Slide 1 Blue Box Program Plan Review for 2007 Stewardship Ontario Funding Formula - Second Public Consultation Meeting - February 14, 2006

Slide 1

Blue Box Program Plan Review for 2007Stewardship Ontario Funding Formula

- Second Public Consultation Meeting -

February 14, 2006

Slide 2

Introduction to Session & Website Mechanics

Lyle Clarke & Neil Antymis

Slide 3

Welcome!Welcome!

Second public consultation meeting on Blue Box Second public consultation meeting on Blue Box Program Plan (BBPP) review for 2007 & Program Plan (BBPP) review for 2007 & Stewardship Ontario’s funding formula for Stewardship Ontario’s funding formula for stewardsstewards

More than 100 people here in personMore than 100 people here in person

Approximately 30 registered by webcastApproximately 30 registered by webcast reflects interest & participation of diverse stakeholdersreflects interest & participation of diverse stakeholders

Slide 4

AgendaAgenda

8 a.m.8 a.m. Registration openRegistration open

9 a.m.9 a.m.- Meeting begins- Meeting begins- Steering Committee presents - Steering Committee presents

preliminary recommendationspreliminary recommendations

10:20 a.m.10:20 a.m. Break Break

10:40 a.m.10:40 a.m.- Steering Committee & Stakeholder - Steering Committee & Stakeholder

Panel Questions & AnswersPanel Questions & Answers- Review of next steps- Review of next steps

12:30 p.m. 12:30 p.m. (approx.) (approx.) Meeting closesMeeting closes

Slide 5

Our AudiencesOur Audiences

Webcast audience listening on-lineWebcast audience listening on-line speakers will refer to slide numbers to prompt you to speakers will refer to slide numbers to prompt you to

move to the next slidemove to the next slide email questions to:email questions to:

[email protected] [email protected]

Archived webcast available for 180 daysArchived webcast available for 180 days

Slide 6

Opening Remarks

Derek Stephenson

Program Manager

Slide 7

Opening Comments (1)Opening Comments (1)

The work of the Steering Committee to date has The work of the Steering Committee to date has been reviewed by newly expanded Stewardship been reviewed by newly expanded Stewardship Ontario Board Ontario Board

Board now includes wider representation fromBoard now includes wider representation from durable products & distributors – CHHAdurable products & distributors – CHHA retail & distribution, including CRFA & Costcoretail & distribution, including CRFA & Costco consumable products, Unilever, Nestle, Kraftconsumable products, Unilever, Nestle, Kraft

Believe it has been an open & thorough review Believe it has been an open & thorough review

Slide 8

Opening Comments (2)Opening Comments (2)

Board is supportive of directions outlined, but as Board is supportive of directions outlined, but as with each of you, individual members are with each of you, individual members are thinking through carefully the impacts & issues thinking through carefully the impacts & issues before final decision before final decision

While program has been successful in meeting While program has been successful in meeting the obligation of stewards to datethe obligation of stewards to date 2005 target has been met2005 target has been met MOE received only 3 comments during most recent MOE received only 3 comments during most recent

fee-settingfee-setting

Board welcomes attendees’ input as to whether Board welcomes attendees’ input as to whether BBPP can be made better BBPP can be made better

Slide 9

Lyle Clarke & Neil Antymis

Steering Committee Preliminary Recommendations

Slide 10

Topics for Today’s PresentationTopics for Today’s Presentation

Objectives of reviewObjectives of review Principles guiding the Principles guiding the

reviewreview Objective of the Objective of the

meeting todaymeeting today Review of process & Review of process &

timelinestimelines Screening criteria Screening criteria

usedused Review current Review current

funding formulafunding formula

Summary of input & Summary of input & commentscomments

Steering Committee Steering Committee recommendations recommendations

Check against key Check against key screening criteriascreening criteria

Next stepsNext steps

Slide 11

Objectives of the ReviewObjectives of the Review

Fulfill commitment made during 2006 fee Fulfill commitment made during 2006 fee consultation process to consider modifications to consultation process to consider modifications to BBPP fee setting methodologyBBPP fee setting methodology

Provide an opportunity for all stakeholders to:Provide an opportunity for all stakeholders to: re-evaluate the current funding formula re-evaluate the current funding formula identify & assess potential modifications or alternative identify & assess potential modifications or alternative

approaches approaches

Slide 12

Review of Process & Timelines (1)Review of Process & Timelines (1)

