BILL ANALYSIS �
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|Hearing Date:April 9, 2012 |Bill No:SB |
| |1387 |
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SENATE COMMITTEE ON BUSINESS, PROFESSIONS
AND ECONOMIC DEVELOPMENT
Senator Curren D. Price, Jr., Chair
Bill No: SB 1387Author:Emmerson
As Amended:April 2, 2012 Fiscal: Yes
SUBJECT: Metal theft.
SUMMARY: Prohibits 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
owns or previously owned that material. Failure to comply with this
provision would result in a criminal fine of up to $3,000.
Existing law, the Business and Professions Code (BPC):
1)Regulates junk dealers and recyclers and defines "junk" as
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. (Business and
Professions Code (BPC) � 21600)
2)Requires junk dealers and recyclers to allow for periodic inspection
of their premises or junk, to determine compliance with
recordkeeping requirements, and requires junk dealers and recyclers
to produce their records of sales and purchases and any property
purchased, for inspection by any of the following: (BPC � 21606.5)
a) An officer holding a search warrant.
b) A person appointed by the county sheriff or head of the police
department.
c) An officer with a court order to inspect the records or
property.
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3)Prohibits junk dealers and recyclers from providing payment for
nonferrous material, as defined, unless payment is made by cash or
check, and the payment is mailed or provided on the third business
day after the date of sale. (BPC � 21608.5(a)(1))
4)Requires junk dealers and recyclers to obtain a thumbprint from a
seller, and to maintain the thumbprint record for 2 years after the
date of sale. (BPC � 21608.5(a)(6)(A))
5)Provides that inspections or seizures of thumbprints shall only be
performed by a peace officer under a criminal search warrant, where
probable cause for the warrant was based on a theft related to the
sale for which the thumbprint was collected. (BPC �
21608.5(a)(6)(B))
6)Requires junk dealers and recyclers produce their records for
inspection on demand, however the thumbprint of the seller may only
be obtained by a peace officer with a search warrant. (BPC �
21606.5)
Existing law, the Penal Code (PC):
1)Provides that a swap meet vendor, as defined, or a person who deals
in, or collects, merchandise or personal property, or their agent,
employee, or representative, who buys or receives any property of a
value greater than $950, that has been stolen or obtained in any
manner under circumstances that should cause the buyer to inquire
about the legal right to sell the property, and the buyer does not
make a reasonable inquiry, shall be punished by imprisonment in a
county jail for not more than one year, or imprisonment of up to
three years. (PC � 496 (b))
2)Any person who buys or receives, for purposes of salvage, any part
of a fire hydrant or fire department connection, including, but not
limited to, bronze or brass fittings and parts, that has been stolen
or obtained in any manner constituting theft or extortion, knowing
the property to be so stolen or obtained, shall, in addition to any
other penalty provided by law, be subject to a criminal fine of not
more than three thousand dollars ($3,000). (PC � 496 (e))
This bill:
1) Prohibits any junk dealer or recycler from possessing a public fire
hydrant, fire department connection, including, but not limited to,
bronze or brass fittings or parts, a public manhole cover or lid,
or any part of that cover or lid, or a public backflow device and
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connections to that device without a written certification on the
letterhead of the public agency, or utility that owned the
material, that the entity has sold the material, and that the
person possessing the certificate is authorized to sale the
material.
2) Specifically makes junk dealers and recyclers civilly liable and
would also provide that if a junk dealer or recycler lacks the
certification described above, the lack of that certification would
give rise to the presumption that the property was stolen for
purposes of the provisions proscribing receiving stolen property.
3) Expands the prohibition described above proscribing the purchase or
receipt of items that a dealer or collector knows or reasonably
should know is ordinarily used by or ordinarily belongs to a
transportation or utility company, or a political subdivision of
the state engaged in furnishing public utility service, to also
apply to recyclers, and to apply to the fire hydrants and other
items described above.
4) Expands the provision providing that any person who buys or
receives, for purposes of salvage, any part of a fire hydrant or
fire department connection is subject to a criminal fine of not
more than $3,000 by making that fine applicable to any person who
is engaged in the salvage, recycling, purchase, or sale of scrap
metal.
FISCAL EFFECT: Unknown. This bill has been keyed "fiscal" by
Legislative Counsel.
COMMENTS:
1.Purpose. This bill is sponsored by Eastern Municipal Water District
(Sponsor). According to the Author, metal theft is on the rise as
the price of metal continues to climb. The theft of metals has
devastated both public and private property and has harmed critical
public infrastructure, making it difficult to deliver essential
utilities to customers. Moreover, the theft of certain metal
devices can seriously threaten public health and safety. For
instance, individuals have been severely injured falling down
uncovered manholes and vehicles have incurred damage driving over
manholes where the covers have been stolen. In addition, stolen
backflow devices leave potable water sources vulnerable to
cross-contamination while stolen fire hydrants render properties
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defenseless to fire. While several laws have been enacted to curb
metal theft, it is still prevalent throughout California. According
to the Sponsor, this measure seeks to address this epidemic and
strengthen current law by eliminating the attractiveness of manhole
covers, backflow devices, and fire hydrants to metal thieves as
there would no longer be a buyer for these stolen items.
2.Background. Metal theft has become increasingly popular within the
last decade and the theft of fire hydrants, copper, manhole covers,
and backflow devices in particular are on the rise, and represent a
significant health and safety concern to the public. According to
an April 2, 2012 Sacramento Bee article, "The cost of addressing the
crime wave has likely surpassed $1 million over the past year.
