BILL ANALYSIS                                                                                                                                                                                                    Ó




                   Senate Appropriations Committee Fiscal Summary
                            Senator Kevin de León, Chair


          AB 538 (Pan) - Firearms: transfers.
          
          Amended: June 4, 2013           Policy Vote: Public Safety 5-2
          Urgency: No                     Mandate: Yes
          Hearing Date: June 24, 2013                             
          Consultant: Jolie Onodera       
          
          This bill does not meet the criteria for referral to the  
          Suspense File.
          
          
          Bill Summary: AB 538 would make a series of changes to firearm  
          purchase and transfer processes, as specified.

          Fiscal Impact: 
           One-time administrative costs to the Department of Justice  
            (DOJ) of $143,000 (Special Fund*) in Fiscal Year (FY) 2013-14  
            and $27,000 (Special Fund*) in FY 2014-15 to develop and  
            modify the Automated Firearm System (AFS) to accommodate the  
            new record information requirements.
           Minor ongoing non-reimbursable local law enforcement costs.

          *Dealer Record of Sale (DROS) Special Account

          Background: Under existing law, firearms dealers are required to  
          obtain identification and other information from prospective  
          firearm purchasers and transmit that information to the DOJ via  
          the DROS form. The prospective buyer must wait 10 days before  
          taking possession of the firearm during which time the DOJ  
          conducts a background check to determine whether the buyer is  
          prohibited from owning a firearm. 

          If the DOJ does not notify the dealer that the purchaser is  
          prohibited from firearm ownership, the purchaser may take  
          possession after the 10-day waiting period. The dealer is  
          required to record the date and time the firearm was delivered  
          to the buyer and is required to maintain the record for at least  
          three years. In the event the buyer does not take possession of  
          the firearm within 30 days, it must be reported to the DOJ.  
          Failure to report to the DOJ is punishable as a misdemeanor,  
          forfeiture of the dealer's license, or both. Under current law,  
          dealers are required to provide a copy of the DROS form when the  








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          buyer takes possession of the firearm upon the request of the  
          buyer. Existing law also allows buyers to check with the DOJ to  
          determine whether the DOJ lists them as the owner of any  
          firearm.

          This bill seeks to address the potential situation in which a  
          person purchases a firearm but fails to take possession of that  
          firearm, and subsequently, the dealer does not report that fact  
          to the DOJ. In this case, the person would still appear in DOJ  
          records as the owner of the firearm despite not taking  
          possession of the firearm. This bill would also make a series of  
          changes to existing firearm purchase and transfer provisions.

          Proposed Law: This bill would make the following changes to  
          firearm purchase and transfer processes:
          (1)                          Creates an exemption from normal  
            firearms transfer requirements for firearms transferred by a  
            law enforcement agency to licensed firearms dealers,  
            wholesalers, or manufacturers, so long as the transaction is  
            reported to the DOJ. If the agency sells, delivers, or  
            transfers a firearm to a licensed firearms dealer, the agency  
            must enter a record of the delivery into the AFS via the  
            California Law Enforcement Telecommunications System (CLETS)  
            within 10 days.
          (2)                          Clarifies that law enforcement  
            agencies are required to report to the DOJ, as specified, the  
            disposition of any weapon in their possession whether the  
            weapon is retained, transferred, sold, or destroyed.
          (3)                          Requires firearms dealers to  
            provide a firearms buyer with a copy of the DROS form at the  
            time of delivery of the firearm and after the dealer notes the  
            date of delivery and the dealer provides a signature verifying  
            the delivery and the purchaser acknowledges receipt of the  
            firearm.
          (4)                          Requires the record or register of  
            electronic transfer for all firearms to include the following  
            additional information:
                 Any applicable waiting period exemption information.
                 A statement on the DROS form advising purchasers of  
               their right to request firearms ownership information from  
               DOJ, their right to file reports with DOJ regarding such  
               ownership, and information regarding how to access DOJ's  
               website.
                 The dealer's signature indicating delivery of the  








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               firearm.
                 The purchaser's signature indicating that the firearm  
               has been delivered.
          (1)                          Makes other technical,  
            non-substantive changes to the language of various firearms  
            statutes.

          Staff Comments: The DOJ has indicated the provisions of this  
          bill will result in one-time staffing costs of $143,000 in FY  
          2013-14 and $27,000 in FY 2014-15 to make the necessary changes  
          to the AFS to accommodate the new requirements for the record.  
          The record that is entered into the AFS via the CLETS would be  
          required to include any applicable waiting period exemption  
          information. Estimated costs include overtime hours for existing  
          staff as well as an external consultant to assist with the  
          one-time development activities to modify the AFS. All other  
          provisions are estimated to result in minor, absorbable ongoing  
          costs to the DOJ, as well as minor non-reimbursable local law  
          enforcement costs.