, the tax rate on income characterized as capital
gains is lower than that on ordinary income.66 The capital gains
rate may be 50% lower than that applied to ordinary income. Be-
cause of the capital gains treatment, the price of virgin timber is
reduced, making it more economically attractive than waste paper
as the raw material source for paper production.6 7

The secondary effect of the capital gains' treatment is that current
operating costs can be deducted from the ordinary income of any of
the taxpayer's other enterprises. 6 For example, a corporation en-
gaged in both timber growing and manufacturing could deduct its
timber growing expenses from revenue generated by manufactur-
ing. The revenue resulting from the timber is taxed at the lower
capital gains rate while the timber related expenses are deducted

als is price inelastic may be untenable after Nat'l Ass'n of Recycling v. ICC, 585
F.2d 522, 535 (D.C. Cir. 1978). In that case, the court rejected a similar conclusion
by the Interstate Commerce Commission.

62. STAFF OF THE SUBCOMM. ON PRIORITIES AND ECONOMY IN GOVERN-
MENT OF THE JOINT ECONOMIC COMM. OF CONGRESS, 93RD CONG., 2D SESS., RE-
PORT ON FEDERAL SUBSIDY PROGRAMS 96 (Comm. Print 1974) [hereinafter cited as
FEDERAL SUBSIDY PROGRAM].

63. E.g., CAL. REV. & TAX. CODE §§ 17711, 18181, 18182 (West Supp. 1980).
64. Id.
65. See JOINT EcoNoMIc COMM. OF CONGRESS, 92D CONG., 2D SESS., THE Eco-

NOMICS OF FEDERAL SUBSIDY PROGRAM, A COMPENDIUM OF PAPERS SUBMITTED TO
THE JOINT ECONOMIC COMMITTEE, pt. 3 at 337 (Comm. Print 1972).

66. E.g., CAL. REV. & TAX. CODE § 18162.5 (West Supp. 1980).
67. The effect of the federal timber capital gains tax provisions, after which most

of the state timber tax schemes are patterned, is to reduce the supply price of timber
by 20%. OFFICE OF TAX ANALYSIS, supra note 4, at 32.

68. Id. at 35.



Recycling and Resource Recovery

from the higher taxed ordinary income of other enterprises. The
deduction has the effect of converting ordinary income into a capi-
tal gain which reduces the timber grower's net tax liability and ulti-
mately the supply price of timber.8 9

B. Percentage Depletion Allowance and Other Mining Deductions

A few states allow exclusion of a certain percentage of the gross
income derived from mining, oil and gas wells, and sometimes tim-
ber.70 The percentage of tax-free income depends on the character
of the resource. In California, the depletion allowance varies from
22% for oil and gas to 10% for coal. 71 Utah allows a fixed 33/3%
on all resources. 72 The purpose of the tax is to stimulate explora-
tion and discovery of natural resources. 73 The effect is to lower the
tax rate for the mining industry which in turn reduces the cost of
virgin materials.

States having the depletion allowance usually have two other tax
laws that also reduce the cost of mining virgin resources. One pro-
vides that certain development costs are deductible from gross in-
come in the year in which they are expended. 74 The other allows
an immediate deduction for exploration expenses. 75 These laws ex-
empt exploration and development costs from being characterized
as capital expenses. If classified as capital expenses, these costs
would have no beneficial tax effect until the mine reached the pro-
duction stage or was sold. These tax provisions operate as a tax
subsidy to the mining industry by reducing the present value of
taxable income. 76 The effect is to reduce tax liability in year one by
a certain dollar amount rather than, for example, in year ten when
the same amount would have less purchasing power. As a result of
these two provisions, the secondary materials industry may have a

69. The effect of the similar federal deduction is to reduce the supply price of
timber by 9%. Id. at 36.

70. E.g., UTAH CODE ANN. § 59-14-4(h) (1974); ARiz. REV. STAT. ANN. § 43-1028
(Supp. 1979).

71. CAL. REV. & TAX. CODE §§ 17686, 17687 (West Supp. 1979).
72. UTAH CODE ANN. § 59-14-4(h) (1974).
73. See Hearings on the Economics of Recycling Waste Materials Before the

Subcomm. on Fiscal Policy of the Joint Economic Comm. of Congress, 92d Cong.,
1st Sess. 56 (1971) [hereinafter cited as Hearings on Recycling].

74. E.g., CAL. REV. & TAX. CODE §§ 17690, 24836 (West Supp. 1980).
75. E.g., CAL. REV. & TAX. CODE §§ 17689.5, 24837, 24837.5 (West Supp. 1980).
76. The similar federal tax provisions had the effect in 1975 of an $860 million

subsidy to the mining industry. FEDERAL SUBSIDY PROGRAM, supra note 62, at 96.

1980]



COLUMBIA JOURNAL OF ENVIRONMENTAL LAW

tax rate which when expressed as a percentage of net income is
twice that of the virgin material extractor. 77

C. Remedy: Reclamation Tax Benefits

The competitive inequality created by these tax provisions could
be eliminated by repealing them or extending equal tax incentives
to reclamation industries. Since similar federal tax provisions have
been challenged for many years and Congress continues to believe
they are worthwhile, 78 the probability of the states repealing their
tax provisions is small. The alternative of granting equal tax bene-
fits to reclamation must therefore by considered.

