Existing law provides that any person who feloniously steals, takes, or carries away the personal property of another, or who fraudulently appropriates property that has been entrusted to him or her, is guilty of theft. Existing law also provides that a person who, being a dealer in or collector of junk, metals, or secondhand materials, buys or receives any wire, cable, copper, lead, solder, mercury, iron, or brass that he or she knows or reasonably should know is ordinarily used by, or ordinarily belongs to, a railroad or other transportation, telephone, telegraph, gas, water, or electric light company or county, city, or city and county without using due diligence to ascertain that the person selling or delivering the same has a legal right to do so, is guilty of criminally receiving that property.

Existing law establishes the Department of Justice, which is headed by the Attorney General and tasked with, among other things, representing California in criminal cases.

This bill, until January 1, 2020, would require the Department of Justice to establish a Metal Theft Task Force Program designed to enhance the capacity of the department to serve as the lead law enforcement agency in the investigation and prosecution of illegal recycling operations, and metal theft and related recycling crimes, and would authorize the department to enter into partnerships, as defined, with local law enforcement agencies, regional task forces, and district attorneys for the purpose of achieving the goals of the program. The bill would authorize the department to enter into an agreement with any state agency for the purpose of administering the program. The bill would establish the Metal Theft Task Force Fund, to be administered by the Department of Justice, and would continuously appropriate all moneys in that fund to the department for the purposes of the program, thereby making an appropriation.

The bill would require the Department of Justice to submit a comprehensive report to the Legislature, no later than December 31, 2018, on the status and progress, since the year 2016, of the program in deterring, investigating, and prosecuting illegal recycling operations, and metal theft and related recycling crimes. The bill would specify that the program would not be implemented until the Department of Justice determines that sufficient moneys have been deposited in the fund to implement the program.

Existing law requires, until January 1, 2019, a weighmaster who is a junk dealer or recycler to pay an additional annual fee of $500 to the Department of Food and Agriculture for each location at which the weighmaster operates, as specified, for the administration and enforcement of specified provisions.

The bill would extend the operation of the above provisions until January 1, 2020, and would additionally require a weighmaster who is a junk dealer or recycler, as defined, to pay a specified additional license fee to be deposited into the Metal Theft Task Force Fund and to be expended by the Department of Justice for the purpose of administering the Metal Theft Task Force Program. The bill would prohibit the proceeds of this fee from exceeding an aggregate total of $2,000,000 per year.

Date of Hearing: April 22, 2015

ASSEMBLY COMMITTEE ON APPROPRIATIONS

Jimmy Gomez, Chair

ABPCA Bill Id:AB 1019

Author:(Eduardo Garcia) – As Introduced Ver:February 26, 2015

Urgency: No State Mandated Local Program: No Reimbursable: No

SUMMARY:

This bill creates the Metal Theft Task Force (MTTF) Program to provide funding for local law enforcement agencies, as specified, to combat metal theft and related recycling crimes. Specifically, this bill:

1. Requires the Department of Justice (DOJ) to establish a Metal Theft Task Force Program designed to enhance the capacity of the department to serve as the lead law enforcement agency in the investigation and prosecution of illegal recycling operations, and metal theft and related recycling crimes, and would authorize the department to enter into partnerships, as defined, with local law enforcement agencies, regional task forces, and district attorneys for the purpose of achieving the goals of the program.
   
   

2. Establishes the Metal Theft Task Force Fund, to be administered by the DOJ, and would continuously appropriate all moneys in that fund to the department for the purposes of the program, thereby making an appropriation. Specifies that the program would not be implemented until the DOJ determines that sufficient moneys have been deposited in the fund to implement the program.
   
   

3. Requires the DOJ to submit a comprehensive report to the Legislature, no later than December 31, 2018, on the status and progress of the program, since the year 2016, in deterring, investigating, and prosecuting illegal recycling operations, and metal theft and related recycling crimes.
   
   

4. Requires a weighmaster, who is a junk dealer or recycler, as defined, to pay a specified additional license fee of $1,000 or $1,500, to be deposited into the Metal Theft Task Force Fund and to be expended by the Department of Justice for the purpose of administering the Metal Theft Task Force Program. The additional revenue is limited to $2 million per year.
   
