BILL ANALYSIS Ó
AB 2459
Page 1
Date of Hearing: April 12, 2016
Counsel: Gabriel Caswell
ASSEMBLY COMMITTEE ON PUBLIC SAFETY
Reginald Byron Jones-Sawyer, Sr., Chair
AB
2459 (McCarty) - As Introduced February 19, 2016
SUMMARY: Imposes duties and responsibilities upon firearms
retailers as specified. Specifically, this bill:
1)Permits the Department of Justice (DOJ) to impose a civil fine
of up to $500 against firearms dealers for a breach of
specified prohibitions. Additionally, provides for a fine of
up to $2,000 for breaches when the licensee previously
received written notification from the DOJ regarding the
breach and failed to take corrective action, or the DOJ
determines that the licensee committed the breach knowingly or
with gross negligence.
2)Prohibits, commencing January 1, 2018, a firearms dealer
license from designating a building that is a residence, as
defined, as a building where the licensee's business may be
conducted.
3)Provides that the provisions of this bill would not preclude
or preempt a local ordinance that places additional or more
stringent requirements on firearms dealers regarding where the
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business of the licensee may be conducted.
4)Requires a licensee to ensure that its business premises are
monitored by a video surveillance system that, among other
requirements, visually records and archives footage of the
following:
a) Every sale or transfer of a firearm or ammunition, in a
manner that makes the facial features of the purchaser or
transferee clearly visible in the recorded footage;
b) All places where firearms or ammunition are stored,
displayed, carried, handled, sold, or transferred;
c) The immediate exterior surroundings of the licensee's
business premises; and
d) All parking areas owned or leased by the licensee.
5)Specifies that the video footage must be maintained and stored
for not less than 5 years.
6)Requires, commencing January 1, 2018, a licensee to obtain a
policy of commercial insurance that insures the licensee
against liability for damage to property and for injury to or
death of any person as a result of the theft, sale, lease or
transfer or offering for sale, lease or transfer of a firearm
or ammunition, or any other operations of the business and
business premises, in the amount of $1,000,000 per incident,
as specified. Provides that these provisions would not
preclude or preempt a local ordinance that places additional
or more stringent requirements on firearms dealers regarding
insurance pertaining to the licensee's business.
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EXISTING LAW:
1)States that, in general and subject to exceptions, the
business of a firearms licensee shall be conducted only in the
buildings designated by the business license; (Pen. Code §
26805, subd. (a).)
a) Provides an exception that a person licensed, as
specified, may take possession of firearms and commence
preparation of registers for the sale, delivery, or
transfer of firearms at any gun show or event if the gun
show or event is not conducted from any motorized or towed
vehicle. A person conducting business shall be entitled to
conduct business as authorized at any gun show or event in
the state, without regard to the jurisdiction within this
state that issued the license provided the person complies
with all applicable laws, including, but not limited to,
the waiting period specified, and all applicable local
laws, regulations, and fees, if any; (Pen. Code § 26805,
subd. (b)(1).)
b) Provides an exception for a person licensed as specified
may engage in the sale and transfer of firearms other than
handguns, at specified events, subject to the prohibitions
and restrictions contained in those sections; (Pen. Code §
26805, subd. (c)(1).)
c) Provides an exception for a person licensed, as
specified, who may also accept delivery of firearms other
than handguns, outside the building designated in the
license, provided the firearm is being donated for the
purpose of sale or transfer at an auction or similar event
specified; (Pen. Code § 26805, subd. (c)(2).)
d) Provides that a firearm may be delivered to the
purchaser, transferee, or person being loaned the firearm
at one of the following places: (Pen. Code § 26805, subd.
(d).)
i) The building designated in the license;
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ii) The places specified as express exemptions; and
iii) The place of residence of, the fixed place of
business of, or on private property owned or lawfully
possessed by, the purchaser, transferee, or person being
loaned the firearm.
2)Provides a person conducting specified firearms business shall
publicly display the person's license issued, or a facsimile
thereof, at any gun show or event, as specified in this
subdivision. (Pen. Code § 26805, subd. (b)(2).)
