Diversion Rate Estimate

1

Diversion Rate EstimateOne Indicator of Diversion Program

Success

2

Three Primary Components of Measurement System

BASE YEARBASE YEAR

ADJUSTMENT METHODADJUSTMENT METHOD

DISPOSAL REPORTINGDISPOSAL REPORTING

3

BASE YEARBASE YEAR

The base year is the foundation for diversion rate measurement

An accurate base year is critical for accurate diversion rate estimates

Each jurisdiction (city, county, or regional agency) is required to establish a base year

Over 250 jurisdictions updated their base years since original 1990 studies

4

ADJUSTMENT METHOD

More People?More Jobs?More Sales?

5

Statute required the Board to develop an adjustment method

The Board adopted the method developed by a working group

Uses readily available data to keep costs low The adjustment method estimates changes in

waste generation due to changes in population and the economy

without having to measure both diversion and disposal in the measurement year

Saves jurisdictions time and money

Depends on anaccurate base year

ADJUSTMENT METHODADJUSTMENT METHOD

6

Adjustment Method Premise

25

1990

200X

PRC 41780.1 & 41780.2

7

Residential vs. Non-Residential

Measurement year residential and non-residential generation amounts are estimated separately Affected differently by changes in population

and the economy. Population is used only with the residential

estimate. The residential and non-residential

estimates are added to find total measurement year generation tonnage.

8

Adjustment Method Formula

Adjustment Method Formula Steps: (1) IM = Inflation Multiplier: CPIB/CPIR (2) CTR = Corrected Reporting—Year Taxable Sales in Dollars: TR x

IM (3) NRAF = Non—Residential Adjustment Factor: (ER/EB + (CTR/TB)/2 (4) RAF = Residential Adjustment Factor: (PR/PB) + NRAF/2 (5) Estimated Reporting Year Generation: (RWGB x RAF) + (NRWGB x

NRAF)

Glossary of Terminology: RWGB=Base-Year Residential Waste Generation in Tons NRWGB=Base-Year Non-Residential Waste Generation in Tons PR=Reporting-Year Population in Persons PB=Base-Year Population in Persons ERLF=Reporting-Year Labor Force Employment in Jobs ERIN=Reporting-Year Industry Employment in Jobs EBLF=Base-Year Labor Force Employment in Jobs EBIN=Base-Year Industry Employment in Jobs TR=Reporting-Year Taxable Sales in Dollars TB=Base-Year Taxable Sales in Dollars CPIR=Reporting-Year Consumer Price Index CPIB=Base-Year Consumer Price Index

9

Population-(CA Department of Finance)

Employment-(CA Employment Development Department)

Taxable Sales-(CA Board of Equalization)

Inflation Index-(provided on another slide)

Adjustment Factors(and Sources)

10

Adjustment Factor Trends

This graph shows percent change in population, employment, inflation-adjusted taxable sales, and waste disposal for California, 1991-2004 (base year = 1990). 

11

Taxable Sales Inflation Adjustment Factors (and sources)

Inflation Adjustment Factor adjusts taxable sales amounts for inflation

Consumer Price Index (CPI) -(CA Department of Industrial Relations)

Taxable Sales Deflator Index (TSDI)-(CA State Board of Equalization)

Note: Board Item in September 2005authorized future use as alternative factor

12

Comparison of Inflation Indexes: CPI vs. TSDICalifornia Consumer Price Index (CPI) vs. Taxable Sales Deflator

Index (TSDI), 1985-2004 (1985=100)

100.0

110.0

120.0

130.0

140.0

150.0

160.0

170.0

180.0

190.0

1985 1986 1987 1988 1989 1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004

Year

Ind

ex

CPI TSDI

New Employment Adjustment Factors

Employment Development Department total employment by jurisdiction for 2005 and subsequent years is now

available

May be used to calculate diversion rates when using a 2005 or later base year 

13

14

Web Tools Perform Adjustment Method Calculations

Adjustment Factor Impact vs Base Year on Diversion RatesRidgecrest Diversion Rate 2006 Diversion Calculation Input Rate Estimate Double B-Y Generation Tons 82%

Halve B-Y Generation Tons 27% Double City Population % Growth 64%

Halve City Population % Growth 64%  Double County Employment % Growth 67%

Halve County Employment % Growth 62% Double City Taxable Sales % Growth 69%

Halve City Taxable Sales % Growth 60% Double TSDI % Growth 62%

Halve TSDI % Growth 65%

15

16

Diversion Rate EstimateOne Indicator of Diversion Program

Success

17

18

19