Report to the Legislature Required by Senate Bill 2202

(due January 1, 2002)

Board BriefingJune 13, 2001

Agenda Item 5Attachment 1

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

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

Structure for Developing Report to the Legislature

• Two working groups focus on improvements to the existing systemo Disposal Reporting System – 28 memberso Adjustment 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

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

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

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

Adjustment Method

More People?More Jobs?More Sales?

More Waste Generated

Standard Diversion Rate CalculationADJUSTMENT METHOD

PRC 41781PRC 41780.1 & 41780.2

Base Year Generation

Estimated 1999 Generation

Estimating Non-Residential Change

1999

1990

+1999

1990

2

Economic Change Ratio

(Inflation Corrected)

Estimating Residential Change

1999

1990

+

2

Economic Change

Ratio

Demographic Change Ratio

Data Analysis and Presentations

Interactions Between The Adjustment Method, Base-Year Generation, & Report-Year Disposal

Possible Sources Of Estimate Error

Does Base-Year Age Matter?

• Most jurisdictions have 1990 Base-Years

Jurisdiction Base Years

0

50

100

150

200

250

300

350

1989 1990 1991 1992 1993 1994 1995 1996 1997 1998 1999

Base Year

Nu

mb

er o

f Ju

risd

icti

on

s

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

Maximized Non-Residential Adjustment Factor

Base Year = 1990; Report Year = 1999

Non-Residential Adjustment Factor

Nu

mb

er

of

Juri

sdic

tion

s

0

10

20

30

40

50

60

70

80

90

100

0.790.86

0.931.00

1.071.14

1.211.28

1.351.42

1.491.56

1.631.70

1.771.84

1.911.98

2.052.12

Maximized Residential Adjustment Factor

Base Year = 1990; Report Year = 1999

Residential Adjustment Factor

Nu

mb

er

of

Juri

sdic

tion

s

0

10

20

30

40

50

60

70

80

90

100

110

120

0.790.86

0.931.00

1.071.14

1.211.28

1.351.42

1.491.56

1.631.70

1.771.84

1.911.98

2.052.12

2.192.26

2.33

Does Jurisdiction Size Matter?

• Issue: Do the odds of Disposal Reporting System error increase as jurisdiction size decreases?

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?

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

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?

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

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

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

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)

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

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

EDD Labor Force vs. EDD Industry

DIV. RATE # of JURISDTIONS %

(no change) 131 31.5

+ 1% to +2% 250 60

+ 3% or more 35 8.5

416 100.0

EDD Labor Force vs. Federal Industry

DIV. RATE # of JURISDICTIONS %

(no change) 139 33.5

+ 1% to +2% 236 56.8

+ 3% or more 40 9.6

415 100.0

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) 277 70.3+ 1% to +2% 112 28.5+3% or more 5 1.3

394 100.0

 

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