Draft discussion paper approved & circulatedDraft discussion paper approved & circulated

11stst Advisory Committee meeting Advisory Committee meeting

11stst Public Meeting Public Meeting

Oct 25Oct 25

Oct 27 Oct 27

Dec 8Dec 8

Receive & review written commentsReceive & review written comments

- detail for modeling impacts- detail for modeling impacts

- further general comments- further general comments

Dec 22Dec 22

Jan 12Jan 12

Steering Committee recommendationsSteering Committee recommendations Jan 20Jan 20

2nd Advisory Committee meeting2nd Advisory Committee meeting Jan 25Jan 25

Stewardship Ontario Board approval of Stewardship Ontario Board approval of preferred option for the purposes of further preferred option for the purposes of further consultationconsultation

Jan 31Jan 31

Slide 13

Review of Process & Timelines (2)Review of Process & Timelines (2)

2nd Public Meeting2nd Public Meeting

- recommendations on Funding Formula - recommendations on Funding Formula (FF) & related changes to BBPP(FF) & related changes to BBPP

Feb 14Feb 14

3rd Advisory Committee meeting3rd Advisory Committee meeting

- preferred option & related impacts on - preferred option & related impacts on BBPPBBPP

Mar 6Mar 6

Stewardship Ontario Board approvalStewardship Ontario Board approval Mar 8Mar 8

Review by Waste Diversion Ontario (WDO) Review by Waste Diversion Ontario (WDO) BoardBoard

Mar 22Mar 22

Recommendations forwarded to MinisterRecommendations forwarded to Minister

Slide 14

Screening Criteria (1)Screening Criteria (1)

Complies with legal requirements of Complies with legal requirements of Waste Waste Diversion ActDiversion Act (WDA) (WDA)

Furthers policies & goals of WDA & BBPPFurthers policies & goals of WDA & BBPP

Material impact that warrants changeMaterial impact that warrants change

Treats stewards & materials in a fairer mannerTreats stewards & materials in a fairer manner

Strengthens incentives for 3RsStrengthens incentives for 3Rs

Slide 15

Screening Criteria (2)Screening Criteria (2)

Improves simplicity & transparencyImproves simplicity & transparency

Facilitates compliance & auditingFacilitates compliance & auditing

Has a proponentHas a proponent

Sufficient outline of approach & data for Sufficient outline of approach & data for effective modelingeffective modeling

Slide 16

The Current Funding Formula (1)The Current Funding Formula (1)

Sets fees within context of:Sets fees within context of: the goals & objectives of the BBPPthe goals & objectives of the BBPP the requirements of the WDA, &the requirements of the WDA, & program requests made by the Minister of the program requests made by the Minister of the

EnvironmentEnvironment

Slide 17


Defines Blue Box Wastes (BBW) as those Defines Blue Box Wastes (BBW) as those managed primarily within municipal waste managed primarily within municipal waste streamstream

Exempts thousands of companies generating Exempts thousands of companies generating small quantities of BBW from the programsmall quantities of BBW from the program

Recognizes differences in costs to manage Recognizes differences in costs to manage different material typesdifferent material types

Slide 18


Encourages the diversion of greater quantities of Encourages the diversion of greater quantities of BBWBBW lowest possible total cost to stewards & municipalitieslowest possible total cost to stewards & municipalities encourages recovery of next least cost tonne of BBWencourages recovery of next least cost tonne of BBW shares some of the costs incurred by stewards of shares some of the costs incurred by stewards of

materials with the highest recycling rates among materials with the highest recycling rates among stewards of materials with the lowest recycling rates stewards of materials with the lowest recycling rates

Slide 19


Minimizes cross-subsidization among material Minimizes cross-subsidization among material categoriescategories

Provides for a material specific market Provides for a material specific market development fee to help remove barriers to development fee to help remove barriers to recycling & to improve revenues, &recycling & to improve revenues, &

Shares common program delivery & Shares common program delivery & administration costs across all stewardsadministration costs across all stewards

Slide 20

In summary: In summary:

Meets the legal obligations of stewards to Meets the legal obligations of stewards to share in the costs of operating municipal share in the costs of operating municipal recycling programs in a manner which recycling programs in a manner which minimizes total Blue Box (BB) program minimizes total Blue Box (BB) program costs & for fairness, shares these costs costs & for fairness, shares these costs among all obligated companies.among all obligated companies.


