The Recycling Market Development Program continues as the little program that could. Staff reviews applications that range from small niche market projects to large expansions. Loans are currently not available, but grants continue to make an impact on Indiana’s economy. Often, board members and staff alike are asked what has been the overall impact of the program. So, here’s a rundown of our economic development efforts in recycling to this point.
Funding Details
When IDEM began administering the RMDP, the Program had several categories of grants and loans. Goals included creating jobs and increasing the recycling capacity in the state through equipment purchases at industrial operations as well as increasing recycling awareness in communities. As mentioned, during the economic downturn in 2008, the RMDP was suspended. When the Program regrouped, one large grant was created—the Recycling Market Development Grant. Continuing efforts focused on projects that would have the greatest economic impact in manufacturing—either for equipment purchases where machines could better process recyclables as feedstock or machines that could actually make the products.
Since 1991, more than $23 million has been funded towards projects. Overall results are summarized in Table 1 and Table 2. A complete list of projects is available upon request.
| Table 1: RMDP Funding (FY1991-2016, as of 05/12/2016) | ||||
|---|---|---|---|---|
| Funding Type | Description | Number of Projects | Funding Amount ($)* | Percent of Funding |
| RMD Grant | Recycling Market Development Grant: A grant up to $200,000 for Indiana companies to purchase equipment involving the manufacturing of products from recycled materials or the processing of recyclables into finished grade specifications ready for use by manufacturers. | 22 | $2,079,374 | 8.9% |
| Loan_rpaf | Recycling Promotion and Assistance Fund: A loan up to $500,000 for Indiana companies to purchase equipment involving the manufacturing of products from recycled materials or the processing of recyclables into finished grade specifications ready for use by manufacturers. | 48 | $13,452,821 | 57.2% |
| Loan_attr | $1 million RPAF Attraction Loan: An RPAF loan at a higher funding level to support existing successful companies that are building markets for hard-to-recycle priority materials. | 6 | $5,365,712 | 22.8% |
| BSUG | Business Start-up Grant: A grant up to $50,000 for new Indiana recycling businesses to purchase equipment and/or conduct feasibility studies for a business plan. | 15 | $669,957 | 2.9% |
| IG | Innovations Grant: A grant of up to $100,000 for companies to research or develop a product or process that reduces waste or increases the use of recyclables. | 13 | $877,029 | 3.7% |
| MG | Marketing Grant: A grant of up to $30,000 for a company to market its recycled-content product manufactured in Indiana. | 14 | $377,481 | 1.6% |
| PPG | Product Purchasing Grant: A grant of up to $5,000 for a government entity to purchase recycled-content products as a trial or demonstration. | 146 | $548,184 | 2.3% |
| Other | Includes 3 R’s Assessment Grant, Foundry Sand Grant, and Waste Characterization Study grant. | 3 | $130,765 | 0.6% |
| Total: | 267 | $23,501,323 | 100.0% | |
* This is the awarded amount of contract funding unless modified by the actual drawdown for completed projects, whichever is less. Withdrawn projects are not included.
| Table 2: RMDP Funding by Fiscal Year Approved and Source (FY1991-2015, as of 01/20/2015) | |||||||||
|---|---|---|---|---|---|---|---|---|---|
| Fiscal Year Approved | Number of Projects | RMD Grants | Loans | Business Start-up | Innovations | Market | PPG | Other | Total Funding |
| 2015 | 3 | $463,286 | $463,286 | ||||||
| 2014 | 6 | $483,232 | $483,232 | ||||||
| 2013 | 5 | $482,856 | $482,856 | ||||||
| 2012 | 5 | $350,000 | $350,000 | ||||||
| 2011 | 3 | $300,000 | $300,000 | ||||||
| 2010 | 0 | $0 | |||||||
| 2009 | 14 | $48,242 | $100,000 | $48,836 | $197,078 | ||||
| 2008 | 23 | $1,000,000 | $112,933 | $15,013 | $59,297 | $67,672 | $5,600 | $1,260,515 | |
| 2007 | 38 | $3,265,712 | $508,782 | $30,000 | $73,642 | $120,126 | $3,998,262 | ||
| 2006 | 11 | $130,130 | $30,000 | $29,311 | $189,441 | ||||
| 2005 | 19 | $1,734,288 | $296,233 | $30,000 | $43,034 | $2,103,555 | |||
| 2004 | 20 | $1,000,000 | $17,520 | $65,576 | $30,193 | $1,113,289 | |||
| 2003 | 27 | $845,000 | $44,000 | $80,714 | $969,714 | ||||
| 2002 | 25 | $1,805,110 | $304,263 | $42,608 | $57,088 | $2,209,069 | |||
| 2001 | 38 | $1,714,017 | $100,000 | $90,000 | $117,694 | $2,021,711 | |||
| 2000 | 3 | $197,928 | $30,000 | $227,928 | |||||
| 1999 | 2 | $466,400 | $466,400 | ||||||
| 1998 | 3 | $631,395 | $5,039 | $636,434 | |||||
| 1997 | 6 | $1,585,850 | $1,585,850 | ||||||
| 1996 | 2 | $923,885 | $923,885 | ||||||
| 1995 | 6 | $1,716,767 | $1,716,767 | ||||||
| 1994 | 2 | $722,625 | $722,625 | ||||||
| 1993 | 4 | $629,426 | $629,426 | ||||||
| 1992 | 2 | $450,000 | $450,000 | ||||||
| 1991 | 0 | $0 | $0 | ||||||
| Total Funding | $2,079,374 | $18,818,533 | $669,957 | $877,029 | $377,481 | $548,184 | $130,765 | $23,501,323 | |
| Total Projects | 267 | 22 | 54 | 15 | 13 | 14 | 146 | 3 | |
The RMDP has helped create more than 1,000 jobs and has assisted in the development of the state recycling capacity. Most of the RMDP funding, as noted in Table 2 was directed to loans involving equipment purchases, of which more than $16 million has been repaid. Projects also have experienced problems. Issues such as mechanical failures, lack of working capital, and market conditions took their toll on several companies. Specifically, nine projects defaulted on loans with a loss of $2,580,381. But with no venture capitalists dedicated to investing solely in recycling, the RMDP continues to prove its worth to the small business community. The success rate was an 85% return on investments for recycling companies; a profession that once was considered high-risk in bank financing.
Watch for companies to be highlighted throughout the year on the Project Profiles page.
Challenging Markets
With the Recycling Market Development Program’s shift to better understanding the changing economy for recyclers, staff looks at where monies can be used more effectively for businesses and their communities. One challenge for recyclers has been finding materials—the actual raw commodities. Determining if there is a breakdown in collection methods for communities is a focus of House Enrolled Act 1183. Signed into law by the governor in 2014, HEA 1183 seeks to gather state-wide information from recycling brokers, material recovery facilities, solid waste management districts and solid waste disposal facilities. IDEM can coordinate with industry to review collected data on the inventories and shipments by material type, including glass, metal, paper, and plastic to understand where this material was destined and if better outreach to communities could increase valuable material collection for manufacturers. The goal is to reach a 50% state-wide recycling rate.