FISCAL EFFECT:
COMMENTS:
1)Author's Statement: According to the author, "As a local
elected official, I authored successful measures to crack down
on illegal gun and ammunition sales. As a State
Assemblymember, I am proud to author AB 2459, which I believe
will have a strong impact statewide in the effort to keep guns
out of the wrong hands."
2)Background: According to the background submitted by the
author, "Law Enforcement has limited resources to oversee the
more than 2,300 licensed gun dealers in our state. A 2010
Washington Post report found that, due to limited staffing,
ATF could only inspect gun dealers once per decade on average.
These limitations, combined with weak state and federal laws
related to gun dealers, allow many bad actor gun dealers to
evade accountability.
"A New York Times article 'How They Got Their Guns,' brought
to light the fact that since 2009, 15 mass shooting were
committed with legally purchased firearms. This discredits
the notion that only illegal firearms are used in the
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commission of these heinous acts. A study by the Bureau of
Alcohol, Tobacco and Firearms, found that 60% of legally
purchased weapons found at crime scenes came from 1% of gun
dealers. Later studies have estimated that 90% of legally
purchased guns used in the commission of a crime were from 5%
of gun dealers. In 2014, 2,935 Californians were killed by
firearms.
"Many of these gun sales were so called 'straw sales' whereby
a person prohibited from purchasing a gun uses a third party,
often a family member or friend, to legally purchase the gun.
These sales are legal on paper, but when recorded becomes
obvious that the purchaser has no interest in purchasing the
gun for themselves. Video recording is a common practice in
all types of retail and provides safety and security for both
store employees and customers.
"In two academic studies, undercover researchers found that at
least 20% of California gun dealers were willing to conduct an
illegal 'straw purchase;' even when the dealer knew the gun
would be used by a prohibited person. Though these
transactions are a leading source of guns used during crimes,
they often appear legal on paper without security cameras to
visibly capture the sale. California gun dealers also reported
1,797 firearms 'missing' from their inventories from
2012-2015. Without security cameras monitoring dealers'
premises and sales counters, law enforcement has few tools to
investigate whether these firearms were misplaced, stolen, or
illegally trafficked to criminals.
"Another source of legally purchased guns are residential
dealers, which are licensed dealers who sell weapons out of
their homes. To date, over 60 cities and counties in
California have banned this practice, recognizing the
potential for abuse and lack of adequate oversight."
3)Content of the Bill: This proposed legislation basically
implements four changes to existing law for the stated
purposes of cutting down on straw purchases in California.
a) Imposition of Civil Fines for Violations of Rules
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Related to Grounds for Forfeiture of a License to Sell
Firearms: The bill proposes new fines related to
violations of rules imposed upon licensees. The fines
suggested are up to a $500 civil fine for simple
violations, and up to $2,000 fines for violations when the
licensee previously received written notification from the
DOJ regarding the breach and failed to take corrective
action, or the DOJ determines that the licensee committed
the breach knowingly or with gross negligence. The grounds
for forfeiture include a wide range of conduct, including
the following: properly displayed license, proper delivery
of a firearm, properly displaying firearms, prompt
processing of firearms transactions, posting of warning
signs, safety certificate compliance, checking proof of
California residence, safe handling demonstrations,
offering a firearms pamphlet, and many more.
b) Requiring Gun Dealers to Install Security Cameras to
Monitor and Videotape their Premises and Sales: The sponsor
and author have indicated that the requirement to install
video surveillance cameras in businesses that sell firearms
will discourage straw purchases and illegal activities.
The fact that purchasers and sellers are being recorded
while sales are being conducted will arguably shed light on
transactions. Retailers are opposed because it places an
overly-burdensome expense on the business to maintain a
security camera system, and retain and store the footage
captured. The footage must be maintained for not less than
five years. Additionally, the American Civil Liberties
Union objects to this provision on grounds of a violation
of privacy.
c) Prohibiting Gun Dealers from Selling Weapons from their
Homes: The author's intent in this provision is to push
firearms transactions into lawful places of business, where
they are more likely to be legitimate. The sponsor
believes that by permitting the sale of firearms from a
private residence that illegal transactions such as straw
purchases are much more likely. There is a legislative
history to this provision. AB 988 (Lowenthal), of the
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1999-2000 Legislative Session stated that no licenses to
sell firearms could be granted to sell firearms out of
residential buildings. AB 22 (Lowenthal), of the 2001-2002
Legislative Session, prohibited the retail sale of firearms
from a residential dwelling with specific exceptions. Both
bills failed passage on the Senate floor. This bill would
cover specialty gun smiths, and those concerns were brought
up in the prior legislative sessions in which this
provision was considered.
d) Requiring Gun Dealers to Carry Liability Insurance:
According to the sponsor, 31 localities have enacted this
provision of law (including San Francisco and Los Angeles).
