FCS3

Section 3 Scenarios

3. SCENARIOS We believe that the scenarios presented in the RFP are more expansive than may be encountered in practice and without more specific details it is difficult to predict the best approach to be utilized in the actual execution of this contract. However, we have described how we would approach these hypothetical scenarios and identified plausible work plans and budgets consistent with them, within the context of the overall RFP and proposal requirements, including budget requirements. General Approach to All Scenarios For efficiency, in this first section, we describe our general approach to the three scenarios. Then in the following section we describe the specific responses for each of the three scenarios. Identifying Potential Crumb Rubber Usage: A manufacturer’s potential crumb rubber usage is calculated separately for each product based on identifying the following: 1) the total weight of each product; 2) the percentage of raw material in each product; 3) the weight and percentage (minimum 5 percent) of the raw material that would be replaced by crumb rubber; 4) the projected number of products to be sold annually; and 5) the total projected use of crumb rubber per year. The total project use of crumb rubber would be determined by multiplying the estimated total use of crumb rubber times the projected number of units to be sold annually per product. We will seek to develop projections for year two (i.e., after FCS assistance is complete) and for year 5 (i.e., after the firm has had time to adjust operations and marketing activities). In our experience, extensive discussions and review of documents is needed to develop these estimates with any confidence and, sales projections are often somewhat less than accurate, meaning that all projections will be estimates. That said, we intend to be conservative in our assumptions and to ensure that projections are realistic, attainable goals given all information available to the team. The assumptions used to estimate potential crumb rubber usage are likely to change during Activity Plan implementation and will be updated at the end of the contract for use in the final report. Defining Crumb Rubber Mesh Size: Detailed specifications for crumb rubber needs will ideally define the mesh size, including the particle distribution (i.e., the amount of crumb rubber above and below certain defined threshold sizes that is allowable). In some cases, the specification may also refer to the morphology (i.e., structure and shape) of the granules, whether it is produced using a cryogenic or ambient process, the percentage of natural rubber and/or the percentage of other contaminants allowable, such as wire or fiber. In practice, the specific specification will be developed through iterative discussions with the customer (if requested), manufacturer and tire-derived material (TDM) supplier. First, one of the FCS Manufacturer Technical Assistance Managers will work with the manufacturer as the lead for the individual manufacturer projects. We will address the Activity Plans, recommended type/size of crumb rubber; and communicate with the TDM feedstock suppliers Most often it is best to send several sizes to the manufacturer if they want to first test the crumb rubber for its properties, size, or how it works with another raw material. We tentatively assume that the cost of the crumb rubber and cost of shipment is not eligible for reimbursement under the program and will be the responsibility of the TDM supplier or manufacturer. The mesh size will vary depending on the manufactured product and its specification and customer requirements. The manufacturer may require different crumb rubber mesh sizes to experiment in producing numerous samples to determine what crumb rubber material will work in the prototype. Once the manufacturer determines that the sample(s) appear to be successful, further testing may be required. For independent testing verification, a process that in some cases can

Page | 41