   

FISCAL EFFECT:

Significant ongoing MTTF Fund (special fund) costs to the DOJ of up to $2 million per year. The administrative costs alone will be $350,000 to $400,000, the remainder would be used to provide grants to local law enforcement agencies to reduce metal theft-related crimes.

The bill specifies the program is contingent upon sufficient funding from the MTTF Fund, which pursuant to this bill would be primarily funded by an additional fee of $1,000 or $1,500 on the weighmaster, but limits the aggregate revenue to no more than $2 million per year. The bill also authorizes the deposit of federal, industry and private funds into the MTTF Fund.

COMMENTS:

1. According to the author, "This bill will establish The Metal Theft Taskforce within the California Department of Justice (DOJ). The Taskforce will distribute grants to regional and local law enforcement agencies for use in combating metal theft crimes. Grant will also be available for prosecution efforts. Funding for these grants would come from license fees.

"The legislation also directs DOJ to award grants based on a number of criteria to determine where the most pressing needs for additional funding are."

2. Metal Theft in California: Metal theft has been well documented throughout California. In 2007, the New York Times reported:

"This is the No. 1 crime affecting farmers and ranchers right now," said Bill Yoshimoto, an assistant district attorney in the agriculturally rich Tulare County in the Central Valley.

"Virtually every farmer in the Central Valley has been hit," Mr. Yoshimoto said. But some have been hit far beyond the value of the metal. For the farmer to replace the pump is anywhere between $3,000 to $10,000, and then there is downtime, and loss to crops.

3. Prior Attempts at Establishing a Metal Theft Taskforce:

1. SB 485 (Calderon), Chapter 518, Statutes of 2013, required junk dealers to provide additional information to CDFA when applying for or renewing a weighmaster's license in order to reduce the number of non-compliant dealers, and hopefully deter fraudulent transactions and decrease the sale of stolen metal property. This bill also created new license fees for a weighmaster who is a recycler or junk dealer in order to operate at specified locations.

2. Also in 2013, the Legislature passed AB 909 (Gray) which was substantially similar to this bill, with the major differences being that AB 909 had the Department of Justice establish and oversee the MTTF Program and did not provide a funding source for the MTTF. The Governor vetoed AB 909 with the following rationale in his veto message: "[AB 909] creates a new enforcement effort without identifying a funding source. Today I signed SB 485, which does provide a funding source for greater enforcement within the existing infrastructure. More can certainly be done, but let's build on stable funding base."

3. Additionally, in 2014, AB 2313 (Nestande), which was similar to this bill when it passed by this committee, it was later amended to be identical to this bill, but failed passage on the Senate floor.

Analysis Prepared by: Pedro R. Reyes / APPR. / (916) 319-2081

Date of Hearing: April 7, 2015

Counsel: Gabriel Caswell

ASSEMBLY COMMITTEE ON PUBLIC SAFETY

Bill Quirk, Chair

ABPCA Bill Id:AB 1019

Author:(Eduardo Garcia) – As Introduced Ver:February 26, 2015

SUMMARY:

Creates the Metal Theft Task Force (MTTF) Program to provide funding for local law enforcement agencies, as specified, to combat metal theft and related recycling crimes. Specifically, this bill:

1. Requires the Department of Justice (DOJ) to establish a Metal Theft Task Force Program designed to enhance the capacity of the department to serve as the lead law enforcement agency in the investigation and prosecution of illegal recycling operations, and metal theft and related recycling crimes, and would authorize the department to enter into partnerships, as defined, with local law enforcement agencies, regional task forces, and district attorneys for the purpose of achieving the goals of the program.
   
   

2. Authorizes the DOJ to enter into an agreement with any state agency for the purpose of administering the program.
   
   

3. Establishes the Metal Theft Task Force Fund, to be administered by the DOJ, and would continuously appropriate all moneys in that fund to the department for the purposes of the program, thereby making an appropriation.
   
   

4. Requires the DOJ to submit a comprehensive report to the Legislature, no later than December 31, 2018, on the status and progress, since the year 2016, of the program in deterring, investigating, and prosecuting illegal recycling operations, and metal theft and related recycling crimes.
   
   

5. Specifies that the program would not be implemented until the DOJ determines that sufficient moneys have been deposited in the fund to implement the program.
   
