California Carpet Stewardship Program Q2 2024 Results

The California Carpet Stewardship Program reports quarterly on collection/recycling rates and program financing.

1. CARE Update: Q2 2024 Results
8/29/24
California Carpet Stewardship Program Approved Results

2. California Carpet Stewardship Program Q2 2024 Approved Results
2
•Quarterly Overview of Results
•Manufacturers Report
•Quarterly Subsidy and Expense Payouts
•Drop-off Program Update
•Approval Request
•Program Updates
Agenda

3. CARE Executive Director Message
California Carpet Stewardship Program Q2 2024 Approved Results
3
Robert Peoples, PhD
Executive Director
Second quarter saw mixed results with gross collections up, but recycled output and manufactured output down. Markets have been very difficult with two major sectors for PC carpet materials down. Major manufacturing indicators suggest we are looking at a looming economic downturn.
As noted in Q1, carpet pad markets, not
covered by the carpet steward law, also continue to be depressed.
Virgin resin prices remains low and high mortgage interest rates continue to adversely impact housing.
There is no sign of relief. Anticipation of a cut in the interest rate by the Federal Reserve suggests further
economic slow down is anticipated.
Sales in Q2 were 13.9 million square yards, down 2% vs. budget and down again 3% vs. Q2 2023. As a
reminder, the new Plan reflects a 32% reduction in sales over the life of the Plan. Thus, sales are expected
to continue their decline year over year.
Overall, 78% of total expenses were paid out in the form of subsides and 78% of all those subsidies were
paid to CA recyclers. Revenue exceeded expenses and the fund balance ended the quarter at $5.0M, up
by $2.1M vs. Q1.
All stakeholders are encouraged to go to the CARE website, click on the CA tab and sign up for the
monthly eNews letter to stay abreast of the latest developments. www.carpetrecovery.org

4. AB 2398 Summary Results
California Carpet Stewardship Program Q2 2024 Approved Results
4

5. Quarterly Over view of Results
California Carpet Stewardship Program Q2 2024 Approved Results
5
Readers note: There may be slight differences in numbers versus prior reports since some data are
based on accruals and may change when actual data is available, or adjustments must be made.
Adjustments typically occur with audits, are routine, and are usually minor with minimal impact and
no implications for the Program.

6. AB 2398 Performance Trends (millions of pounds)
6 Table Note: 2015 – 2023 data represents the quarterly average during the year.
25.8
26.8
24.5
23.4
20.5
19.4
22.1
23.3 23.3
22.5
25.5
8.7
9.4
11.8
12.3
14.5
13.2
16.9
18.4
16.5
18.9
18.3
-
5.0
10.0
15.0
20.0
25.0
30.0
2015 2016 2017 2018 2019 2020 2021 2022 2023Q1 2024Q2 2024
Pounds (Millions)
Gross Collections Recycled Output

7. Recycling Rate Trend
7
1.Recycling rate increased by an average of 29% year over year from 2015 to 2024.
10.1%
11.0%
14.0%
15.3%
19.1%
20.9%
27.9%
33.9%
35.0%
38.9%
5.0%
10.0%
15.0%
20.0%
25.0%
30.0%
35.0%
40.0%
45.0%
2015 2016 2017 2018 2019 2020 2021 2022 2023 YTD 2024
Recycling Rate (Annual) Expon. (Recycling Rate (Annual))
2024 RR Target = 34%

8. Gross Collected PCC Sent Back to Landfill
1
8
Q2 2024 Gross Collected: 25.5M lbs. – 1.5M lbs. sent to landfill | Cumulative back to landfill 2015 – 2024: 140.6 M lbs.
1.

