BILL ANALYSIS �
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|Hearing Date: April 22, 2013 |Bill No:SB |
| |485 |
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SENATE COMMITTEE ON BUSINESS, PROFESSIONS
AND ECONOMIC DEVELOPMENT
Senator Curren D. Price, Jr., Chair
Bill No: SB 485Author:Calderon
As Amended:April 8, 2013 Fiscal:Yes
SUBJECT: Weighmasters: junk dealers and recyclers.
SUMMARY: Requires a junk dealer or recycler upon application for or
renewal of a weighmasters' license to submit additional specified
information regarding its junk dealer or recycler business to the
Department of Food and Agriculture; requires the Department to make a
thorough investigation of the information submitted on that
application within 90 days; requires the Department to revoke a junk
dealer or recycler's weighmasters' license if the information
submitted in the application is materially inaccurate; requires a junk
dealer or recycler applying for a weighmaster license to pay an
additional unspecified fee to the Department for the administration
and enforcement of these provisions.
Existing law:
1)Vests the Department of Food and Agriculture (DFA) with general
supervision of weights and measures and weighing and measuring
devices sold or used in the state, and authorizes the Secretary of
Food and Agriculture (Secretary) to exercise any power conferred
upon the department or upon the State Sealer, who is the chief of
the Division of Measurement Standards (DMS) within DFA and is
charged with the enforcement of the provisions relating to weights
and measures. (Chapter 7 (commencing with � 12700) of Division 5 of
the Business and Professions Code (BPC))
2)Further provides for the enforcement of those laws and the inspection
and testing of measuring devices, in each county, by the county
sealer. (BPC � 12100 et seq., and � 12200 et seq.)
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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)Authorizes the Secretary to refuse to grant a license, to refuse to
renew a license, or to revoke or suspend a license if, after an
administrative hearing, the Secretary is satisfied that the
applicant or licensee is not qualified to capably or reliably
perform the duties of a weighmaster
or has been found guilty of a misdemeanor relating to the regulation of
weighmasters.
(BPC � 12708)
6)Regulates junk dealers and recyclers and defines for purposes of that
law:
a) "Junk" to mean 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. (BPC � 21600)
b) "Junk dealer" to include any person engaged in the business of
buying, selling and dealing in junk, or purchasing, gathering,
collecting, soliciting or procuring junk, and any person
operating, carrying on, conducting or maintaining a junk yard or
place where junk is gathered together and stored or kept for
shipment, sale or transfer. (BPC � 21601)
c) "Recycler" to mean any processor, recycling center, or
noncertified recycler, as defined, who buys or sells scrap metal
that constitutes junk. (BPC � 21605).
1)Requires junk dealers and recyclers to keep a written record of each
sale and purchase for at least two years; requires the written
information to be reported to the chief of police or sheriff, as
specified; and makes it a misdemeanor to make a false or fictitious
statement in the written record. The record must include the place
and date of the sale; the name, driver's license number and state of
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issue, and the vehicle license plate number and state of issue of
any motor vehicle used in transporting the junk; the name and
address of each person to whom the junk is sold and that person's
motor vehicle license number; a description of the junk purchased or
sold; and, a statement indicating that the seller of junk owns it or
is authorized to sell it. (BPC � 21606)
2)Requires junk dealers and recyclers to record certain information
from the seller when buying nonferrous (not containing iron)
materials, including a valid driver license, or other specified
identification; obtain a clear photograph or video of the seller and
a clear photograph or video of the material being purchase, and
obtain a thumbprint of the seller, as proscribed by the Department
of Justice. (BPC Section 21608.5)
This bill:
1)Makes legislative declarations that:
a) The commercial scrap recordkeeping and reporting requirements
are intended primarily to discourage metal theft and to promote
honest competition within the scrap metal recycling industry.
b) The primary function of the DMS is to ensure fair and honest
competition for industry and accurate value comparison for
consumers.
c) Because DMS and county sealers are responsible for
periodically inspecting and regulating all weighing and measuring
devices utilized by all scrap recyclers doing business within the
state, they are perfectly suited to review and verify the
recordkeeping and reporting requirements for the scrap recycling
industry.
