Following CalRecycle approval, differential assessments currently charged on all carpet sold in California will increase on February 1, 2025. The assessment increase was requested by CARE on November 8th and approved by CalRecycle on December 23rd. The new amounts are:
California law requires CARE,听as the carpet stewardship organization for the state, to implement a differential assessment on each square yard of carpet sold that reflects its cost burden to recycle. CARE鈥檚 differential assessment plan is based on two factors: 1) carpet material, as in broadloom vs. tile, and 2) percent of post-consumer content, as in greater than or equal to 10 percent post-consumer content vs. less than 10 percent post-consumer content. The new assessment amounts will replace the current amounts.
鈥淲e recognize the burden this places on California retailers and their customers,鈥� noted CARE Executive Director Bob Peoples. 鈥淲hile the California Carpet Stewardship Program has made huge progress in recent years, new demands and rising costs make this increase necessary.鈥�
The factors driving the increase include:
- CalRecycle鈥檚 new requirement that CARE build to a 6-month operating reserve balance by the end of 2025. This requires the organization to add approximately $13 million dollars in 2025.
- Program growth and success leading to higher costs.
- A new union earmark of up to 8% of revenue annually means a new liability of up to $4 million per year. That equates to about 8 cents per square yard, based on current sales.
- Continuing decline in sales, meaning the base over which to spread the increased costs is shrinking.
- Inflation has contributed but is expected to have a smaller impact in 2025.
This comes at a time when the California Program has achieved remarkable results in terms of carpet collection and recycling; the assessment increase is necessary to continue the progress and to meet the challenging goals for the Program that have been set by CalRecycle. The Program attained a record 35% recycling rate in 2023 and typically recycles approximately 71% of carpet collected.
Carpet retailers in the state should prepare immediately for the point of purchase changes that will be needed to collect the correct, updated assessment from customers. Carpet mills are responsible for advising retailers on which products qualify in terms of post-consumer content.听CARE will continue to supply point of purchase materials as well as training support materials for sales staff. Retailers are encouraged to visit the听CARE website听for the latest collateral and updates.
Assessments are expected to change again in the future. The CalRecycle approval letter noted that CARE鈥檚 next Five Year Plan amendment, which it is required to submit to CalRecycle by July 1, 2025, 鈥渕ust address all statutory, regulatory, and plan requirements, which includes a revised system of differential assessments that is inclusive of additional factors, such as type of face fiber, to more accurately align the assessment levels with the financial burden various carpet materials impose on the program.鈥�听
The California carpet stewardship legislation (AB 2398, 1159, 729 and, new in 2025, 863) is designed to incentivize the growth of carpet reclamation and recycling and still allow the market to work. The law (AB 2398) generates funding to meet its stated goals through the assessment on all carpet sold in California. California consumers pay the assessment when they buy carpet. These monies then support CARE鈥檚 efforts, including subsidies paid to recyclers, grants to expand capacity and collection, technical assistance, market development and outreach to increase carpet recycling in California. In 2023 78% of all expenses were paid out in subsidies to recyclers. Of those funds paid, 75% were paid to recyclers in California.