   

6. Extends the operation of the provision requiring a weighmaster to pay a specified additional fee of $500 until January 1, 2020, and would additionally require a weighmaster who is a junk dealer or recycler, as defined, to pay a specified additional license fee to be deposited into the Metal Theft Task Force Fund and to be expended by the Department of Justice for the purpose of administering the Metal Theft Task Force Program. The additional fee is specified as follows:
   
   

   1. One thousand dollars ($1,000) if the weighmaster is operating at a fixed location; and
      
      

   2. One thousand five hundred dollars ($1,500) if the weighmaster is operating at other than a fixed location;
      
      

7. Prohibits the proceeds of this fee from exceeding an aggregate total of $2,000,000 per year.
   
   

8. Defines the following terms as follows for the purposes of this bill:
   
   

   1. “Agency” means a regional task force, a local law enforcement agency, or a district attorney;
      
      

   2. “Department” means the Department of Justice;
      
      

   3. “Fund” means the Metal Theft Task Force Fund;
      
      

   4. “Junk” has the same meaning as set forth in Section 21600 of the Business and Professions Code;
      
      

   5. “Junk dealer” has the same meaning as set forth in Section 21601 of the Business and Professions Code;
      
      

   6. “Program” means the Metal Theft Task Force Program; and
      
      

   7. “Recycler” has the same meaning as set forth in Section 21605 of the Business and Professions Code.
      
      

9. Provides that the Metal Theft Task Force Fund is hereby established within the State Treasury. Notwithstanding Section 13340 of the Government Code, the fund is hereby continuously appropriated to the department for the purposes set forth in this title. Transfers to the Metal Theft Task Force Fund shall be deposited in the State Treasury, or in a state depository bank approved by the Treasurer.
   
   

   1. Provides that the fund shall consist of moneys deposited into it received from, or recovered by, the federal government, industry, and private sources, moneys appropriated by the Legislature, and from fees collected as specified. General Fund moneys shall not be deposited into the fund nor used to start up, implement, or support the continuing administration of the provisions of this title. The fund shall be administered by the DOJ.
      
      

   2. Moneys distributed from the fund pursuant to the program are intended to ensure that the department is equipped with the necessary personnel and tools to successfully combat metal theft and related recycling crimes, with a primary focus of shutting down illegal recycling operations, which include, but are not limited to, all of the following offenses:
      
      

      1. Illegal recycling operations, in which a junk dealer or recycler does not possess any of the following:
         
         

         1. A current business license;
            
            

         2. A stormwater permit, application for a stormwater permit, or a statement indicating that the applicant has either filed an application for a stormwater permit or is not required to obtain a stormwater permit; or
            
            

         3. A weighmaster’s license issued as specified.
            
            

      2. The theft of metals, including, but not limited to, nonferrous metals;
         
         

      3. The purchase and recycling of stolen metals by recyclers;
         
         

      4. The transportation of stolen metals from junk dealers and recyclers in this state to another state; and
         
         

      5. The transportation of stolen metals from another state to this state.
         
         

10. Provides that after deduction of the DOJ's actual and necessary administrative costs, moneys in the fund shall be expended for the exclusive purpose of enhancing the capacity of the department to serve as the lead law enforcement agency in deterring, investigating, and prosecuting illegal recycling operations, and metal theft and related recycling crimes.
    
    

11. Provides that moneys in the fund may be expended for the purpose of enabling the department to enter into partnerships with local law enforcement agencies, regional task forces, or district attorneys.
    
    

12. Provides that the DOJ shall establish and administer the Metal Theft Task Force Program. The department may enter into an agreement with any state agency for the purpose of administering the program.
    
    

13. Provides that the program shall be designed to enhance the capacity of the DOJ to serve as the lead law enforcement agency in the investigation and prosecution of illegal recycling operations and metal theft and related recycling crimes.
    
    

14. Provides that the DOJ shall consult at least twice per calendar year with pertinent recycling trade associations, including, but not limited to, the Institute of Scrap Recycling Industries, California Chapter and the California Metal Coalition, to determine the best allocation of resources, for purposes of the program, from an industry perspective, in preventing metal theft, with an emphasis on eliminating illegal recycling operations from the state.
    
    

15. Provides that the DOJ may enter into partnerships with local law enforcement agencies, regional task forces, or district attorneys. For purposes of this title, “partnership” means a collaborative effort involving financial contributions by the department to achieve the goals of the program established by this title.
    
