BILL ANALYSIS                                                                                                                                                                                                    







                      SENATE COMMITTEE ON PUBLIC SAFETY
                             Senator Mark Leno, Chair                S
                             2009-2010 Regular Session               B

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          SB 449 (Padilla)                                            
          As Amended April 2, 2009 
          Hearing date:  April 14, 2009
          Business and Professions Code; Penal Code
          SM:mc

                FIREARMS: REPORTS BY PAWNBROKERS AND SECONDHAND DEALERS  

                                       HISTORY

          Source:  Department of Justice

          Prior Legislation: None directly on point

          Support: Peace Officers' Research Association of California  
          (PORAC); California Peace                              Officers'  
          Association; California Police Chiefs Association; California  
          Chapters of                                            the Brady  
          Campaign to Prevent Gun Violence; Legal Community Against  
          Violence

          Opposition:None known


                                         KEY ISSUE
           
          SHOULD SECONDHAND DEALERS BE REQUIRED TO REPORT ACQUISITION OF  
          FIREARMS DIRECTLY TO DOJ RATHER THAN TO A LOCAL LAW ENFORCEMENT  
          AGENCY?


                                       PURPOSE





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                                                           SB 449 (Padilla)
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          The purpose of this bill is to (1) remove the requirement that  
          secondhand dealers report acquisition of firearms to local law  
          enforcement on a daily basis and instead require that reporting  
          go directly to the Department of Justice (DOJ); and (2)  
          authorize DOJ to retain those records for the purpose of  
          determining whether the firearm had been reported lost or stolen  
          and then applying existing law regarding retention of those  
          records.

           Existing law  defines a "secondhand dealer" as any person or  
          entity taking in pawn, accepting for sale of consignment,  
          trading, etc., any tangible personal property.  (Bus. & Prof.  
          Code  21626.)

           Existing law  defines a pawnbroker as a "person engaged in the  
          business of receiving goods in pledge for security for a loan."   
          (Fin. Code  21000.)

           Existing law  (subdivisions of Bus. & Prof. Code  21628)  
          provides that pawnbrokers and secondhand dealers shall report  
          daily on forms approved or provided by the Department of  
          Justice, all personal property purchased, taken in trade, taken  
          in pawn, etc., to local law enforcement.  The report shall  
          include the following information:

                 The name and current address and identification  
               of the intended seller or pledgor of the property  
               (subds. (a)-(b));
                 A complete and reasonably accurate description of  
               serialized or nonserialized property (subds.  
               (c)-(d));
                 A certification by the intended seller or pledgor  
               that he or she is the owner of the property, or has  
               the authority of the owner to sell or pledge the  
               property and that any information provided is true  
               and complete (subds. (e)-(f)); and
                 A legible fingerprint taken from the intended  
               seller or pledgor (subd. (g)).

           Existing law  provides that DOJ shall, in consultation with local  




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          law enforcement, develop clear and comprehensive categories of  
          property subject to reporting requirements in Business and  
          Professions Code Section 21628.  The categories shall be  
          incorporated by secondhand dealers and coin dealers (Bus. &  
          Prof. Code  21626) for reporting requirements.  DOJ and local  
          law enforcement, in consultation with secondhand dealer and coin  
          dealer representatives, shall develop a standard statewide  
          format for electronic reporting.  Twelve months after the format  
          and the categories have been developed.  Each secondhand dealer  
          and coin dealer shall make reports electronically.  Until that  
          time, each secondhand dealer and coin dealer may either continue  
          to report this information using existing forms and procedures  
          or may begin electronically reporting this information under the  
          reporting categories and using the new format when it has been  
          developed.  (Bus. & Prof. Code  21628.)

           Existing law  requires a secondhand dealer to make acquired  
          property available for law enforcement inspection for specified  
          time periods.  (Bus. & Prof. Code  21636.)

           Existing law  provides that effective January 1, 2003, the  
          purchaser of a firearm shall provide his or her right thumbprint  
          as part of the Dealers' Record of Sale (DROS form) in a manner  
          prescribed by the California Department of Justice.  No  
          exception to this requirement shall be permitted except by  
          regulations adopted by the department.  (Pen. Code  12077,  
          subds. (b)(2) and (c)(2).)

           Existing law  provides that the original register of firearm  
          sales shall be retained by the dealer in consecutive order.   
          Each book of 50 originals shall become the permanent register  
          and retained for not less than three years from the date of the  
          last transaction and shall be available for the inspection of  
          any peace officer, Department of Justice employee designated by  
          the Attorney General, or agent of the Federal Bureau of Alcohol,  
          Tobacco, and Firearms upon the presentation of proper  
          identification, but no information shall be compiled there from  
          regarding the purchasers or other transferees of firearms that  
          are not pistols, revolvers, or other firearms capable of being  
          concealed upon the person.  (Pen. Code  12076, subd. (a)(2).)




