AN ACT CONCERNING THE REDEMPTION RATE AND REFUND VALUE OF BEVERAGE CONTAINERS.

Senate
SB516 / File No. 701 1

General Assembly File No. 701
February Session, 2026 Senate Bill No. 516

Senate, April 20, 2026

The Committee on Finance, Revenue and Bonding reported
through SEN. FONFARA of the 1st Dist., Chairperson of the
Committee on the part of the Senate, that the bill ought to pass.

AN ACT CONCERNING THE REDEMPTION RATE AND REFUND
VALUE OF BEVERAGE CONTAINERS.
Be it enacted by the Senate and House of Representatives in General
Assembly convened:

Section 1. (Effective from passage) (a) (1) To evaluate the effectiveness 1
of the antifraud and enforcement measures enacted pursuant to public 2
act 26 -2, the Commissioner of Revenue Services shall, not later than 3
February 15, 2027, determine for calendar year 2026 the state -wide 4
average redemption rate of all beverage containers, as defined in section 5
22a-243 of the general statutes, and the redemption rate of beverage 6
containers for each deposit initiator. If the commissioner determines 7
that the state -wide redemption rate or the redemption rate of any 8
deposit initiator was more than one hundred per cent for calendar year 9
2026, notwithstanding the provisions of subdivision (1) of subsection (a) 10
of section 22a -244 of the general statutes, the refund value under said 11
subdivision shall be reduced to five cents, effective July 1, 2027, or as 12
soon as practicable thereafter for the beverage industry to implement 13
the change. 14
SB516 File No. 701

SB516 / File No. 701 2

(2) The refund value shall remain at five cents until such time as the 15
commissioner certifies, based on irrefutable evidence, that one hundred 16
per cent of the beverage containers redeemed in this state are beverage 17
containers originally sold in this state. 18
(b) Each deposit initiator that submitted a quarterly report pursuant 19
to section 22a -245a of the general statutes that properly reported a 20
negative balance in such deposit initiator's special account during the 21
fiscal years ending June 30, 2025, and June 30, 2026, where such negative 22
balance resulted from the overredemption of beverage containers and 23
the payment of handling fees associated therewith, may apply to the 24
Secretary of the Office of Policy and Management, in the form and 25
manner prescribed by the secretary, for full reimbursement of the 26
financial loss to the deposit initiator as a result of the overredemption of 27
beverage containers. 28
(c) Nothing in this section shall affect the rate of the handling fee set 29
forth in subsection (d) of section 22a-245 of the general statutes. 30
This act shall take effect as follows and shall amend the following
sections:

Section 1 from passage New section

FIN Joint Favorable

SB516 File No. 701

SB516 / File No. 701 3

The following Fiscal Impact Statement and Bill Analysis are prepared for the benefit of the members of
the General Assembly, solely for purposes of information, summarization and explanation and do not
represent the intent of the General Assembly or either chamber thereof for any purpose. In general,
fiscal impacts are based upon a variety of informational sources, including the analyst’s professional
knowledge. Whenever applicable, agency data is consulted as part of the analysis, however final
products do not necessarily reflect an assessment from any specific department.

OFA Fiscal Note

State Impact:
Agency Affected Fund-Effect FY 27 $ FY 28 $
Policy & Mgmt., Off. Uncertain -
Potential Cost
See Below See Below
Revenue Serv., Dept. GF - Revenue
Impact
None Minimal
Note: GF=General Fund
Municipal Impact: None
Explanation
The bill, which requires the refund value of beverage containers be
reduced from 10 cents to five cents under certain circumstances, results
in (1) a minimal net revenue impact to the General Fund beginning in
FY 28, and (2) a potential cost to the state.
Revenue Impact
Based on currently available data, the redemption rate threshold
established under the bill for calendar year 2026 would be triggered,
thus reducing the bottle deposit amount from 10 cents to five beginning
in FY 28, or after when practicable for the bever age industry to
implement. It is anticipated this would reduce redemption rates below
60% thus increasing the General Fund escheat rate from 5% to 45%.1 The
impact of (1) the decrease in the bottle deposit amount and (2) the
increase in the escheat rate results in a minimal net revenue impact to
the General Fund until such time that the DRS commissioner certifies,
based on irrefutable evidence, that 100% of the beverage containers

1 Prior to the increase in the deposit amount from five cents to 10 cents the quarterly
redemption rate was approximately 50%.
SB516 File No. 701

SB516 / File No. 701 4

redeemed in Connecticut were originally sold here.
Potential Cost Impact
The bill allows deposit initiators that were over -redeemed in FY 25
and FY 26 to apply to the Office of Policy and Management for full
reimbursement for financial losses. This results in a potential cost to the
state.2 It is uncertain what funding, if any, would be available for such
reimbursement.3
The Out Years
The annualized ongoing fiscal impact identified above would
continue into the future subject to statewide and individual redemption
rates.