Percentages shown are % of Gross Collected PCC sent to landfill as unrecyclable PCC or process waste.
2015 – 2022 data represents the quarterly average during the year.
5.2 5.3
4.9
5.8
4.0
2.6
2.2 2.3
1.7 1.4 1.5
21% 20% 20% 25% 20% 13% 10% 10% 7% 6% 6%
0.0
1.0
2.0
3.0
4.0
5.0
6.0
7.0
2015 2016 2017 2018 2019 2020 2021 2022 2023Q1 2024Q2 2024
Pounds (Millions)

9. Calcium Carbonate (PC4) by Quarter
1
9
1. Beginning with Q4 2022, PC4 pounds were adjusted to correct for excess water content.
4,811
4,2214,311
4,652
5,2445,1345,239
4,053
4,738
3,979
3,723
5,1235,041
0
1,000
2,000
3,000
4,000
5,000
6,000
Q2 2021Q3 2021Q4 2021Q1 2022Q2 2022Q3 2022Q4 2022Q1 2023Q2 2023Q3 2023Q4 2023Q1 2024Q2 2024
Pounds (Thousands)

10. AB 2398 Manufacturers/Mills
Quarterly Summar y Report
California Carpet Stewardship Program Q2 2024 Approved Results
10
Readers note: Q1 numbers have been updated to reflect the latest information due to late reporters

11. AB 2398 Mills Summary
11
Cumulative SQYD Sold: 1,072.1M Cumulative Remittances: $233.3M
Q2 2021Q3 2021Q4 2021Q1 2022Q2 2022Q3 2022Q4 2022Q1 2023Q2 2023Q3 2023Q4 2023Q1 2024Q2 2024
79 77 77 77 78 80 83 82 83 84 83 84 87
# Mills Not Reporting 1 0 2 2 2 0 0 0 1 8 4 2 1
Non-response Rate 1% 0% 3% 3% 3% 0% 0% 0% 1% 10% 5% 2% 1%
Remittance Collected
Total Sq Yd Sold (millions) 17.9 17.8 15.5 15.1 16.9 16.5 13.4 12.8 14.2 14.4 12.4 12.5 13.9
Total Remittances ($M) 6.26$ 6.24$ 5.42$ 5.28$ 6.22$ 6.11$ 4.99$ 4.72$ 8.53$ 8.62$ 7.45$ 9.25$ 10.31$
Top 10 Remittances (>$10K) 5.93$ 5.86$ 5.09$ 4.90$ 5.81$ 5.69$ 4.63$ 4.39$ 8.01$ 8.09$ 6.97$ 8.56$ 9.59$
Top 10 % of Total (Avg) 95% 94% 94% 93% 93% 93% 93% 93% 94% 94% 94% 93% 93%
# Mills Registered
Mills - Quarterly Summary

12. Sales by Quarter
12
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
14.2 14.4
12.4 12.5
13.9
0
5
10
15
20
25
30
Q1 Q2 Q3 Q4
Square Yards (Millions)
201320142015201620172018201920202021202220232024
-3%
-3%
-13%
-7%

13. Carpet Mill Sales by Face Fiber
13
31.5%
55.9%
0.0%
10.0%
20.0%
30.0%
40.0%
50.0%
60.0%
2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024
CA Face Fiber Sales
Nylon 6 Nylon 66 PET Polypropylene Natural Blended / Other

14. AB 2398 Quarterly Subsidy and
Expense Payouts
California Carpet Stewardship Program Q2 2024 Approved Results
14

15. Summary of Payouts Q2 2024
15
1
2
3
4
CSEs
CSE Reporting Incentive 10,000$
Tile Recycling or Reuse Pilot 90,728$
Tile Reuse 214,007$
Broadloom Reuse 102$
Total Reuse Payout 214,109$
624,232$
Adjustments -$
Total CSE Payouts 939,070$
Broadloom Shipped and Sold
Processors
Tile RECYCLED 84,894$
Type 1 Standard Payout 1,479,623$
Highest Recyclability: Nylon 359,816$
Total Type 1 Payout 1,924,333$
Type 2 Filler/Other -$
PC4 (Calcium Carbonate) 856,992$
Total Type 2 Payout 856,992$
Adjustments 189,419$
Total All Processor Payouts 2,970,743$
Manufacturers
Total PET Payout 1,189,819$
PET Pellet Payouts 80,542$
Total Polypropylene Payout 233,426$
Total Polypropylene Pellet Payout 41,161$
Non-Nylon Payouts 1,544,949$
Nylon 6 Payouts 843,683$
Nylon 6,6 Payouts 132,439$
Adjustments -$
Total All Manufacturers Payouts 2,521,071$
Subsidy Payouts
Total Subsidy Payouts for Qtr 6,430,883$
Represents additional $0.05 per pound for Type
1 output (excludes Tile & PC4) for the month of
June 2024