There are several tax reducing measures that could be extended
to reclamation participants which would equal those now enjoyed
by the users of primary materials. One proposed scheme, called a
negative sales tax, would allow a manufacturer to take a tax deduc-
tion (or a tax credit) for purchasing or selling a recycled good. 79

The deduction or credit would be computed as a percentage of the
cost of the recycled material. The proposal is similar to the per-
centage depletion allowance for virgin materials and would allow
companies to switch from using virgin mateiials to recycled materi-
als without suffering adverse tax effects.

A second proposal, intended to encourage construction and de-
velopment of reclamation facilities and technology, advocates a
rapid write-off of depreciation allowances. As a general principle,
taxpayers are allowed to deduct from their yearly gross income a
portion of the cost of their capital goods.8 0 The earlier these deduc-
tions can be taken, the cheaper becomes the purchased capital as-
set, since a dollar not paid in taxes today is worth more than one
not paid in a few years. To spur reclamation, it has been suggested
that the usual number of years over which depreciation can be
taken should be shortened to five, allowing the taxpayer to deduct
one-fifth the cost of any reclamation asset for each of five years.81

77. Such is the effect of similar federal tax provisions. HOUSE COMM. ON WAYS

AND MEANS & SENATE COMM. ON FINANCE, 91st CONG., 1st SESs., TAX REFORM

STUDIES AND PROPOSALS (Comm. Print 1969).
78. See generally STAFF OF JOINT COMM. ON INT. REV. TAXATION, 81st CONG.,

2D SESS., LEGISLATIVE HISTORY OF DEPLETION ALLOWANCES (Comm. Print 1950).

79. COUNCIL OF STATE GOVERNMENTS, supra note 35, at 72; Hearings on
Recycling, supra note 73, at 20-40.

80. See OFFICE OF TAX ANALYSIS, supra note 4, at 110-12.
81. COUNCIL OF STATE GOVERNMENTS, supra note 35, at 73; CITIZENS ADVISORY

COMMITTEE ON ENVIRONMENTAL QUALITY, ANNUAL REPORT TO THE PRESIDENT
AND TO THE COUNCIL ON ENVIRONMENTAL QUALITY 36 (1972).



Recycling and Resource Recovery

For a taxpayer in ferrous metals manufacturing and in the 48%k tax
bracket, the five-year plan would effectively reduce the price of a
capital asset by over 13%.81

Some states have proposed investment tax credits as an
alternative to the rapid write-off scheme. 83 A 10% investment
credit, for instance, would allow the taxpayer to subtract 10% of
the price of capital assets purchased for reclamation from his or her
tax payments. This would reduce the cost of the capital asset and
yet would not prevent the taxpayer from recovering the entire pur-
chase through tax depreciation deductions.8 4 Assuming a 10% in-
vestment tax credit, the cost of an asset purchased by a ferrous
metal manufacturer in the 48% tax bracket would be reduced by
nearly 17%.85 To the extent that the use of recyclable materials is
responsive to their cost, an investment tax credit, like a rapid
write-off scheme, would increase recycling.

Of these tax proposals, the negative sales tax measure strikes
most directly at mercantile indifference to reclamation. The ex-
isting recycling facilities have the capacity to process twice their
current volume.8 6 This indicates the primary barrier to increased
recycling is insufficient demand, not supply. 87 The negative sales
tax measure directly affects the demand for recycled materials by
rewarding those who purchase them. For that reason, it would
stimulate recycling more than the other measures. The rapid write-
off and investment credit proposals, by contrast, are oriented to
increasing supply by making investment in reclamation assets less
costly. They affect the demand for recycled products only indi-
rectly by reducing the cost of processing recycled products. This is
not to say the rapid write-off and tax investment credit schemes
would not promote reclamation, but only that they would to a
lesser degree than the negative sales tax.

IV. DISCRIMINATORY FRIEGHT RATES

Intrastate freight rates for recyclable materials often are substan-
tially higher than those for equal quantities of directly competing
virgin resources. In Minnesota, for example, a shipper pays $0.51

82. OFFICE OF TAX ANALYSIS, supra note 4, at 113.
83. TASK FORCE WORKING GROUP, NEW YORK STATE GOVERNOR'S TASK FORCE

ON RESOURCE ISSUES 31 (1977); see OFFICE OF TAX ANALYSIS, supra note 4, at 104.

84. OFFICE OF TAX ANALYSIS, supra note 4, at 116.

85. Id. at 119.
86. DEP'T OF ECOLOGY, supra note 5, at 4-5.

87. See RECYCLE, supra note 42, at 9.

1980]



COLUMBIA JOURNAL OF ENVIRONMENTAL LAW

per cwt to transport paper scrap by rail, but only $0.365 per cwt to
transport pulpwood.88 The effect of such dissimilar freight rates is
to raise the cost of recyclable materials relative to virgin re-
sources89 and thus, as congressionally acknowledged, to reduce the
demand for recycled goods. 90

The once substantial reasons for the rate disparity no longer ap-
ply. Before the advent of containerization in shipping processes,
transporting scrap was difficult and expensive. 91 Jagged edges on
scrap metals injured box cars and other cargo. Movement of scrap
was burdensome because the straps holding the baled scrap to-
gether often broke, requiring a major clean-up. Additionally, com-
pressing scrap materials was not possible. 92 A larger shipping
volume was required, and so higher rates were justifiable. But
times have changed. Containerization techniques have made scrap
movement easy and eliminated the risk of harm to other cargo. 93

Similarly, technology has overcome the compression problems,
reducing the volume required for scrap shipment. 94

Since the transportation characteristics of scrap materials are no

88. Letter from Donald W. Wickstrom, Assistant Diretor, Minn. Dep't of Transp.,
to author (March 17, 1980) (on file at University of Washington School of Law); see
TASK FORCE WORKING GROUP, DEP'T OF ENVT'L CONSERVATION, STATE OF NEW

YORK, FIRST PRESENTATION OF ANALYSIS OF RESOURCE RECOVERY ISSUES 51 (1977)

(discriminatory intrastate freight rates are common among the states); Munchow,
Recycling of Solid Waste: Legal Impediments and a Program for Reform, 59
CORNELL L. REV. 440, 475 (1974) ("the pattern of freight rate discrimination against
recycled materials found at the national level is reflected at the state level.") [herein-
after cited as Munchow].

