Carryout Bags & Containers (Fees, Bans, Reusables)

Remitting collected bag fee funds

The remittance form is now live in our GovOS/MuniRevs collection system.

The fee remittance form will be automatically assigned as a quarterly task through your workflow. If your business has signed up through GovOS/MuniRevs but you are not seeing the bag fee form in your workflow, or if you have been assigned a bag fee form and don't believe your business is affected by this law, please contact the City of Durango immediately.

No penalties or late fees will be assessed at this time for any delays in remittance, but stores are expected to remit any backlogged fee collections since January 1, 2023.

Questions on remittance should be directed to sustainability@durangogov.org or 970-375-5061.

What happens in 2024 to the bag fees?

Starting January 1, 2024 single-use plastic carryout bags are banned across Colorado in affected stores. Stores may still provide paper bags, but they must continue to charge a $0.10 fee for these bags and the bags must be 100% recycled content.

Stores must continue to remit 60% of any collected fees on a quarterly basis to the City of Durango. Stores remitting for the first time, or who have missed a submission at any point must remit any backlog of collected fees.

There is no change in 2024 regarding what stores are or are not affected by the carryout bag part of the law.

What stores are affected by the CARRYOUT BAG part of the state law?

A retail store IS affected if either of the following apply*:

• The store has more than three (3) retail locations
• The store is part of a franchise, corporation, or partnership that has physical store locations outside of Colorado

*For the bag fee/ban, food service and restaurant establishments are ALL exempt (not affected) no matter the type. Grocery stores and convenience stores are not considered food service under the definitions in the law, so grocery stores and convenience stores are affected based on the rules above.

Examples:

• A grocery store with more than three locations across Colorado would be affected, a grocery store with three or fewer locations would not.
• A chain fast food restaurant would not be affected, because it is food service (and is not a grocery store or convenience store).
• Any local restaurant or café would not be affected.
• A local retail store with one location in Durango would not be affected.
• A retail souvenir shop that is part of a larger franchise with a location in Utah would be affected.

What stores are affected by the POLYSTYRENE (STYROFOAM®) CONTAINER part of the state law?

Retail food establishments ARE affected by the polystyrene food container ban:

• Restaurants
• Fast food
• Cafeterias
• Schools
• Prisons

A list of exempted businesses can be found on the Eco-Cycle Guide to the 2024 Polystyrene Ban.

Discouraging disposables

The state law has several exemptions for food service and local independent businesses for both the bag fees/bans and the polystyrene ban. At the same, many stores may wish to take steps to consumption of these items to help our environment. Even if a store is not affected by the state law, it can still take meaningful steps for reducing waste and encouraging re-use over disposables.

Coordinating efforts

The City of Durango is continuing to work with stakeholders to develop a coordinated, community-wide effort. As the first step in this effort, exempt businesses are encouraged to voluntarily take one or more of the following actions:

• Only offer carryout bags to customers upon request.
• Offer discounts to customers that bring their own bags or other reusable containers.
• Seek alternatives to polystyrene using Eco-Cycle's Guide to Sustainable Serviceware
• Charge $0.10 for each carryout bag used (be sure to check the FAQ tab to understand how sales tax applies to this charge).
• Not provide single-use carryout bags at all.

To show your commitment to this campaign, we encourage you to display signs proudly in your store informing customers of your policies and why you support them!

Be sure to look out for ongoing efforts in this campaign. If you would like to be involved in developing new ideas as a stakeholder in this effort, reach out to sustainability@durangogov.org.

What does the law require and when does it go into effect?

Starting January 1, 2023: Certain retail stores are required to charge a $0.10 fee on each single-use carryout paper and/or plastic bag. On a quarterly basis, stores remit (pay) 60% of what they collected to the City of Durango, and the stores keep 40%.

Starting January 1, 2024: Single-use carryout plastic bags are banned in certain retail stores. The rules from 2023 still apply for paper carryout bags.

Also, starting in 2024, polystyrene (also known as Styrofoam^®) takeout containers are banned at retail food establishments.

What counts as a single-use carry-out bag, and are there exceptions?

A single-use carry-out bag is just what it sounds like: a paper or plastic bag that customers use to put items in as they leave a store at check-out. These does not include small and lightweight bags to collect items inside a store like produce, bulk food items, deli items, bulk seed/feed, or prescription medications.

Are there rules for what types of paper carryout bags that can be provided?

Paper carry-out bags must be made from 100% recycled material or postconsumer content.

What stores are affected by the bag fee and bag ban?