16. Summary of Expenses
16 Note: All data from Finance Director confirmed 8/19/24
Subsidies paid in CA = 78%
Expenses Q2 2024
Base Subsidy Payouts 6,430,883$
Total Subsidy Payouts for Quarter 6,430,883$ Advisory Committee -$
Education and Outreach 277,461$
Collections Program 595,804$
Grants 24,728$
Technical Assistance 115,939$
Program Expenses Sub-total
1,013,932$
CalRecycle 191,171$
CARE Administrations Cost 17,679$
Direct Expenses 259,327$
Direct Support 149,332$
Accounting and Legal 187,351$
Admin Expenses Sub-total
804,860$
Program & Admin Expenses Total 1,818,792$
Total
Grand Total Expenses 8,249,675$
78%
0%
1%
12%
2%
0%
3%
2%
2%
10%
22%
100%
Percentage
78%
0%
3%
7%

17. Fund Balance Trends: Accrual Basis
17
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 8/19/24
$6.2
$6.4
$5.4 $5.3
$6.2 $6.1
$5.0
$4.7
$9.2
$8.7
$6.7
$9.4
$10.3
$7.3
$8.4
$7.2 $7.0
$8.2 $8.0
$8.4
$7.1
$8.2
$7.5 $7.6
$8.6
$8.2
$16.1
$14.2
$12.1
$10.4
$8.5
$6.6
$3.2
$0.8
$1.8
$3.0
$2.1
$2.9
$5.0
$4.9
$5.6 $4.9 $4.7 $5.4 $5.3 $5.6
$4.7
$5.5
$5.0 $5.1
$5.7
$5.5
$-
$2.0
$4.0
$6.0
$8.0
$10.0
$12.0
$14.0
$16.0
$18.0
Q2 2021Q3 2021Q4 2021Q1 2022Q2 2022Q3 2022Q4 2022Q1 2023Q2 2023Q3 2023Q4 2023Q1 2024Q2 2024
Dollars (Millions)
Revenue Expenses Fund BalanceFund Reserve

18. CA Employees (FTEs)
18
FTE = Fulltime equivalent employees
68 73 74 77 81 86 87 91 97 94 95 97 96
74
79 79
86 84
84 84
84
84 84 77 77 77
26
26 28
28
31
30 28
28
28 28
27 27 27
13
12 12
12
12
12 12
12
12 12
12 12 12
181
190 193
203
208
212 211
215
221 218
211 213 212
-
50
100
150
200
250
Q2 2021Q3 2021Q4 2021Q1 2022Q2 2022Q3 2022Q4 2022Q1 2023Q2 2023Q3 2023Q4 2023Q1 2024Q2 2024
CSE FTEs Processor FTEs Manufacturer FTEs CARE-related FTEs

19. Drop-Off Site Program Update
California Carpet Stewardship Program Q2 2024 Approved Results
19

20. Total Drop- off Sites

20
Note: Public drop- off site data includes three regional distribution sites.
192197202207211202201193201
182185
196
211
89
90
98
101102115
135
135
138
142
150
151
151
281
287
300
308313317
336
328
339
324
335
347
362
0
50
100
150
200
250
300
350
400
Q2
2021
Q3
2021
Q4
2021
Q1
2022
Q2
2022
Q3
2022
Q4
2022
Q1
2023
Q2
2023
Q3
2023
Q4
2023
Q1
2024
Q2
2024
# of Drop -off Sites
Private Drop-off SitesPublic Drop-off Sites

21. Drop-Off Site Total Program Costs
21
$170
$203
$235
$202
$285$282$267
$226
$292
$327$323
$278
$333
$52
$56
$61
$67
$70 $69
$73
$56
$72
$76 $75
$76
$90
$85
$100
$83
$88
$127$122
$114
$96
$116
$131
$117
$102
$127
$307
$359
$379
$358
$482
$474
$454
$377
$480
$533
$515
$456
$551
$0
$100
$200
$300
$400
$500
$600
Q2 2021Q3 2021Q4 2021Q1 2022Q2 2022Q3 2022Q4 2022Q1 2023Q2 2023Q3 2023Q4 2023Q1 2024Q2 2024
Cost $ (Thousands)
Hauling CostStorage CostRecycling Fees