89. The costs of transporting some recycled materials, such as low grade textile
waste, from their source to a processor and then to the consumer may equal 78% of

their sales price. Hearings on H.R. 11824, H.R. 11826 & H.R. 11207 Before the
Subcomm. on Surface Transp. and Aeronautics of the House Comm. on Interstate
and Foreign Commerce, 92d Cong., 2d Sess. 1220 (1972) (statement of E. Frankel).

90. Nat'l Ass'n of Recycling v. ICC, 585 F.2d 522, 535 (D.C. Cir. 1978) (inter-
preting Section 204 of the Railroad Revitalization and Regulatory Reform Act of
1976, 45 U.S.C. § 793 (1976) (repealed 1978)). Notwithstanding the congressional
findings in the Act, there is no agreement among the existing studies as to whether
discriminatory freight rates impair the marketability of recycled products. Compare
Ex Parte No. 310, Increased Freight Rates and Changes, 1975, 349 I.C.C. 555, 578
(1975) (transportation rates affect the demand for recycled goods) with Ex Parte No.
319, Investigation of Freight Rates for the Transportation of Recyclable or Recycled
Materials, [1977] 7 ENVIR. REP. (BNA) 1543-44 (rate structures do not have a signifi-
cant impact on demand for scrap), vacated and remanded, Nat'l Ass'n of Recycling v.
ICC, 585 F.2d 522 (D.C. Cir. 1978).

91. Munchow, supra note 88, at 446.
92. Id.
93. Id.
94. Id.



Recycling and Resource Recovery

longer different from those of virgin commodities, the rate dispar-
ity should be removed. Elimination of the disparity may be accom-
plished through statutory changes, voluntary rate commission ac-
tions or lawsuits. As to the first, Florida has enacted a statute
barring all intrastate rate discrimination. 95 Also, rate commissions,
in light of the deterrent effect of the differential, may now be per-
suaded to eliminate the disparity. The Washington Utilities and
Transportation Commission, for instance, has voluntarily equalized
the rates. 96

Where the commission and legislature are unwilling to end the
disparity, a lawsuit alleging the rates are illegally arbitrary might
succeed. Most states statutorily prohibit all rates that are unjust,
unreasonable or unjustly discriminatory. 97 But actions under these
statutes have been hampered by plaintiffs' burden of proving that
the rates violate the statute. 98 Complainants have failed to satisfy
this burden because, among other things, they have lacked data
concerning the characteristics of recycled materials and the effect
of the rates on recycling. 99 Additionally, one of the factors in the
reasonableness determination is the carrier's need for revenues. 1°°

In view of the financial condition of most railroads, that factor has
almost always justified higher rates. 10 1 Prompted in part by rec-
ognition of this built-in bias, Congress enacted the Railroad
Revitalization and Regulatory Reform Act of 1976,102 which as to
interstate rates shifted the burden of proof to the railroads and, as
interpreted by National Association of Recycling v. ICC, 10 3 re-
quires that the interstate rates be equalized, unless the transporta-
tion characteristics of recyclable materials justify the rate dispar-
ity. 104 Because of the Act and the recent innovations in shipping
secondary materials, interstate rate discrimination is unlikely to

95. Florida Freight-Forwarding Act, FLA. STAT. ANN. § 323.08(6) (West Supp.
1980).

96. Conversation with K. L. Larson, Transp. Tariff Specialist, Wash. Utilities and
Transp. Comm'n (March 18, 1980).

97. E.g., IDAHO CODE § 61-301 (1976); IOWA CODE ANN. § 327D.12 (West Supp.
1980).

98. See Munchow, supra note 88, at 448.

99. Id. at 449.
100. Id.
101. Id.
102. Pub. L. No. 94-210, 90 Stat. 31 (codified in scattered sections of 49 U.S.C.

(Supp. III 1979)).
103. 585 F.2d 522, 533 (D.C. Cir. 1978).
104. Id. at 533, 534.

1980]



COLUMBIA JOURNAL OF ENVIRONMENTAL LAW

persist much longer. The intrastate rates, however, are not covered
by the Act and cannot directly benefit from its procedural man-
dates. Nevertheless, the congressional finding within the Act that
rate disparity impedes increased recycling is significant. That decla-
ration and the growing evidence on the need for reclamation
should increase the cogency of arguments that intrastate rate
disparities are illegal and unreasonable. A judicial finding that the
disparate intrastate rates are discriminatory and unjust is now plau-
sible.