Slide 21

Overview of Input & Comments (1)Overview of Input & Comments (1)

Suggestions received since the BBPP first Suggestions received since the BBPP first approved (December 23, 2002)approved (December 23, 2002)

October 27 Advisory Committee meeting to October 27 Advisory Committee meeting to identify additional suggestions & review the long identify additional suggestions & review the long list of ideaslist of ideas

December 8 public stakeholder meeting inputDecember 8 public stakeholder meeting input

Slide 22

Overview of Input & Comments (2)Overview of Input & Comments (2)

Additional written comments received following Additional written comments received following December 8 meetingDecember 8 meeting summary of comments posted on Stewardship summary of comments posted on Stewardship

Ontario websiteOntario website

January 25 Advisory Committee meeting to January 25 Advisory Committee meeting to review preliminary direction of Steering review preliminary direction of Steering CommitteeCommittee

Slide 23

Issues Raised by Stakeholders (1)Issues Raised by Stakeholders (1)

1.1. Insufficient sharing of costs incurred by high Insufficient sharing of costs incurred by high recycling rate materials among low recycling recycling rate materials among low recycling rate materials:rate materials:

represents a disincentive to promoting even higher represents a disincentive to promoting even higher diversion of easily recyclable materialsdiversion of easily recyclable materials

may encourage stewards to select low recycling may encourage stewards to select low recycling rate materials to reduce feesrate materials to reduce fees

Slide 24


2.2. Excessive sharing of costs incurred by high Excessive sharing of costs incurred by high recycling rate materials among low recycling recycling rate materials among low recycling rate materials:rate materials:

conflicts with nexus requirements of the WDAconflicts with nexus requirements of the WDA some materials must be collected by regulationsome materials must be collected by regulation penalizes non-recyclable materials for which there penalizes non-recyclable materials for which there

is no practical alternativeis no practical alternative does not take into consideration other does not take into consideration other

environmental & social factorsenvironmental & social factors municipalities choose what materials collectedmunicipalities choose what materials collected

Slide 25


3.3. Revenue from sale of some materials is not Revenue from sale of some materials is not calculated accurately or fairly attributed to calculated accurately or fairly attributed to stewards of those materials. Currently:stewards of those materials. Currently:

benefit of sales revenue that is shared with benefit of sales revenue that is shared with contractors under municipal recycling contracts is contractors under municipal recycling contracts is distributed across all materials distributed across all materials

surplus revenue from aluminum lowers all stewards surplus revenue from aluminum lowers all stewards financial obligationsfinancial obligations

4.4. The costs of managing materials exempted The costs of managing materials exempted under de minimis provision, non-compliance & under de minimis provision, non-compliance & inaccurate data falls to “compliant stewards”inaccurate data falls to “compliant stewards”

Slide 26


5.5. The aggregation of some material types blunts The aggregation of some material types blunts the impact of the price signals that are built the impact of the price signals that are built into the funding formula to encourage greater into the funding formula to encourage greater recyclingrecycling

6.6. The funding formula is overly complicated, The funding formula is overly complicated, difficult to understand & describedifficult to understand & describe

7.7. Recycled content credit should be allowed to Recycled content credit should be allowed to recognize contribution to demand for recognize contribution to demand for recyclable materialsrecyclable materials

Slide 27

Summary of General Recommendations (1)Summary of General Recommendations (1)

1.1. Improve accuracy of material-specific net costs Improve accuracy of material-specific net costs by the changing way in which revenue & by the changing way in which revenue & material prices are calculatedmaterial prices are calculated

2.2. Provide an opportunity for a recycled-content Provide an opportunity for a recycled-content credit program to be incorporated into credit program to be incorporated into subsequent annual fee setting calculations subsequent annual fee setting calculations within the existing market development within the existing market development component of the fee setting formulacomponent of the fee setting formula

stewards within material sectors would submit stewards within material sectors would submit detailed plans for such programs for Stewardship detailed plans for such programs for Stewardship Ontario approval Ontario approval

Slide 28

Summary of General Recommendations (2)Summary of General Recommendations (2)

3.3. Aggregate materials with similar characteristics Aggregate materials with similar characteristics (handling, revenue, etc.) for fee setting (handling, revenue, etc.) for fee setting purposespurposes

