California’s beverage bottle recycling program is on the verge of bankruptcy thanks to the state’s massive budget deficit. Two main factors have created a perfect storm, so-to-speak, and the recycling program is facing some serious cutbacks. First, the state borrowed hundreds of millions of dollars from the program in an attempt to balance the budget. Second, the extended downturn in the economy is leading more people to turn to beverage container recycling to augment their income.

This means that the recycling program, which is already short on cash, is paying out more money as people claim their deposits. Obviously, something has to give and unfortunately it is the employees at these recycling centers that are facing the crunch. Many of these employees just happen to be at-risk youth who were taking advantage of this green job opportunity to help provide them with a pathway out of poverty.

This whole situation is already quite messy and it is sure to get even more so as recycling centers continue to close down and California residents are forced to go farther to get their products recycled.

What I find most unfortunate about this whole situation is that it likely could have been avoided had California Gov. Schwarzenegger and the State Legislature been able to come to an agreement about continued funding for the program instead of playing politics.

The Legislature attempted to increase the deposit rate for certain beverage containers to keep the program afloat. However, Gov. Schwarzenegger vetoed the proposed law and sent a stern message to lawmakers.

In an L.A. Times report about this issue, Shane Goldmacher provides some valuable background behind Gov. Schwarzenegger’s veto message: “Schwarzenegger also demanded in his veto message that legislators pass a law forbidding future raids of the deposit fund. It was Schwarzenegger himself who first proposed taking $100 million from the fund in early 2009.” 

Unfortunately all of this political play is sending more people to the unemployment line.

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