V. DISCRIMINATORY ZONING LAws

Recycling and resource recovery facilities must comply with all
land use and zoning requirements. 10 5 In some states, an exception
is made for facilities which generate electricity for distribution to
utilities. 106

Because recycling and resource recovery involve garbage and
junk, they are often indiscriminately confused with junkyards and
consequently subjected to junkyard regulations. Since citizens
seem to be equally unwilling to have junk hauled into and stored
in their neighborhoods, zoning requirements have been promul-
gated that force junkyards and new reclamation facilities to inac-
cessible and remote areas. Some codes prevent scrap metal dealers
from locating even in heavily industrialized areas. 10 7 Others pro-
hibit junkyards from operating within 1000 feet from the edge of
any interstate or federal-aid primary highway unless screened from
visibility.' 06 And, some confine recycling centers to general com-
mercial zones.'10

These exclusionary zoning requirements force scrap metal pro-
cessors, recyclers, and resource recovery enterprises to locate at
uneconomical distances from markets and sources of supply. This
affects recycling in several ways. As long as the municipal collec-
tion service neglects reclamation, an environmentally conscious
discarder will have to transport his or her waste to distant facilities;

105. E.g., WASH. REV. CODE §§ 35.63, 35A.63, 36.70 (1979); SEATTLE, WASH.
CODE § 26.36.040(e) (1973).

106. E.g., Energy Facility Siting Act, WASH. REV. CODE §§ 80.50.020(9), .020(10),
.020(14) (Supp. 1980-81).

107. Gould, Restrictive Law and the Scrap Dealer, 4 PHOENIX Q. 7 (1972).
108. E.g., WASH. REV. CODE § 47.41.030 (1979); ARK. STAT. ANN. § 76-2515

(Supp. 1979). For a small junkyard of ten acres, a fence satisfying the visibility re-
quirement could cost $10,000. Seattle Post-Intelligencer, Feb. 25, 1980, at 7, col. 1.

109. E.g., SEATTLE, WASH. CODE § 26.36.040(e) (1973).



Recycling and Resource Recovery

the incentive to do so decreases as the distance to them increases.
Moreover, as noted above, the transportation rates for recycled
goods are higher than those for competitive virgin materials.
Hence, as the distance the recycled goods must travel increases,
they become less price competitive.

Additional costs are created by the requirement that facilities be
inconspicuous. To avoid being reminded of their waste, municipali-
ties have required junkyards and scrap processors to construct
eight feet high, "no-see-through" fences. 110 Reclamation centers, in
addition to having to construct these fences, must also be land-
scaped 1" and be aesthetically compatible with their environs. 112

Undoubtedly, these requirements were made for aesthetic reasons,
but their effect is to require great capital outlays and limit the
practice of stockpiling recyclables during periods of low market de-
mand.

Capital expenses also are augmented by the requirement, in at
least one state, that every reclamation center, including the corner
newspaper recycling stand, provide toilets, hand-washing facilities,
and drinking water. 113 The amenities required should bear some
reasonable relationship to the extent and nature of the activity at
the site. The statute, however, is a monolith, requiring all facilities
to meet its requirements. If strictly enforced, it could deter the
construction of reclamation centers.

The reach of these discriminatory zoning laws can be averted
only in limited situations. A governmental unit could engage in
reclamation, and, because solid waste disposal is considered a gov-
ernmental function, the government operated reclamation facility
would be exempt from all zoning ordinances. 114 Alternatively, the
government entity could contract for a private party to offer recla-
mation services to the community. The private contractor would be
considered an agent of the government and like the government
would be exempt from the zoning laws. 115

Where the zoning laws cannot be circumvented by the govern-
mental function theory, their discriminatory effect will be avoided

110. E.g., WASH. AD. CODE § 308-84-030 (1977).
111. E.g., SEATTLE, WASH. CODE § 26.36.040(e) (1973).
112. E.g., WASH. AD., CODE § 173-301-452 (1977).
113. WASH. AD. CODE § 173-301-456 (1977).
114. See 61 A.L.R.2d 970 (1958); E. McQUILLIN, MUNICIPAL CORPORATIONS §

25.15 (3d ed. 1976).
115. City of Medford v. Marinucci, 344 Mass. 50, 181 N.E.2d 584 (1962); E.

MCQUILLIN, MUNICIPAL CORPORATIONS § 25.15 (3d ed. 1976).

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COLUMBIA JOURNAL OF ENVIRONMENTAL LAW

only if they are repealed or the suggestion of the Council of State
Governments is implemented. The Council has suggested that a
law be enacted requiring a governmental body to review all zoning
laws having a substantial impact on reclamation. 116 The reviewing
body would be required to examine the costs and benefits of the
zoning ordinances in light of their impact on reclamation. The
virtue of the plan is that the reviewing body could make an in-
formed decision as to whether to prefer aesthetics or increased rec-
lamation.

VI. REGULATORY PROCEDURES IMPAIRING THE
RECLAMATION OF AUTOMOBILES

The abandoned junk car' 17 problem in this country has reached
major proportions. Every thirty minutes a car in some major city is
being abandoned,11 becoming one of ten to thirty million cars ei-
ther marring the countryside or lying in auto graveyards. 119 The
failure to recycle these autos results in aesthetic pollution, in-
creased consumption of virgin resources, and concomitant environ-
mental damage. These deleterious effects could be mitigated if the
abandoned autos were recycled. Every ton of scrap iron recycled
conserves one and one-half tons of iron ore, one ton of coke, and
one-half ton of limestone.120

Abandoned automobiles, however, are often not recycled for two
reasons. First, compliance with the regulatory procedures gov-

116. COUNCIL OF STATE GOVERNMENTS, supra note 35, at 75 (environmental im-
pact statement required on "zoning actions affecting solid waste management and
recycling"). For the drawbacks of this proposal, see note 35 supra.

