September 16, 2015

CSSA's Fee Setting Methodology Project Status Update
Dear Steward,
Please find below our latest update on Canadian Stewardship Services Alliance's (CSSA) Fee Setting Methodology Project.
A Recap of the Fee Setting Methodology Project
As you are aware, CSSA initiated a project earlier this year to identify options to change the way steward material fee rates are calculated making it simpler/easier to understand and fair.   Currently, over 85% of the material fees are paid by stewards who contribute to more than one program.  For these stewards, the methodology used for setting fees is a critical element of the strategy to harmonize the administration of packaging and printed paper programs.   By initiating this project, we hope to address the existing and emerging challenges with the current methodology caused by the changing mix of materials stewards put into the marketplace and the way recycling systems are evolving in response to these changes.   

Where are we now in the Process and How are Stewards Engaged?
Stewards representing a broad spectrum of steward business sectors were brought together to form a Steward Consultation Committee (SCC) in May.  (See below for a full list of SCC member companies).  The SCC is co-chaired by PepsiCo Beverages' Neil Antymis and Scott Tudor from Sobey's.  To date, the SCC has held five facilitated workshops and will continue its work via at least two or three more workshops throughout the fall. 

What Have the Experts Told Us?
The SCC heard presentations and was provided with information from industry experts. 
A key element of the Fee Project work is ensuring that the SCC has a full understanding of the elements that make up the costs in the recycling system that stewards ultimately pay for through annual fees.  As the material mix in the system evolves, the cost associated with managing these materials evolves as well.   Several experts were enlisted to provide the SCC with a thorough understanding of the many variables associated with managing materials from collection to processing through to sale of recycled materials.  A solid understanding of the various cost components will help the SCC identify and evaluate options for developing a new fee methodology - one that not only reflects the costs to manage materials, but one that is also able to stand the test of time as steward material choices and recycling systems evolve over the coming years.  

The following experts were enlisted to provide their insights:
  • Jerry Powell presented to the SCC the various cost drivers in the recycling system. Jerry is the owner of Resource Recycling, a privately-held publishing company with over 20 years' experience in Material Recovery Facility (MRF) operations.
  • Guy Perry in consultation with Resource Recycling Systems (RRS) provided information to help the SCC understand the nature of system costs vs individual material costs and what characteristics and cost drivers make one material different from the others. Guy has over 20 years of experience working with municipalities and private sector companies on waste management and product stewardship funding methodologies.  RRS is a US based recycling and sustainability consulting firm with a collective 75+ years of experience managing MRF operations with significant municipal Canadian experience.
  • Maria Kelleher, Kelleher Environmental provided insights from interviews with Canadian MRF operators on cost drivers in their MRFs. Kelleher Environmental has extensive experience in providing support to municipalities, federal and provincial government departments in helping with policy and strategy decisions on waste management financing options. 
What's Next?
The SCC will continue its work to assess and develop viable alternatives to today's method for setting fee rates. These options will be publicly shared with the broader steward community in late 2015 or early 2016.  All stewards will be able to provide their input for consideration.
Another update on the Fee Methodology Project will be provided at CSSA's Annual Steward Meeting scheduled for October 29, 2015.  Click here for details and to register.

SCC Member Companies:

 A. LassondeInc.
 Canadian Tire
 Costco Wholesale
 PepsiCo Beverages Canada
 Coca-Cola Refreshments Canada
 Procter & Gamble Canada
 Groupe TVA
 Sobeys Inc.
 Home Hardware
 Loblaw Companies Ltd.
 TDL Group Corp. (Tim Hortons)
 McCain Foods
 Unilever Canada Inc.
 Mondel─ôz International
 Walmart Canada Corp.