Posted on February 25, 2026 by Neva Modric
#Corporate CSR Reporting #Corporate Governance #Corporate Responsibility #Corporate Sustainability #EPR #States & Sustainability #Sustainability Reporting #Uncategorized
U.S. states’ Extended Producer Responsibility (EPR) laws for packaging present a variety of compliance and financial considerations. For companies subject to these laws, understanding EPR packaging fee structures is critical for financial planning, while also allowing companies to explore opportunities to reduce compliance costs through their packaging choices.
New to our EPR blog series? Get up to speed with our introductory blog on the topic, our FAQ on how to comply, our blog on data collection best practices, and our detailed resource paper.
EPR fees are used to fund each states’ collection, sorting, and disposal of packaging materials, as well as the administrative costs of implementing and managing EPR programs. Producers pay the required fees to Producer Responsibility Organizations (PROs), which then direct funds toward recycling facilities, municipal programs, and system administration. PROs calculate the fees—which can change on a yearly basis—using factors such as:
There are currently three types of fees for packaging EPR: base fees, modulated fees, and flat fees. For large producers, most states apply a combination of base fees and modulated fees, while for small producers, they allow flat fees.
In the base fee structure, the state charges all producers a uniform per-weight fee per category of packaging material they introduce into the state. This approach creates a direct relationship between packaging weight and compliance costs: the more packaging a company puts into the market, the more it pays. Example base fees in Colorado and Oregon for 2026:
| Packaging Material Category | Colorado Base Fee (¢/lb) | Oregon Base Fee (¢/lb) |
| Aluminum container | 2.1 | 6 |
| Corrugated cardboard | 8.3 | 8 |
| HDPE plastic bottles, jugs, and jars (clear) | 14.6 | 9 |
One advantage to clearly outlined base fees is that they enable companies to estimate EPR exposure based on weight alone. However, a drawback is that, because each category fee applies whether the material is easily recyclable or not, this approach does not yield lower fees for companies that prioritize recyclable packaging.
Modulated fees apply “on top of” base fees, and aim to drive packaging innovation by creating a financial advantage for more sustainable choices. In states with a modulated fee structure, producers receive bonuses or incentives and ultimately pay lower fees for packaging that:
In states with modulated fees, companies that invest in preferred packaging design may realize reductions in their EPR compliance costs.
Conversely, packaging that is difficult to recycle, contains hazardous substances, or is made with materials with lower recycled content incurs higher fees through disincentives, or maluses. Example modulation factors in Colorado for 2026:
| Factor | Bonus or Malus | Result | Example Materials |
| Detriment (materials that disrupt recycling) | Malus | +5% fees | Ceramics, rigid plastic made from PVC, wood |
| Materials with a high recycling rate | Bonus | -5% fees | Glass bottles, steel containers, corrugated cardboard |
Some states allow small businesses—defined using a threshold for either revenue or material tonnage—to opt for a flat fee, while all other producers need to pay modulated fees in addition to their base fees.
With a flat fee structure, an eligible producer pays a standardized amount set by the program, rather than a fee based on the specific types, recyclability, weight, or volume of packaging materials it places on the market.
The Packaging Optimization Opportunity
In EPR programs that apply modulated fees, companies can reduce their EPR packaging costs by adjusting packaging design. In these programs, materials with higher recyclability and greater post-consumer recycled content will generally incur lower fees than materials with limited recyclability, minimal recycled content, or the presence of hazardous substances.
EPR fees are also volume-based and weight-based, meaning that the more packaging a company places on the market, the higher its total cost obligation. Reducing overall packaging weight and volume can therefore directly lower costs. Other ways to reduce EPR costs include reducing the use of packaging accessories such as inserts and shrink wraps, which add to the overall weight of packaging, as well as avoiding laminated paper and plastic windows, which lower the recyclability rates of packaging materials.
Collaborating with packaging suppliers to upgrade materials, improve recycling instructions on labels, increase recycled content, and eliminate unnecessary packaging not only helps minimize EPR fees but also advances broader waste reduction goals.
As packaging EPR laws continue to take effect across the U.S., compliance is increasingly becoming a direct financial consideration for companies.
For companies that have already identified their EPR reporting obligations and developed packaging data collection systems, the next opportunity lies in optimizing costs. G&A helps companies assess their current packaging portfolio, evaluate how materials are categorized under state EPR programs, and identify strategies to reduce future fees.
Set up a call to learn how G&A can help your company optimize your packaging materials to minimize packaging EPR compliance fees.
ABOUT NEVA MODRIC
Sustainability Analyst, G&A Institute
Neva Modric is a Sustainability Analyst at Governance & Accountability Institute. Her role includes conducting research to support client engagements, assisting with double materiality assessments, developing sustainability reports, analyzing ESG data, and providing general sustainability consulting. She is passionate about helping companies drive positive, sustainable impact that benefits both people and the environment.
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