BILL ANALYSIS Ó
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|Hearing Date:June 16, 2014 |Bill No:AB |
| |2312 |
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SENATE COMMITTEE ON BUSINESS, PROFESSIONS
AND ECONOMIC DEVELOPMENT
Senator Ted W. Lieu, Chair
Bill No: AB 2312Author:Nestande
As Amended: April 10, 2014Fiscal: Yes
SUBJECT: Metal theft.
SUMMARY: Requires a junk dealer or recycler to request metal theft
alert notifications from an Internet-based theft alert system, and to
provide a statement to the California Department of Food and
Agriculture that they have requested to do so, when applying for a
weighmasters license.
Existing law:
1)Vests the California Department of Food and Agriculture (CDFA) with
general supervision of weights and measures and weighing and
measuring devices sold or used in the state. (Business and
Professions Code (BPC) § 12700, et seq.)
2)Further provides for the enforcement of the weights and measures laws
and the inspection and testing of measuring devices, in each county,
by the county sealer. (BPC §§ 12100 et seq.; 12200 et seq.)
3)Defines a weighmaster as any person, who, for hire or otherwise,
weighs, measures, or counts any commodity and issues a statement or
memorandum of the weight, measure, or count which is used as the
basis for either the purchase or sale of that commodity or charge
for service. (BPC § 12700)
4)Requires a weighmaster to obtain a license and to pay a license fee,
as prescribed.
(BPC §§ 12703; 12704)
5)Requires the DFA to require a recycler or junk dealer, as defined,
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who applies for or renews a weighmaster license to furnish the
following information on the application: (BPC § 12703.1)
a) A copy of the current business license.
b) A statement that the applicant has filed an application for a
stormwater permit or is not required to obtain a stormwater
permit.
c) A statement that the applicant has the equipment to meet the
photographic and thumbprinting requirements for the purchase and
sale of nonferrous materials or a statement that the applicant
will not be purchasing or selling nonferrous materials.
d) The names of any deputy weighmasters.
This bill:
1)Makes the following legislative findings and declarations:
a) The Institute of Scrap Recycling Industries, Inc. (ISRI) has
developed ScrapTheftAlert.com, a web-based theft alert system
that allows law enforcement to alert recyclers of reported stolen
material and allows recyclers to alert law enforcement when they
receive materials they believe might have been stolen.
b) This alert system broadcasts theft alerts to every registered
user within a 100-mile radius of where the theft occurred and can
expand depending on the circumstances.
c) ISRI has worked closely with law enforcement and has integrated
their suggestions into the system to make its use more
user-friendly for law enforcement.
d) There is no cost to law enforcement or non-ISRI members to use
the system.
e) Members of ISRI pay for the entire database through membership
dues.
1)Requires the DFA to require a recycler or junk dealer who applies for
or renews a weighmaster license to additionally include a statement
indicating that the applicant has requested to receive theft alert
notifications, as specified.
2)Requires a junk dealer or recycler to request to receive theft alert
notifications regarding the theft of commodity metals, including,
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ferrous metal, copper, brass, aluminum, nickel, stainless steel, and
alloys, in the junk dealer's or recycler's geographic region from
the theft alert system maintained by ISRI, or its successor.
3)Encourages law enforcement agencies to report thefts of commodity
metals, including, ferrous metal, copper, brass, aluminum, nickel,
stainless steel, and alloys that have occurred within their
jurisdiction to the theft alert system maintained by ISRI, or its
successor, in order to ensure that persons using that system receive
timely and thorough information regarding metal thefts.
4)Provides that ISRI or its successor shall not require payment for the
use of the theft alert system by law enforcement agencies or members
of the public, and shall not sell subscribers' information to third
parties.
FISCAL EFFECT: This measure has been keyed "fiscal" by Legislative
Counsel. According to the Assembly Appropriations Committee analysis
dated April 30, 2014:
1)Minor and absorbable one-time administrative costs to CDFA to update
the weighmaster application form.