Officials with the city's Department of Transportation think they'll
have to spend another $2 million over the next year repairing
streetlights damaged by thieves." Over a New Year's weekend in
2011, 50 manhole covers were stolen from the streets of Sacramento.
Cities, counties, and special districts are taking different
approaches to address metal theft. Los Angeles residents are being
asked to "adopt" their neighborhood manhole covers in an attempt to
"police" their streets. Eastern and Municipal Water Districts have
issued $500 rewards for citizens who turn in thieves. Anaheim
Public Utilities has issued a customer alert on their website asking
residents to take precautions to protect their backflow devices.
The City has further indicated that residents may wish to increase
patrol and install video surveillance devices if they wish to
further protect their devices.
The rise in recycled metal prices has increased the demand for such
items. Scrap metal from fire hydrants are estimated to recycle at
$300 per ton; price fluctuates rapidly according to demand. Metal
theft has been well documented in California. The Los Angeles Times
reported an individual stealing 45 fire hydrants within the Inland
Empire. Investigators of the incident reported, "The theft of metal
to sell as scrap, such as copper wiring, bronze fixtures and iron
from construction site, is common, especially during a prolonged
economic slump."
3.Metal Theft Costs. The increasing theft of backflow devices,
manhole covers and fire hydrants or any parts of hydrants impact
city budgets greatly, especially during tough economic times.
Replacement hydrants can range between $1,000- $1,500, while
accessories can cost up to $25 per hydrant. Backflow devices have
been priced anywhere from $330 to $22,000 depending on the diameter,
while cast iron manhole covers have a price tag of $231.71; not
accounting for labor. Cities and counties have to repair and
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replace these items immediately due to public safety concerns. The
Sponsor citied several incidents where individuals have suffered
injuries because of missing manhole covers, leaving local entities
open to the possibility of legal action.
4.Enforcement Concerns. Dramatic increases in metal theft have
sparked numerous legislative actions over the past decade. However,
enforcement of such provisions has proven not to be as effective due
to fiscal constraints in local law enforcement. Resident Deputy
Sheriff Jim Currie of the Solano County Sheriff's Office reported
that incidents of metal theft seem to be picking up in Rio Vista.
"We've got some things in place to help step up our surveillance,
but like other agencies, we've cut back on people and patrol time.
Our Sheriff is addressing that right now, but it has been rough with
the budget situation the way it is," Currie said. The 2011 report
from the National Insurance Crime Bureau identified 25,083 insurance
claims compared with only 13,861 identified from the 2006-2008
report; an 81 percent increase. California was ranked third out of
the top five states with 1,348 insurance claims.
5.Arguments in Support. Eastern Municipal Water District states, SB
1387 is a critical measure necessary to respond to the epidemic of
metal theft occurring throughout the state. It would prohibit a junk
dealer or recycler from possession without written certification.
Lack of such certification would give rise to the presumption that
the property was stolen. SB 387 provides effected agencies with the
tools necessary to prosecute thieves and further enables local
agencies to recoup the ratepayer's funds for the cost of the stolen
items.
6.Arguments in Opposition. The California Chapters of the Institute
of Scrap Recycling Industries (ISRI) states that the proposed
Business and Professions Code section is unnecessary and duplicative
of Penal Code Sections 496, 496a, and 496e. The current Penal Code
sections are clearly sufficient enough to prevent recyclers from
taking in prohibited material, such as fire hydrants, backflow
devices, and manhole covers. Criminals are going to break the law
regardless. More importantly, ISRI states, this measure contains a
"due diligence" standard which, if violated, can result in criminal
prosecution. "Due diligence" is the key term here and creates a far
fairer and more defensible position for the prosecutor than the
"knew or should have known" standard. "Anyone who has tried cases
under the latter standard will understand this." Additionally, no
civil action should be allowed against a recycler unless the
recycler has been convicted under the section. We assume that that
is the reasonable intent of the Author.
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7.Related Legislation:
AB 1508 (Carter, 2012), eliminates specific provisions dealing with
recyclers and junk dealers and expands the definition of a crime by
increasing the recordkeeping duties of junk dealers and recyclers.
This measure is currently awaiting a hearing in the Assembly
Business, Professions and Consumer Protection Committee.
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 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 2009) 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 2009) 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 720, Statutes of 2009) 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
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unless the payment is made by check, and the check is mailed or
provided no earlier than 3 days after the date of sale.
AB 85 (Berryhill, Chapter 78, Statutes of 2009) Prohibited a junk
dealer or recycler from providing payment for nonferrous material,
as defined, unless the payment is made by cash or check, and the
check is mailed or the cash or check is provided no earlier than 3
days after the date of sale, and the dealer or recycler obtains a
photograph or video of the seller and certain other identifying
information, as specified, which information is to be retained by
the dealer or recycler for 2 years.
AB 2668 (DeVore, 2007) would have included theft or vandalism of
fire equipment within the definition of grand theft. AB 2668 failed
passage in this Committee.
NOTE : Double-referral to Rules Committee, second.
SUPPORT AND OPPOSITION:
Support:
Association of California Water Agencies
California Association of Sanitation Agencies
California Chamber of Commerce
California District Attorneys Association
California Special Districts Association
California State Sheriffs Association
City of Canyon Lake
East Bay Municipal Utility District
Eastern Municipal Water District (Sponsor)
Lake Hemet Municipal Water District
Three Valleys Municipal Water District
Walnut Valley Water District
Walnut Valley Water District
Western Municipal Water District
Western Riverside Council of Governments
Opposition:
California Chapters of the Institute of Scrap Recycling Industries
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Consultant:Michael Lynch