Carpet Recycling Fees Set to Increase in California

In a move aimed at strengthening the state’s carpet recycling efforts, California will raise its carpet differential assessment starting February 1, 2025. The California Department of Resources Recycling and Recovery (CalRecycle) has approved this increase, which was requested by the Carpet America Recovery Effort (CARE) on November 8, 2023. The revised rates reflect the growing financial demands on the program, which seeks to improve carpet recycling and reduce waste in the state.

Credit: carpetrecovery.org

The new assessment rates will vary depending on the type of carpet and its post-consumer content. For broadloom carpets with less than 10% post-consumer content, the new rate will be $1.05 per square yard. Broadloom carpets with 10% or more post-consumer content will be assessed at $0.96 per square yard. Meanwhile, carpet tiles with less than 10% post-consumer content will face a higher assessment of $1.49 per square yard, and the assessment fee for carpet tiles with 10% or more post-consumer content will be $1.4 per square yard.

These rates are part of CARE’s differential assessment system, which aims to charge carpet manufacturers based on the environmental impact of the products they sell. The system takes into account the material composition (broadloom vs. carpet tile) and the percentage of recycled content in the carpet. This change will replace the current rates and is essential to ensure that the program can continue to cover its increasing costs.

CARE Executive Director Bob Peoples acknowledged the burden that these increased assessments could place on California retailers and consumers but stressed the necessity of the increase. “While the California Carpet Stewardship Program has made huge progress in recent years, new demands and rising costs make this increase necessary,” he said.

The increase is driven by several factors. Most notably, CalRecycle has mandated that CARE build a six-month operating reserve by the end of 2025, requiring the addition of approximately $13 million in 2025 alone. Additionally, the success of the program, which has led to higher costs, and a new union agreement requiring up to 8% of revenue annually, means that CARE will face new liabilities of up to $4 million per year. This equates to an additional 8 cents per square yard based on current sales.

In addition, Sales of carpet in California have been declining, which means the program’s revenue base is shrinking while costs are increasing. Inflation also continues to affect operational costs, although its impact in 2025 is expected to be smaller than in previous years.

The organization says Despite these challenges, the California Carpet Stewardship Program has seen significant success. In 2023, the program achieved a record 35% recycling rate, and on average, 71% of collected carpet is recycled. These achievements demonstrate the program’s growing effectiveness in reducing waste and increasing the recovery of valuable materials.

The organization also says that carpet retailers in California should prepare for the changes that will take effect in 2025. They will need to adjust their point-of-purchase systems to ensure they are collecting the updated assessments from customers. And CARE will continue to support retailers by providing updated training materials and point-of-purchase collateral. Carpet mills will also play a crucial role in helping retailers understand which products qualify for the updated assessments based on their post-consumer content.

According to CARE, changes to the assessments are expected to continue, as a recent approval letter from CalRecycle indicates that the organization must submit assessment levels for the next five years to meet all statutory, regulatory, and plan requirements. 

The increase in carpet assessments is essential to maintaining California’s leadership in sustainability and recycling. By adjusting the rates to reflect rising costs and new program demands, the state can further advance its efforts to reduce carpet waste and enhance the reclamation of valuable materials.