22. Annual Cost Comparison
22
% of 2024 Total Program Costs: Hauling: 61% | Storage: 16% | Recycling Fees: 23%
$450 $504
$733
$1036
$1167
$611
$209
$234
$219
$280
$279
$167
$344
$322
$339
$451
$460
$229
$1,003
$1,060
$1,291
$1,767
$1,906
$1,007
$0
$500
$1000
$1500
$2000
$2500
2019 2020 2021 2022 2023 YTD 2024
Cost in Thousands
Hauling CostStorage CostRecycling Fees

23. Material Collected by CARE Drop- Off Sites (Annual)
23
2024 lbs. collected: 56% of total 2023 lbs. collected
Q2 2024 lbs. collected: 18% increase from Q1 2024 lbs.; 15% increase from Q2 2023 lbs. collected
10,167 10,226
12,773
17,053
18,088
10,051
0
2,000
4,000
6,000
8,000
10,000
12,000
14,000
16,000
18,000
20,000
2019 2020 2021 2022 2023 YTD 2024
Pounds (Thousands)

24. Drop-Off Site Program Summary
1
24
• 211 operational private sites reported at the end of Q2 2024.
• 151 operational CARE Drop- Off Sites in 58 CA counties at the end of Q2 2024. Public drop- off site data includes three regional distribution
sites.
1. Cost/Capita uses updated U.S. Census information as available.
Data Collected 2018 2019 2020 2021 20222023
YTD
2024
Hauling Cost (K $) $475 $450 $504 $733$1,037$1,167 $611
Storage Cost (K $) $172 $209 $234 $219 $280$279 $167
Recycling Fees (K $) $284 $344 $322 $339 $451$460 $229
TOTAL Cost (K $) $930$1,003$1,060$1,291$1,768$1,906$1,007
Avg. Cost/lb Collection $0.12$0.10$0.10$0.10$0.10$0.11$0.10
Avg. Cost/lb - Rural $0.17$0.21$0.20$0.19$0.18$0.20$0.18
Avg. Cost/lb - Urban $0.10$0.08$0.09$0.09$0.09$0.09$0.09
Average Cost/Capita [1]$0.005$0.004$0.003$0.003$0.004$0.004$0.004
Pounds Collected (K lbs)7,94510,16710,22612,77317,05318,08810,051
Private Drop-Off Site 117 160 178 202 201 185 211
Public Drop-Off Site 53 73 83 98 135 150 151
Annual Data Summary

25. Private vs. Public Collection Sites
25
84%82% 84%
80%
77%79%
76%77%
74%75% 76%74%
72%
16% 18%
16%
20% 23%
21%24% 23%26% 25% 24% 26%
28%
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
Q2
2021
Q3
2021
Q4
2021
Q1
2022
Q2
2022
Q3
2022
Q4
2022
Q1
2023
Q2
2023
Q3
2023
Q4
2023
Q1
2024
Q2
2024
Private Collection Sites - Lbs. Collected Public Collection Sites - Lbs. Collected
% Lbs. Collected - Private Sites % Lbs. Collected - Public Sites

26. Recommendations to SFOC
California Carpet Stewardship Program Q2 2024 Approved Results
26

27. 2Q Recommendations for SFOC Approval
27
1) Approve CSE subsidy 939,070$
2) Approve Processor subsidy 2,970,743$
3) Approve Manufacturer subsidy 2,521,071$
4) Approve Program costs 1,013,932$
5) Approve Administrative costs 804,860$
Total Payout: 8,249,675$

28. CARE Program Update
28
Education & Outreach
Collection
Grants
Market Development
Newsletters & Communications

29. Education & Outreach
29
Retailer
–271 one-to-one phone calls to flooring retailers, (752 YTD)
Retailer, Installer, Contractor, Sustainability Professional
–Newsletter of CARE Highlights sent to retailers and installers
–Postcards promoting drop-off sites sent to retailers and licensed installers in 3 counties
–Five Tabling Events
•4 carpet distribution centers
•1 California Resource Recovery Conference (CRRA) conference
–Four Presentations
•Bay Area Sustainability Construction Leaders (BASCL)
•All for Reuse (AFR) Owners Alliance
•Conservation Corp
•Hotel Council of San Francisco (HCSF)
–Union Apprentice Training – DC16, San Leandro