2)Unknown, likely minor costs to local law enforcement should they
voluntarily report metal thefts to the theft alert system. The bill
prohibits ISRI or its successor from charging law enforcement or the
public to use the system.
3)Negligible costs to junk dealers or recyclers to request to receive
theft alert notifications over the internet.
COMMENTS:
1.Purpose. This bill is sponsored by the West Coast Chapter of the
Institute of Scrap Recycling Industry (ISRI) to require all scrap
metal recycling centers in California to subscribe and receive
reports of metal thefts in their region from the ISRI metal theft
alert system. The Author states the alert system is free of charge
to subscribers and to law enforcement. The Author further indicates
that the bill will encourage local law enforcement agencies to
report crimes to the ISRI database so recycling centers can be made
aware of them. The ISRI reporting system operates by law
enforcement officials submitting a report to their online database
with a description of the stolen items and the date and location
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from where they were stolen. Once that report is submitted, ISRI
sends an alert to recycling centers within a 100 mile radius of
where the theft occurred.
2.Background.
a) The Ongoing Problem of Metal Theft. Metal theft continues to
be a serious problem in California. In addition to the loss of
property, repairing the damage from metal theft can also be
costly.
For example, Fresno's ABC7 television news on November 2013,
reported a registered California historic landmark memorial was
stolen from the Pinedale Remembrance Plaza. The 20 pounds of
brass from the stolen memorial was worth approximately $50 at a
recycling facility, but it will cost an estimated $5000 to
replace. The Desert Sun reported on February 14, 2014 that less
than two months into 2014, the Coachella Valley Water District is
on its way to losing more equipment to metal thieves this year
than it did in 2013.
The National Insurance Crime Bureau (NICB) released a report in
2013 regarding metal theft which reported, "thieves have been
willing to go to almost any length to obtain the metal. They
have stripped sheets of metal from building rooftops, stolen
memorial decorations from cemeteries, ripped apart air
conditioners for the copper coils within, and stripped homes and
buildings of wiring and piping? The thieves can endanger the
safety of themselves and those in the surrounding community, and
weaken the infrastructure vital to our everyday lives.
Unoccupied buildings have exploded due to gas lines being stolen,
stretches of highway have been left dark after thieves stole
wiring from utility poles, and tornado warning sirens have been
rendered inoperable due to wiring being stolen? Regardless of the
motive, the damage caused by such thefts is often several times
the value of the metal stolen, leaving the victims with hefty
repair costs which are then often passed on to insurance
companies." (Metal Theft Claims and Questionable Claim Referrals
from January 1, 2010 to December 31, 2012, April 19, 2013, NICB).
b) The Growing Nonferrous Metal Recycling Industry. According to
ISRI, nonferrous (non iron-based) metals are among the few
materials that do not degrade or lose their chemical or physical
properties in the recycling process. Because of this, these
metals have the capacity to be recycled an infinite number of
times. Nonferrous materials include copper, copper alloys,
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stainless steel, or aluminum (excluding beverage containers, as
defined in the California Public Resources Code).
In the United States, the value of the nonferrous scrap industry
approached $50 billion in 2012. In terms of volume, nonferrous
scrap materials make up a small percentage of the total quantity
of material recycled in the United States, but by value they
account for more than half of the total earnings of the scrap
recycling industry. In 2012, the U.S. exported nearly $14
billion worth of nonferrous scrap to more than 90 countries.
c) Theft Alert Notifications. ScrapTheftAlert.com is a free tool
for junk dealers and recyclers, law enforcement, and other local
agencies to allow an individual to alert others in the scrap
industry of significant thefts of materials within the United
States and Canada.
Alerts posted by individuals are broadcast by email to all
subscribed users within a 100 mile radius of where the incident
occurred, and depending on the incident, that radius can be
increased. Once an alert has been broadcast, it can be in the
recipient's email inbox in minutes.
