BILL ANALYSIS Ó SB 1387 Page 1 Date of Hearing: June 19, 2012 ASSEMBLY COMMITTEE ON BUSINESS, PROFESSIONS AND CONSUMER PROTECTION Mary Hayashi, Chair SB 1387 (Emmerson) - As Amended: April 19, 2012 SENATE VOTE : 37-0 SUBJECT : Metal Theft. SUMMARY : Prohibits a junk dealer or recycler from possessing fire hydrants, manhole covers or backflow devices unless specified provisions are met and results in a criminal fine for failure to comply. Specifically, this bill : 1)Prohibits a junk dealer or recycler from possessing a fire hydrant or fire department connection, including but not limited to brass fittings and parts, a manhole cover or lid, or backflow device or connection to that device unless specified conditions are met. 2)Requires written certification on letterhead of the agency or utility that owns or previously owned the material described in the certification, that the agency has sold the material or is offering the material for sale, salvage, or, recycling; and that the person identified in the certification is authorized to negotiate the sale of that material. 3)Provides a fine up to $3000, for any person engaged in the salvage, recycling, purchase, or sale of scrap metal who possess any of the following items that have been obtained illegally: a) A fire hydrant or any part of that hydrant; b) Any fire department connection, including, but not limited to bronze or brass fittings and parts; c) Manhole covers or lids or any part of those covers and lids; or, d) Backflow devices and connections or any part of those devices. SB 1387 Page 2 4)Adds finding and declarations. EXISTING LAW 1)Defines "junk" as secondhand and used machinery and all ferrous and nonferrous scrap metals and alloys including any and all secondhand and used furniture, pallets, or other personal property, other than livestock. 2)Defines a "junk dealer" as anyone engaged in the business of buying, selling and dealing in junk; any person purchasing, gathering, collecting or soliciting or procuring junk; or, any person operating, carrying on, conducting or maintaining a junk yard. 3)Requires every junk dealer and every recycler to keep a written record of all sales and purchases made in the course of his or her business. The written record shall include: a) The place and date of each sale or purchase of junk made in the conduct of his or her business; b) The name, valid driver's license number and state of issue or California issued identification card number , and vehicle license number including the state of issue of any motor vehicle used in transporting the junk to the junk dealer's or recycler's place of business; c) The name and address of each person to whom junk is sold or disposed of, and the license number of any motor vehicle used in transporting the junk from the junk dealer's or recycler's place of business; d) A description of the item or items of junk purchased or sold, including the item type and quantity, and identification number, if visible; and, e) A statement indicating either that the seller of the junk is the owner of it, or the name of the person he or she obtained the junk from, as shown on a signed transfer document. 4)Requires junk dealers and recyclers to allow for periodic inspection of any premise maintained and any junk to determine compliance with record keeping requirements and requires junk SB 1387 Page 3 dealers and recyclers to produce his or her records of sales and purchase for inspection by any of the following. a) An officer holding a warrant; b) A person appointed by the sheriff of a county or appointed by the head of the police department of a city; and, c) An officer holding a court order directing them to examine the records or property. 5)Provides that a junk dealer or recycler who fails to keep the written record required is guilty of a misdemeanor. 6)Prohibits junk dealers and recyclers from providing payments for nonferrous materials unless specified conditions are met. 7)Provides, in the penal code, for any person who buys or receives, for purposes of salvage, any part of a fire hydrant or fire department connection that has been stolen or obtained in any illegal manner shall, in addition to any other penalty provided by law, be subject to a criminal fine of not more than $3,000. FISCAL EFFECT : Unknown COMMENTS : Purpose of this bill . According to the author, "Metal theft is on the rise as the price of metal continues to climb. The theft of metals has devastated both public and private property and has harmed critical public infrastructure, making it difficult to deliver essential utilities to customers. Moreover, the theft of certain metal devices can seriously threaten public health and safety. For instance, individuals have been severely injured falling down uncovered manholes and vehicles have incurred damage driving over manholes where the covers have been stolen. In addition, stolen backflow devices leave potable water sources vulnerable to cross-contamination while stolen fire hydrants render properties defenseless to fire." Background . Metal theft has become increasingly popular within the last decade and the theft