4.4. Do not give exemption or credit for Do not give exemption or credit for biodegradabilitybiodegradability

5.5. Leave de minimis level as it isLeave de minimis level as it is

6.6. Leave allocation of common costs as it isLeave allocation of common costs as it is

7.7. Continue to calculate generation using waste Continue to calculate generation using waste audit data cross-checked against steward dataaudit data cross-checked against steward data

Slide 29

Short-listed Options for Detailed Review (1)Short-listed Options for Detailed Review (1)

Evaluated two alternatives for modifying the Evaluated two alternatives for modifying the funding formula:funding formula:

a) Modifications to current 3-factor funding formula, keeping core structure same

b) New 2-factor model

Decided that Option (a) would be the focus of consultation

Slide 30

Short-listed Options for Detailed Review (2)Short-listed Options for Detailed Review (2)

Option a) Modifications to current 3-factor funding Option a) Modifications to current 3-factor funding formula selected because:formula selected because:

Greater flexibility to equitably allocate costs to Greater flexibility to equitably allocate costs to achieve objectives of BBPP & WDAachieve objectives of BBPP & WDA

Ability to meet requirements of nexusAbility to meet requirements of nexus

Modeling simplicityModeling simplicity

Slide 31

Modifications to Current Modifications to Current Funding Formula (1)Funding Formula (1)

In addition to general recommendations, In addition to general recommendations, e.g. modified calculation of revenue e.g. modified calculation of revenue

1. Simplify recovery rate factor calculation− replace statistical calculation with simplified

calculation based on relative recovery

− same result with simpler steps

Slide 32


2.2. Reduce target recovery on equalization factor Reduce target recovery on equalization factor from 75% to 60%from 75% to 60%

reflects the 60% diversion target for BBW set by the reflects the 60% diversion target for BBW set by the Minister & rewards highest recovery materialsMinister & rewards highest recovery materials

Slide 33


3.3. Adjust weightings of 3 factorsAdjust weightings of 3 factors shift some of the weighting from recovery rate factor shift some of the weighting from recovery rate factor

to equalization factorto equalization factor greater sharing of cost of achieving higher diversion greater sharing of cost of achieving higher diversion

among all materialsamong all materials can adjust weightings to achieve marginal change can adjust weightings to achieve marginal change

or more significant changeor more significant change

Fees Reflecting Cost to Manage Each MaterialFees Reflecting Cost to Manage Each Material

Fee Rates Reflecting 100% Cost

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Net Cost to Manage

Slide 34

Impact of Current Funding FormulaImpact of Current Funding Formula

• Formula transfers portion of obligation from materials with higher recovery rates to materials with lower recovery rates, e.g. plastics at 18% overall

Current 2006 Fee Formula: Recovery = 40%, Cost = 40%, Equalization = 20%

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Current 2006 40/40/20

Net Cost to Manage

Slide 35

Impact of Modifications to Current Funding FormulaImpact of Modifications to Current Funding FormulaBefore Impacts of Aggregation/Dis-aggregationBefore Impacts of Aggregation/Dis-aggregation

• Modified formula results in similar fees by category• Biggest impacts on plastic & aluminum

Revised Fee Formula: Recovery = 20%, Net Cost = 40%, Equalization = 40%

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Current 2006 40/40/20

Net Cost to Manage

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Slide 36

Impact of Modifications to Current Funding FormulaImpact of Modifications to Current Funding Formula

Revised Model - Alternative Weightings

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• Factor weighting can be used to shift fees to low recovery & high cost material … biggest impact on plastic

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Current 2006 40/40/20

Proposed 20/40/40

Alternative 30/40/30

Alternative 20/35/45

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Slide 37

Slide 38

Printed Paper AggregationPrinted Paper Aggregation

Currently Printed Paper completely Currently Printed Paper completely dis-aggregateddis-aggregated

Recommend partial aggregationRecommend partial aggregation treat “like with like” treat “like with like” spread effects of de minimis, non-compliance, spread effects of de minimis, non-compliance,

imprecision of dataimprecision of data balance fee rates on newspapers & municipal balance fee rates on newspapers & municipal

payment levelspayment levels

Separate categories for CNA/OCNA newsprint Separate categories for CNA/OCNA newsprint & other newsprint & other newsprint

