Disposable Bag Fee for Businesses

• "Customer" means anyone who makes a purchase from a retail store
• "Disposable Bag" means any bag other than a reusable carryout bag that is intended for single-use purpose of transporting goods
• "Disposable bag fee" means the fee of ten cents ($0.10) applied to a consumer's receipt at checkout imposed by the City and County of Denver, required to be paid to each customer that opts for a disposable bag
• “Store” means a grocery store, supermarket, convenience store, liquor store, dry cleaner, pharmacy, drug store, clothing store, or other type of retail establishment at which carryout bags are traditionally provided to customers. 
  • Due to a change in state law, “Store” now includes a farmers market, roadside market or stand, festival, or other temporary vendor or event that includes temporary vendors. 
• "Reusable carryout bag" means it is designed for multiple reuse; made of cloth, fiber, or other fabric that can be regularly sanitized and machine washable; has handles; has a permanent tag with manufacturing information; capable of carrying twenty-two pounds (22); capable of one hundred twenty-five (125) uses

• Any bag that a customer brings into a retail store
• Any customers that are part of a federal or state food assistance program
• Bags used by consumers inside of the retail store to package food items like meat, fish, baked goods, etc. or small hardware items like nails, nuts, screws, etc.
• Bags used to protect purchased items from damaging or contaminating other purchased items
• Bags provided by pharmacists to contain prescription drugs
• Newspaper bags, door-hanger bags, laundry-dry cleaning garment bags, bags sold in packages for uses such as food storage, garbage, pet waste, etc.

• Retail stores must impose, collect and account for a disposable bag fee in the amount of ten cents ($0.10) per bag provided from the retail store
• The retail store shall be liable and responsible for payment to the city in the amount of six cents ($0.06) of each disposable bag fee collected to defray costs to the City and County of Denver
• A retail store must remit to the executive director of CASR the total amount due to the city for the preceding calendar quarter on or before the twentieth day of the month following the quarter end
• A retail store may retail four cents ($0.04) of each disposable bag fee that may only be used to:
  • Provide educational information about the bag fee to customers
  • Develop and display informational signage to inform customers about the fee, encourage the use of reusable bags, or promote recycling of disposable bags
  • Train staff in the implementation and administration of the fee
  • Improve or alter infrastructure to allow implementation, collection, administration of the fee
  • Improve infrastructure to increase disposable plastic bag recycling
  • Provide free reusable carryout bags to customers
• The retained portion of the disposable bag fee is not revenue for the purposes of calculating sales tax

• A retail store must record the number of disposable bags provided to a customer and the total amount of fees charged for the disposable bags, itemized by the material type
• A retail store required to collect the disposable bag fee must display a sign in a location outside or inside of the business, viewable by customers, alerting customers to the disposable bag fee

Monies from the disposable bag fee may be used to defray the costs to the city for administering the disposable bag fee program including for the following specific uses:

1. Administrative costs associated with developing, implementing, and administering the fee
2. Provide reusable carryout bags to residents and visitors
3. Educate residents, businesses, and visitors about the requirements of the program and impact of disposable bags on the city’s environmental health, the importance of reducing the number of disposable bags and other singles-use products entering the waste stream, and the expenses associated with mitigating the effects of disposable bags on the city’s drainage system, transportation system, wildlife and environment
4. Fund programs and infrastructure that allow city to reduce waste associated with disposable bags and other single-use products
5. Purchase and install equipment designed to minimize bag pollution, including recycling containers and waste receptacles associated with disposable bags and single-use products
6. Fund community cleanup events that reduce trash associated with disposable bags and single-use products
7. Mitigate the effects of disposable bags and single-use products on the city’s drainage system, transportation system, wildlife and environment
8. Conduct studies of disposable bag usage and the impact of the disposable bag fee in Denver
9. Maintain a public website that educates residents on the progress of waste reduction efforts associated with disposable bags and single-use products
10. Develop a task force to analyze the data and impact, and to recommend improvements

Violations of the provisions of this article may result in a civil penalty of not more than nine hundred ninety nine dollars ($999.00).