    

16. States that no later than December 31, 2018, the DOJ shall submit a comprehensive report to the Legislature on the status and progress, since the year 2016, of the program in deterring, investigating, and prosecuting illegal recycling operations, and metal theft and related recycling crimes. The report shall include, but be not limited to, all of the following information:
    
    

    1. The number of metal theft and related recycling crime cases filed;
       
       

    2. The number of metal theft and related recycling crimes cases investigated;
       
       

    3. The number of victims involved in the cases reported;
       
       

    4. The number of convictions obtained;
       
       

    5. The total aggregate monetary loss suffered by the victims, including damage caused by the theft;
       
       

    6. The number of illegal recycling operations or illegal junk dealers or recyclers, or both, shut down; and
       
       

    7. An accounting of moneys received and expended in each program year, commencing with 2016, which shall include all of the following:
       
       

       1. The amount of moneys received and expended by the department;
          
          

       2. The use to which those moneys were put, including payment of salaries and benefits, operating expenses, equipment purchases, and allowable expenditures; and
          
          

       3. Any other relevant information requested.
          
          

17. Provides that the program established pursuant to this title shall not be implemented until the department determines that sufficient moneys have been deposited in the Metal Theft Task Force Fund to implement the provisions of this title. The DOJ shall only be required to implement the provisions of this title upon the availability of moneys in the fund in an amount sufficient to cover all costs relating to the startup, implementation, and continuing administration of the provisions of this title.
    
    

18. Sunsets the provision of this bill on January 1, 2020.

EXISTING LAW:

1. Provides that a weighmaster shall pay to the department the following license fee for each license year as applicable to the operation: (Bus. & Prof. Code § 12704, subd. (a).)
   
   

   1. Seventy-five dollars ($75) if the weighmaster is operating at a fixed location;
      
      

   2. Thirty dollars ($30) for each additional fixed location at which the weighmaster is operating;
      
      

   3. Two hundred dollars ($200) if the weighmaster is operating at other than a fixed location; and
      
      

   4. Twenty dollars ($20) for each deputy weighmaster.
      
      

2. Provides in addition to the license fees set forth a weighmaster who is a recycler or a junk dealer as defined, or is performing services on behalf of a recycler or junk dealer shall also pay to the department the following license fee for each license year as applicable to the operation: (Bus. & Prof. Code § 12704, subd. (b).)
   
   

   1. Five hundred dollars ($500) if the weighmaster is operating at a fixed location;
      
      

   2. Five hundred dollars ($500) for each additional fixed location at which the weighmaster is operating; and
      
      

   3. Five hundred dollars ($500) if the weighmaster is operating at other than a fixed location.
      
      

3. Defines “license year” as the period of time beginning with the first day of the month the weighmaster is required to be licensed in this state, and ending on the date designated by the secretary for expiration of the license, or yearly intervals after the first renewal. (Bus. & Prof. Code § 12704, subd. (c).)
   
   

4. States that “location” means a premise on which weighing, measuring, or counting devices are used. (Bus. & Prof. Code § 12704, subd. (d).)
   
   

5. Provides that the provisions of this section shall remain in effect until January 1, 2019. (Bus. & Prof. Code § 12704, subd. (e).)
   
   

6. Provides that all license fees collected pursuant to this chapter shall be deposited in the Department of Food and Agriculture Fund to be expended by the department for the administration and enforcement of this chapter, except as provided. (Bus. & Prof. Code § 12709, subd. (a).)
   
   

7. License fees collected pursuant to specified sections shall be deposited in a special account in the Department of Food and Agriculture Fund to be expended by the department for the administration and enforcement of specified provisions. (Bus. & Prof. Code § 12709, subd.(b).)
   
   

FISCAL EFFECT:

Unknown

COMMENTS:

1. Author's Statement: According to the author, "This bill will establish The Metal Theft Taskforce within the California Department of Justice (DOJ). The Taskforce will distribute grants to regional and local law enforcement agencies for use in combating metal theft crimes. Grant will also be available for prosecution efforts. Funding for these grants would come from license fees.

"The legislation also directs DOJ to award grants based on a number of criteria to determine where the most pressing needs for additional funding are."

