USA Flag Retirement Program

There used to be a company that would take the American flags, but they have been acquired and no longer available.

I did Google for information in the St.  Augustine, FL area:

The most respectful and proper way to dispose of an unserviceable American flag is to have it retired in a dignified, official ceremony. In St. Augustine, you can easily drop off worn or tattered flags at designated collection boxes, which will then be collected by local veterans for proper retirement. 
Drop-off Locations in St. Augustine:
  • VFW Post 2391: 6184 US-1 (Look for the M60A Patton Tank). They hold public flag retirement ceremonies on the 3rd Saturday of every month. [1, 2]
  • City Customer Service Center: 50 Bridge Street (Drop box in the main lobby). 
  • Local Home Depot: All St. Johns County Home Depot stores, including the location on US-1 South, have flag collection boxes near the service desk