117. A commonly accepted definition of "abandoned junk motor vehicle" is that
used in Washington. WASH. REV. CODE § 46.52.145 (Supp. 1980-81) defines an aban-
doned automobile as one meeting the following requirements:

(a) Left on private property for more than twenty-four hours without the permis-
sion of the person having right to the possession of the property, or a public
street or other property open to the public for purposes of vehicular travel or
parking, or upon or within the right of way of any road or highway, for
twenty-four hours or longer;

(b) Three years old, or older;
(c) Extensively damaged, such damage including but not limited to any of the

following: A broken window or windshield, missing wheels, tires, motor, or
transmission;

(d) Apparently inoperable;
(e) Without a valid, current registration plate;
(f) Having a fair market value equivalent to the value of the scrap therein, only.
118. 1 PHOENIX Q. 3 (1969).
119. Reichert, Recycling Abandoned Automobiles: Do Present Laws Act as Bottle-

necks?, 2 ENVT'L L. 105 (1971) [hereinafter cited as Reichert].
120. Id. at 106.



Recycling and Resource Recovery

erning their purchase is too costly. Secondly, the laws prohibiting
abandonment have been ineffectual.

A. Costly Regulatory Procedures

The laws pertaining to the removal of abandoned autos on public
property are extremely cumbersome. They generally require the
car to be picked up by the police and towed to an impounding
yard. 121 The vehicle must be held there for a statutory period. The
police must then sell the car at public auction,' 2 2 after first adver-
tising the sale in a local newspaper and searching the records of
the register to determine and give notice of the auction to the
owner and any lienholder. 123 If the owner does not respond, a pur-
chaser at the auction acquires legal ownership upon getting a cer-
tificate of title and paying a transfer fee. 124

These procedures are responsible for as much as one-half of the
expenses of recycling an abandoned car. 12 The processor must go
to the courthouse with the old certificate of title and pay a transfer
fee of one or two dollars. 126 This is costly primarily in terms of the
time consumed to make the transaction. The recycler must also pay
for the costs of the public sale and notice to the owner, as well as
the costs of towing the car to the impoundment area and then to
the processor's location. 127 These costs of towing, storage and pub-
lic sale often exceed the value of the recyclable scrap contained in
the auto. 128 When the price of scrap steel is low, abandoned vehi-
cles are not purchased to be recycled.1 29

The costs of the procedures could be reduced without harming
the interests they protect. A two-step process could replace the ex-

121. E.g., WASH. REV. CODE § 46.52.111 (1979); see also COMMONWEALTH OF
KENTUCKY LEGISLATIVE RESEARCH COMMISSION, SOLID WASTE: THE THIRD
POLLUTANT 50 (1973) (summary of state laws on automobile abandonment) [herein-
after cited as COMMONWEALTH OF KENTUCKY].

122. E.g., WASH. REv. CODE § 46.52.112 (1979); see also COMMONWEALTH OF
KENTUCKY, supra note 121, at 50.

123. D. REICHERT, INSTITUTE OF SCRAP IRON AND STEEL, INC. SPECIAL RE-
PORT: THE ABANDONED CAR CRISIS (1972), quoted in COMMONWEALTH OF
KENTUCKY, supra note 121, at 50. See also WASH. REV. CODE § 46.52.11 (1979).

124. Reichert, supra note 119, at 110.
125. THOMAS G. HOGAN & ASSOCIATES, INC., AUTO HULK DISPOSAL PROJECT IN

GRANT COUNTY, WASHINGTON 20 (1974).

126. Reichert, supra note 119, at 110.
127. Id.
128. Id. at 109, 112.
129. Id.

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COLUMBIA JOURNAL OF ENVIRONMENTAL LAW

isting title laws.' 30 Title could be said to pass upon the issuance of
a bill of sale from the selling governmental authority to the
recycler. The recycler, in turn, could be required to mail a copy of
the bill of sale to the department of motor vehicles. This process
would improve the profit margin in auto recycling by reducing the
costs of the current title transfer laws. It would also clear the regis-
ter's files of titles to cars no longer in service and prevent any im-
proper use of the title-the primary purposes for title require-
ments. 1

3 1

The costs of the due process procedures and the public sale also
could be ameliorated. The expense of trying to locate the owner
and lienholder is essentially unnecessary for they seldom respond
to the notice. 132 The lack of response is very often reflective of the
value of the car. Most abandoned vehicles have no significant
value; therefore, eliminating the notice requirement would not
constitute a substantial taking of property without due process.
Acknowledging this, the Council of State Governments has pro-
posed that an exception to the notice requirements be made when
the vehicle is of a certain age or less than a particular value. 133

Likewise, vehicles of minimal value could be exempted from the
very expensive towing and public sale procedures.' 3 4 The aban-
doned car could be directly towed from the street to a licensed
scrap processor willing to purchase it. 1 35 By exempting low value

130. This was suggested in COUNCIL OF STATE GOVERNMENTS, supra note 35, at
60, as follows:

Section 9. [Disposal of Abandoned Vehicles.]
(a) Disposal of impounded vehicles having a retail value of $100 or less and age

of 8 years or more shall be by contract or auction to persons licensed under
the provisions of this Act. Abandoned vehicles with a retail value exceeding
$100 and age of less than 8 model years shall be disposed of by public sale.

(b) Title to vehicles disposed of under the provisions of subsection (a) of this
section shall be conveyed by a bill of sale issued by the state or local author-
ity having jurisdiction on a form approved by the department. A copy of the
bill of sale shall be forwarded to the department by the purchaser within 10
days.

(c) Any subsequent sale of such vehicles is prohibited, except to a person li-
censed under this Act, without a certificate of title issued by the department
under [the vehicle code of this State].

