BILL ANALYSIS                                                                                                                                                                                                    Ó



                                                                      



           ------------------------------------------------------------ 
          |SENATE RULES COMMITTEE            |                  SB 1387|
          |Office of Senate Floor Analyses   |                         |
          |1020 N Street, Suite 524          |                         |
          |(916) 651-1520         Fax: (916) |                         |
          |327-4478                          |                         |
           ------------------------------------------------------------ 
           
                                         
                              UNFINISHED BUSINESS


          Bill No:  SB 1387
          Author:   Emmerson (R), et al.
          Amended:  8/20/12
          Vote:     21

           
           SENATE BUS., PROF. & ECON. DEV. COMMITTEE  :  7-0, 4/9/12
          AYES:  Price, Emmerson, Correa, Hernandez, Negrete McLeod, 
            Strickland, Wyland
          NO VOTE RECORDED:  Corbett, Vargas

           SENATE PUBLIC SAFETY COMMITTEE  :  7-0, 4/24/12
          AYES: Hancock, Anderson, Calderon, Harman, Liu, Price, 
            Steinberg

           SENATE APPROPRIATIONS COMMITTEE  :  Senate Rule 28.8

           SENATE FLOOR  :  37-0, 5/14/12
          AYES:  Alquist, Anderson, Berryhill, Blakeslee, Calderon, 
            Cannella, Corbett, Correa, De León, DeSaulnier, Dutton, 
            Emmerson, Evans, Fuller, Gaines, Hancock, Harman, 
            Hernandez, Huff, Kehoe, La Malfa, Leno, Lieu, Liu, 
            Lowenthal, Negrete McLeod, Padilla, Pavley, Price, Rubio, 
            Simitian, Steinberg, Vargas, Walters, Wolk, Wright, Yee
          NO VOTE RECORDED:  Runner, Strickland, Wyland

           ASSEMBLY FLOOR  :  Not available


           SUBJECT  :    Metal theft

           SOURCE  :     Eastern Municipal Water District

                                                           CONTINUED





                                                               SB 1387
                                                                Page 
          2


           DIGEST  :    This bill prohibits junk dealers and recyclers 
          from possessing fire hydrants, manhole covers or backflow 
          devices without proper certification, as specified; and 
          provides that possession of stolen fire hydrants, manhole 
          covers or backflow devices by persons engaged in the 
          salvage, recycling, purchase or sale of scrap metal, shall 
          be punishable by an additional fine up to $3000.

           Assembly Amendments  (1) prohibit a junk dealer or recycler 
          from possessing a reasonably recognizable, disassembled or 
          inoperative fire hydrant, or fire department connection; 
          (2) require a junk dealer or recycler who unknowingly takes 
          possession of prohibited material as part of a load of 
          otherwise nonprohibited materials without written 
          certification to notify the appropriate law enforcement 
          agency by the end of the next business day upon discovery 
          of the prohibited material; and (3) define "written 
          confirmation" and "appropriate law enforcement agency."

           ANALYSIS  :    

          Existing law, the Business and Professions Code:

          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 allow for 
             periodic inspection of their premises or junk, to 
             determine compliance with recordkeeping requirements, 
             and requires junk dealers and recyclers to produce their 
             records of sales and purchases and any property 
             purchased, for inspection by any of the following:  

             A.    An officer holding a search warrant.

             B.    A person appointed by the county sheriff or head 
                of the police department.

             C.    An officer with a court order to inspect the 







                                                               SB 1387
                                                                Page 
          3

                records or property.

          3. Prohibits junk dealers and recyclers from providing 
             payment for nonferrous material, as defined, unless 
             payment is made by cash or check, and the payment is 
             mailed or provided on the third business day after the 
             date of sale.  

          4. Requires junk dealers and recyclers to obtain a 
             thumbprint from a seller, and to maintain the thumbprint 
             record for two years after the date of sale.  

          5. Provides that inspections or seizures of thumbprints 
             shall only be performed by a peace officer under a 
             criminal search warrant, where probable cause for the 
             warrant was based on a theft related to the sale for 
             which the thumbprint was collected.  

