BILL ANALYSIS Ó
------------------------------------------------------------
|SENATE RULES COMMITTEE | AB 1583|
|Office of Senate Floor Analyses | |
|1020 N Street, Suite 524 | |
|(916) 651-1520 Fax: (916) | |
|327-4478 | |
------------------------------------------------------------
THIRD READING
Bill No: AB 1583
Author: Roger Hernández (D), et al.
Amended: 8/6/12 in Senate
Vote: 21
SENATE BUSINESS, PROF. & ECON. DEVELOP. COMM. : 9-0,
6/25/12
AYES: Price, Emmerson, Corbett, Correa, Hernandez, Negrete
McLeod, Strickland, Vargas, Wyland
SENATE APPROPRIATIONS COMMITTEE : Senate Rule 28.8
ASSEMBLY FLOOR : 76-0, 5/14/12 - See last page for vote
SUBJECT : Bulk merchandise pallets
SOURCE : MillerCoors
DIGEST : This bill prohibits junk dealers and recyclers
from purchasing or receiving bulk merchandise pallets, as
defined, marked with indicia of ownership, as defined, from
anyone except the indicated owner, unless specified
information is provided. In addition, this bill authorizes
a junk dealer and recycler to accept as identification of a
seller a passport from any country or a Matricula Consular,
along with another form or identification bearing an
address, or an identification card issued by the United
States.
ANALYSIS : Existing law:
CONTINUED
AB 1583
Page
2
1.Regulates junk dealers and recyclers and defines "junk"
as secondhand and used machinery and all ferrous
(containing iron) and nonferrous (excludes iron) scrap
metals (as defined) and alloys, including any and all
secondhand and used furniture, pallets, or other personal
property, excluding livestock.
2.Requires junk dealers and recyclers to keep a written
record of all junk sales and purchases for at least two
years and requires the written information to be reported
to the chief of police or sheriff, as specified, and
makes it a misdemeanor to make a false or fictitious
statement in the written record. The written record must
include:
A. The place and date of the transaction.
B. The name, driver's license number and state of
issue, and the license plate number and state of issue
of any vehicle used in transporting the junk.
C. The name and address of each person to whom the
junk is sold and that person's vehicle license number.
D. A description of the junk purchased or sold.
E. A signed statement indicating that the seller owns
or is authorized to sell the junk.
1.Defines "merchandise pallet" as a wooden or plastic
carrier or container of specified size, used by a
manufacturer or distributor to transport merchandise to
retail outlets, which has a notice permanently affixed to
it identifying the owner of the pallet and providing
other specified information.
2.Makes it a crime for an unauthorized person, as defined,
to possess a merchandise pallet or for a person other
than its owner to obliterate the identification notice on
a merchandise pallet.
3.Requires any person or entity purchasing plastic bulk
merchandise containers who is in the business of
CONTINUED
AB 1583
Page
3
recycling, shredding, or destruction of plastic bulk
merchandise containers, as defined, to obtain a proof of
ownership record and other identifying information from a
person selling five or more containers, and to retain the
required record for one year from the date do purchase or
delivery, as specified. Makes a violation of these
provisions a misdemeanor.
This bill:
1.Defines the following terms:
A. "Indicia of ownership" to mean words, symbols, or
registered trademarks printed, stamped, etched,
attached, or otherwise displayed on the exterior
surface of the merchandise pallet that reasonably
identifies the owner.
B. "Bulk merchandise pallets" to mean plastic or wood
containers, carriers, or holders used by a
manufacturer or distributor for bulk transport of
merchandise to wholesale or retail outlets.
1.Prohibits a junk dealer or recycler from purchasing or
receiving bulk merchandise pallets marked with indicia of
ownership from any person or entity other than the
indicated owner.
2.Authorizes a junk dealer or recycler to purchase or
receive bulk merchandise pallets if the seller is not the
indicated owner, only if the seller or transferor
provides a receipt verifying his or her current ownership
or a document indicating that he or she is authorized by
the owner to sell or transfer the merchandise pallets,
and requires the junk dealer or recycler to maintain
copies of these documents as part of the written record
of the transaction.
3.Requires a junk dealer or recycler to make payment for a
single transaction involving five or more bulk
merchandise pallets marked with indicia of ownership
where the seller is not the indicated owner by mailed
check or by cash or check collected by the seller after
three business days.
CONTINUED
AB 1583
Page
4
4.Makes the obliteration of the indicia of ownership on a
merchandise pallet punishable under provisions of law
guarding against grand and petty theft, as specified.
5.Requires a person or entity purchasing or transporting
plastic bulk merchandise containers who is in the
business of recycling, shredding, or destruction of
plastic bulk merchandise containers, or is in the
business of transporting plastic bulk merchandise
containers for those purposes, to obtain a proof of
ownership record or bill of lading and other identifying
information from the person selling or delivering five or
more containers, and to retain this information, as
specified.
6.Authorizes a junk dealer and recycler to accept as
identification of a seller all of the following:
A. The name, identification number, and country of
issue from a passport used for identification and the
address from an additional item of identification that
also bears the seller's name.
B. The name and identification number from a Matricula
Consular used for identification and the address from
an additional item of identification that also bears
the seller's name.
C. An identification card issued by the United States.
1.Makes technical and conforming changes.
FISCAL EFFECT : Appropriation: No Fiscal Com.: Yes
Local: Yes
SUPPORT : (Verified 8/7/12)
MillerCoors (source)
California Grocers Association
California Nevada Soft Drink Association
California Police Chiefs Association
California Retailers Association
Coca-Cola Refreshments
CONTINUED
AB 1583
Page
5
Dairy Institute
Intelligent Global Pooling Systems
Los Angeles County District Attorney's Office
Rockview Farms
Safeway Inc.