1)Requires the DFA to require a recycler or junk dealer, as defined,
who applies for a weighmaster's license or to renew a weighmaster;s
license to furnish specified additional information on the
application.
a) A 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
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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.
1)Requires DFA to issue a license to a junk dealer or recycler to an
applicant who submits the appropriate information and fee.
2)Requires DFA to make a thorough investigation of all of the
information contained in the application within 90 days.
3)Requires DFA to revoke a junk dealer or recycler's weighmaster's
license if the information submitted in the application is
materially inaccurate, unless the junk dealer or recycler complies
with these information requirements within 14 days.
4)Provides that a junk dealer or recycler whose license has been
revoked is entitled to a hearing before an administrative law judge,
as specified.
5)Requires a weighmaster that is junk dealer or recycler to pay an
additional unspecified fee to the DFA for the administration and
enforcement of these provisions.
FISCAL EFFECT: Unknown. This bill has been keyed "fiscal" by
Legislative Counsel.
COMMENTS:
1.Purpose. This bill is sponsored by West Coast Chapter of the
Institute of Scrap Recycling Industries (ISRI) in an effort to
better identify recyclers that operate outside of the law, and who
often deal in stolen recyclable materials.
The Author acknowledges that California has stringent reporting
requirements for recycling companies when purchasing non-ferrous
materials such as copper and stainless steel. The purpose for
creating such strict reporting requirements, according to the
Author, was to discourage metal theft and promote honest competition
within the scrap metal recycling industry. Unfortunately, the
reporting requirements have not stopped the theft of metals.
Instead, it has created unscrupulous and non-compliant recyclers
within the industry. The consensus is not that existing laws have
shortcomings, but the lack of resources to enforce the law. Due to
the extreme strain on state and local revenues, the ability to
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enforce the existing laws seems to be the greatest challenge to
solving the metal theft puzzle for local law enforcement.
Non-compliant recyclers provide an avenue for thieves to sell stolen
material, according to the Author.
SB 485 seeks to address the issue of monitoring recyclers who do not
follow the law by establishing additional requirements for recyclers
who submit an application for a new weighmaster license or the
renewal of a weighmaster license with the Department of Food and
Agriculture. The recycler would be required to submit:
A copy of the applicant's current business license.
A statement indicating that the applicant has either filed
an application for a storm water permit or is not required to
obtain a storm water permit.
A statement indicating that the applicant has the
technology to comply with the photographic and thumb printing
requirements relative to the purchase and sale of non-ferrous
material as required by Business and Professions Code �
21608.5.
The bill would additionally require the Division of Measurement
Standards through the local sealer to verify the accuracy of the
information submitted, and take disciplinary action for submitting
false information on the application. The bill also requires a junk
dealer or recycler to pay a fee in the amount necessary to cover the
reasonable regulatory costs for enforcing these provisions and
authorizes county boards of supervisors to charge junk dealers and
recyclers an amount not to exceed the amount needed for county
sealers to enforce these requirements.
1.Background. This bill has been introduced within the context of
California's ongoing struggles to curb the theft of stolen valuable
metals such as copper, aluminum, and brass. In California, the
fourth largest agriculture economy in the world generating over $34
billion, the negative impact of metal theft on agriculture affects
the daily lives of each Californian.
The Author cites estimates that place the annual loss of U.S.
agricultural economic activity due to agricultural crime, including
metal theft, at well over $5 billion. The Author indicates that our
farm economy in California is losing tens of millions of dollars
each year to thieves. Metal theft is particularly harmful as the
farmer or rancher losses are more than just metal. Typically, the
damage to the equipment far outweighs the value of stolen metal.
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2.Historical Perspective. In 2009 metal theft, simply put, had reached
an unacceptable level. In 2005, the number of reported metal theft
incidents went up 100% from the previous year, and in 2006 the
increase was 400%. The value of metals stolen in 2008 was at least
$6 million in California. News stories up and down the state were
highlighting that nothing was being spared by metal thieves.