2 As of December 2025, the cumulative negative balance for deposit initiators whose
total withdrawals exceeded deposits was approximately $19.2 million.
3 Section 404 of PA 25 -168, AAC The State Budget For The Biennium Ending June 30,
2027, And Making Appropriations Therefor, And Provisions Related To Revenue And
Other Items Implementing The State Budget, provided $1.75 million in grants to over-
redeemed de posit initiators. As of March 31, 2026, approximately $30,500 remains
available.
SB516 File No. 701

SB516 / File No. 701 5

OLR Bill Analysis
SB 516

AN ACT CONCERNING THE REDEMPTION RATE AND REFUND
VALUE OF BEVERAGE CONTAINERS.

SUMMARY
This bill makes several changes related to the state’s beverage
container redemption law (“bottle bill”). It requires the Department of
Revenue Services (DRS) commissioner, by February 15, 2027, to
determine the 2026 (1) statewide average beverage containers
redemption rate and (2) beverage containers redemption rate for each
deposit initiator . (The bill s pecifies that this is to evaluate the
effectiveness of the antifraud and enforcement measures enacted under
PA 26-2. It does not specifically define “deposit initiator,” but under the
bottle bil l, a deposit initiator is generally the first entity to collect a
deposit on a beverage container.)
If the DRS commissioner determines that either the statewide
redemption rate or any deposit initiator’s redemption rate was more
than 100%, the bill requires the refund value of beverage containers to
be reduced from 10 cents to 5 cents. This change applies regardless of
existing law and is effective July 1, 2027, or as soon as practicable after
that date for the beverage industry to implement the change.
Under the bill, if the refund value is reduced to five cents, it must
remain so until the DRS commissioner certifies, based on irrefutable
evidence, that 100% of the beverage containers redeemed in Connecticut
are beverage containers originally sold in the state. (“Irrefutable”
commonly means incapable of being disproved or countered effectively
(Black’s Law Dictionary, 12th ed.).)
Additionally, the bill allows certain deposit initiators to apply for full
reimbursement of the ir financial loss es resulting from the over -
SB516 File No. 701

SB516 / File No. 701 6

redemption of beverage containers . ( In the context of the bottle bill,
over-redemption is generally considered to be the illegal or improper
redemption of containers .) Existing law requires deposit initiators to
deposit the refund value of containers they sell into special interest -
bearing bank accounts and use the funds in these accounts to reimburse
dealers and redemption centers for the refunds on redeemed containers.
If a deposit initiator does not have enough money in its account in any
quarter to pay these refunds, it must subtract the deficiency from its next
quarterly remittance of unclaimed bottle deposits until the deficiency is
completely subtracted. The bill allows deposit initiators that submit a
quarterly report showing a negative balance in their special accounts
during FYs 25 and 26 because of the over -redemption of beverage
containers (and the payment of handling fees associated with them) to
apply to the Office of Policy and Management secretary, in a way he
prescribes, for full reimbursement.
Lastly, the bill specifies that it does not affect the existing handling
fee rate.
EFFECTIVE DATE: Upon passage
BACKGROUND
Bottle Bill & Handling Fee Rate
The state’s bottle bill generally requires a deposit to be charged on
each beverage container at the time of purchase, which is then refunded
to the consumer when it is redeemed at a retailer or redemption center.
By law, distributors must pay dealers and redemption center
operators, in addition to the container’s refund value, a handling fee of
2.5 cents for each container of beer, hard seltzer, hard cider, or other malt
beverage, and 3.5 cents for each container of mineral water, soda water,
and similar carbonated soft drinks or other noncarbonated beverage
returned for redemption.
Related Act
PA 26-2 also makes several changes to the bottle bill, including (1)
reducing the handling fee distributors pay to certain redemption centers
SB516 File No. 701

SB516 / File No. 701 7

by up to one cent if the redemption center does not use certain scanning
technology to redeem beverage containers and (2) authorizing a rebate
to certain deposit initiators who reported a negative balance in their
special account for the quarter ending June 30, 2026.
Related Bill
sSB 457 (File 479), favorably reported by the Environment
Committee, also makes various modifications to the bottle bill,
including banning (1) dealers from collecting or charging a refund value
on beverage containers not purchased in Connecticut and (2) dealers
and redemption centers from misrepresenting the size, brand, or
quantity of beverage containers given to distributors.
COMMITTEE ACTION
Finance, Revenue and Bonding Committee
Joint Favorable
Yea 38 Nay 15 (03/31/2026)