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           Existing law  provides that in order to assist in the  
          investigation of crime, the prosecution of civil actions by city  
          attorneys, as specified, the arrest and prosecution of  
          criminals, and the recovery of lost, stolen, or found property,  
          the Attorney General shall keep and properly file a complete  
          record of all copies of fingerprints, copies of licenses to  
          carry firearms, as specified, dealers' records of sales of  
          firearms, and reports of stolen, lost, found, pledged, or pawned  
          property in any city or county of this state, and shall, upon  
          proper application therefore, furnish this information to the  
          officers referred to in Section 11105.  (Penal Code  11106(a).)


           Existing law  provides that the Attorney General shall not, with  
          specified exceptions, retain or compile any information  
          regarding firearms that are not handguns.  All copies of the  
          forms submitted, or any information received in electronic form  
          for firearms that are not handguns shall be destroyed within  
          five days of the clearance by the Attorney General, unless the  
          purchaser or transferor is ineligible to take possession of the  
          firearm or retention is necessary for use in a criminal  
          prosecution.  (Penal Code  11106(b)(1).)


           Existing law  provides that a peace officer, the Attorney  
          General, a Department of Justice employee designated by the  
          Attorney General, or any authorized local law enforcement  
          employee shall not retain or compile any information from a  
          firearms transaction record, as defined, for firearms that are  
          not handguns unless retention or compilation is necessary for  
          use in a criminal prosecution or in a proceeding to revoke a  
          license issued pursuant to Section 12071.  (Penal Code   
          11106(b)(2).)

           This bill  amends the existing requirement that secondhand  
          dealers report daily all property purchased, taken in trade,  
          taken in pawn, etc., to local law enforcement to exclude  
          firearms from that reporting requirement and instead requires  




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          that secondhand dealers report daily any firearms purchased,  
          taken in trade, taken in pawn, etc., directly to DOJ in a format  
          prescribed by DOJ.  

           This bill  provides that DOJ may retain secondhand dealer firearm  
          reports to determine whether a firearm taken in by a secondhand  
          dealer has been reported lost or stolen.  Following the return  
          or transfer of a firearm by a secondhand dealer, the existing  
          provisions of law regarding retention of these records will  
          apply.


                    RECEIVERSHIP/OVERCROWDING CRISIS AGGRAVATION
          
          California continues to face a severe prison overcrowding  
          crisis.  The Department of Corrections and Rehabilitation (CDCR)  
          currently has about 170,000 inmates under its jurisdiction.  Due  
          to a lack of traditional housing space available, the department  
          houses roughly 15,000 inmates in gyms and dayrooms.   
          California's prison population has increased by 125% (an average  
          of 4% annually) over the past 20 years, growing from 76,000  
          inmates to 171,000 inmates, far outpacing the state's population  
          growth rate for the age cohort with the highest risk of  
          incarceration.<1>

          In December of 2006 plaintiffs in two federal lawsuits against  
          CDCR sought a court-ordered limit on the prison population  
          pursuant to the federal Prison Litigation Reform Act.  On  
          February 9, 2009, the three-judge federal court panel issued a  
          tentative ruling that included the following conclusions with  
          respect to overcrowding:

               No party contests that California's prisons are  
               ----------------------
          <1>  "Between 1987 and 2007, California's population of ages 15  
          through 44 - the age cohort with the highest risk for  
          incarceration - grew by an average of less than 1% annually,  
          which is a pace much slower than the growth in prison  
          admissions."  (2009-2010 Budget Analysis Series, Judicial and  
          Criminal Justice, Legislative Analyst's Office (January 30,  
          2009).)



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               overcrowded, however measured, and whether considered  
               in comparison to prisons in other states or jails  
               within this state.  There are simply too many  
               prisoners for the existing capacity.  The Governor,  
               the principal defendant, declared a state of emergency  
               in 2006 because of the "severe overcrowding" in  
               California's prisons, which has caused "substantial  
               risk to the health and safety of the men and women who  
               work inside these prisons and the inmates housed in  
               them."  . . .  A state appellate court upheld the  
               Governor's proclamation, holding that the evidence  
               supported the existence of conditions of "extreme  
               peril to the safety of persons and property."  
               (citation omitted)  The Governor's declaration of the  
               state of emergency remains in effect to this day.

               . . .  the evidence is compelling that there is no  
               relief other than a prisoner release order that will  
               remedy the unconstitutional prison conditions.

               . . .

               Although the evidence may be less than perfectly  
               clear, it appears to the Court that in order to  
               alleviate the constitutional violations California's  
               inmate population must be reduced to at most 120% to  
               145% of design capacity, with some institutions or  
               clinical programs at or below 100%.  We caution the  
               parties, however, that these are not firm figures and  
               that the Court reserves the right - until its final  
               ruling - to determine that a higher or lower figure is  
               appropriate in general or in particular types of  
               facilities.

