Report 2018-107 Recommendation Responses
Report 2018-107: California Department of Resources Recycling and Recovery: It Has Not Provided the Oversight Necessary to Ensure That the Mattress Recycling Program Fulfills Its Purpose (Release Date: August 2018)
Recommendation for Legislative Action
The Legislature should amend the recycling act to require the Mattress Council to maintain a reserve equal to no more than six months of the mattress program's budgeted expenses. Further, the Legislature should amend the recycling act to provide CalRecycle the ability through its budget approval process to direct the spending of any amount of funding that the Mattress Council accumulates in excess of this amount or to adjust the mattress recycling charge.
Description of Legislative Action
AB 187 requires the organization, commencing January 1, 2027, to maintain total reserves that do not exceed 60 percent of its annual operating expenses, and authorizes CalRecycle to approve a reserve up to 75 percent. If the organization's reserves exceed the specified amount, CalRecycle may require the organization to increase spending on implementing statutory requirements in order to reduce the excess amount of reserves.
- Legislative Action Current As-of: August 2020
California State Auditor's Assessment of Annual Follow-Up Status: Legislation Enacted
Description of Legislative Action
AB 187 would prohibit the mattress recycling organization, commencing with the 2027-28 fiscal year, from maintaining total reserves exceeding 60 percent of its annual operating expenses, consistent with the requirements of the Financial Accounting Standards Board's Accounting Standards Update 2016-14, Not-for-Profit Entities (Topic 958), and any future updates to that standard. CalRecycle, in approving the annual budget, may authorize the total reserves to be increased to up to 75 percent of the organization's annual operating expenses if CalRecycle determines the increase is necessary. If the mattress recycling organization's reserves exceed the specified amount, CalRecycle may require the mattress recycling organization to increase spending in order to reduce the excess amount of reserves.
- Legislative Action Current As-of: August 2019
California State Auditor's Assessment of 1-Year Status: Legislation Introduced
Description of Legislative Action
Assembly Bill 187 (C. Garcia), introduced January 10, 2019, would require the Mattress Council to include in its proposed program budget a recommended funding level sufficient to cover the plan's budgeted costs and to operate the mattress recycling program over a 6-month period in a prudent and responsible manner. The bill would prohibit the Mattress Council from maintaining more funding in its reserve than the recommended funding level for that calendar year.
- Legislative Action Current As-of: March 2019
California State Auditor's Assessment of 6-Month Status: Legislation Introduced
Description of Legislative Action
The Legislature has not taken action to address this specific recommendation.
- Legislative Action Current As-of: October 2018