OPPOSITION : (Verified 8/7/12)
California Chapters of the Institute of Scrap Recycling
Industries (unless amended)
ARGUMENTS IN SUPPORT : According to the sponsor, "Despite
current requirements on junk dealers and recyclers when
purchasing merchandise pallets, theft of merchandise
pallets is becoming a serious problem for food and beverage
manufacturers and distributors. Higher scrap values paid
recyclers of the plastic resins typically used in pallets
is a major factor in these thefts. Replacing a pallet can
cost approximately $30 and total losses are estimated in
the millions of dollars.
"In December of 2011, the L.A. County Sheriff investigators
recovered $1.3 million in stolen plastic containers, boxes,
and crates. According to lead detective Shelley Jones from
the Sheriff's Industry Substation, stolen plastic pallets
cost businesses in the San Gabriel Valley alone nearly $10
million annually. Sheriff's officials said the recovered
property was part of a complex web of organized crime
operating nationally and internationally that deals in
stealing, recycling, and reselling trademarked plastic
containers.
"AB 1583 tightens and clarifies existing laws relative to
purchase of merchandise pallets, adding a prohibition on
purchasing or receiving pallets marked with indicia of
ownership unless the seller can prove lawful ownership or
possession. When the seller is not the indicated owner,
payment must be made by check mailed to the address on the
seller's photo ID or by cash after the third business day.
The bill also expands current law to require that persons
who transport bulk merchandise containers for the purpose
of shredding, recycling, or destroying, whether or not they
are a junk dealer or recycler, also obtain or carry proof
of ownership or lawful possession."
CONTINUED
AB 1583
Page
6
ARGUMENTS IN OPPOSITION : The California Chapters of the
Institute of Scrap Recycling Industries (ISRI) has taken an
"oppose unless amended" position on the bill. Although
ISRI indicates that it supports many provisions in the
bill, it believes that the proposed BPC Section 21609.7 is
unnecessary in that it is duplicative of current law.
Specifically, ISRI points out that BPC Sections 22750 and
22755(b) provide "any person or entity purchasing plastic
bulk merchandise containers, who is in the business of
recycling, shredding, or destruction of plastic bulk
merchandise containers, shall obtain a proof of ownership
record from a person selling five or more plastic bulk
merchandise containers that shows that the person selling
the containers has lawful possession or ownership of the
containers, and shall also verify the seller's identity by
a driver's license or other government-issued photo
identification." It further states that "any person who
violates the provisions of this section is guilty of a
misdemeanor." ISRI argues that the duplicate provisions
should be removed from the bill since the existing law
relating to the purchasing of plastic bulk merchandise
containers is clearly sufficient.
ISRI further opposes the amendments to BPC Section
21609.7(c) and 22755(c) which provide that payment may only
be made by check and only after the third business day.
ISRI points out that this requirement was established for
the sale or purchase of non-ferrous metals (copper,
aluminum, etc.). The Legislature imposed the requirement,
which ISRI supported, because the theft of non-ferrous
metals poses a health and safety issue. "However, the
recycling of merchandise containers is not a health and
safety issue it is a proof of ownership issue. If a
recycler has an authorization letter or a contract with the
owner of the merchandise containers, we believe payment of
said containers should be left up to the parties at hand.
Once that ownership has been established, why would the
Legislature want to interject itself on a legitimate
transaction?" As amended on June 15, 2012, AB 1583 deleted
the payment provision in section 22755(c), but the same
payment language is still found in section 21609.7(c), and
ISRI would ask that it also be removed from the bill.
CONTINUED
AB 1583
Page
7
Ultimately ISRI argues that the problem is not the
sufficiency of the current law; it is the lack of judicial
enforcement of the current law. "Simply stated, few local
police agencies have the desire to redirect their scarce
resources to enforce the merchandise container laws. This
is not an issue of substantive law. This is an issue where
dairy, bakery, and soft drink industries need to make sure
the supermarkets in which their products are sold keep the
merchandise containers in a secure location."
ASSEMBLY FLOOR : 76-0, 05/14/12
AYES: Achadjian, Alejo, Allen, Ammiano, Beall, Bill
Berryhill, Block, Blumenfield, Bonilla, Bradford,
Brownley, Buchanan, Butler, Charles Calderon, Campos,
Carter, Cedillo, Chesbro, Conway, Cook, Davis, Dickinson,
Donnelly, Eng, Feuer, Fong, Fuentes, Furutani, Beth
Gaines, Galgiani, Garrick, Gatto, Gordon, Gorell, Grove,
Hagman, Halderman, Hall, Harkey, Hayashi, Roger
Hernández, Hill, Huber, Hueso, Huffman, Jeffries, Jones,
Knight, Lara, Logue, Bonnie Lowenthal, Ma, Mansoor,
Mendoza, Miller, Mitchell, Monning, Morrell, Nestande,
Nielsen, Norby, Olsen, Pan, V. Manuel Pérez, Portantino,
Silva, Skinner, Smyth, Solorio, Swanson, Torres, Wagner,
Wieckowski, Williams, Yamada, John A. Pérez
NO VOTE RECORDED: Atkins, Fletcher, Perea, Valadao
JJA:n 8/7/12 Senate Floor Analyses
SUPPORT/OPPOSITION: SEE ABOVE
**** END ****
CONTINUED