Gun dealers would be required to carry insurance of at
least a million dollars to insure them for their liability
for damage to property and for injury to or death of any
person as a result of the theft, sale, lease or transfer or
offering for sale, lease or transfer of a firearm or
ammunition, or any other operations of the business and
business premises. The Federal "Protection of Lawful
Commerce in Arms Act" (PLCAA) is a United States law which
protects firearms manufacturers and dealers from being held
liable when crimes have been committed with their products.
However, both manufacturers and dealers can still be held
liable for damages resulting from defective products,
breach of contract, criminal misconduct, and other actions
for which they are directly responsible in much the same
manner that any U.S. based manufacturer of consumer
products is held responsible. They may also be held liable
for negligence when they have reason to know a gun is
intended for use in a crime.
4)Argument in Support: According to The Law Center to Prevent
Gun Violence, "On behalf of the Law Center to Prevent Gun
Violence, I strongly urge you to support AB 2459 (McCarty),
legislation the Law Center is co-sponsoring to help ensure
that firearms dealers operate responsibly in California.
Founded by lawyers after an assault weapon massacre at a San
Francisco law firm in 1993, the Law Center provides legal
expertise in support of gun violence prevention to federal,
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state, and local legislators nationwide.
"AB 2549 would bring increased security, transparency, and
accountability to gun sales in California by requiring gun
dealers to comply with a set of responsible business practices
and by authorizing DOJ to fine irresponsible dealers for
illegal conduct.
"ATF data confirms that firearms dealers are the leading
source of guns on the black market, responsible for 'nearly
half of the total number of trafficked firearms' uncovered in
ATF investigations. Though stolen firearms are also a major
source of black market guns, 4.5 times as many are obtained
from gun dealers as are stolen from any source. According to
ATF, gun dealers' 'access to large numbers of firearms makes
them a particular threat to public safety when they fail to
comply with the law.' On average, ATF trafficking
investigations implicating a gun dealer involved over 350
black market guns per investigation, and over 550 guns in
cases in which the dealer was the sole trafficker. In the
wrong hands, every one of those weapons poses a significant
threat to public safety.
"Unfortunately, federal law enforcement has limited resources
to oversee the more than 2,300 licensed gun dealers in our
state. A 2010 Washington Post investigation found that, due
to limited staffing, ATF could only inspect gun dealers once
per decade on average. These limitations, combined with weak
state and federal dealer laws, allow too many bad apple gun
dealers to evade accountability for allowing dangerous people
to access deadly weapons. Although California has enacted
some laws to regulate gun dealers, stronger oversight is
necessary to help law enforcement detect and prevent gun
dealer practices that endanger our communities.
"Numerous California cities and counties have already enacted
laws to promote responsible gun sales. AB 2459 would extend
these best practices statewide by:
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1. "Requiring gun dealers to sell weapons out of
commercial storefronts instead of their homes. Existing
law permits gun dealers to sell large firearm inventories
out of private residences, locations that are more
accessible to children and burglars but less accessible
to law enforcement oversight than commercial storefronts.
Home-based dealers threaten the safety and character of
their communities, as neighbors and local law enforcement
are often unaware that significant quantities of weapons
are flowing in and out of their residential streets. As
a 2012 Pinole City Council Planning Commission concluded,
"The safety of residents in close proximity to home-based
firearm and ammunition sales poses concerns about the
negative influence of such home occupations on children,
the possible increase in violence and/or criminals in
residential neighborhoods, trafficked firearms, and the
frequency of federal and state inspections to adequately
regulate these business operations once established." In
upholding Lafayette's residential dealer ban, a
California Appeals Court similarly noted that, "because
dealerships can be the targets of persons who are or
should be excluded from possessing weapons, it is
reasonable to insist that dealerships be located away
from residential areas[.]" California law generally
prohibits individuals from operating liquor
establishments out of a private residence, and restricts
the use of residential property by businesses ranging
from barbers and cosmetologists to funeral parlors.
