Flexible alcohol pouches would be exempt from Michigan's beverage deposit law under a bill that won final approval Tuesday in the Senate.
The legislation was introduced in response to a state Treasury Department analysis that said the containers must carry a deposit unless the 1976 law is changed. It passed the House earlier and now goes to Gov. Rick Snyder.
Supporters said the pouches aren't recyclable and would be a hardship on grocers who would have to deal with them as returnables carrying a 10-cent deposit. Critics, however, said the legislation could encourage beverage companies to consider pouches instead of aluminum cans and glass bottles to avoid the deposit.
The landmark law was approved by voters more than 30 years ago to reduce litter. Michigan is one of 11 states with a deposit law.
"This piece of legislation is taking us in completely the wrong direction," said Sen. Rebekah Warren, D-Ann Arbor.
The bill passed 36-2 after senators defeated Warren's amendment to extend the deposit law to sports drinks and other beverages. It now mostly covers soda and beer.
There were more than 175,000 cases of alcohol pouches sold in Michigan last year, generating $900,000 in tax revenue, according to the House Fiscal Agency.