          6. Requires junk dealers and recyclers produce their 
             records for inspection on demand, however the thumbprint 
             of the seller may only be obtained by a peace officer 
             with a search warrant.  

          Existing law, the Penal Code:

          1. Provides that a swap meet vendor, as defined, or a 
             person who deals in, or collects, merchandise or 
             personal property, or their agent, employee, or 
             representative, who buys or receives any property of a 
             value greater than $950, that has been stolen or 
             obtained in any manner under circumstances that should 
             cause the buyer to inquire about the legal right to sell 
             the property, and the buyer does not make a reasonable 
             inquiry, shall be punished by imprisonment in a county 
             jail for not more than one year, or imprisonment of up 
             to three years.  

          2. Any person who buys or receives, for purposes of 
             salvage, any part of a fire hydrant or fire department 
             connection, including, but not limited to, bronze or 
             brass fittings and parts, that has been stolen or 
             obtained in any manner constituting theft or extortion, 
             knowing the property to be so stolen or obtained, shall, 
             in addition to any other penalty provided by law, be 







                                                               SB 1387
                                                                Page 
          4

             subject to a criminal fine of not more than $3,000.  

          This bill:

           1. Prohibits a junk dealer or recycler from possessing any 
             reasonably recognizable, disassembled or inoperative 
             fire hydrant or fire department connection, including 
             but not limited to reasonably recognizable brass 
             fittings and parts, manhole cover or lid or parts, 
             backflow device or connection to that device or parts 
             that were owned or previously owned by an agency 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. Requires, upon the discovery of a prohibited material, 
             a junk dealer or recycler who unknowingly takes 
             possession of one or more designated items as part of a 
             load of otherwise non-prohibited materials without a 
             written certification has a duty to notify the 
             appropriate law enforcement agency by the end of the 
             next business day.

           4. Defines "appropriate law enforcement agency" to mean:

             A.   The police chief of the city, or his or her 
               designee, if the specified item or items are located 
               within the territorial limits of an incorporated city; 
               or,

             B.   The sheriff of the county or his or her designee if 
               the specified item or items are located within the 
               county but outside the territorial limits of an 
               incorporated city.

           1. Provides that the written confirmation shall relieve 
             the junk dealer or recycler from any civil or criminal 
             penalty for possession of the prohibited material and 







                                                               SB 1387
                                                                Page 
          5

             requires the prohibited material to be set aside and not 
             sold pending a determination by law enforcement.

           2. Defines "agency" to mean a public agency, city, county, 
             city and county, special district or private utility 
             regulated by the Public Utilities Commission.

           3. Defines "written confirmation" to mean a confirmation 
             in written form by the junk dealer or recycler to a law 
             enforcement agency including electronic mail, facsimile 
             or a letter delivered in person or by certified mail. 

           4. Provides a fine up to $3,000, for any person engaged in 
             the salvage, recycling, purchase, or sale of scrap metal 
             who possess any of the following items that were owned 
             or previously owned by any public agency, city, county, 
             city and county, special district or private utility 
             that have been stolen or obtained in an illegal manner:  
             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.

           5. Adds finding and declarations.

           6. Makes technical and clarifying changes.
           
          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 represent a significant health and safety concern to 
          the public.  According to an April 2, 2012 Sacramento Bee 
          article, "The cost of addressing the crime wave has likely 
          surpassed $1 million over the past year.  Officials with 
          the city's Department of Transportation think they'll have 
          to spend another $2 million over the next year repairing 
          streetlights damaged by thieves."  Over a New Year's 
          weekend in 2011, 50 manhole covers were stolen from the 
          streets of Sacramento.  Cities, counties, and special 
          districts are taking different approaches to address metal 







                                                               SB 1387
                                                                Page 
          6

          theft.  Los Angeles residents are being asked to "adopt" 
          their neighborhood manhole covers in an attempt to "police" 
          their streets.  Eastern and Municipal Water Districts have 
          issued $500 rewards for citizens who turn in thieves.  
          Anaheim Public Utilities has issued a customer alert on 
          their website asking residents to take precautions to 
          protect their backflow devices.  The City has further 
          indicated that residents may wish to increase patrol and 
          install video surveillance devices if they wish to further 
          protect their devices.

