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CARE CA Program Q4 2019

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California Carpet Stewardship Program results, Q4 2019

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CARE CA Program Q4 2019

  1. 1. CARE Sustainable Funding Oversight Committee Q4 2019 California Summary & Recommendations for Approval Updated 02/18/2020
  2. 2. 2 Agenda ü Quarterly Overview of Results ü Manufacturers Report ü Quarterly Subsidy and Expense Payouts ü Drop-off Program Update ü Approval Requests ü Other Information (as required)
  3. 3. 3 CARE’s Executive Director’s Message CARE reports yet another record quarter for the recycling rate results for Q4 and continues the dramatic increase in performance. Circular Polymers contributed to this increase with the start-up of another increase in capacity during December, funded in part by another grant from CARE. Unfortunately, two other CARE funded recycled output investments were unable to start up during 2019 due to factors beyond their control. LA Fiber Company has been waiting on permit approval by the City of Vernon. The expansion, originally scheduled to begin operation in August, is still not operational. Aquafil Plant #2 in Woodland has been waiting for power to be delivered by PG&E since May of 2019. As a result, the June start-up, funded in part by a grant from CARE, was not possible. Thus the Recycling Rate for Q4 did not achieve the 24% target. The actual recycling rate was 22.5% and represents a 44% increase vs Q4 2018, still another significant step in performance, it fell short of expectations. What is important to note is that had either the LA Fiber or Aquafil projects been completed on schedule, Q4 would have exceeded the 24% target. While the normal Q4 seasonal slowdown was observed and considering sales of new carpet set another new low, recycled output remained strong, setting a new Q4 high. Public Drop Off Sites ended Q4 at 73, up by 20 sites vs. end 2018. CARE Collections were up 28% vs 2018. The number of counties serviced rose by 3 to 50 after losing one due to the sale of operations. CARE added 3 new mills to the program in Q4 and our year end fund balanced was $20M as a result of no change from Q3 to Q4. CARE dispersed an additional $1M in grants in 2019. Overall 2019 was a very good year in terms of growth in the recycling rate. All stakeholders are encouraged to go to the CARE website, click on the CA tab and sign up for the monthly newsletter to stay abreast of the latest developments. www.carpetrecovery.org Bob Peoples, Ph.D., Executive Director, February 20, 2020
  4. 4. 4 AB 2398 Summary Results
  5. 5. 5 AB 2398 Performance Trends (millions of pounds) *Average: 2011 is average of Q3 & Q4; 2012-2015 is 4 quarter average
  6. 6. 6 AB 2398 Performance Trends (percentage) *Average: 2011 is average of Q3 & Q4; 2012-2015 is 4 quarter average Recycling Rate
  7. 7. 7 Recycling Rate (percentage) * Percentages shown are the % of Recycled Output from Total Discards during the quarter. Percentages compared against January 1, 2020 Recycling Rate goal of 24%. 2018 Q4 Recycling Rate 2019 Q4 Recycling Rate +44% increase Two major recycled output projects, both grant recipients, did not come on-line as planned due to permit delays (August start-up) and failure of PG&E to deliver power (June start-up). Either project would have contributed to a 24% plus recycling rate in Q4!