ScrapTheftAlert.com currently has 524 active users in California
and has issued 246 active alerts. Nationwide, the Web site has
over 17,000 total users and has helped recover over one million
dollars of stolen material. ScrapTheftAlert.com is maintained by
ISRI and there is no separate cost for users because ISRI members
pay for the operation of the Web site.
This bill requires junk dealers and recyclers to request to receive
theft alert email notifications, and junk dealers and recyclers
seeking a weighmasters license must provide a statement in their
application that they have registered to receive email alerts
from the theft alert system as a condition for licensure. This
bill also provides that ISRI or its successor will not charge a
fee for the use of the theft system and is not permitted to sell
subscribers' information to third parties.
3.Related Legislation. SB 485 (Calderon, Chapter 518, Statutes of
2013) requires a junk dealer or recycler to submit additional
information regarding its junk dealer business to DFA when applying
for a weighmaster's license or a renewal license, requires the DFA
to complete an investigation of the information on the application
or renewal within a specified period of time and revoke the license
if the information submitted in the application or renewal is
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materially inaccurate, increases the fees that junk dealers or
recyclers pay for each fixed location, and sunsets those provisions
on January 1, 2019.
AB 841 (Torres, 2013) would have required junk dealers and recyclers to
provide payment to sellers of nonferrous material by mailed check
only, as specified. ( Status : AB 841 was vetoed by the Governor.)
AB 909 (Gray, 2013) would have required the Board of State and
Community Corrections to establish the Metal Theft Task Force
Program to provide, evaluate and monitor grants disbursed to enhance
the capacity of local law enforcement and prosecutors to deter,
investigate, and prosecute metal theft and related metal theft
crimes. ( Status : AB 909 was vetoed by the Governor.).
AB 316 (Carter, Chapter 317, Statutes of 2011) provided that every
person who steals, takes, or carries away copper materials which are
of a value exceeding $950 is guilty of grand theft, punishable as
specified.
SB 447 (Maldonado, Chapter 732, Statutes of 2008) required scrap metal
dealers and recyclers to report what materials are being scraped at
their facilities and by whom on a daily basis.
AB 844 (Berryhill, Chapter 731, Statutes of 2008) required recyclers to
hold payment for three days, check photo identification and take a
thumbprint of anyone selling scrap metals. AB 844 also required any
person convicted of metal theft to pay restitution for the materials
stolen and for any collateral damage caused during the theft.
SB 691 (Calderon, Chapter 730, Statutes of 2008) required junk dealers
and recyclers to take thumbprints of individuals selling copper,
copper alloys, aluminum and stainless steel, and required sellers to
show government identification and proof of their current address.
4.Arguments in Support. The Association of California Water Agencies
(ACWA) writes in support that metal theft has quickly become a
severe drain on many water district budgets. "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 each year to repair and replace. We had hoped that the
series of bills signed into law over the past several years would
have curbed the rash of metal thefts, but it appears that more still
needs to be done."
Association of California Recycling Industries (ACRI) states, "We
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support the creation of this notification system and believe it is
an appropriate and effective approach to reducing the incidents of
metal theft in California, while ensuring that law-abiding
businesses in California are not placed at a competitive
disadvantage in the marketplace."
The City of Beaumont states that requiring businesses to receive
updates from the ISRI-operated database will help them avoid
purchasing stolen goods and reduce demand for stolen scrap. "This
database will also provide a powerful deterrent as thieves realize
that scrap metal recycling centers are aware of their stolen goods
thus increasing their chances of being caught and brought to
justice."
The Eastern Municipal Water District states that it "spent over
$300,000 in a single year on the repair and replacement of items
lost to metal theft - while the thieves only receive a minimal
amount in exchange for the items that were stolen. The coordinated
approach outlined in
AB 2312 will assist recyclers and junk dealers as they conduct honest
business to identify and report stolen goods, and will further
assist local law enforcement with capturing metal thieves."
