Carpet America Recovery Effort: California Carpet Stewardship Program quarterly results

1. CARE Update: Q1 2023 Results
06/05/2023
1
California Carpet Stewardship Program Approved Results

2. Agenda
• Quarterly Overview of Results
• Manufacturers Report
• Quarterly Subsidy and Expense Payouts
• Drop-off Program Update
• Approval Request
• Program Updates
California Carpet Stewardship Program Q1 2023 Approved Results
2

3. CARE Executive Director Message
The big news is the return of CARE in April as the Carpet Stewardship Organization (CSO). CARE is
in the process of returning to normal operations and resolving a multitude of financial and operational
issues created by the CalRecycle November 2022 decision to remove CARE as CSO. One positive
result of this unfortunate episode is that CalRecycle staff has a much better understanding of the
difficulty of CARE’s job.
Coming off a very strong 2022 performance, Q1 saw a steep decline in sales beyond the normal Q1
seasonality and the heavy rains in California. Sales are the trigger for old carpet removal and the
steep 15% decline resulting in a drop in collections. Recycled output was also down due to seasonality
combined with reduced collections. The Q1 Recycling Rate did rise to 35.6%.
Overall, 80% of expenses were paid out in the form of subsides and 75% of total expenses were paid
out to CA recyclers. Expenses exceeded assessments collected resulting a fund balance of $1.1M
and below our targeted reserve. The assessment increase will begin the process of rebuilding the fund
balance in Q2. Another assessment increase is expected later this year.
Finally, all stakeholders are encouraged to go to the CARE website, click on the CA tab and get
signed up for the monthly e-news letter to stay abreast of the latest developments.
www.carpetrecovery.org
California Carpet Stewardship Program Q1 2023 Approved Results
3
Robert Peoples, PhD
Executive Director

4. AB 2398 Summary Results
California Carpet Stewardship Program Q1 2023 Approved Results
4

5. AB 2398 Performance Trends (millions of pounds)
5 Table Note: 2015 – 2022 Data represents the quarterly average during the year.
25.8
26.8
24.5
23.4
20.5
19.4
22.1
23.3
21.3
8.7 9.4
11.8 12.3
14.5
13.2
16.9
18.4
16.0
-
5.0
10.0
15.0
20.0
25.0
30.0
2015 2016 2017 2018 2019 2020 2021 2022 Q1 2023
Pounds
(Millions)
Gross Collections Recycled Output

6. AB 2398 Performance Trends (percentage)
6 Table Note: 2015 – 2022 Data represents the quarterly average during the year.
29.8%
31.3%
29.0% 29.1%
27.4%
30.1%
36.5%
43.1%
47.5%
10.1% 10.9%
14.1%
15.3%
19.1%
20.9%
27.8%
34.2%
35.6%
0.0%
5.0%
10.0%
15.0%
20.0%
25.0%
30.0%
35.0%
40.0%
45.0%
50.0%
2015 2016 2017 2018 2019 2020 2021 2022 Q1 2023
Percentage
Gross Collections Rate Recycling Rate

7. Gross Collected PCC Sent Back to Landfill 1
7
1. Percentages shown are % of Gross Collected PCC actually sent to landfill as PCC or process waste. 2015 – 2022
Data represents the quarterly average during the year.
Q1-2023 Gross Collected: 21.3M pounds – 2.0M sent to landfill Cumulative to landfill: 203.4M lbs.
5.2 5.3
4.9
5.8
4.0
2.6
2.2 2.3
2.0
21% 20% 20% 25% 20% 13% 10% 10% 10%
0.0
1.0
2.0
3.0
4.0
5.0
6.0
7.0
2015 2016 2017 2018 2019 2020 2021 2022 Q1 2023
Pounds
(Millions)

8. Calcium Carbonate (PC4) by Quarter1
8
3,395
2,698
3,536 3,600 3,721
4,811
4,221 4,311
4,652
5,244 5,134 5,239
4,086
0
1,000
2,000
3,000
4,000
5,000
6,000
Q1 2020 Q2 2020 Q3 2020 Q4 2020 Q1 2021 Q2 2021 Q3 2021 Q4 2021 Q1 2022 Q2 2022 Q3 2022 Q4 2022 Q1 2023
Pounds
(Thousands)
1. Beginning with Q4 2022, PC4 pounds were adjusted to correct for excess water content.