All retail stores that provide carryout bags to customers must comply, but there are two main exemptions:

Any store, regardless of type, does not need to comply if it operates solely in Colorado, has three or fewer locations in the state, and is not part of a franchise, corporation, or partnership that has physical locations outside of Colorado. This is commonly referred to as the small business or independent business exemption.

Retail food establishments do not need to comply if they prepare or serves food in individual portions for immediate on- or off- premises consumption; however, this exemption does not apply to grocery store or convenience stores, and they must still comply. This is commonly referred to as the food service or restaurant exemption.

What stores are affected by the Polystyrene food container ban in 2024?

Retail food establishments including restaurants, fast food establishments, cafeterias, schools, and prisons. A list of exempted businesses can be found on the Eco-Cycle Guide to the 2024 Polystyrene Ban.

How can I avoid paying the fee as a customer?

If you bring your own reusable bag and do not use a single-use carryout bag, you can avoid paying the fee.

Also, customers that can show proof of being on a federal or state food assistance program do not have to pay the fee.

What if an individual employee or customer tries to avoid the fee dishonestly?

Stores must implement and enforce policies to follow the requirements of the law. If a store is found to be accommodating behavior that avoids the fee, it could be suffer the penalties outlined in the law. If a store is having troubles with uncooperative employees or customers, the owner or management should call the City of Durango at 970-375-5061 to discuss how to address these issues.

What should I do if I think a store is not following the law?

Customers who believe a store is not charging the fee, or is improperly offering refunds or discounts that offset the fee, can report the store to the City of Durango by calling 970-375-5061.

Is signage required in the store?

All impacted stores must display a sign notifying customers of the bag fee program.

How are fees charged and do they show up on a receipt?

Stores must keep records of fees collected and must include the bag fee as an itemized line on customer receipts, accounting for the total number of bags used at the time of purchase.

This fee is not subject to tax and so will not affect the sales tax amount shown on the receipt.

What portion of the fee do the stores keep, and what portion is paid to the City of Durango?

Stores are allowed to retain 40% of the collected fee and must remit (pay) 60% to the City of Durango.

Does an affected store have to pay sales tax on the 40% portion of the bag fee they collect?

No. The law explicitly states that the funds kept by the stores from this fee do not count as revenue and are not subject to sales tax.

Are stores required to spend the funds retained from fee collection on anything specific?

No. The law does not outline what the store can or should do with this fee revenue.

What will the City of Durango do with the 60% of the fee revenue?

The funds will support community-wide distribution of reusable bags and education on the value of reducing the reliance on single-use carryout bags. Funds may also be used to support any recycling, composting, or other waste diversion programs and related outreach and education activities.

When do affected stores need to provide payment City of Durango?

Stores must remit payment to the City of Durango on a quarterly basis. For example, if your store collected $100 in bag fees between January 1 and March 31, you would submit a payment of $60 to the City of Durango within the first week of April. If your store then collected $200 worth of fees between April 1 and June 30, you would remit $120 during the first week of July, and so on.

Stores are asked to remit quarterly payments starting October 1, 2023. A store must still account for all collected fees starting on January 1, 2023, up to that point. If a payment is delayed, stores must retroactively remit all unpaid fees.

My store is not affected by the law, but I want to reduce bag use at my store, what can I do?

The rules for which stores are and are not affected by this law are automatic, which can be confusing for stores that would like to opt-in to a program to discourage single-use carryout bags. See the "Options for Independent Businesses" tab for more info.

There are multiple options for stores that wish to reduce single-use carryout bags:

• Self-impose a policy for not providing single-use carryout bags at all . Many stores in town (include a grocery store in town) already have successfully implemented this sort of policy.
• Provide discounts or other incentives to customers that bring their own bag.
• Self-impose a single-use carryout bag charge (more details below).

My store is not affected by the law, but I have been charging customers a fee for bags (on purpose or by accident), what should I do?

Stores that are exempt from the state law are allowed to charge their own self-imposed charge on carryout bags if they wish. However, this charge is not subject to the rules and requirements of the state law. As such, there are two important distinctions for stores that are exempt from the law, but still charge for bags:

• This charge is still subject to sales tax as it would be categorized as a sale of an item - selling a bag to a customer for a certain price. The store should categorize bag charges as the sale of a bag and remit sales tax the same as any other items sold.
• The store is not required to remit 40% of this bag charge to the City of Durango. Revenue from this charge is the same as the revenue from any other sold item.

The City of Durango recommends stores use a $0.10 price per bag to align with other stores in our community.