The California Farm Bureau Federation (Farm Bureau) argues that the
bill will help increase awareness when metal is reported stolen to
prevent it being sold by thieves, stating, "If the market for stolen
metal is reduced, metal theft should decline. Working to reduce
metal theft will help California farmers and ranchers. Thieves
strip copper wires from pumps and steal other metal such as
sprinkler heads and irrigation pipes from farms. The cost of
replacing copper wire on an irrigation pump ranges from $1,500 to
$4,000. When the irrigation pump is damaged in the theft the repair
costs can reach tens of thousands of dollars. Yet this cost only
covers repair of the pump, not the cost of potential crop damage
caused by lack of irrigation while the pump was unusable.
Allied Riverside County Chiefs of Police and Sheriff (ARCCOPS) states
that communities have experienced a significant increase in
commercial metal theft, costing our businesses and residents
hundreds of thousands of dollars in direct and indirect costs.
Metal theft has also created safety hazards including missing
manhole covers, exposed electrical wires and severe flooding of
streets and farms following damage to of backflow and irrigation
systems. In some communities, these cases have resulted in serious
injury to innocent citizens. ARCCOPS states, "We believe that
legislation such as this, requiring recyclers to receive and
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disseminate information and updates from the ISRI-operated database
will help to identify stolen goods and reduce demand for stolen
scrap metals"
5.Policy Concerns. This bill recognizes a web based theft alert system
ScrapTheftAlert.com that is operated by ISRI a private trade
association. The bill encourages enforcement agencies to report
thefts of commodity metals to the alert system, and requires
recyclers and junk dealers to subscribe to, and receive alerts from
the alert system.
Although the bill prohibits ScrapTheftAlert.com from charging for
alerts sent to subscribing junk dealers and recyclers, the bill is
vesting what may be regarded as essentially a state regulatory
function into an industry-run web based alert system. While the
creativity of using a privately-operated alert system is laudable in
the light of the limited and diminishing fiscal resources of state
agencies, there remains a level of concern with assigning this
function to a private entity. There is concern that the bill does
not contain any practice standards for the alert system, leaving
those details solely in the hands of ISRI. Further there is concern
that a trade association could possibly use a mandated alert system
to advertise to those mandated subscribers or to sell advertisements
which are then distributed to the subscribers through the alert
system. In addition, there is a strong likelihood mandating junk
dealers and recyclers to use ISRI's theft alert system, the bill
would result in possibly benefiting ISRI by substantially increasing
the membership of that trade association.
Therefore, in order that the efficacy of mandating the use of an
association operated theft alert system may be evaluated, the
Committee may wish to establish a three year sunset date until
January 1, 2018, on this bill's provisions. As with all sunsets,
this will allow the Legislature to revisit the issue and respond to
any unintended consequences and evaluate the adequacy of encouraging
law enforcement to report metal thefts to, and requiring junk
dealers and recyclers to subscribe to ISRI's metal theft alert
system.
NOTE: Double-referral to Public Safety Committee Second.
SUPPORT AND OPPOSITION:
Support:
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West Coast Chapter of the Institute of Scrap Recycling Industry
(Sponsor)
Allied Riverside County Chiefs of Police and Sheriff
Association of California Recycling Industries
Association of California Water Agencies
Blythe Police Department
California Farm Bureau Federation
California Municipal Utilities Association
California Police Chiefs Association
California State Sheriffs' Association
California Women for Agriculture
Californians Against Waste
City of Beaumont
City of Indio Police Department
City of Rancho Mirage
City of Salines
Coachella Valley Association of Governments
Coachella Valley Economic Partnership
Coachella Valley Water District
Desert Fresh, Inc.
Desert Sands Unified School District
Desert Valley Builders Association
Eastern Municipal Water District
Fresno Metropolitan Flood Control District
General Patton Memorial Museum
Indio Chamber of Commerce
Mayor of San Jacinto
Metropolitan Water District of Southern California
Patton Memorial Museum Board of Directors
Riverside County Board of Supervisors
Riverside County Chiefs of Police and Sheriffs
Schintzer Steel Industries
Opposition:
None received as of June 11, 2014.
Consultant:G. V. Ayers
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