1. Report to the Legislature Required by Senate Bill 2202 (due January 1, 2002) Board Briefing June 13, 2001 Agenda Item 5 Attachment 1

2. Report to the Legislature Board required to establish, at a minimum, a working group to evaluate the disposal reporting system (PRC Section 41821.5) Board required to submit a report with recommendations for changes and improvements by January 1, 2002

3. Evaluation of Measurement System December 2000— Board directed staff to evaluate the entire diversion rate measurement system Adjustment Method is one component of the diversion rate measurement system

4. Structure for Developing Report to the Legislature Two working groups focus on improvements to the existing system oDisposal Reporting System – 28 members oAdjustment Method – 17 members Alternatives working group focus on alternatives to the existing system – 23 members Synthesis group combine solutions from all groups to develop a workable, improved diversion rate measurement system – 18 members

5. Representation of Working Groups Cities and counties throughout CA—both urban and rural Haulers, disposal facility operators, recyclers Consultants Environmental and special interest groups Colleges and universities

6. Working Group Meetings Meetings held in March, April and May Identify issues and potential solutions Solutions include improvements to existing system with and without legislation Solutions to be forwarded to the synthesis group—early June

7. Report to Legislature Recommendations from working groups, Board staff will be included in a draft report in July 2001 30 day comment period on draft report Revised report in August 2001 Final report October 2001 for Board consideration Final report due to Legislature January 2002

8. Adjustment Method More People? More Jobs? More Sales? More Waste Generated Standard Diversion Rate Calculation ADJUSTMENT METHOD PRC 41781PRC 41780.1 & 41780.2 Base Year Generation Estimated 1999 Generation

9. Estimating Non-Residential Change 1999 1990 + 1999 1990 2 Economic Change Ratio (Inflation Corrected)

10. Estimating Residential Change 1999 1990 + 2 Economic Change Ratio Demographic Change Ratio

11. Data Analysis and Presentations Interactions Between The Adjustment Method, Base-Year Generation, & Report-Year Disposal Possible Sources Of Estimate Error

12. Does Base-Year Age Matter? Most jurisdictions have 1990 Base-Years

14. Does Base-Year Age Matter? Issue: –Original Adjustment Method Working Group lacked data to analyze Adjustment Method accuracy when residential and non-residential sector growth exceeds 14% Error increases as the growth rate increases

17. Does Jurisdiction Size Matter? Issue: Do the odds of Disposal Reporting System error increase as jurisdiction size decreases?

20. Does Jurisdiction Size Matter? The smaller the jurisdiction: –The greater the odds of Disposal Reporting System error –The greater the range of default diversion rates?

22. Issue: What adjustment factor measurement level is best: county or jurisdiction? –Measurement level use has changed over time –County level is a more accurate level for measuring the factor –Jurisdiction level data may be more representative if the jurisdiction is different from the county as a whole

23. Adjustment Factor Balanced Change Issues: –If base-year to report-year % change in adjustment factors is not balanced, has the nature of solid waste production significantly changed since the base-year?

25. Conclusions 1.Base-year age may be a factor in diversion rate estimate error –Adjustment Method accuracy not demonstrated for growth over 14% –Unbalanced change in adjustment factors may be more likely for jurisdictions with older base-years –Changes in nature of solid waste production should be considered

26. Conclusions 2.Jurisdiction size may be a factor in diversion rate estimate error –Disposal Reporting System data may have significant error for smaller jurisdictions –Difference between maximized and minimized diversion rates is greater for smaller jurisdictions

27. Conclusions 3. Unbalanced change in adjustment factors should be investigated –Unbalanced change could indicate: Significant change in the nature of the production of solid waste County level factors do not reflect the jurisdiction’s demographic and economic growth

28. Adjustment Method Factor Sources Uses readily available factor sources to keep costs down and maintain consistency: Population –(CA Department of Finance) Employment –(CA Employment Development Department) Taxable Sales –(CA Board of Equalization) –Inflation Corrected using Consumer Price Index (CPI)

29. Adjustment Method Factor Choices A jurisdiction may use: – Default (standard) countywide or jurisdiction- specific factors supplied by the Board – Alternative factors from independent third-party sources Each factor must be from same published source and use same method for both years

30. How Alternative Employment measures affect diversion rate? Currently AM uses EDD Labor Force as the default Examined whether other Employment factor use impact diversion rates Factors compared with EDD Labor Force: -EDD Industry employment data -Federal Industry employment data

31. EDD Labor Force vs. EDD Industry DIV. RATE# of JURISDTIONS% (no change)13131.5 + 1% to +2%25060 + 3% or more358.5 416 100.0

32. EDD Labor Force vs. Federal Industry DIV. RATE# of JURISDICTIONS% (no change)13933.5 + 1% to +2%236 56.8 + 3% or more40 9.6 415100.0

33. Do CIWMB estimates of fourth quarter taxable sales add error to AM estimates of waste generation (and the diversion rate)? DIV. RATE# of JURISDICTIONS% (no change)27770.3 + 1% to +2%11228.5 +3% or more 51.3 394100.0

34. Adjustment Method Working Group Recommendations 1. Allow more flexibility in data used for adjustment factors 2. Establish a list of circumstances that impact accuracy of adjustment method and diversion rates 3. Diversion rates are an indicator. Board needs to look at program implementation as well as diversion rates. 4. More detail on recommendations handout