• Retail stores must maintain accurate and complete records of the disposable bag fees collected, the number of disposable bags provided to customers, the form and recipients of any notice required by this article, and any underlying records, including books, accounts, invoices, or other records necessary to verify the accuracy and completeness of such records
• If requested, each retail store must make records available for compliance audit by CASR during regular business hours for the city to verify compliance with this article
• The city will treat the information as confidential commercial documents
• If any retail store fails, neglects, or refuses to collect the disposable bag fee, or underpays the disposable bag fee, the exec director of CASR muse make an estimate of the fees due, and must add it to penalties, interest, and any additional fees due.
• CASR executive director must serve a notice of final determination, assessment, and demand for payment from non-complying retailers
• Any retail store may request a hearing on the assessment
• Penalties for failure to submit payments for disposable bag fee on or before the applicable due date:
  
  • A penalty of ten percent (10%) on the total amount due
  • Interest charge of one percent (1%) on the amount of the deficiency of the disposable bag fee per month
• Notices of Delinquency were sent on July 1, 2022.
• Notices of Violation were sent on July 31, 2022.
• Administrative Citations of nine hundred ninety nine dollars ($999.00) will be issued on August 30, 2022.
• Retailers can request an appeal for late fees & interest applied to disposable bag remittance fees by completing this form. All appeal requests will be reviewed, but approval is not guaranteed. 
  • Bag Fee Late Penalty and Interest Appeal Form

• Retail stores may request a hearing on any proposed fee imposed under this title after receiving a notice of final determination, by filing a written request within twenty (20) calendar days
• The request for hearing shall set forth the reasons for an amount

Why is disposable bag use a concern in Denver?

More than 100 million disposable bags are used annually in Denver, but less than five percent (5%) are recycled. Plastic bags are very difficult to recycle (they should not be put in recycling carts or recycling dumpsters), and cause damage to recycling facility equipment. Plastic bags litter our community, block storm drains, and endanger wildlife. Paper bags can be recycled, but they need a very large amount of water and energy to produce.

What is the reason for the Fee on Disposable Bags?

The Denver City Council adopted the Fee on Disposable Bags to reduce environmental impacts and cost to the city caused by disposable bags. A mandatory fee on disposable bags has been shown to significantly reduce the number of disposable bags used. 

How much is the fee?

The fee is ten cents ($0.10) per disposable bag (plastic, paper, or other material including but not limited to compostable material) provided at the checkout.

What stores are required to collect the bag fee?

All retail stores within Denver that sell personal consumer goods, household items, or groceries must charge the fee. Examples of the types of stores include, but are not limited to: convenience stores, department stores, retail chain stores, hardware stores, liquor stores, and grocery stores. Due to a change in state law, temporary vendors or events such as farmer’s markets, and marijuana dispensaries are no longer exempt and must charge the disposable bag fee. 

Which stores are not required to collect the bag fee?

Restaurants, beauty salons, auto mechanics, and other businesses where retail sales are not the primary business activity are not required to charge the bag fee.  

Are signs about the bag fee required to be on display in stores?

Yes. Retail stores required to collect the bag fee must display a sign viewable to customers, alerting them to the bag fee. You can find downloadable and printable signs at DenverGov.org/BringYourOwnBag/Disposable-Bag-Fee-for-Businesses. 

Must stores charge all shoppers the bag fee?

All customers must be charged except those who provide proof of participation in a federal or state Food Assistance Program. Examples of Food Assistance Programs include EBT, SNAP, or TANF. 

How can shoppers avoid the bag fee?

Shoppers can avoid paying the ten cents ($0.10) bag fee by bringing their own bags, including reusing disposable bags that they already have, or refusing a bag when they make a small purchase that is easy to carry without a bag.

Are some types of bags exempt from the fee?

Yes. The Fee on Disposable Bags does not apply to any bag brought into a store by a customer, nor does it apply to packages containing multiple bags for food storage, garbage, pet waste, or yard waste. Additionally, the Fee on Disposable Bags does not apply to bags used by a customer inside the store to contain or wrap the following: 

• Loose bulk items such as produce, nuts, grains, candy, or small hardware
• Frozen or freshly prepared food such as baked goods, meat, or fish 
• Flowers, potted plants, or other items where dampness might be a problem 
• Newspaper, laundry, or dry cleaning 
• Prescription drugs from the pharmacy
• Important Changes Coming in 2024
  • Starting January 1, 2024 a store shall not provide a disposable plastic carryout bag to a customer. 
  • Inventory of plastic disposable bags that was purchased before January 1, 2024 may be used on or before June 1, 2024. 
  • Stores may only provide recycled paper disposable bags that are made from 100% recycled material or other post-consumer content, or reusable bags.