               . . .

               Under the PLRA, any prisoner release order that we  
               issue will be narrowly drawn, extend no further than  
               necessary to correct the violation of constitutional  
               rights, and be the least intrusive means necessary to  




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               correct the violation of those rights.  For this  
               reason, it is our present intention to adopt an order  
               requiring the State to develop a plan to reduce the  
               prison population to 120% or 145% of the prison's  
               design capacity (or somewhere in between) within a  
               period of two or three years.<2>

          The final outcome of the panel's tentative decision, as well as  
          any appeal that may be in response to the panel's final  
          decision, is unknown at the time of this writing.

           This bill  does not appear to aggravate the prison overcrowding  
          crisis outlined above.

























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          ---------------------------
          <2>  Three Judge Court Tentative Ruling, Coleman v.  
          Schwarzenegger, Plata v. Schwarzenegger, in the United States  
          District Courts for the Eastern District of California and the  
          Northern District of California United States District Court  
          composed of three judges pursuant to Section 2284, Title 28,  
          United States Code (Feb. 9, 2009).










                                      COMMENTS

          1.  Need for This Bill  

          According to the author:

               Currently, secondhand dealers/pawnbrokers are exempt  
               from reporting firearms acquisitions directly to the  
               DOJ.  Instead, pawnbrokers and secondhand dealers fill  
               out a form, which is sent to local law enforcement  
               agencies.  

               In theory, local agencies log in the information they  
               receive.  In reality, the DOJ has found that due to  
               limited resources, many local law enforcement agencies  
               are unable to enter the firearms information into the  
               DOJ's Automated Firearms System.  As a result  
               inaccurate owner information sometimes appears in the  
               system.  This bill would require that secondhand  
               dealers and pawnbrokers report the acquisition of  
               firearms directly to the DOJ.

          2.  Secondhand Dealers and Gun Transaction Records  

          Currently, secondhand dealers, which includes pawnbrokers, are  
          required to report to their local law enforcement agency, every  
          piece of personal property they acquire daily, or on the first  
          working day after receipt or purchase of the property.  (Bus. &  
          Prof. Code  21628.)  This includes firearms.  For this reason,  
          secondhand dealers are specifically exempted from reporting  
          receipt of firearms to DOJ, as is required of all other licensed  
          firearms dealers.  (Pen. Code  12071(b)(18)(B)(iii).)  This  
          places the burden on local law enforcement agencies to then  
          report all firearm acquisitions by secondhand dealers to DOJ.   
          In theory, the local agencies are supposed to log all the  
          information received regarding secondhand dealers' receipt of a  
          firearm (through the California Law Enforcement  
          Telecommunications System or CLETS) into DOJ's Automated  




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          Firearms System (AFS) database.  Additionally, local law  
          enforcement agencies should check to see if the firearm is  
          already listed in AFS as being reported lost or stolen.   
          Unfortunately, DOJ has found that due to limited resources, many  
          law enforcement agencies are unable to enter the firearms  
          information into the AFS.

          When a secondhand dealer transfers a firearm  to  a customer, the  
          secondhand dealer must report that transaction to DOJ by way of  
          the Dealers' Record of Sale or DROS form.  When firearms  
          transfers are reported to DOJ by any firearms dealer, including  
          secondhand dealers, the department runs a background check on  
          the buyer to determine whether that person is prohibited by law  
          from owning a firearm, and whether that firearm has been  
          reported lost or stolen.  Anyone buying a firearm must wait 10  
          days before taking possession of the firearm to allow DOJ to  
          conduct these record checks.  

          DOJ has sponsored this bill to eliminate the cumbersome and  
          inefficient process of requiring secondhand dealers to report  
          firearm acquisitions to local law enforcement officials who then  
          must themselves turn around and report that information to DOJ.   
          This bill would, in essence, cut out the middleman and require  
          secondhand dealers, who are also licensed firearms dealers, to  
          report firearms transactions directly to DOJ.  Upon receipt of  
          this information, DOJ would then check the AFS database to  
          determine whether the firearm has been reported lost or stolen.   


          SHOULD SECONDHAND DEALERS BE REQUIRED TO REPORT ACQUISITION OF  
          FIREARMS DIRECTLY TO DOJ RATHER THAN TO A LOCAL LAW ENFORCEMENT  
          AGENCY? 

          WILL THIS RESULT IN MORE OF THESE TRANSACTIONS ACTUALLY BEING  
          REPORTED TO DOJ?

          WILL THIS ASSIST LOCAL LAW ENFORCEMENT AGENCIES BY RELIEVING  
          THEM OF THIS DUTY?














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