Oregon’s Extended Producer Responsibility program for packaging and paper products is intended to shift recycling costs to producers and encourage a circular economy, but its rollout has raised concerns over complexity, transparency, fee-setting, legal challenges, and whether the system will actually improve recycling efficiency.
Oregon’s Extended Producer Responsibility Framework
Extended Producer Responsibility, or EPR, policies are designed to reduce waste, promote recycling and reuse, and shift waste management costs back to producers.
Oregon adopted its comprehensive EPR framework through the Plastic Pollution and Recycling Modernization Act in August 2021. The law made Oregon the first U.S. state to adopt a comprehensive EPR framework for packaging and paper products.
The system is built around a Producer Responsibility Organization, or PRO. A PRO is a non-governmental organization made up of representatives from producers whose products are covered by the EPR policy.
The PRO’s role includes:
- Setting rates and fees
- Collecting fees from producers and distributors
- Using recycled content criteria
- Funding recycling and processing improvements
- Supporting education and marketing
- Developing responsible end markets for covered products
The goal is to keep covered products moving from production to recycling and back into production through a circular economy.
Circular Action Alliance’s Role
The Circular Action Alliance, or CAA, was approved as Oregon’s sole EPR program PRO in 2023.
CAA is also the state-approved PRO in:
- California
- Colorado
- Maryland
- Minnesota
- Oregon
- Washington
CAA developed and revised Oregon’s EPR program plan, including fee structures, collection system improvements, and recycling targets.
Oregon’s EPR program requirements were finalized in 2024, though rules continue to change.
Beginning in 2025, distributors and manufacturers were required to join the PRO and begin paying fees based on the type and recyclability of their packaging.
CAA expects to collect roughly $190 million in fees in the first year, growing to nearly $300 million by the third year of the program.
Some revenue is remitted to the state for administration, but most is spent directly by CAA to implement the Plastic Pollution and Recycling Modernization Act.
Fees on 60 Materials
Oregon’s EPR program applies fees to 60 different materials, including:
- Paper
- Glass
- Aluminum
- Steel
- Plastic
- Wood products
Rates range from $0.05 per pound for paper products to $1.38 per pound for rigid plastic foam containers and cushioning.
Most producers of covered products must join the PRO and pay the fees.
Smaller producers may qualify for simplified treatment:
- Producers with less than $10 million in gross revenue, or those selling less than 5 metric tons of covered products per year, may choose a flat fee of $1,200 to $5,800, based on weighted tons of material.
- Producers with less than $5 million in gross annual revenue, or less than 1 metric ton of covered products per year, are exempt.
Fees may also be subject to discounts under a separate system of bonuses and incentives.
Complexity and Lack of Transparency
The source argues that Oregon’s system is neither simple nor transparent.
The Department of Environmental Quality-approved program plan from CAA is nearly 400 pages, not including confidential portions.
CAA publicizes its rates, but the methodology used to determine the rates is kept confidential. Oregon Administrative Rules treat the methodology for determining producer fees as proprietary and confidential.
The source contrasts this with a simpler approach such as a raw plastic excise tax, which it argues could more directly incentivize recycled material use, reduce waste, and fund local recycling programs.
Instead, Oregon’s program uses multiple rates, confidential methodology, and a revenue-target structure.
CAA is required to differentiate fees by type and form of material, make fees proportional to handling costs, graduate fees to encourage production changes, and calibrate the system to fund the PRO’s obligations under the law.
The source argues that this means CAA begins with a state budget or revenue target and works backward based on handling costs and the amount of material shipped into Oregon. According to the source, this does not reflect the usual economic justification for excise taxes, which would focus on relative harms to society.
Existing Recycling Law Adds More Complexity
The Plastic Pollution and Recycling Modernization Act adds to Oregon’s existing solid waste recovery laws and to eight separate responsibility programs for other products.
The law covers detailed questions such as:
- How to determine who counts as the “producer” of a covered product
- PRO fee structure requirements
- Recycling targets
- Collection system improvements
- Diversity, Equity, and Inclusion mandates for the recycling industry
Small definitional disputes can affect program obligations. For example, CAA and Oregon’s Department of Environmental Quality have disagreed over whether garbage bags should count as “packaging.”
Including garbage bags would increase the amount of additional packaging that must be recycled by about 5,000 tons to meet a separate 25% statewide recycling goal by 2028.
Legal Challenge
Oregon’s EPR program has already faced litigation.
In July 2025, the National Association of Wholesaler-Distributors filed a federal lawsuit challenging Oregon’s EPR law.
Members of the association received a preliminary injunction against the EPR fees. The court found serious questions about the law’s constitutionality, and a trial is expected to proceed in the summer.
Concerns About PRO Structure
The source notes that PROs can have useful features. They can give affected producers a voice in policy and allow industry knowledge about production and recycled materials to shape recycling systems.
However, the source warns that poorly structured PROs can create incentives for producers to shift costs and burdens onto competitors or smaller producers with less influence.
Limiting PRO board membership to a few large producers may enable cartelization rather than simply helping with administration.
Recycling Costs and Consumer Burdens
Oregon has required state agencies to use recycled products whenever economically feasible since 2003.
The source argues that the reason state buildings are not made with 100% recycled material is cost. It also notes that the PRO is required to reimburse local governments when the requirement to use post-consumer recycled material for roll carts is more expensive.
Consumers do not receive the same protection.
The source argues that expanding access to recycling without making recycling more efficient can burden producers and consumers without necessarily helping the environment.
Competition Concerns
The source criticizes Oregon statutes that discourage competition in recycling.
It states that municipalities are instructed to displace competition with regulated collection services, award monopolistic recycling contracts with or without bids, and enable recycling franchisees’ collusion.
The source argues that this centralization disconnects recycling from rational prices and entrenches inefficient systems, creating costs for both the environment and the economy.
Policy Lessons
The source argues that the goal of recycling policy should be efficiency in allocating scarce resources, including the resources used to recycle.
It contrasts arbitrary recycling rate mandates with approaches that consider broader energy savings and total efficiency.
Earlier Oregon solid waste recovery legislation included an alternative recovery rate calculation method that considered total energy savings rather than only the nominal percentage of material recovered. The source presents this as a better framework for optimizing recycling policy.
The source suggests that PRO fees could make sense if they build infrastructure that makes recycling more efficient. But it argues that confidentially determined fees used to subsidize costly and inefficient processes burden producers, consumers, and the environment.
Reform Priorities
The source argues that EPR policies are still in their early stages and that Oregon’s rollout offers lessons for other states considering similar policies.
The main reform priorities identified are:
- More transparency in how fees are set
- Clearer definitions of recyclable materials
- Rates based on costs to society
- Rates that reflect whether a material can successfully be reused as a recycled product
- Avoiding fee structures designed mainly to hit revenue targets
- Avoiding opaque systems that subsidize inefficient recycling processes
The central criticism is that Oregon’s EPR system may be too complex and opaque to achieve its stated goals. While the policy aims to support recycling and circular markets, the source argues that its current structure risks legal uncertainty, higher costs, reduced competition, and inefficient outcomes.
Source article: taxfoundation.org
