Oregon just turned a green recycling mandate into a hidden consumer tax buried in the price of everyday products.
Now federal courts have cleared the way for that cost to hit consumers across the country.
The Ninth Circuit is about to decide how many more states can do the exact same thing.
Oregon's Packaging Tax Lets a Private Nonprofit Set Consumer Prices With No Oversight
Oregon's Democrat-controlled legislature passed the Plastic Pollution and Recycling Modernization Act in 2021, Democratic Gov. Kate Brown signed it, and Democratic Gov. Tina Kotek has spent the years since expanding Oregon's green regulatory agenda.
The law requires every business selling packaged food, beverages, paper products, and food serviceware in the state to register with a private nonprofit called the Circular Action Alliance and pay whatever fees that organization determines they owe.
Those fees aren't paid by Oregon taxpayers or the state government – they're paid by businesses, which pass the cost to consumers.
You pay it when you buy groceries, pick up takeout, or grab anything that comes in a package.
The organization sets what each business owes using a proprietary formula it refuses to make public.
Disputes go to binding arbitration – not a regulator, not an elected official, not a judge.
There is no public vote and no line item on your receipt – just a slightly higher price on everything you buy.
The National Association of Wholesaler-Distributors sued, arguing Oregon's law violates the Constitution's Dormant Commerce Clause and the Due Process Clause of the Fourteenth Amendment.
Nine friend-of-the-court briefs backed the legal challenge – NFIB among them.
A federal court issued a preliminary injunction pausing enforcement in February 2026, but after a five-day trial, Obama-appointed Judge Michael H. Simon upheld every element of Oregon's law on August 27, 2026.
NAW filed its notice of appeal to the Ninth Circuit on September 24, 2026.
California Grocery Prices Are Next and the Same Nonprofit Is Already Set Up
Court documents show Oregon regulators expected companies to pass compliance costs on to customers – including customers who have never set foot in the state and never had a say in its elections.
Oregon's packaging tax hits their grocery bills anyway.
A separate class action filed June 25, 2026, on behalf of producers not affiliated with NAW, confirms this fight extends far beyond one trade association.
The Ninth Circuit – which covers California, Washington, Nevada, Arizona, Montana, Idaho, Alaska, and Hawaii in addition to Oregon – will now decide whether every state in that jurisdiction can run the same scheme.
California has already tapped Circular Action Alliance to administer its own version of the law.
California's packaging tax program filed its first plan in June 2026, with annual business invoices expected in early 2027.
Six other states have enacted similar packaging laws built on Oregon's framework – Colorado's is already facing its own federal constitutional challenge.
A Ninth Circuit ruling in Oregon's favor becomes binding precedent across all nine states – and every blue state in the country is watching to run the same play.
This Is How Democrats Use Green Mandates to Raise Grocery Prices Without a Single Vote
Oregon Democrats discovered they don't need to raise taxes to raise prices.
Mandate the green program, assign the bill to businesses, and let businesses bury it in the cost of everything on the shelf – voters never approved it, nobody sees it on a receipt, and the politicians who created it never have to answer for the price.
Oregon Democrats handed enforcement authority to a private nonprofit with a secret fee structure, designed the program so the costs would cross state lines, and then watched an Obama-appointed judge call it constitutional.
The Ninth Circuit is the most favorable court in America for exactly this kind of government overreach, but constitutional questions receive no deference on appeal – the Ninth Circuit reviews them from scratch, and Judge Simon's conclusions carry no weight there.
A NAW win at the Ninth Circuit unravels California and Colorado's versions before they can take hold.
Lose this one, and seven states have a tested, court-approved blueprint for raising American grocery prices without ever asking the people who pay them.
Sources:
- Jack McGeever, "Little-Known Green Law Becoming Thorn In Side Of Businesses," The Daily Caller, October 13, 2026.
- "NAW Appeals Oregon EPR Ruling," Resource Recycling, September 25, 2026.
- "Oregon Judge Upholds EPR Scheme in Full Against Constitutional Attacks," National Law Review, August 28, 2026.
- NFIB, "NFIB Filed an Amicus Brief Challenging Oregon's Extended Producer Responsibility Law," National Federation of Independent Business, January 27, 2026.