OMG, OTB, other printed paper togetherOMG, OTB, other printed paper together

Printed Paper Aggregation (1)Printed Paper Aggregation (1)

• Minimal impact of modified 3 factor model• Largely due to revised material prices

Printed Paper Current Dis-aggregation

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Current 2006 40/40/20 Fully Dis-aggregated

Alternative 20/40/40 Fully Dis-aggregated

CNA/OCNA News

Other News

OMG OTB Other Print Paper

Slide 39


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Other News


Current 2006 40/40/20 Fully Dis-aggregatedAlternative 20/40/40 Fully Dis-aggregatedAlternative 20/40/40 Fully Aggregated

• Other printed paper fees impacted significantly & in line with other paper categories

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Slide 40

CNA/OCNA News

Other News


Printed Paper Partial Aggregation

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• Recommended partial aggregation to reflect that generally handled together & given data aggregation, but also reflecting some differences in cost & recovery - fairer to other paper categories

Slide 41

Slide 42

Plastic Packaging AggregationPlastic Packaging Aggregation

Currently Plastic Packaging fully aggregatedCurrently Plastic Packaging fully aggregated

Recommend partial dis-aggregationRecommend partial dis-aggregation PET bottles PET bottles HDPE bottles & jugsHDPE bottles & jugs otherother

film, plastic laminants, polystyrene, other plastics, film, plastic laminants, polystyrene, other plastics, (including other PET & HDPE packaging) (including other PET & HDPE packaging)

• Modified model initially shifts costs to lower recovery plastics

Plastic Packaging Aggregation (1)Plastic Packaging Aggregation (1)Before Impact of Dis-aggregationBefore Impact of Dis-aggregation

Plastic Packaging Current Aggregation

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PET Bottles

HDPE Bottles & Jugs

Plastic Film

Plastic Laminants

Polystyrene Other Plastics

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Current 2006 40/40/20 Fully Aggregated

Alternative 20/40/40 Fully Aggregated

Slide 43

Plastic Packaging Aggregation (2)Plastic Packaging Aggregation (2)

• Complete plastic dis-aggregation impact on plastic laminants is dramatic

Plastic Packaging Dis-aggregation

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PET Bottles

HDPE Bottles & Jugs

Plastic Film

Plastic Laminants


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Current 2006 40/40/20 Fully AggregatedAlternative 20/40/40 Fully AggregatedAlternative 20/40/40 Fully Dis-aggregated

Slide 44

Plastic Packaging Aggregation (3)Plastic Packaging Aggregation (3)

• Partial aggregation recognizes differences in handling & recovery rates, but is fairer & more balanced

Plastic Packaging Partial Aggregation

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PET Bottles

HDPE Bottles & Jugs

Plastic Film

Plastic Laminants


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Current 2006 40/40/20 Fully AggregatedAlternative 20/40/40 Fully Aggregated


Proposed 20/40/40 Partial Dis-aggregated

Slide 45

Slide 46

Paper Packaging AggregationPaper Packaging Aggregation

Currently Paper Packaging fully aggregatedCurrently Paper Packaging fully aggregated

Recommend partial dis-aggregationRecommend partial dis-aggregation OCC & OBB OCC & OBB

aggregated togetheraggregated together polycoat, paper laminants, asepticpolycoat, paper laminants, aseptic

aggregated togetheraggregated together

Paper Packaging Aggregation (1)Paper Packaging Aggregation (1)

• Modified model initially shifts costs down marginally

Paper Packaging Current Aggregation

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Old CorrugatedContainers

Gabletop Paper Laminants

Aseptic Containers

Old Boxboard

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Slide 47


• Full dis-aggregation does not recognize material handling reality … does not treat “like with like”

Paper Packaging Fully Dis-aggregation

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Old Corrugated Containers


Aseptic Containers

Old Boxboard

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Slide 48


• Partial aggregation treats materials fairly & balances impact between materials

Paper Packaging Partial Dis-aggregation

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Old CorrugatedContainers


Aseptic Containers

OldBoxboard

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Current 2006 40/40/20 Fully AggregatedAlternative 20/40/40 Fully Aggregated


Proposed 20/40/40 Partial Dis-aggregated

Slide 49

Impact on Material Fee RatesImpact on Material Fee Rates

• Changes vary by material - some adjustments may need to be considered

Comparison of Fee Rates

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Current 2006 Model 40/40/20

Proposed 3-Factor Model 20/40/40

Al C

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Slide 51

What Changes Accomplish (1)What Changes Accomplish (1)

