BILL NUMBER: SB 385	AMENDED
	BILL TEXT

	AMENDED IN SENATE  APRIL 2, 2013

INTRODUCED BY   Senator Block

                        FEBRUARY 20, 2013

    An act to add Section 6812.5 to the Revenue and Taxation
Code, relating to bulk sales.   An act to amend Section
28235 of, and to add Article 6.1 (commencing with Section 27970) to
Chapter 4 of Division 6 of Title 4 of Part 6 of, the Penal Code,
relating to firearms. 


	LEGISLATIVE COUNSEL'S DIGEST


   SB 385, as amended, Block.  Bulk sales: sales and use
taxes: collection of taxes: successor's liability: notifications:
disclosures.   Firearms: Private Patrol Operators:
registration and assignment.  
   Existing law generally regulates the ownership and transfer of
firearms, but does not authorize business entities to own or register
firearms.  
   This bill would establish procedures allowing Private Patrol
Operators to own firearms and to assign those firearms to employees
of the Private Patrol Operator (PPO) who are licensed security
guards. The bill would state findings and declarations of the
Legislature, and expresses the intent of the Legislature in
connection with these procedures. The bill would direct the
Department of Justice to modify and create forms, and charge
reasonable fees for the filing and processing of those forms for
these purposes and for enforcement of these provisions, including to
allow the PPO to be listed as the purchaser and legal owner of a
firearm, for a security guard who is assigned that firearm to be
listed as the registered owner, as specified, and for a firearm
custodian to be designated by the PPO. The bill would provide that an
assignment for these purposes would not constitute a loan, sale, or
transfer of a firearm. The bill would require the security guard
receiving a firearm by assignment from a PPO to undergo a background
check and to possess a handgun safety certificate, as specified. The
bill would require security guards, upon request by the PPO, for any
reason, or upon separation of employment or revocation of the
security guard's firearm qualification card, to immediately return
the firearm to the PPO.  
   The bill would make other conforming changes. 
   Existing law, the Uniform Commercial Code-Bulk Sales, is a
comprehensive body of law regulating bulk sales, which are defined to
include a sale not in the ordinary course of the seller's business
of more than 1/2 the seller's inventory and equipment, as specified,
and which imposes specified obligations on an escrow agent for that
sale. 
   The Sales and Use Tax Law, employment tax laws, and personal
property laws impose liabilities for unpaid taxes upon the purchaser
of a business under specified circumstances. Under the Sales and Use
Tax Law, if any person liable for any amount under that law sells out
the business or stock of goods or quits the business, the successors
or assigns are required to withhold sufficient of the purchase price
to cover such amount until the former owner either produces a
receipt from the State Board of Equalization showing that it has been
paid or produces a certificate from the board stating that no amount
is due. Under that law, if the purchaser of a business or stock of
goods fails to withhold from the purchase price as required, the
purchaser becomes personally liable for the payment of the amount
required to have been withheld to the extent of the purchase price,
valued in money.  
   This bill would require an escrow agent to make specified
notifications in writing to a potential purchaser of a business
regarding a purchaser's liabilities under the Sales and Use Tax Law.
This bill would also require specified sellers of a business to
provide under penalty of perjury a successor liability disclosure
statement, as may be prescribed by the State Board of Equalization,
to all potential purchasers or their authorized agents. By expanding
the crime of perjury, this bill would impose a state-mandated local
program.  
   The California Constitution requires the state to reimburse local
agencies and school districts for certain costs mandated by the
state. Statutory provisions establish procedures for making that
reimbursement.  
   This bill would provide that no reimbursement is required by this
act for a specified reason. 
   Vote: majority. Appropriation: no. Fiscal committee: yes.
State-mandated local program:  yes   no  .


THE PEOPLE OF THE STATE OF CALIFORNIA DO ENACT AS FOLLOWS:

   SECTION 1.    Article 6.1 (commencing with Section
  27970) is added to Chapter 4 of Division 6 of Title 4 of
Part 6 of the   Penal Code   , to read:  

      Article 6.1.  Ownership, Registration, and Assignment of
Firearms by Private Patrol Operators