30. Education & Outreach
30
Drop-off Site
–One quarterly outreach effort (3YTD).
•one-to-one technical assistance phone calls with CARE drop- off sites
Local Government
–Conducted Local Government Survey and completed summary of results
–Distributed Waste Wizard Toolkit to 16 agencies
–Preparations for Local Government Task Force Engagement
–Presentations:
•Contra Costa County, AB 939Meeting
•ESJPABoard of Directors Meeting
•San Francisco Department of Environment, Zero Waste SF
•San Mateo County, Countywide Recycling CommitteeMeeting

31. Collection
31
CARE Drop-off Sites – 152
–148 public drop- off sites and 4 semi-public Drop- off Sites
–Four new Drop- off Sites
–Three sites withdrew from the program
Convenient Collection Goal 2024
–One site in Riverside County is needed to meet 2024 goal.
–Colusa County would like to disengage from the carpet collection program.
Growing Collections & Reuse
–Plan in process with Waste Management to on-board four facilities in No Cal in 2024
–UCLA project for the renovation of 400 dorm rooms is complete.
–Establishing a trial collection service in Southern CA. using 3-yd front-end loader style bins
–Exploring collaboration with Conservation Corp to conduct collection events

32. Grants
32
Micro Grants
–Cycle 5 of micro grants is evergreen and continues to take applications through year end
–One project is complete
–Four new proposals are underway
–Three projects are on-going
Capital Grants
–Two projects ongoing
–A new cycle launch for 2024 is under discussion
Testing Grants
–Two projects are ongoing
Innovation and Design Grants
–Two projects are ongoing
–Two projects were awarded and the contract process is underway
Case study about grant funding for fiber identification technology and testing.

33. Market Development
33
Venders
–29 Tier two manufacturers
•13 in California
•16 outside of California
Products
–112 Products contain PCC recycled content.
•47 products made within the State
•65 products made outside of the State
A PCC characterization study is underway to discover recyclability issues.
Outcomes will guide carpet design and end markets for recycled carpet.
TranPak’s design for plastic recyclable pallets is underway to meet the
2024 Program Goal objectives with 30 Tier Two manufacturers and 113
total products.

34. Newsletters/Communications
34
Added 6 blog posts:
–CARE Conducts Consumer Survey
–Program Highlights Mailed to Installers and Retailers
–CARE Publishes Recyclability Study
–Q1 2024 Sets Record Carpet Recycling Rate
–Innovation & Design Grants Awarded
–Reuse Stories: CARE Helps Divert Carpet Tile to School
Three e-news sent (June, July, August)
Ongoing: reporting collateral, signage, presentations, website
and LinkedIn and Twitter.

35. Table 3-2. Summary of Program Performance Goals and Metrics, 2024
Performance Progress as of Q2 2024
35
2024 Year End Program Performance Goals
- Metrics
Performance
Goal #
Metric 2024 Goal Status
1
Recyclability: Recyclable
Products
Ensure program capacity to recycle 73%
of PCC types
On Track
2 Markets: New Products 3 new products; 108 total products On Track
2 Markets: New Vendors 2 new vendors; 30 total vendors 29 of 30
3
Reuse of PCC (% of Recycled
Output)
1.7% of Recycled Output On Track
4
Gross Collection
(thousand pounds)
92,000 On Track
5
Disposal of PCC (thousand
pounds)
119,000 On Track
6 & 11
Public Access to Drop-off Sites
(Collection Convenience)
One site per 450,000
residents in each county, (minimum of
one per county)
Slight Risk
6 & 12
Flooring Professional Proximity:
% of residents within 15 miles of a
location that accepts carpet from
all flooring professionals
78% Met
7
Processor Capacity (West
Coast)
138 million pounds capacity On Track
8 Recycling Rate 34% On Track
9 Collection Rate 45% On Track
10
Recycling Efficiency Rate
(formerly Yield)
75% On Track
Table 3-2. Summary of Program Performance Goals and Metrics, 2024
Performance Progress as of 08/01/2024

36. End of Review
California Carpet Stewardship Program Q2 2024 Approved Results
36