1.1. Will put greater emphasis on costs to manage Will put greater emphasis on costs to manage different material typesdifferent material types

through net cost & equalization factorsthrough net cost & equalization factors

2.2. Sharing slightly greater amount of total program Sharing slightly greater amount of total program costs among stewards using lowest recycled costs among stewards using lowest recycled materials (~$6.3 million, ~11% of obligation)materials (~$6.3 million, ~11% of obligation)

3.3. Improved financial signals to encourage Improved financial signals to encourage greater diversiongreater diversion

Slide 52


4.4. Introducing technical improvements to better Introducing technical improvements to better reflect true net costs & revenue attributable to reflect true net costs & revenue attributable to individual obligated materialsindividual obligated materials

5.5. Sharing a portion of costs for exempted/non-Sharing a portion of costs for exempted/non-reporting materials within material groupsreporting materials within material groups

6.6. Introducing a new option for stewards of specific Introducing a new option for stewards of specific materials to develop & propose a recycled materials to develop & propose a recycled content credit program to stimulate greater content credit program to stimulate greater market demand for these materialsmarket demand for these materials

Slide 53


7.7. Maintaining current rules on de minimis for Maintaining current rules on de minimis for economic efficiencyeconomic efficiency

8.8. Maintaining the essential architecture of the Maintaining the essential architecture of the model given:model given: the considerable investment in the considerable investment in

education/understanding of the current modeleducation/understanding of the current model close adherence to policy & legal opinions in close adherence to policy & legal opinions in

design & approval of the original BBPPdesign & approval of the original BBPP

9.9. Improving the simplicity & transparency Improving the simplicity & transparency of the formulaof the formula

Slide 54


In summary: In summary:

New Funding Formula maintains the New Funding Formula maintains the critical legal requirements of the existing critical legal requirements of the existing Funding Formula & improves upon Funding Formula & improves upon fairness, accuracy & incentives while fairness, accuracy & incentives while striking a better balance of cost sharing striking a better balance of cost sharing between high recovery materials & low between high recovery materials & low recovery materialsrecovery materials

Slide 55

Check against key review criteria (1)Check against key review criteria (1)

Complies with legal requirements of WDAComplies with legal requirements of WDA preliminary assessment – strengthens nexus testpreliminary assessment – strengthens nexus test

Furthers policies & goals of WDA & BBPPFurthers policies & goals of WDA & BBPP stronger financial incentives to increase recycling at stronger financial incentives to increase recycling at

lowest total costlowest total cost maintains prime motivation to maintains prime motivation to reducereduce waste waste

Material impact warrants changeMaterial impact warrants change modest change overall (but with significant impact modest change overall (but with significant impact

possible on individual stewards)possible on individual stewards)

Slide 56


Treats stewards & materials in a fairer mannerTreats stewards & materials in a fairer manner technical improvements provide more accurate technical improvements provide more accurate

revenues, costs & recovery ratesrevenues, costs & recovery rates addresses perceived unfairness that results from wide addresses perceived unfairness that results from wide

ranging recovery rates (whether due to costs, ranging recovery rates (whether due to costs, logistics, legislation or municipal choice) by having logistics, legislation or municipal choice) by having low recovery materials share more of the cost of low recovery materials share more of the cost of recycling materials that are less costly to recoverrecycling materials that are less costly to recover

does not reflect total life cycle considerations (beyond does not reflect total life cycle considerations (beyond scope of BBPP)scope of BBPP)

Slide 57


Strengthens incentives for 3RsStrengthens incentives for 3Rs yesyes

Improves simplicity & transparencyImproves simplicity & transparency simplified calculation of recovery rate factorsimplified calculation of recovery rate factor opportunity to improve presentation & flow opportunity to improve presentation & flow

of the modelof the model

Facilitates compliance & auditingFacilitates compliance & auditing no significant changeno significant change

Slide 58

Ways to Mitigate Effects (1)Ways to Mitigate Effects (1)

1.1. By making incremental changes to factor By making incremental changes to factor weightings over several years, e.g.weightings over several years, e.g.