9. AB 2398 Manufacturers/Mills
Quarterly Summary Report
California Carpet Stewardship Program Q1 2023 Approved Results
9

10. AB 2398 Mills’ Summary
10
Cumulative SQYD Sold: 1,004.7M Cumulative Remittances: $189.2M

11. Sales by Quarter
11
24.2
25.4
26.6
24.3
23.6
25.7 26.1
23.5
22.9
25.2
26.4
22.5
22.2
24.8 25.2
21.9
21.1
24.0 23.9
21.4
20.5
22.9 23.2
19.5
18.8
21.7 21.8
18.3
17.1
14.4
18.4
16.8
16.1
17.9 17.8
15.5
15.1
16.9 16.5
13.4
12.8
0
5
10
15
20
25
30
Q1 Q2 Q3 Q4
Square
Yards
(Millions)
Annual Sales by Quarter 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023

12. AB 2398 Quarterly Subsidy
and Expense Payouts
California Carpet Stewardship Program Q1 2023 Approved Results
12

13. Summary of Payouts Q1 2023
13
1
2
3
4

14. Summary of Expenses
14 All data from Finance Director confirmed 05/31/2023

15. Fund Balance Trends: Accrual Basis
15
Based on unaudited numbers – adjustments may be made after audit closes.
Reserve = 2-month average of the last quarter total expenses (effective Q1-2019)
Financial Director confirmed 05/31/2023
Fund Reserve
$5.8
$5.1
$6.4
$5.9 $5.55
$6.20 $6.44
$5.37 $5.28
$6.22 $6.13
$5.20 $4.71
$4.8 $5.8 $6.8 $6.8 $6.72 $7.29 $8.41 $7.36
$7.03 $8.16 $8.00 $8.28
$7.09
$20.3
$19.6 $19.2
$18.3
$17.10
$16.13
$14.17
$12.15
$10.40
$8.45
$6.60
$3.50
$1.08
$3.2 $3.9 $4.5 $4.6 $4.48 $4.86 $5.60 $4.93 $4.69 $5.44 $5.34 $5.50 $4.73
$0.0
$5.0
$10.0
$15.0
$20.0
$25.0
$0.0
$5.0
$10.0
$15.0
$20.0
$25.0
Q1 2020 Q2 2020 Q3 2020 Q4 2020 Q1 2021 Q2 2021 Q3 2021 Q4 2021 Q1 2022 Q2 2022 Q3 2022 Q4 2022 Q1 2023
Dollars
(Millions)
Revenue Expenses Fund Balance

16. CA Employees (FTEs)
16
FTE = Fulltime equivalent employees
60 58 65 60 70 68 73 74 77 81 86 87 91
72 72
74 75
74 74
79 79 86 84 84 84 84
23 27
27 27
27 26
26 28
28 31 30 28 28
14 14
13 13
13 13
12 12
12 12 12 12 12
169 171 179 175 184 181
190 193
203 208 212 211 215
-
50
100
150
200
250
Q1
2020
Q2
2020
Q3
2020
Q4
2020
Q1
2021
Q2
2021
Q3
2021
Q4
2021
Q1
2022
Q2
2022
Q3
2022
Q4
2022
Q1
2023
CSE FTEs Processor FTEs Manufacturer FTEs CARE-related FTEs

17. Drop-Off Site
Program Update
Q1 2023
California Carpet Stewardship Program Q1 2023 Approved Results
17

18. Total Drop-off Sites
18 Public drop-off site data includes one union site and three regional distribution sites.
168 176 185 178 189 192 197 202 207 211 202 201 193
77
78
79 83
86 89 90 98 101 102 115 135 135
245
254
264 261
275 281 287
300 308 313 317
336 328
0
50
100
150
200
250
300
350
400
Q1
2020
Q2
2020
Q3
2020
Q4
2020
Q1
2021
Q2
2021
Q3
2021
Q4
2021
Q1
2022
Q2
2022
Q3
2022
Q4
2022
Q1
2023
#
of
Drop-off
Sites
Private Drop-off Sites Public Drop-off Sites

19. Drop-Off Site Total Program Costs
19
$119 $107 $130 $147 $124
$170
$203
$235
$202
$285 $282 $267
$181
$55 $57
$58
$64
$51
$52
$56
$61
$67
$70 $69
$73
$57
$82
$71
$82
$86
$71
$85
$100
$83
$88
$127 $122
$114
$85
$257
$235
$271
$297
$246
$307
$359
$379
$358
$482 $474
$454
$324
$0
$100
$200
$300
$400
$500
$600
Q1
2020
Q2
2020
Q3
2020
Q4
2020
Q1
2021
Q2
2021
Q3
2021
Q4
2021
Q1
2022
Q2
2022
Q3
2022
Q4
2022
Q1
2023
Cost
$
(Thousands)
Hauling Cost Storage Cost Recycling Fees

20. Annual Cost Comparison
20
Total Program Costs: Hauling: 56% of Q1 2023 Cost Storage: 18% of Q1 2023 Cost Recycling Fees: 26% of Q1 2023 Cost
$450 $504
$733
$1037
$181
$209
$234
$219
$280
$57
$344
$322
$339
$451
$85
$1003
$1060
$1291
$1768
$324
$0
$200
$400
$600
$800
$1000
$1200
$1400
$1600
$1800
$2000
2019 2020 2021 2022 2023
Cost
in
Thousands
Hauling Cost Storage Cost Recycling Fees

21. Material Collected by CARE Drop-Off Sites (Annual)
21
2023 lbs. collected YTD: 20% of total 2022 lbs. collected
Q1 2023 lbs. collected: 4% increase over Q1 2022 lbs.; 31% increase over Q1 2021 lbs. collected
7,945
10,167 10,226
12,773
17,053
3,434
0
2,000
4,000
6,000
8,000
10,000
12,000
14,000
16,000
18,000
2018 2019 2020 2021 2022 2023
Pounds
(Thousands)