Does the fee apply to bags used for delivery orders or self-checkout?

Yes. The bag fee must be applied to each disposable bag (plastic, paper, or other material including but not limited to compostable material) used to deliver goods or provided at self-checkout. It is recommended that stores place notification of the bag fee at each self-checkout location (see printable PDFs above).

Can a store pay the fee for a customer?

No. The Fee on Disposable Bags prohibits a store from paying or otherwise refunding the fee to the customers.  The intent of the fee is to discourage customers from taking disposable bags. If the store pays the fee, then customers have less of a reason to avoid taking a disposable bag.  

How is the ten cents ($0.10) fee monitored?

A retail store must record on a customer’s receipt the number of disposable bags (plastic, paper, or other material including but not limited to compostable material) provided to a customer and the total amount of fees charged for each type of bag. The bag fee cannot be included as revenue for the purposes of calculating sales tax to the customer.

The city reserves the right to request that a retail store make its records available for compliance audits and can assess penalties for failure to comply with the ordinance.

Anyone can report stores that may not be compliant with the Fee on Disposable Bags by filling out the Bag Fee Citation Appeal Form.

How and when do store owners report and remit the fees they collect?

Stores must pay the city six cents ($0.06) of each bag fee collected. Although this is not a tax, retailers are encouraged to submit the fees online using the same system that they report their sales taxes at www.denvergov.org/ebiztax/. The Bag Fee account type will be added to your existing profile which also includes Sales Tax and Occupational Privilege Tax. Bag Fees are due quarterly.

What type of information are stores be required to report?

Stores will be required to report the number of disposable bags distributed, itemized by bag material type and total fees due.

What happens to the portion of the bag fee kept by stores?

Stores keep four cents ($0.04) of each bag fee, and may only use the fee to cover the cost of:

• Providing educational information about the bag fee to customers
• Developing and displaying informational signage to inform customers of the fee, encourage use of reusable carryout bags, or promote recycling of disposable bags
• Training staff on the implementation and administration of the fee
• Improving or altering infrastructure to allow for the implementation, collection, and administration of the fee
• Providing FREE reusable carryout bags to customers
• Improving infrastructure to increase disposable plastic bag recycling

Can a store use their portion of the bag fee to provide free reusable carryout bags?

Yes. A store may use their portion of the fee to provide free reusable carryout bags, which are defined by Denver’s Revised Municipal Code as bags that:

• Are specifically intended for multiple reuse
• Made of cloth, fiber, or other fabric or material that can be cleaned and disinfected regularly, and must be machine-washable
• Have handles
• Cannot be made from a plastic film where thickness is measured in mils
• Have a permanent tag identifying the name of the manufacturer, the material used to manufacture it, and location (country) where it was manufactured
• Can carry twenty-two pounds (22) or more and be used one hundred twenty-five (125) or more times

What happens to the portion of the bag fee proceeds kept by the city?

The city may spend its portion of the bag fees on administering the bag fee program and public information programs focused on reducing the use of disposable bags and other single-use products, including providing free reusable bags to the community.  Monies may also be spent to address the impact of single-use products on the city’s environment and drainage system through community cleanups, infrastructure, and equipment. 

The Fee on Disposable Bags is not a tax and none of the proceeds can be used for other non-related government expenses.

Can a store use their portion of the bag fee to provide free reusable carryout bags?

Yes. A store may use their portion of the fee to provide free reusable carryout bags, which are defined by Denver’s Revised Municipal Code as bags that:

• Are specifically intended for multiple reuse
• Made of cloth, fiber, or other fabric or material that can be cleaned and disinfected regularly, and must be machine-washable
• Have handles
• Cannot be made from a plastic film where thickness is measured in mils
• Have a permanent tag identifying the name of the manufacturer, the material used to manufacture it, and location (country) where it was manufactured
• Can carry twenty-two pounds (22) or more and be used one hundred twenty-five (125) or more times