2006: 40% recovery, 40% cost & 20% equalization 2006: 40% recovery, 40% cost & 20% equalization 2007: 30% recovery, 40% cost & 30% equalization2007: 30% recovery, 40% cost & 30% equalization 2008: 20% recovery, 40% cost & 40% equalization2008: 20% recovery, 40% cost & 40% equalization

Or, an even more gradual shift?Or, an even more gradual shift?

If direction & goal is right, should we move more slowly?

Slide 59

Ways to Mitigate Effects (2)Ways to Mitigate Effects (2)

OrOr

2.2. By making incremental changes to By making incremental changes to aggregation/dis-aggregation levelsaggregation/dis-aggregation levels

e.g. for plastics,e.g. for plastics,

partially dis-aggregating PET bottles, HDPE bottles partially dis-aggregating PET bottles, HDPE bottles & jugs & all other plastics & jugs & all other plastics

the fee for each material would be composed of a the fee for each material would be composed of a dis-aggregated part & an aggregated part dis-aggregated part & an aggregated part

the portion that is aggregated & dis-aggregated is the portion that is aggregated & dis-aggregated is changed over timechanged over time

similar option for papersimilar option for paper

Incremental Change to WeightingsIncremental Change to Weightings

• Incremental changes to weightings lessens impacts on fee rates

Incremental Changes to Factor Weightings

-80

-40

0

40

80

120

160

200C

NA

/OC

NA

Ne

ws

Oth

er N

ews

OM

G

OT

B

Oth

er P

rin

ted

P

ape

r

Pa

per

Pa

cka

gin

g

Pla

stic

s

Ste

el

Alu

min

um

Gla

ss

To

tal F

ee R

ate

($

/to

nn

e)

Current 2006 40/40/20Proposed 20/40/40Alternative 30/40/30

Slide 60

• Incremental changes to weighting aggregation lessens impact of dis-aggregation on fee rates

Incremental Dis-aggregation of PlasticsIncremental Dis-aggregation of Plastics

Revised ModelIncremental Changes to Plastics Aggregation

0

100

200

300

400

500

600

PET Bottles

HDPE Bottles& Jugs

Plastic Film

PlasticLaminants

Polystyrene OtherPlastics

To

tal F

ee R

ate

($

/to

nn

e)

Alternative 20/40/40 Fully AggregatedProposed 20/40/40 Partial Dis-aggregatedAlternative 20/40/40 Partial Dis-aggregated

Slide 61

Slide 62

Other Elements Affecting FeesOther Elements Affecting Fees

Various other elements of the BB System will Various other elements of the BB System will affect fee rates:affect fee rates: material generation estimates, material generation estimates, material recovery rates, material recovery rates, system & material-specific costs, &system & material-specific costs, & revenue & material pricesrevenue & material prices

These will be addressed when setting 2007 fees, These will be addressed when setting 2007 fees, as in previous yearsas in previous years

Slide 63

Next StepsNext Steps

Immediate - Detailed policy & legal reviewImmediate - Detailed policy & legal review

March 1 – Comments dueMarch 1 – Comments due

March 6 - Review comments received & March 6 - Review comments received & Steering Committee final recommendations with Steering Committee final recommendations with Advisory CommitteeAdvisory Committee

March 8 – Recommendations to Stewardship March 8 – Recommendations to Stewardship Ontario Board (including other changes to Ontario Board (including other changes to BBPP)BBPP)

March 15 – Submit to WDO Board (for review at March 15 – Submit to WDO Board (for review at March 22 board meeting)March 22 board meeting)

Slide 64

Feedback Requested (1)Feedback Requested (1)

Please provide your feedback on the Please provide your feedback on the proposed changes to Stewardship Ontario proposed changes to Stewardship Ontario by March 1, 2006. In addition to your by March 1, 2006. In addition to your comments on the overall recommendations comments on the overall recommendations we would appreciate your response to the we would appreciate your response to the following specific questions . . .following specific questions . . .

Slide 65


1.1. Do you agree with the recommendation Do you agree with the recommendation to transfer slightly more of the program cost to transfer slightly more of the program cost to materials with low recovery rates?to materials with low recovery rates?

to share more equitably among all materials the to share more equitably among all materials the cost of achieving higher diversion at the lowest cost of achieving higher diversion at the lowest possible costpossible cost

2.2. Do you agree with the recommended Do you agree with the recommended weightings for the funding formula?weightings for the funding formula?