131. See Reichert, supra note 119, at 111.
132. Id. at 112 (citing NIPCC SUB-COUNCIL, JUNK CAR DISPOSAL 8, 34 (1976)).
133. COUNCIL OF STATE GOVERNMENTS, supra note 35, at 59 ("notice shall not

be required if the retail value of an abandoned vehicle is $100 or less and its age is 8
or more model years"); see also WASH. REV. CODE § 46.52.116 (1979).

134. COUNCIL OF STATE GOVERNMENTS, supra note 35, at 60.
135. COMMONWEALTH OF KENTUCKY, supra note 121, at 49-52.



Recycling and Resource Recovery

autos from these regulatory procedures, the costs of recycling them
would decrease. In addition, if the owner and any lienholder were
entitled within a fixed period of time to submit a claim to the city
for the car, their due process rights would be protected.

B. Nonenforcement of Automobile Abandonment Laws

A fundamental obstacle to automobile recycling is abandonment.
The abandonment of a car triggers the costly title transfer, im-
poundment, notice, and public sale procedures discussed above. If
vehicles were hauled to the scrap processor rather than abandoned
on a street or in a field, these costly procedures would be avoided.

Like the landfill operator, the auto discarder fears no retribution
for violating the law. The laws possibly violated by abandonment
include those making abandonment a crime and assessing a fine,136

others preventing auto storage in areas not zoned as junkyards,1 3 7

or those fining anyone for storing cars without an auto wrecker's li-
cense. 138 These laws, however, have not deterred abandonment
primarily because police departments and county health boards
lack sufficient staff and resources to implement them.139 Locating
and prosecuting the offender is time consuming and expensive.
And, too often, even if apprehended, the one who abandons a car
is unable to pay the fine. 140

Several remedial suggestions have been made. The simplest one
proposes heavier fines for abandonment.14 1 An alternative sugges-
tion would make the owner of record presumptively liable for all
costs of removal, storage, and disposal.14 2 As to the latter sugges-
tion, the difficulty of tracing the owner undermines its effective-
ness. Most abandoned cars give no indication of who is the owner
of record. Moreover, neither proposal will increase deterrence un-
til the regulatory bodies are given the necessary funds to seek and
prosecute the offender. 43

136. E.g., N.Y. VEH. & TRAF. LAW § 1224(7) (McKinney Supp. 1979).
137. See Reichert, supra note 119, at 114.
138. E.g., N.H. REV. STAT. ANN. § 267-A:3 (1965) (owners permitting two junked

cars on their property need a junkyard license).
139. Reichert, supra note 119, at 113.
140. Id.
141. ENVIRONMENTAL PROTECTION AGENCY, SECOND REPORT TO CONGRESS ON

RESOURCE RECOVERY AND SOURCE REDUCTION 72 (1974) [hereinafter cited as EPA

SECOND REPORT].
142. See WASH. REV. CODE § 46.52.112 (1979).
143. See EPA SECOND REPORT, supra note 141, at 72.

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COLUMBIA JOURNAL OF ENVIRONMENTAL LAW

A third possibility is either to subsidize the processor who re-
trieves abandoned cars or to pay a bounty to those who deposit
their cars with the processor. 144 The primary problem with this
proposal is that cars are often abandoned because they no longer
run and the discarder lacks the money to remove or repair them.
Unless the bounty exceeds the cost of towing the car to the
processor, neither the discarder nor the processor will remove it.
In this age of fiscal conservation, a proposal to award bounties and
subsidies of the size necessary to induce removal is not likely to
meet with legislative approval.

A final suggestion commonly made is to implement "returnable
bottle"-type legislation for automobiles. 145 It would require new
car buyers to pay a charge, say $35, repayable to whomever even-
tually returns the vehicle for recycling. Because of the difficulty of
prosecuting anyone for abandonment, this scheme, encouraging
voluntary compliance with the laws, may be the only practical solu-
tion. The major criticism of it concerns its income redistribution ef-
fects. 146 The new car buyer, typically a more affluent member of
society, pays the charge while the person who returns a vehicle for
recycling, someone traditionally with less money, would receive it.
But as the new car buyer generally is a more profligate consumer
and hence more responsible for pollution and decreasing resources
than the person returning a car, such a redistribution may actually
be equitable. Even if it is not, the benefits of increased auto re-
cycling ought to outweigh any negative redistribution effects of the
scheme.

VII. NONENFORCEMENT OF LANDFILL LAWS

In a recent survey of reclamation professionals, 75% felt the fac-
tors most definitely contributing to the process of reclamation were
the environmental restrictions now placed on landfill setting and
design. 147 They stated that these regulatory pressures, if enforced,

144. Id. at 73; see also H.R. 15860, 91st Cong., 1st Sess. (1970).
145. EPA SECOND REPORT, supra note 141, at 73. See also W. RODGERS, ENvI-

RONMENTAL LAW 681 (1977) [hereinafter cited as W. RODGERS].
146. W. RODGERS, supra note 145, at 681. Other criticisms are that the deterrent

effect of the scheme is too speculative and that the scheme would be regressive in
effect by requiring rich and poor alike to pay a deposit with each new car purchase.
id.