22. Drop-Off Site Program Summary 1
22
• 135 operational CARE Drop-Off Sites in 55 CA counties at end of Q1
• 193 operational private sites reported at the end of Q1. Public drop-off site data includes one union site and three regional
distribution sites.
1. Cost/Capita uses updated U.S. Census information as available.
YTD

23. Private vs. Public Collection Sites
23
85% 82%
86% 84% 85% 84%
82%
84%
80% 77% 79% 76%
79%
15% 18% 14% 16% 15% 16% 18% 16% 20% 23% 21% 24% 21%
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
-
2,000,000
4,000,000
6,000,000
8,000,000
10,000,000
12,000,000
14,000,000
16,000,000
18,000,000
20,000,000
Q1 2020Q2 2020Q3 2020Q4 2020Q1 2021Q2 2021Q3 2021Q4 2021Q1 2022Q2 2022Q3 2022Q4 2022Q1 2023
Private Collec�on Sites - Lbs. Collected Public Collec�on Sites - Lbs. Collected
% Lbs. Collected - Private Sites % Lbs. Collected - Public Sites

24. Recycling Rate Trend1
24
1. Recycling rate increased by an average of 27% year of year from 2016 to 2022.
2. 2023 reflects recycling rate for Q1 2023 results.
10.1%
11.0%
14.0%
15.3%
19.1%
20.9%
27.9%
33.9%
35.6%
5.0%
10.0%
15.0%
20.0%
25.0%
30.0%
35.0%
40.0%
2015 2016 2017 2018 2019 2020 2021 2022 2023
Recycling Rate (Annual) Expon. (Recycling Rate (Annual))

25. Recommendations to SFOC
California Carpet Stewardship Program Q1 2023 Approved Results
25

26. Recommendations for SFOC Approval
26

27. CARE Program Update
27
 Education & Outreach
 Collection
 Grants
 Market Development
 Newsletters & Communications

28. Education & Outreach
28
 Retailer and Installer Outreach
– 388 phone outreach calls to flooring retailers in 2023 YTD
– DOS Map Booklet mailed to all retailers and C-15 installers
– Accelerated Differential Assessment Communication Plan undertaken
 Consumer Outreach
– Lowe’s instore carpet recycling signage is in the process - 113 Locations
 Drop-off Site Outreach
– Two quarterly outreach efforts
• Technical assistance phone calls with CARE drop-off sites
– One quarterly educational webinar for Drop-off Sites

29. Collection
29
 CARE Drop-off Sites – 136 sites
– 131 public drop-off sites supporting 57 counties.
– Four semi-public Drop-off Sites supporting flooring installers
 Three new Drop-off Sites:
– 2 in Northern CA
• Mono County, Lee Vining, Pumice Valley Landfill
• Calaveras County, Angel’s Camp, Pinnell’s Carpet One Floor & Home
– 1 in Southern CA
• Madera County, Madera, J&M Floor Covering

30. Collection
30
 Convenient Collection
– One public Drop-off Site per 500k population: Goal met in 2022
– Per the 2023-27 Plan, CARE will use 2020 Census data beginning in 2023
 Growing Collections
– Site-visit effort initiated at Drop-off Sites
• Best practices and support of high performing sites
• Technical assistance and support for low performing sites

31. Grants
31
 Micro Grants
– One new award is under contract and four projects are underway and will close in 2023.
– Micro Grant case study focused on a reuse project underway.
 Pilot Collection Awards for Small-Volume Projects
– One project closed in 2023 and results will be shared in CARE’s 2022 Annual Report.
– One project awarded in Q2.
 Capital Grants
– Cycle 4: One project is underway through mid 2023 and one project closed in Q2.
– Cycle 5: Two projects are ongoing through Q3 2023.
– Cycle 6 solicitation has been developed and planned for release in early June.
 Testing Grants
– Cycle 5 of Testing Grants solicitation has been developed and planned release is early June.
 Innovation and Design Grants
– Four proposals assessed with recommendations to fund two, which will kick off in fall 2023.
– Seed awards up to $100k.

32. Market Development
32
 98 Products containing PCC recycled content
– 23 Tier two manufacturers
• 9 in California
• 14 outside of California
 Attendance at CAPPO Conference.
 Sent mailing about carpet recycling and recycled-carpet products
to CAPPO conference attendees.
 Ongoing technical and business development assistance to
processors, and manufacturers.

33. Newsletters/Communications
33
 Five e-news sent (January, February, March, Special Issue on
Program Success, May)
 Four new blog posts:
– CARE Submits Revised Five-Year Plan to CalRecycle
– Record Results in 2022 for California Carpet Stewardship Program
– Carpet Differential Assessment to Increase April 1, 2023
– CARE Grantees Contribute to Attaining 2022 Program Goals
 Ongoing: reporting (including to CalRecycle and Annual Report),
collateral, website and Twitter.

34. End of Review
34