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This report, prepared by R.W. Beck, Inc. for Humboldt State University and CIWMB, examines the net cost reports from the Electronic Waste Recycling Program for 2005. It assesses the findings, methodologies, common reporting errors, and key trends in the e-waste recycling industry. The goal is to enhance reporting accuracy and provide insights to the Board for better program administration. Key issues such as variability in net costs, payment rates, and market trends are discussed, aiming to inform participants and adjust the program as necessary.
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R.W. Beck, Inc. Humboldt State University CIWMB Electronic Waste Recycling Program Analysis of Net Cost Reports
Analysis of 2005 Net Cost ReportsOutline 1. Background 2. Results 3. Issues and Considerations
HSU, Office for Economic & Community Development Margaret Gainer, Director Dan Iharra, PhD, Economics Student Assistants R.W. Beck, Inc. Ed Boisson, Project Manager Greg Broeking, CPA Susan Bush and Mary Chamberlin, Recycling Market Analysts The Team
Project Objectives • Help participants prepare reports • Maximize accuracy and consistency • Provide information to help the Board administer the program
Timeline Jul. 2005 – Project begins Oct. 2005 – Participant survey and literature review Nov. 2005 – Reporting forms and Guide Jan. 2006 – Webinar trainings Mar. 2006 – 2005 reports due Nov. 2006 – Preliminary results; Guide and forms revised Jan. 2007 - Webinar trainings Mar. 2007 – 2006 reports due
Net Cost Reporting System • Form 220, Net Cost Report • Worksheets • Form 220a for collectors • Form 220b for recyclers • Guide with Line-by-Line Instructions
The Math Total Revenue - Costs (Labor, Transportation, Other) = Net Cost ÷ Pounds Handled = Net Cost per Pound
Key Guidelines • Include costs & revenue for CEW only • Report on collection & recycling separately • Don’t include CIWMB revenue • Report your best, most reasonable estimate
Methodology • Preliminary Analysis to Determine Best Approach • Select Representative Sample • Review and “Confirm” Selected Reports (Not an Audit) • Analyze Confirmed Reports
Most Common Errors • Wrong forms • Reporting on e-waste other than CEW • Separating collection & recycling activities • Missing line item costs • Arithmetic errors
Analysis of 2005 Net Cost ReportsOutline 1. Background 2. Results 3. Issues and Considerations
Findings • High variability of net costs • Current payment rates cover *most* participants’ net cost • High variability in suggested “reasonable rate of profit”
Analysis of 2005 Net Cost ReportsOutline 1. Background 2. Results 3. Issues and Considerations
Key Trends • Growing, Immature Industry – Continued Restructuring Likely • Intense Recycler Competition • Mergers, acquisitions, partnerships • Innovative business models • Pass thru of funds to collectors, handlers and generators • Relatively strong end markets and pricing in 2005 and 2006 • Changing technologies will radically affect recycling costs, but not yet
Issues for Board Consideration • Which measure of “average net cost” should be used? • Include collector revenue? • Should collector, recycler or both rates be changed? • Are tiered payment rates practical?
Options to Enhance the Self-Reporting Approach • On-site review of documentation and/or audits • Time-and-motion studies • Derive reasonable costs for archetypal programs • Analyze impact of changing technologies • Decline of CRTs, new consumer products, etc. • Analyze recycling industry market trends • Impact of SB20 system on recycling non-CEW material • Document best management practices
Questions? Ed Boisson, R.W. Beck, Inc. 415-499-0919 eboisson@rwbeck.com