20% recovery, 40% net cost & 40% equalization & 20% recovery, 40% net cost & 40% equalization & a target for the equalization factor of 60% diversiona target for the equalization factor of 60% diversion

if not, please specify alternative weightingsif not, please specify alternative weightings

Slide 66


3.3. Should these changes be made in 2007? Should these changes be made in 2007? If not, why?If not, why?

if not, please specify the weightings each yearif not, please specify the weightings each year

4.4. Do you agree with the general approach of Do you agree with the general approach of aggregating “like” materials in terms of how aggregating “like” materials in terms of how they are handled, e.g. collection, processing they are handled, e.g. collection, processing & marketing together, similar recovery, data & marketing together, similar recovery, data availability, etc.?availability, etc.?

to reflect significant different costs & performanceto reflect significant different costs & performance

Slide 67


5.5. a) Do you agree for the purposes of fee a) Do you agree for the purposes of fee setting, printed paper materials should be setting, printed paper materials should be aggregated as:aggregated as:

CNA/OCNA newsprint, CNA/OCNA newsprint, other newsprint, & other newsprint, & all other printed paper categoriesall other printed paper categories

b) If not, why not?b) If not, why not?

c) What is your proposed alternative?c) What is your proposed alternative?

Slide 68


6.6. a) Do you agree for the purposes of fee setting, a) Do you agree for the purposes of fee setting, paper packaging should be aggregated as:paper packaging should be aggregated as:

corrugated cardboard & boxboard together, &corrugated cardboard & boxboard together, & all other paper packaging materials togetherall other paper packaging materials together



Slide 69


7.7. a) Do you agree for the purposes of fee setting, a) Do you agree for the purposes of fee setting, plastic packaging should be aggregated as:plastic packaging should be aggregated as:

PET bottlesPET bottles HDPE bottles & jugs, andHDPE bottles & jugs, and all other plastic packaging materials togetherall other plastic packaging materials together



Slide 70

How to Provide CommentsHow to Provide Comments

Deadline for comments is March 1, 2006Deadline for comments is March 1, 2006

On-line survey to facilitate your commentOn-line survey to facilitate your comment URL to on-line survey & URL to model to be sent by URL to on-line survey & URL to model to be sent by

end of day in a end of day in a Need to KnowNeed to Know newsletter newsletter this will NOT be compiled & evaluated as a statistical this will NOT be compiled & evaluated as a statistical

surveysurvey

More detailed, written comments may also More detailed, written comments may also be provided:be provided:

[email protected]@stewardshipontario.ca

Slide 71

Next Part of AgendaNext Part of Agenda

20 minute break20 minute break

Steering Committee & Stakeholder Panel for Steering Committee & Stakeholder Panel for Questions & AnswersQuestions & Answers stakeholder statementsstakeholder statements open Q&Aopen Q&A

Slide 72

Questions & Answers for next part of session

[email protected]

Slide 73

Break

Slide 74

Next StepsNext Steps

Immediate - Detailed policy & legal reviewImmediate - Detailed policy & legal review

March 1 – Comments dueMarch 1 – Comments due

March 6 - Review comments received & March 6 - Review comments received & Steering Committee final recommendations Steering Committee final recommendations with Advisory Committeewith Advisory Committee

March 8 – Recommendations to Stewardship March 8 – Recommendations to Stewardship Ontario Board (including other changes Ontario Board (including other changes to BBPP)to BBPP)

March 15 – Submit to WDO Board (for review March 15 – Submit to WDO Board (for review at March 22 board meeting)at March 22 board meeting)

Slide 75

How to Provide CommentsHow to Provide Comments

Deadline for comments is March 1, 2006Deadline for comments is March 1, 2006

On-line survey to facilitate your commentOn-line survey to facilitate your comment URL to on-line survey & URL to model to be sent by URL to on-line survey & URL to model to be sent by

end of day in a end of day in a Need to KnowNeed to Know newsletter newsletter this will NOT be compiled & evaluated as a this will NOT be compiled & evaluated as a

statistical surveystatistical survey

More detailed, written comments may also More detailed, written comments may also be provided: be provided:

[email protected]@stewardshipontario.ca

Slide 76

Thank You

Documents

Slide 1 Blue Box Program Plan Review for 2007 Stewardship Ontario Funding Formula - Second Public Consultation Meeting - February 14, 2006