147. ARGONNE NATIONAL LABORATORIES, DEFINITION AND ANALYSIS OF THE
BARRIERS OF THE IMPLEMENTATION OF URBAN ENERGY RECOVERY SYSTEMS 6

(1979) [hereinafter cited as ARGONNE NATIONAL LABORATORIES]. The following are



Recycling and Resource Recovery

could eventually eliminate landfilling by making it too costly. 148

Full compliance with the environmental standards would cost
landfill operators $1.6 billion (in 1974 dollars) per year. 149

Enforcement of the new restrictions, however, is virtually nonex-
istent. Nearly two-thirds of all land disposal sites do not meet envi-
ronmental standards.' 50 Only one landfill area in the state of
Washington in 1977 met both the state and federal standards. 15 ' In
Spokane County, Washington, there has only been one prosecution
for landfill violations, though it is conceded that not a single site in
the county fully complies with the sanitary codes. 152

While there are a variety of enforcement sanctions, none have
proven effectual. They include revocation or suspension of
operating permits, misdemeanor provisions, probationary periods
of operation, forfeiture of bonds for non-compliance, and civil pen-
alties, including injunctions and damages for nuisance actions.' 53

The primary reason for the inefficacy of these sanctions is that they
are seldom employed.1 5 4 The agencies which possess authority to
implement these sanctions, usually county health boards, are
under-staffed and lack the resources to institute punitive actions.
Because they lack the staff, they typically become aware of viola-
tions only if a citizen files a complaint' 55 and often respond only by

representative requirements: a land disposal site must be operated so to provide ade-
quate protection to ground and surface waters used as drinking water supplies; must
be designed and operated in an aesthetically acceptable manner; must control de-
composition gases to avoid posing a hazard to occupants of adjacent property; must
maintain conditions "unfavorable" to the breeding of vectors; and must daily apply
cover material to minimize fire hazards, infiltration or precipitation, odors and blow-
ing litter; control gas venting and vectors; discourage scavanging; and provide a
pleasing appearance. See WASH. AD. CODE §§ 173-301-182 to 173-301-304 (1977); 40
C.F.R. §§ 241.204-1, .205-3, .207-1, .208-1, .209-1 (1981).

148. ARGONNE NATIONAL LABORATORIES, supra note 147, at 6.
149. OFFICE OF TAX ANALYSIS, supra note 4, at 79. There it is reported that

enforcing the environmental standards would increase current disposal costs by 25%.
150. Id.
151. DEP'T OF ECOLOGY, supra note 5, at 6-8.
152. SPOKANE COUNTY, supra note 21, at 31, 58; see Solid Waste Management in

Louisiana: A Survey of Current Regulatory Response, 49 TUL. L. REV. 439, 452
(1975) (reporting there has only been one criminal prosecution for landfill violations
in Louisiana) [hereinafter cited as Solid Waste Management in Louisiana ].

153. See generally NATIONAL ASSOCIATION OF COUNTIES RESEARCH FOUNDA-
TION, DIGEST OF SELECTED LOCAL SOLID WASTE MANAGEMENT ORDINANCES
(1972).

154. OHio LEGISLATIVE SERVICE COMMISSION, SOLID WASTE DISPOSAL 29
(1970) [hereinafter cited as OHIo LEGISLATIVE SERVICE COMMISSION].

155. Id.

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COLUMBIA JOURNAL OF ENVIRONMENTAL LAW

sending the landfill operator a letter notifying him or her of the
complaint. 156

Enforcement is also substantially limited by the ease with which
illegal practices may be exempted from the environmental stan-
dards. Variances are readily given to landfill operators. Minnesota,
for example, grants a variance if its Pollution C ontrol Agency finds
"that by reason of exceptional circumstances strict conformity with
any provisions of the regulations . . . would cause undue hardship,
would be unreasonable, impractical, or not feasible under the cir-
cumstances .... .157 Wisconsin will grant an exemption from com-
pliance after weighing "such factors as population of the area being
served, amounts of waste generated, location of the disposal opera-
tion, nature of wastes, seasonal character of "the operation, and
other significant factors."'158 Such provisions have the effect of
condoning almost any illegal operation when it is the only one
serving the area.

Procedural and institutional loopholes also prevent effective en-
forcement of the landfill codes. Local district attorneys are reluc-
tant to prosecute either their constituency or the political entities
they serve.' 59 This is particularly prevalent in small communities
where only one landfill exists.' 60

Not only are the available sanctions not used, but many of them,
even if enforced, are incapable of remedying the violations. The
criminal fines, 1 1 usually less than $100, are inadequate to deter
violation. 162 When assessed, they simply become another cost of
doing business. Landfill operators also do not fear injunctions for
they are not easily obtained due to the presence of minimal crimi-
nal penalties and the equities in each case. By definition, in-
junctive relief is available only when the remedy at law fails.
Courts have denied injunctions, finding that the criminal fine, a
remedy at law, will suffice to correct the harm. 163 Even when the
criminal penalty is held insufficient to cure the violation, the court

156. Solid Waste Management in Louisiana, supra note 152, at 452.
157. MINN. SOLID WASTE DISPOSAL REG. § SW-1 (1981).
158. WiS. AD. CODE § NR 151.06 (1973); see also OHIO LEGISLATIVE SERVICE

COMMISSION, supra note 154, at 29.
159. Solid Waste Management in Louisiana, supra note 152, at 452.
160. Id.
161. E.g., WASH. REV. CODE § 70.05.120 (1979) ($25-$100 and/or up to 90 days of

jail).
162. Solid Waste Management in Louisiana, supra note 152, at 452.
163. Id. at 456.