  8. 8. 8 Gross Collected PCC Sent Back to Landfill** *Average: 2011 is average of Q3 & Q4; 2012-2015 is 4 quarter average **Percentages shown is % of Gross Collected PCC actually sent to landfill as PCC or process waste. Data above includes CSE and Processor landfilled pounds beginning in Q2 2014. Q4-2019 Gross Collected: 19.7M pounds – 3.8M sent to landfill Cumulative to landfill: 172.8M lbs.
  9. 9. 9 Disposal % Change in Disposal: -18.8%
  10. 10. 10 Calcium Carbonate (PC4) by Quarter
  11. 11. 11 AB 2398 Manufacturers/Mills Quarterly Summary Report
  12. 12. 12 AB 2398 Mills’ Summary Cumulative SQYD sold: 796.0M Cumulative Remittances: $114.9M 2015 2016 2017 Q1 2018 Q2 2018 Q3 2018 Q4 2018 Q1 2019 Q2 2019 Q3 2019 Q4 2019 # Mills Registered 78 75 76 73 74 71 71 71 73 74 77 # Mills Not Reporting 0 0 3 2 2 3 2 1 0 2 3 Non-response Rate 0% 0% 4% 3% 3% 4% 3% 1% 0% 3% 4% Remittance Collected Total Sq Yd Sold (millions) 96.9 94.1 90.4 20.5 22.9 23.2 19.5 18.8 21.7 21.8 18.3 Total Remittances ($M) 8.60$ 16.60$ 22.72$ 5.12$ 5.72$ 5.79$ 4.89$ 6.55$ 7.60$ 7.63$ 6.40$ Top 10 Remittances (>$10K) 7.86$ 15.21$ 20.93$ 4.76$ 5.38$ 5.49$ 4.60$ 6.12$ 7.13$ 7.25$ 6.01$ Top 10 Percentage of Total (Avg) 91% 91% 92% 93% 94% 95% 94% 94% 94% 95% 94% Mills - With Yearly Roll-up
  13. 13. 13 Sales by Quarter
  14. 14. 100.5 98.6 96.9 94.1 90.4 86.0 80.3 75 80 85 90 95 100 105 2013 2014 2015 2016 2017 2018 2019 CASales(Msquareyards) -6.6% CA Sales by Year -1.6% -2.0% -4.0% -2.9% -4.8% CA Sales Decline n Rate 5 252010 35Assessment/yd2 : 5 25
  15. 15. 15 AB 2398 Quarterly Subsidy and Expense Payouts
  16. 16. 16 Summary of Payouts Q4 2019 1 2 3 4 * All CSE pounds are now consolidated directly in CSE section. Previously Processors who also collected were reported separately.
  17. 17. 17 Summary of Expenses All data confirmed 02/14/2020
  18. 18. 18 Payouts Over Time Adjusted Target Q3 2014 Launch Tier 2 Growth Bonus Q2 2015 Launch Retroactive subsidy in Q3 2015 Growth Bonuses Eliminated Q1 2017 *Average: 2014-2017 is 4 quarter average NOTE: All REUSE payouts are counted under the CSE category. Tier 2 N6 Subsidy Q4 2017 Tier 2 N6,6 Subsidy Q1 2019
  19. 19. 19 Fund Balance Trends All data a/o 02/12/19 Reserve = 2 month average of the last quarter total expenses (effective Q1-2019) ACCRUAL BASIS Based on unaudited numbers – adjustments may be made after audit closes Note reserve change consistent with approved Plan
  20. 20. 20 CA Employees (FTEs*) * Full-time equivalent employees
  21. 21. 21 Drop-Off Site Program Update Q4 2019
  22. 22. 22 Drop-Off Site Total Program Costs
  23. 23. 23 Annual Cost Comparison § Hauling: 43% of Q4 2019 Total Program Cost § Storage: 24% of Q4 2019 Total Program Cost § Recycling Fees*: 33% of Q4 2019 Total Program Cost *”Recycling Fees” was referred to as “Tipping Fees” in previous slide decks
  24. 24. 24 Material Collected by CARE Drop-Off Sites (Annual) § 2019 lbs collected YTD: 128% of total 2018 lbs collected § Q4 2019 lbs collected: -4% decrease under Q4 2018 lbs collected; 25% increase over Q4 2017 lbs collected
  25. 25. 25 Drop-Off Site Program Summary § 73 operational CARE Drop-Off Sites in 50 CA counties by end of Q4 § 160 operational private sites reported at the end of Q4 *Cost/Capita uses updated Census information as available NOTE
  26. 26. 26 Recommendations to SFOC
  27. 27. 27 Recommendations for SFOC Approval
  28. 28. End of Review

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