Farmers were seeing copper wires and aluminum pipes stripped from their
equipment. Utility companies are seeing their lines cut and
stripped of copper wire. Construction companies lost wire and pipe
at construction sites. Schools, churches, and businesses had their
wire from air conditioning units stolen. Catalytic converters
ripped off of parked cars. Even bronze cemetery vases were being
stolen and sold for scrap. The list goes on and on, and the damage
caused by the theft results in much greater costs for the victims
than is gained by the thieves.
The reasons for these thefts were fairly simple. The stolen metal
could be sold to metal recyclers for a good amount of cash, on the
spot. Copper was the hot commodity in particular, and given its
high price, thieves were taking just about anything copper they
could get their hands on. Law enforcement agencies throughout the
state concluded from arrests made that metal thieves were
predominantly drug users looking for quick, easy money to feed their
habit.
In an effort to toughen restrictions on the purchase of metal, and thus
to curb the sale of stolen metal, in 2008, the Legislature enacted
SB 691 (Calderon, Chapter 730, Statutes of 2008), AB 844 (Berryhill,
Chapter 731, Statutes of 2008) and SB 447 (Maldonado, Chapter 732,
Statutes of 2008). These bills attempted to stem the tide of metal
theft in California. Since that time a number of bills have sought
to further address different aspects of the problem of recycling
stolen materials.
3.Related Legislation.
SB 757 (Berryhill) makes conforming changes to authorize a junk dealer
or recycler buying newspaper or CRV containers, as specified above,
to accept as valid seller identification a passport from any country
or a Matricula Consular issued by Mexico; specifies that the term
"secondhand dealer" does not include a junk dealer. This bill is
set for hearing by this Committee on April 22.
AB 909 (Gray) requires the Board of State and Community Corrections to
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establish the Metal Theft Task Force Program (MTTFP). To provide
and evaluate and monitor grants disbursed to enhance to enhance the
capacity of local law enforcement and prosecutors to deter,
investigate, and prosecute metal theft and related metal theft
crimes. That bill is currently in Assembly Appropriations
Committee.
AB 841 (Torres, 2013) requires junk dealers and recyclers to provide
payment to sellers of nonferrous material by mailed check only, as
specified. This bill has been referred to Assembly Business,
Professions and Consumer Protection Committee for hearing.
AB 2003 (Torres, 2012) was essentially identical to AB 841. This bill
failed passage in this Committee on June 18, 2012.
AB 1508 (Carter, Chapter 531, Statutes of 2012) revised 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.
AB 1583 (Roger Hernandez, Chapter 300, Statutes of 2012) prohibited
junk dealers and recyclers from purchasing or receiving bulk
merchandise pallets, as defined, marked with an indicia of
ownership, as defined, from anyone except the indicated owner,
unless specified information is provided.
SB 1387 (Emmerson, Chapter 656, Statutes of 2012) prohibited a junk
dealer or recycler from possessing manhole covers, backflow devices,
and fire hydrants without written certification on the letterhead of
the public agency or utility that previously owned that material.
Failure to
comply with this provision would result in a criminal fine of up to
$3,000. This bill has been referred to the Assembly Public Safety
Committee for hearing.
SB 1045 (Emmerson, Chapter 393, Statutes of 2012) established civil
liability for a junk dealer or recycler who possesses a fire
hydrant, a fire department connection, as specified, or a backflow
device or connection to that device or part of that device without a
prescribed written certification, from the agency or utility owning
or previously owning the material.
AB 316 (Carter, Chapter 317, Statutes of 2011) provided that every
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person who steals, takes, or carries away copper materials which are
of a value exceeding $950 is guilty of grand theft, punishable by a
fine not exceeding $2,500, imprisonment in a county jail not
exceeding one year, or by both that fine and imprisonment, or by
imprisonment in a county jail or the state prison not exceeding 16
months, or 2 or 3 years and a fine not to exceed $10,000, as
specified.
AB 1778 (Ma, Chapter 733, Statutes of 2009) required recyclers to
obtain identifying information of individuals who bring in more than
$50 worth of CRV recyclables and newspapers. AB 1778 also required
that payments of $50 or more be made by check.