          The rise in recycled metal prices has increased the demand 
          for such items.  Scrap metal from fire hydrants are 
          estimated to recycle at $300 per ton; price fluctuates 
          rapidly according to demand.  Metal theft has been well 
          documented in California.  The Los Angeles Times reported 
          an individual stealing 45 fire hydrants within the Inland 
          Empire.  Investigators of the incident reported, "The theft 
          of metal to sell as scrap, such as copper wiring, bronze 
          fixtures and iron from construction site, is common, 
          especially during a prolonged economic slump." 

           Metal Theft Costs  .  The increasing theft of backflow 
          devices, manhole covers and fire hydrants or any parts of 
          hydrants impact city budgets greatly, especially during 
          tough economic times.  Replacement hydrants can range 
          between $1,000- $1,500, while accessories can cost up to 
          $25 per hydrant.  Backflow devices have been priced 
          anywhere from $330 to $22,000 depending on the diameter, 
          while cast iron manhole covers have a price tag of $231.71; 
          not accounting for labor.  Cities and counties have to 
          repair and replace these items immediately due to public 
          safety concerns.  The sponsor of this bill, cities several 
          incidents where individuals have suffered injuries because 
          of missing manhole covers, leaving local entities open to 
          the possibility of legal action.

           Enforcement Concerns  .  Dramatic increases in metal theft 
          have sparked numerous legislative actions over the past 
          decade.  However, enforcement of such provisions has proven 
          not to be as effective due to fiscal constraints in local 
          law enforcement.  Resident Deputy Sheriff Jim Currie of the 
          Solano County Sheriff's Office reported that incidents of 
          metal theft seem to be picking up in Rio Vista.  "We've got 







                                                               SB 1387
                                                                Page 
          7

          some things in place to help step up our surveillance, but 
          like other agencies, we've cut back on people and patrol 
          time.  Our Sheriff is addressing that right now, but it has 
          been rough with the budget situation the way it is," Currie 
          said.  The 2011 report from the National Insurance Crime 
          Bureau identified 25,083 insurance claims compared with 
          only 13,861 identified from the 2006-2008 report; an 81 
          percent increase.  California was ranked third out of the 
          top five states with 1,348 insurance claims.

           FISCAL EFFECT  :    Appropriation:  No   Fiscal Com.:  Yes   
          Local:  Yes

           SUPPORT  :   (Verified  5/9/12)

          Eastern Municipal Water District (source)
          Association of California Water Agencies
          California Association of Sanitation Agencies
          California Chamber of Commerce
          California District Attorneys Association
          California Municipal Utilities Association
          California Professional Firefighters
          California Special Districts Association
          California State Sheriffs' Association
          City of Canyon Lake
          City of Cathedral City
          City of San Jacinto
          City of Thousand Oaks
          Contra Costa Water District
          Cucamonga Valley Water District
          East Bay Municipal Utility District
          El Dorado Irrigation District
          Elsinore Valley Municipal Water District
          Lake Hemet Municipal Water District
          League of California Cities
          Mesa Consolidated Water District
          Municipal Water District of Orange County
          Rancho California Water District
          San Bernardino County Sheriff's Office
          San Bernardino Valley Municipal Water District
          San Diego County Water Authority
          The Metropolitan Water District of Southern California
          Three Valleys Municipal Water District
          Walnut Valley Water District







                                                               SB 1387
                                                                Page 
          8

          Western Municipal Water District
          Western Riverside Council of Governments

           ARGUMENTS IN SUPPORT  :    According to the author's office, 
          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.  While several laws have been enacted to curb metal 
          theft, it is still prevalent throughout California.  
          According to the Eastern Municipal Water District the 
          sponsor, this bill seeks to address this epidemic and 
          strengthen current law by eliminating the attractiveness of 
          manhole covers, backflow devices, and fire hydrants to 
          metal thieves as there would no longer be a buyer for these 
          stolen items.


          JJA:d  8/29/12   Senate Floor Analyses 

                         SUPPORT/OPPOSITION:  SEE ABOVE

                                ****  END  ****