Recycling and Resource Recovery

weighs the equities involved before granting an injunction. In a
small community where only one landfill operates and it is too fi-
nancially weak to make any improvements, issuing an injunction
enjoining the operation of the landfill might result in depriving the
community of waste disposal services. The alternative of no waste
disposal has caused courts to deny injunctive relief.164 Moreover,
should the court rule the landfill must be closed, statutes often al-
low the illegal site to operate until another can be found. 1' Such
extensions have been known to become routine., 6

The only way to enforce the environmental codes is to allocate
more money for that goal. It has often been suggested that the im-
position of heavier penalties would remedy the enforcement prob-
lem.'8 7 But, if there is not sufficient staff to detect and prosecute
the offenders, the threat of heavier fines will not deter landfill vio-
lations. Similarly, where the community's sole landfill lacks the fi-
nancial ability to comply with the pollution laws, monetary assis-
tance either in the form of grants or loans will be necessary. Of the
reasons given for nonenforcement, only the reluctance of local
prosecuting attorneys to press for penalties can be remedied with-
out explicitly allocating more money. That conflict of interest could
be alleviated by requiring that all landfill complaints be referred to
the state attorney general's office and by delegating prosecutorial
responsibility to it.'"

VIII. LABELLING IMPEDIMENTS

Since natural resources have been historically cheap, Americans
have become accustomed to having "new" products. Purchasing a
"used" product was second-best, and the word "used" has acquired
a connotation of inferiority. Some individuals mistakenly believe
that recycled products are synonymous with "second hand," "sal-
vaged," and "second class" goods, and thus eschew their pur-
chase.169 The recycling industry is trying to transform this nega-
tive public attitude toward reprocessed and reused materials into a
more positive one by labelling such materials "recycled.' 170 Al-

164. Id.
165. LEGISLATIVE COUNCIL STAFF, WISCONSIN'S SOLID WASTE MANAGEMENT

PoLIcy 5 (1976).
166. id.
167. Solid Waste Management in Louisiana, supra note 152, at 452.
168. Id.
169. L. KIRKLAND, supra note 1, at 55.
170. Munchow, supra note 88, at 471.

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COLUMBIA JOURNAL OF ENVIRONMENTAL LAW

though recycled goods are as good as, if not better than, "new"
goods, 171 the negative perception has impaired market acceptance
of recycled goods.

Feeding this negative feeling are the state laws requiring
recycled products to be pejoratively labelled as "reused" or
"'reprocessed."172  In Georgia, for example, all reconditioned
lubricating oils must be labelled "reprocessed or re-refined, "173 all
remanufactured items as "remanufactured," 174 and any rebuilt
goods as "rebuilt.- 1 75 The ostensible purpose of such laws is to in-
fbrm the consumer. The effect, however, is to reduce market ac-
ceptance of recycled goods.

The labelling requirements could be changed in a way to protect
the consumer without remaining a barrier to the marketability of
recycled goods. One approach would be simply to change
"reprocessed" and "reconditioned" terms to "recycled." 176 Given
all the recycling rhetoric of the seventies, the latter term should
have less of a negative connotation. Alternatively, the current one
or two word labels could be replaced with a label stating what per-
centage of the product is composed of recycled material.1 77 Such
an approach could be easily implemented %Nith textiles and paper,
where the percentage of recycled fibers is easily ascertainable.
However, the most far-reaching and salutary approach for recycling
would be the elimination of such labelling requirements. Several
studies indicate that existing recycled goods are as good as their

171. 123 CONG. REC. E4967 (daily ed. 1977) (statement of Congressman Jones
"that rerefined oil works as well as, if not better than, conventional oil"); L.
KIRKLAND, supra note 1, at 38 (recycled paper can be as good as virgin paper). Prob-
lems will arise if wastes are recycled without regard to their content. For instance,
converting insecticide containers into paper cups or sewage into fertilizer may create
severe health risks. Sewage, when not properly treated, may be carcinogenic. See
124 CONG. REC. 7679 (1978) (statement of H. Eschwege). To avoid such dangers, leg-
islative regulation of the use of possible contaminates is necessary. Munchow, supra
note 88, at 469-71.

172. The same labelling discrimination exists in some federal laws. Under the
Wool Products Labelling Act of 1939, 15 U.S.C. § 68-68j (1976), recycled fibers
must be labelled either "reused" or "reprocessed."

173. GA. CODE § 73-222 (Supp. 1980); see Miss. CODE AN. § 75-55-13 (Supp.
1979) (must be labelled as recleaned, reclaimed, refined, or used); TEX. CIv. CODE
ANN. tit. 23, § 8606 (Vernon Supp. 1980) (labelled as reconditioned).

174. GA. CODE § 96-701 (1976).
175. GA. CODE § 96-702 (1976); see CAL. PENAL CODE § 537(f) (West 1979) (re-

built storage batteries must be labelled "Rebuilt").
176. Munchow, supra note 88, at 472.
177. Id.



Recycling and Resource Recovery

virgin counterparts. 178 The consumer thus would not be harmed by
the absence of a label identifying the product as re-used. To assure
no harm to the consumer, standards requiring a certain perform-
ance level for all categories of goods could be promulgated, and all
recycled goods could be required to meet them.

IX. CONCLUSION

Although state and municipal governments have enacted increas-
ingly bold legislation intended to spur reclamation, the legal im-
pediments identified in this article remain. These laws detrimen-
tally affecting reclamation are to varying degrees anachronistic.
They were conceived when this country had seemingly inexhaust-
able resources. They are now, in light of the twin problems of solid
waste disposal and dwindling virgin resources, inappropriate. Their
reform or repeal would make reclamation economically more at-
tractive, and making reclamation economically feasible is a neces-
sary step in remedying this nation's resources problem.

178. Sge note 171 supra. This proposal would defeat its purpose should the pub-
lic somneday prefer recycled goods to virgin products.

1980]