   27970.  (a) (1) The Legislature finds and declares that current
practices and statutes authorize the purchase, registration, and
ownership of firearms by individuals, but not by business entities.
   (2) It is the intent of the Legislature in enacting this chapter
to allow business ownership and registration of firearms in the case
of Private Patrol Operators. It is further the intent of the
Legislature to establish procedures whereby a Private Patrol Operator
may assign firearms it owns to its employees who are licensed to
carry firearms and that the assignment of a firearm by a Private
Patrol Operator to that employee shall not constitute a loan, sale,
or transfer of a firearm.
   (b) For purposes of this article, the following definitions shall
apply:
   (1) "Department" means the Department of Justice.
    (2) "Private Patrol Operator" or "PPO" means a Private Patrol
Operator licensed pursuant to Chapter 11.5 (commencing with Section
7580) of Division 3 of the Business and Professions Code.
   27972.  (a) A PPO may be the legal owner of a firearm.
   (b) (1) The department shall modify the Dealers' Record of Sale
(DROS) form to allow a PPO to be listed as the purchaser and legal
owner of a firearm. The form shall also identify the status of the
PPO as a sole proprietorship, partnership, or corporate entity, and
include any tax identification number or other identifying number
that may be required by the department.
   (2) The department shall modify the DROS form to allow a security
guard who receives a firearm from a PPO for purposes of his or her
employment with that PPO to be listed as the registered owner of the
firearm.
   (3) The department shall also modify the DROS form to require the
PPO to designate a "firearms custodian" for the PPO. The firearms
custodian shall possess a valid firearm qualification card issued by
the Department of Consumer Affairs.
   (4) A security guard who receives a firearm pursuant to a
certificate of assignment is subject to a background check by the
department, pursuant to Section 28220. A security guard shall possess
a valid handguns safety certificate prior to receiving a firearm
pursuant to a Certificate of Assignment.
   (c) The PPO shall, on a separate form, and in a manner prescribed
by the department, identify the person who is designated by the PPO
as the firearms custodian for the PPO. If a firearms custodian ceases
to be employed by the PPO, or otherwise becomes ineligible to be the
firearms custodian, the PPO shall inform the department of that
fact, in a manner prescribed by the department, and the PPO shall
have 30 days to designate a replacement firearms custodian. No PPO
may assign a firearm pursuant to this article if there is no
designated firearms custodian for the PPO.
   (d) (1) The department shall prescribe a "Certificate of
Assignment" or "COA." The COA shall contain the same fields as the
DROS form, and shall be used to identify the employee of the PPO who
has been assigned a firearm by the PPO pursuant to this article.
   (2) Upon the PPO assigning a firearm to an employee who is a
security guard licensed pursuant to Chapter 11.5 (commencing with
Section 7580) of Division 3 of the Business and Professions Code, the
licensed security guard shall complete the COA, and the PPO shall
file the COA with the department in a timely manner as prescribed by
the department.
   27974.  The department shall charge a fee not to exceed the
reasonable costs to the department for filing and processing a form
identifying the firearms custodian of the PPO, for filing and
processing a COA, and for costs incurred in enforcing the provisions
of this article, including, but not limited to, processing forms
required by this article, and entering information obtained pursuant
to this article into the department's Automated Firearms System and
other databases as deemed necessary by the department. The fees shall
be deposited in the Dealers' Record of Sale Special Account.
   27976.  If the PPO ceases to do business, ceases to possess a
valid PPO license as determined by the Director of Consumer Affairs,
ceases as a business entity, or changes its type of business
formation, the PPO shall, within 30 days and unless otherwise
prohibited by law, complete new DROS forms for all PPO-owned firearms
and transfer those firearms to a new owner.
   27978.  Notwithstanding any other law, an assignment of a firearm
pursuant to this article is not a loan, sale, or transfer of a
firearm.
   27980.  A security guard shall, immediately upon the PPO's
request, for any reason, or immediately upon separation of employment
or revocation of the firearm qualification card, return the firearm
to the PPO. This article does not limit the right of a licensed
security guard employee to use, possess, or otherwise lawfully carry
a firearm owned by that employee. 
   SEC. 2.    Section   28235 of the  
Penal Code   is amended to read: 
   28235.  All money received by the department pursuant to this
article shall be deposited in the Dealers' Record of Sale Special
Account of the General Fund, which is hereby created, to be
available, upon appropriation by the Legislature, for expenditure by
the department to offset the costs incurred pursuant to any of the
following:
   (a) This article.
   (b) Section 18910.
   (c) Section 27555.
   (d) Subdivisions (d) and (e) of Section 27560. 
   (e) Article 6.1 (commencing with Section 27970) of Chapter 4.
 
    (e) 
    (f)  Article 6 (commencing with Section 28450). 

    (f) 
    (g)  Section 31110. 
    (g) 
    (h)  Section 31115. 
    (h) 
    (i)  Subdivision (a) of Section 32020. 
    (i) 
    (j)  Section 32670. 
    (j) 
    (k)  Section 33320. 
       
  SECTION 1.    Section 6812.5 is added to the
Revenue and Taxation Code, to read:
   6812.5.  (a) For a bulk sale handled through an escrow, the escrow
agent shall notify in writing a potential purchaser of a business
that is required to hold a permit under this part of the following
information:
   (1) That if a person is liable for any amount under this part
sells his or her business or stock of goods, the purchaser must
withhold a sufficient amount of the purchase price to cover that
amount, until the seller produces a receipt from the board showing
payment or no amount due.
   (2) That a tax clearance certificate is available from the board
that will identify amounts owed under this part by the seller of the
business.
   (3) That the purchaser may be personally liable for the payment of
the amounts owed by the seller under this part to the extent of the
purchase price.
   (b) If a person liable for any amount due under this part sells
out his or her business or stock of goods or quits the business, the
person shall provide under penalty of perjury a successor liability
disclosure statement, as may be prescribed by the board, to all
potential purchasers or their authorized agents to identify any
unpaid amounts due under this part.
   (c) For purposes of this section, "bulk sale" has the same meaning
as defined in paragraph (3) of subdivision (a) of Section 6102 of
the Commercial Code.  
  SEC. 2.    No reimbursement is required by this
act pursuant to Section 6 of Article XIII B of the California
Constitution because the only costs that may be incurred by a local
agency or school district will be incurred because this act creates a
new crime or infraction, eliminates a crime or infraction, or
changes the penalty for a crime or infraction, within the meaning of
Section 17556 of the Government Code, or changes the definition of a
crime within the meaning of Section 6 of Article XIII B of the
California Constitution.