Businesses that sell deadly weapons to the public should
be held to a similar standard. Fifty-nine cities and
counties in California have already enacted laws
specifically prohibiting residential gun dealers and 58
others have enacted generally applicable laws that
indirectly do the same.
2. "Requiring gun dealers to install security cameras
to monitor their premises and sales. This provision would
help detect and prevent theft and illegal conduct and
curb the flow of guns to the black market. In two
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academic studies, undercover researchers found that at
least 20% of California gun dealers were willing to
conduct an illegal 'straw purchase,' even when dealers
knew the gun was being purchased for a prohibited person
such as a felon. Though straw purchases are a leading
source of crime guns, they often appear legal on paper
without security cameras to visibly capture the sale.
California gun dealers also reported 1,797 firearms
'missing' from their inventories from 2012-2015. Without
security cameras monitoring dealers' premises and sales
counters, law enforcement has few tools to investigate
whether these firearms were misplaced, stolen, or
illegally trafficked to criminals. Five local governments
in California have already enacted this type of law and
responsible businesses regularly install and maintain
security camera footage without significant cost or
administrative burden.
3. "Requiring gun dealers to carry liability insurance.
This provision would help ensure that people injured by
negligent conduct receive compensation for their
injuries. To be clear, this provision would not create
any new liability for gun dealers, just as a law
requiring drivers to carry car insurance does not create
liability for roadway accidents. However, this bill
would ensure that a gun dealer would be covered for valid
claims if the business is found civilly liable for
negligence under existing law, in cases ranging from a
slip-and-fall in the dealer's store to an employee's
negligent sale of a firearm to a visibly drunk or
unstable individual. Because insurance is generally
cheaper for responsible businesses, just as car insurance
is cheaper for good drivers, this requirement would also
incentive responsible behavior over time. Thirty-one
localities in California have already enacted this law.
"Finally, AB 2459 would provide DOJ with discretion to fine
gun dealers for violations of the law without permanently
revoking a dealer's license to sell firearms. Under
existing law, DOJ's enforcement powers are essentially
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all-or-nothing: when it discovers a significant legal
violation, DOJ must either revoke a dealer's license or let
the dealer continue to operate. As a result, too many
irresponsible dealers face no accountability for illegal
conduct; conversely, gun dealers may also fear that they
will lose their license based on correctable errors. This
bill would provide DOJ with tools to craft a more balanced
approach to incentivize compliance and improve public
safety.
"AB 2459 is consistent with the Second Amendment. Although
gun lobbyists frequently argue that any and all gun safety
laws violate the Second Amendment, legislation like AB 2459
is clearly constitutional. When the Supreme Court
recognized an individual Second Amendment right in District
of Columbia v. Heller, Justice Scalia made clear in writing
for the Court that 'nothing in [the Court's] opinion should
be taken to cast doubt on . . . laws imposing conditions
and qualifications on the commercial sale of firearms.'
This legislation proposes to do just that, placing common
sense qualifications on the commercial sale of firearms by
requiring gun dealers to comply with a set of responsible
business practices. As such, these requirements are
consistent with the Second Amendment. See Teixeira v.
County of Alameda, 2013 U.S. Dist. LEXIS 36792, *15-18
(N.D. Cal. 2013) (rejecting a Second Amendment challenge to
an Alameda County law regulating the location of firearms
dealers).
1)Argument in Opposition: According to The Firearms Policy
Coalition, "AB 2459 (McCarty) is a measure that will
jeopardize public safety by shutting down a significant
portion of the businesses that serve as agents of the state,
providing the only lawful means in California to conduct
firearms transactions.
"This measure seeks to completely outlaw the lawful business
operations of Federal Firearms Licensees who do not operate
out of a traditional commercial facility. AB 2459 does this by
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pre-empting all cities, counties and their respective zoning,
planning and business license and revenue ordinances. By
defying California's traditional local control doctrine, AB
2459 robs over 500 local elected bodies of their ability to
decide what is best for their communities.