of fire hydrants, copper, manhole covers, and backflow devices in particular are on the rise and SB 1387 Page 4 represent a significant health and safety concern to the public. The sponsor cities several incidents where individuals have suffered injuries because of missing manhole covers, leaving local entities open to the possibility of legal action. According to a report published in 2010 by the Office of Electricity Delivery and Energy Reliability, reports of copper theft have been most prevalent in California and Florida, but have also been significant in Ohio, Alabama, Pennsylvania, Michigan, New York, Texas, and Tennessee. Several factors appear to contribute to rates of copper theft. At the time of the report, California was the State with the highest total of copper thefts reported. According to a January 8, 2012 Sacramento Bee article, over a New Year's weekend in 2011, 50 manhole covers were stolen from the streets of Sacramento with a replacement cost estimated at $165 per cover. And more recently, according to scraptheftalert.com, Contra Costa Water District recently had five backflow devices stolen, for a loss valued at approximately $4500. In 2011, Eastern Municipal Water District, Western Municipal Water District, and Elsinore Valley Municipal Water District began offering a $500 reward to anyone who provides information that leads to the arrest and conviction of individuals for vandalism or theft of fire hydrants and other metal facilities. Support . The sponsor of this bill, Eastern Municipal Water District writes in support, "this bill is a critical measure necessary to respond to the epidemic of metal theft occurring throughout the state. This bill would establish criminal fines and penalties for unlawful possession of fire hydrants, manhole covers and backflow devices. Individuals have been severely injured falling down manholes where the cover was stolen. Automobiles and bicycles have been damaged driving over open manholes. Stolen backflow devices leave potable water sources vulnerable to cross-contamination and furthermore, stolen fire hydrants render properties defenseless to fire." The Association of California Water Agencies writes in support, "Metal theft has quickly become a severe drain on many water districts budgets. Many criminals may steal material that only garners a small amount of money but the damage that the theft creates costs our public agencies thousands of dollars to repair." SB 1387 Page 5 Related Legislation . AB 1508 (Carter) of 2012, revises the exemption on the sale of nonferrous materials with a value under $20 from certain payment restrictions by requiring the majority of the transaction be for the redemption of beverage containers and prohibiting the redemption of materials made of copper or copper alloys, as specified. This measure is currently awaiting a hearing in the Senate Business, Professions, and Economic Development Committee. Previous Legislation . AB 316 (Carter) Chapter 317, Statutes of 2011, created a separate section for grand theft of copper materials and added a fine of up to $2,500 on to the existing penalties. AB 1859 (Adams) Chapter 659, Statutes of 2008, established that any person who buys or receives, for purposes of salvage, any part of a fire hydrant or fire department connection that has been stolen, knowing the property to be so stolen, to be subject to a criminal fine of not more than $3000. AB 844 (Berryhill) Chapter 731, Statutes of 2008, required junk dealers and recyclers to comply with recordkeeping requirements and new payment restrictions when purchasing nonferrous materials. SB 691 (Calderon) Chapter 730, Statutes of 2008, required junk dealers and recyclers to comply with additional recordkeeping requirements and new payment restrictions when purchasing nonferrous materials (i.e., copper, copper alloys, stainless steel, and aluminum, excluding beverage containers). REGISTERED SUPPORT / OPPOSITION : Support Eastern Municipal Water District (sponsor) Association of California Water Agencies AT&T California Association of Sanitation Agencies California Chamber of Commerce California Municipal Utilities Association California Professional Firefighters California Special Districts Association California State Association of Counties SB 1387 Page 6 California State Sheriffs' Association City of Hemet City of Roseville Contra Costa Water District Cucamonga Valley Water District Desert Water Agency East Bay Municipal Utility District East Valley Water District El Dorado Irrigation District Friant Water Authority Inland Empire Utilities Agency Irvine Ranch Water District Mesa Consolidated Water District Metropolitan Water District of Southern California Metropolitan Water District of Southern California Municipal Water District of Orange County Newhall County Water District Orchard Dale Water District Rowland Water District San Bernardino Valley Municipal Water District San Diego County Board of Supervisors San Diego County Water Authority Southwest California Legislative Council Opposition None on File. Analysis Prepared by : Elissa Silva / B.,P. & C.P. / (916) 319-3301