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 a photo ID and take a thumbprint
of anyone selling scrap metals. 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. Also, required sellers
to show a government identification (ID) and proof of their current
address. Recyclers who violated the law faced suspension or
revocation of their business license and increased fines and jail
time.
SB 627 (Calderon, Chapter 603, Statues of 2009) required a core
recycler, that accepts, ships, or sells used catalytic converters to
maintain specified information regarding the purchase and sale of
the catalytic converters for not less than 2 years. Prohibited a
core recycler from providing payment for a catalytic converter
unless the payment is made by check, and the check is mailed or
provided no earlier than 3 days after the date of sale.
4.Arguments in Support. In sponsoring the bill the West Coast Chapter
of the Institute of Scrap Recycling Industries (ISRI) argues,
"California has the most comprehensive statutory structures in the
nation to help prevent the theft of non-ferrous metal which ISRI
supported. Over the years, it has become readily apparent that
additional laws on the books are not necessary. The problem is not
the lack of sufficient statutory muscle, but the dire lack of
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judicial enforcement. Simply stated, few local police agencies have
the desire to redirect their scarce resources to enforce the metal
theft laws. This is a budgetary issue and not an issue of
substantive law. SB 485 will help relieve the budgetary stress on
law enforcement and is
another step in the right direction in reducing metal theft by
providing additional enforcement tools."
ISRI further states that this provides a mechanism for additional
enforcement at recycling facilities by county sealers, and gives
sealers authority to make sure that all recycling facilities have
the required business permits for each jurisdiction. The additional
requirements will be paid by the recyclers through a supplemental
fee to cover the costs necessary for the sealer to inspect the
recyclers. ISRI is dedicated in helping law enforcement remove the
noncompliant or "rogue" recyclers in California.
ISRI cites an August 2012 Los Angeles Times article, Illegal Scrap
Yards in California a Burgeoning Problem, which highlighted the
problem of "rogue" or non-legitimate scrap yards which were popping
up around the Los Angeles area. These businesses do not necessarily
fill out the required transaction reports, and are therefore an easy
place to sell stolen or misappropriated nonferrous metal materials.
In addition to the increasing number of illegal scrap yards, the
article noted that there are limited law enforcement resources
available to prosecute such efforts. "SB 485 is designed to assist
law enforcement in eliminating the 'rogue' recyclers. If law
enforcement is able to eliminate the 'rogue' recyclers, California
will see a major decline in metal theft," according to ISRI.
California Agricultural Commissioners and Sealers Association (CACASA)
supports in concept the new oversight program related to junk
dealers and recyclers. CACASA states that it has been approached by
the Sponsors of the bill to provide input on the format of the new
oversight program. CACASA indicates that county sealers are
familiar with the industry due to administration of weights and
measures laws in their respective jurisdictions, and supports the
bill as long as any new or additional duties related to the program
are fully funded or reimbursed. CACASA anticipates continuing to
work with the Sponsors to determine what will be expected of county
sealers and what level of fee will be established to ensure local
cost-recovery.
California Grocers Association (CGA) supports the bill, arguing that
allowing sealers to inspect and cite these businesses' financial
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records for accepting stolen metals such as shopping carts will act
as a deterrent for these dealers to no longer accept unlawfully
obtained material.
"Simply put, SB 485 will help curb a theft issue that deeply impacts
our member companies," writes CGA.
California Farm Bureau Federation supports that bill stating that metal
theft is a crisis facing our communities and given public safety
budget cuts, and providing the authority to county agricultural
commissioners is an important step to expand the enforcement of the
record keeping requirements for junk dealers and recyclers."
California Chamber of Commerce supports the bill arguing that tougher
enforcement serves as a deterrent to crimes as shown through the
work of rural crime task forces operating on the coast and in the
central part of the state.
SUPPORT AND OPPOSITION:
Support:
West Coast Chapter of the Institute of Scrap Recycling Industries
(Sponsor)
Association of California Water Agencies
California Agricultural Commissioners and Sealers Association
California Chamber of Commerce
California Farm Bureau Federation
Opposition:
None received as of April 16, 2013
Consultant:G. V. Ayers