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PROP 65: Money from the Sale of Reusable Grocery Bags

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Sheppard Mullin

In partnership with Sheppard Mullin. Sheppard Mullin is a full service, global law firm with 750 attorneys.  The firm handles corporate and technology matters, high stakes litigation and complex financial transactions.  Visit

Updated at 2:30 PM on Nov. 9, 2016


Prop 65 has failed by a margin of 44.7% yes to 55.3% no.  It allows grocery stores to keep the money from the sale of reusable bags.

What does Prop 65 say?

Prop 65 deals with grocery bags. Yes, there are two propositions on this issue. (See Prop 67 for more info.)

Prop 65 says when grocery stores sell carryout bags to customers the money would have to go to a state-run fund for the environment. The fund is called the Wildlife Conservation Board.

How much money are we talking about?

The state analyst says it's in the tens of millions of dollars, but it's hard to get more specific.

Who supports Prop 65 and what are their arguments?

You might think that a prop to send money for a “Wildlife” fund would come from environmental groups. Nope. Not this time. Prop 65 was put on the ballot by plastic bag companies. (I know. Confusing.)  They say that if grocery store chains are going to make money by selling reusable bags they shouldn’t be able to pocket that money. Instead it should go to help the environment.

Who opposes this prop and what are their arguments?

Environmental groups, including the Sierra Club, hate Prop 65. They say it’s not about funds for environmental projects at all.  What’s really happening is something underhanded.

Now follow this: The say the real reason plastic bag companies put Prop 65 on the ballot is to get the grocery stores to help them defeat Prop 67, the ban on plastic bags.  You see, right now grocery stores are supporting a ban on plastic bags, in part because they can make money by selling reusable bags. BUT.. what if they had to give that money to the state, as Prop 65 proposes? Then maybe grocery stores will come out against the plastic bag ban. And this is what the plastic companies want—an ally to help them defeat the ban on plastic bags (Prop 67).

Opponents of Prop 65 also say the plastic bag companies know that voters get confused when there are two ballot measures on the same issue. And when voters get confused they tend to vote “no” on both propositions. And if voters vote no on both props, then the plastic bag companies get what they really which is to defeat the proposed ban (Prop 67).  

Did you get all that?   

A simple way to look at a confusing situation.

This is one case where you should pay attention to who’s behind it.  

  • If you agree with the plastic bag companies vote “yes” for Prop 65. It would divert the money from the sale of carry out bags into a state environmental fund.
  • If you agree with environmental groups vote “no” on Prop 65. It would allow grocery stores to keep the money from the sale of reusable bags.

Click here for a cheat sheet on all the California ballot propositions.

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