"This measure also mandates retailers to use security cameras
down to a level of nuance that is disturbing in its Orwellian
fascination with completely lawful and moral activities,
requiring the constant recording of 'All places where firearms
or ammunition are stored, displayed, carried, handled, sold,
or transferred, including, but not limited to, counters,
safes, vaults, cabinets, shelves, cases, and entryways.'
"AB 2459 also requires that the customers face be clearly
recorded. These are the same customers who have already
provided a Firearm Safety Certificate (or License to Carry),
proof of residence, valid government photo identification and
submitted to one the nation's most stringent background
checks. How does recording the facial features of the most
already positively identified customers of any industry in the
nation serve the public interest?
"The additional data storage requirement is also vexing.
Storing high quality data from potentially hundreds of camera
angles on-site for 5 years minimum (and up to 10) may require
the consultation or employ of technology professionals and
hundreds or thousands of hard drives in order to comply with
this bizarre mandate that seeks to make the state a voyeur in
every nook and cranny of a firearms store.
"Should a staffer pick up and move a box of ammunition without
Big Brother catching every pixel, the retailer will be
punished by the state. While it may sound perverse to film
your own staff who have been vetted by the employer and the
California Department of Justice, AB 2459 demands that all
lawful, moral and mundane activity be recorded at the
retailer's expense---'for transparency.'
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"Requiring that retailers potentially violate their lease
agreements by placing camera equipment outside of buildings or
in parking lots may not be feasible for all retailers, but
it's unlikely they will be able to comply with AB 2459 at any
rate.
"The final portion of the measure is difficult to articulate
our opposition to, given it mandates a product that does not
exist. AB 2459 mandates a form of insurance-- a policy that
covers the criminal acts of second, third and fourth parties,
even if the retailer is in fact the victim of a crime, such as
theft or kidnapping. While an amazing fantasy put in print for
trial lawyers, even they know that should it ever exist, it
would immediately put all insurers and retailers alike out of
business.
"To summarize, AB 2459 is a clear case of 'be careful what you
wish for.' The retailers and small businesses that AB 2459
seeks to either outlaw or run out of the state are the ONLY
means for over 38 million Californians to comply with the
state's overwhelmingly complex firearms laws. By eliminating
trusted local businesses either by prohibition or by
outrageous mandates, the demand for over 1 million firearms
annually in California will not go with them. When there is a
dearth of available options, the market will find other
avenues.
"Firearms retailers are agents of the state, who process
private party transactions (often at a loss) in accordance
with state law, to serve the state's interest in conducting
background checks and firearms registration. By shutting them
down, the state risks being unable to adequately service the
million of firearms lawfully transacted annually in California
and therefore risks a self-created black market.
"We therefore urge the Chair and the committee to reject this
measure that usurps local control and harms the state's public
safety interests."
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2)Prior Legislation:
a) AB 988 (Lowenthal), of the 1999-2000 Legislative
Session, stated that no licenses to sell firearms could be
granted to sell firearms out of residential buildings.
Failed passage on the Senate Floor.
b) AB 22 (Lowenthal), of the 2001-2002 Legislative Session,
prohibited the retail sale of firearms from a residential
dwelling with specific exceptions. Failed passage on the
Senate Floor.
REGISTERED SUPPORT / OPPOSITION:
Support
Law Center to Prevent Gun Violence (sponsor)
California Chapters of the Brady Campaign to Prevent Gun
Violence
Cleveland School Remembers
Coalition Against Gun Violence
Courage Campaign
Friends Committee on Legislation of California
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Laguna Woods Democratic Club
Physicians for Social Responsibility (SF Bay Area)
Rabbis Against Gun Violence
Violence Prevention Coalition
Women Against Gun Violence
Youth Alive
Opposition
American Civil Liberties Union
California Association of Federal Firearms Licensees
California Pawnbroker's Association
California Sportsman's Lobby
Crossroads of the West Gun Shows
Firearms Policy Coalition
National Rifle Association
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National Shooting Sports Foundation
Outdoor Sportsmen's Coalition of California
Safari Club International
Analysis Prepared
by: Gabriel Caswell / PUB. S. / (916) 319-3744