BILL ANALYSIS �
Senate Appropriations Committee Fiscal Summary
Senator Kevin de Le�n, Chair
AB 2220 (Daly) - Private security services: private patrol
operators.
Amended: August 5, 2014 Policy Vote: BP&ED 8-0; PS 7-0
Urgency: No Mandate: Yes
Hearing Date: August 11, 2014
Consultant: Jolie Onodera
This bill meets the criteria for referral to the Suspense File.
Bill Summary: AB 2220 authorizes, effective July 1, 2016, a
licensed Private Patrol Operator (PPO), as defined, to be the
registered owner of a firearm, and establishes procedures for a
PPO to assign its firearms to its employees who are licensed to
carry firearms. This bill also requires, as a condition of
licensure, a PPO to have on file with the Department of Consumer
Affairs (DCA), a liability insurance policy and workers'
compensation insurance coverage for its employees, as specified.
Fiscal Impact:
One-time costs to the Department of Justice (DOJ) of about
$1 million (Special Fund*) to enhance the registration
database and update forms to accommodate the new fields for
PPO designation, offset by an undetermined level of fee
revenue.
Ongoing workload to the DOJ Bureau of Firearms of about
$500,000 (Special Fund*) for investigations, inspections,
and the processing of forms, offset by the authority to
charge fees.
Ongoing costs of about $175,000 (Special Fund**) to the DCA
for enforcement of the insurance requirements and the
registration process for assigning firearms. DCA
investigations would be initiated based on complaint
allegations of uninsured PPO operations, and ongoing
workload resulting from inspections for compliance by PPOs.
Costs would be offset in minor part by citation revenue of
less than $10,000 annually.
Likely minor non-reimbursable local enforcement costs
offset to a degree by fine revenue for misdemeanor
violations by security guards for failure to return an
assigned firearm as required under the provisions of this
AB 2220 (Daly)
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measure.
*DROS Special Account - staff notes the DROS Special Account is
operating at a structural deficit with a projected 2014-15
year-end balance of $1.3 million.
**Private Security Services Fund
Background: Private patrol operators (private security
companies) are licensed and regulated by the DCA, Bureau of
Security and Investigative Services (BSIS). Possession and use
of firearms by PPO employees (security guards) is specifically
regulated. Under current law, companies are not authorized to be
the legal owner of a firearm (with the exception of assault
weapons), and it has been indicated that PPOs are utilizing the
existing provisions of law that allow for firearms to be
infrequently loaned to a person known to the owner, as a means
of providing firearms to employees.
Pursuant to Penal Code � 27880, firearms may be loaned between
persons who are personally known to each other subject to
specified requirements including that the loan must be for a
lawful purpose, the loan must not exceed 30 days, the individual
being loaned the firearm must have a valid handgun safety
certificate (if the firearm is a handgun), and the loan is
infrequent, meaning less than six transactions per calendar year
for handguns. To the extent PPOs are switching firearms every 30
days between firearm-certified employees is not only
administratively burdensome but also potentially not in the best
interests of public safety.
The provisions of this bill seek to alleviate the burdensome
administrative process utilized by PPOs and make an exception to
the normal firearms ownership laws by authorizing PPOs to be the
legal owner of a firearm and assign that firearm to an employee,
who would be the registered owner.
Proposed Law: This bill authorizes, effective July 1, 2016, a
licensed PPO to be the registered owner of a firearm, if the PPO
is registered with the DOJ. This bill establishes procedures for
PPOs to assign its firearms to its employees who are licensed to
carry firearms. This bill:
Defines PPO as a private patrol operator licensed pursuant
to Chapter 11.5 of the Business and Professions Code.
Requires the DOJ to modify the DROS form to record the PPO
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as the purchaser and registered owner of the firearm.
Requires the DOJ to modify the DROS form to require the PPO
to designate a "firearms custodian" for the firearm owned by
the PPO. The firearms custodian shall possess a valid
firearm qualification permit issued by the DCA.
Requires the DOJ to prescribe a Certificate of Assignment
(COA). The COA may include fields that are in the DROS form
and will be used to identify the PPO employee assigned to a
PPO-owned firearm.
Requires security guards who receive a firearm pursuant to
a COA to possess a valid firearm qualification permit.
Authorizes the DOJ to charge reasonable fees for the
implementation of this program to the PPO's and deposit
those fees in the DROS account.
Authorizes fees collected and deposited into the DROS
account to be used for expenditure by the DOJ, upon
appropriation by the Legislature, for the purposes of this
bill.
Requires that if the PPO loses its license or goes out of
business, the PPO must, 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.
Requires that a security guard shall, within 48 hours of
the PPO's request, for any reason, or within 48 hours of
separation of employment or revocation of the firearm
qualification card, return the firearm to the PPO.
Includes codified legislative findings and declarations.
Revises the coverage amount PPOs are required to maintain
as a condition of licensure that provides minimum limits of
insurance of $1 million for any one loss or occurrence due
to bodily injury, including death, or property damage, or
both.
Requires PPOs to keep copies of the insurance policy and
certificate of workers' compensation coverage for its
employees on file with the BSIS as a condition of licensure.
Provides that a duly appointed peace officer is exempt from
the requirements of requalifying on the range and passing
the written examination for the purposes of renewing a
firearms qualification card, as specified.
Related Legislation: SB 385 (Block) 2013 was substantially
similar to this measure. This bill was held on the Suspense File
of this Committee.
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AB 811 (Hall) 2011 was similar to this measure and provided for
a registration and assignment process for firearms for PPOs.
This bill was referred to but not provided a hearing in the
Assembly Committee on Public Safety.
Staff Comments: According to the DCA, there are approximately
2,700 licensed PPOs in the state. It is estimated that firearm
permits have been issued to approximately 38,700 security
guards. The DOJ will incur significant one-time and ongoing
costs to carry out the provisions of this bill. It is estimated
that DOJ would incur one-time costs of about $1 million (DROS
Special Account) to enhance the firearm registration database
and revise the DROS form as required to accommodate the new PPO
designation. Ongoing workload to the Bureau of Firearms is
projected of about $500,000 (DROS Special Account) for
investigations and inspections.
This bill provides that the DOJ shall charge a fee not to exceed
the reasonable costs to the department for filing and processing
a COA, and for the costs incurred in enforcing the provisions of
this article, including, but not limited to, entering
information obtained pursuant to this article into the DOJ's
Automated Firearms System and other databases as deemed
necessary by the department. The ability for the DOJ to recover
its implementation and operational costs associated with this
measure would be dependent on the fee level established and
charged, which at the time of this analysis, has not been
determined by the DOJ.
Staff notes the DROS Special Account is structurally imbalanced
(with annual expenditures of about $31 million offset in part by
revenues of about $23 million), with an estimated year-end
balance of $1.3 million. To the extent the fees charged and
collected do not fully offset the costs of implementation,
ongoing administration, and enforcement of the provisions of
this bill, another fund source, potentially the General Fund,
would be needed to support the ongoing costs of this bill.
The DCA has indicated ongoing costs of about $175,000 (Special
Fund) associated with the workload created from this bill,
including the insurance documentation requirements and the
registration for assigning PPO-registered firearms. The BSIS
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assumes investigations would be initiated based on complaint
allegations of uninsured PPO operations, as well as ongoing
workload resulting from inspections for compliance by PPOs. The
BSIS anticipates initiating random inspections of approximately
60 PPOs annually, which would include field visits of PPOs to
review and copy firearm records, obtaining DOJ records and
comparing with PPO records, addressing deficiencies and
assessing violations, developing investigation reports, and
preparing educational letters or citations.