2. Metal Theft in California: Metal theft has been well documented throughout California. In 2007, the New York Times reported:

"This is the No. 1 crime affecting farmers and ranchers right now," said Bill Yoshimoto, an assistant district attorney in the agriculturally rich Tulare County in the Central Valley.

"Virtually every farmer in the Central Valley has been hit," Mr. Yoshimoto said. But some have been hit far beyond the value of the metal. For the farmer to replace the pump is anywhere between $3,000 to $10,000, and then there is downtime, and loss to crops.

Some sheriff's departments in agricultural counties have rural crime units that investigate metal crimes almost exclusively these days, setting up sting operations in recycling shops and tagging copper bait with electronic tracking devices.

Metal theft from California farmers rose 400 percent in 2006 over the previous year, according to the Agricultural Crime Technology Information and Operations Network, a regional law enforcement group headed by Mr. Yoshimoto. The numbers this year are equally high. Through the end of June, there were nearly 1000 incidents of scrap metal theft on farms, causing more than $2 billion in losses, the group's figures show. (Unusual Culprits Cripple Farms in California, New York Times (July 1, 2007).)

Moreover, metal theft is not confined to only farms and rural areas. (See Metal Marauders on Loose, Monterey County Herald (May 10, 2008) [stating: "Demand for copper, brass, platinum, stainless steel and other valuable metals has turned the underside of cars, abandoned buildings, farms, freeways and industrial yards into gold mines for thieves. 'It's an easy way to make a quick buck,' said sheriff's detective Matt Davis. 'Everybody is stealing.'].)

3. Prior Attempts at Establishing a Metal Theft Taskforce: In 2013, the Legislature passed AB 909 (Gray) which was substantially similar to this bill, with the major differences being that AB 909 had the Department of Justice establish and oversee the MTTF Program and did not provide a funding source for the MTTF. The Governor vetoed AB 909 with the following rationale in his veto message: "[AB 909] creates a new enforcement effort without identifying a funding source. Today I signed SB 485, which does provide a funding source for greater enforcement within the existing infrastructure. More can certainly be done, but let's build on stable funding base."

Additionally, in 2014 AB 2313 (Nestande) was also substantially similar to this bill when it was passed out of Assembly Public Safety. That bill was amended to a bill that was identical to this bill and it failed passage on the Senate floor.

4. Argument in Support: According to Liberty Mutual Insurance, "Over the past decade metal theft has remained a growing problem in California that presents significant costs to victims who typically include home and vehicle owners, small and large businesses, and public agencies. In fact, the United States Department of Energy estimates that metal theft and resulting power outages, revenue losses and repairs costs the nation some $1 billion annually. Although the Legislature has taken action to help reduce the occurrence of metal theft, a significant factor that prevents criminals from facing justice stems from a lack of resources and expertise required to investigate such crimes."
   
   
   

5. Prior Legislation:
   
   

   1. AB 2313 (Nestande), of the 2013-2014 legislative session, would have created the Metal Theft Task Force (MTTF) Program to provide funding for local law enforcement agencies, as specified, to combat metal theft and related recycling crimes. AB 2313 failed passage on the Senate floor.
      
      

   2. AB 909 (Gray), of the 2013-2014 legislative session, would have created a MTTF Program substantially similar to this bill but delegated establishment and oversight of the program to the Department of Justice. AB 909 was vetoed by the Governor.
      
      

   3. SB 1023 (Committee on Budget and Fiscal Review), Chapter 43, Statutes of 2012, among other provisions, deleted the provisions repealing the authorization for the Central Valley Rural Crime Prevention Program and Central Coast Rural Crime Prevention Program, thereby making the programs operative indefinitely.

4. AB 2298 (Ma), Chapter 823, Statutes of 2012, prior to its chaptered version, was substantially similar to this bill but delegated the establishment and oversight of the MTTF Program to the Board of State and Community Corrections. AB 2298 was amended completely to address a different topic.

5. AB 2768 (Poochigian), Chapter 327, Statutes of 1996, created the Rural Crime Prevention Program, which authorized the County of Tulare to enter into a joint-powers agreement to share resources, personnel hours, and information regarding rural crimes, including metal theft.

6. AB 374 (Matthews), Chapter 719, Statutes of 2002, extended the operation of the Rural Crime Prevention Program to July 1, 2005, and renamed the program the Central Valley Rural Crime Prevention Program.

7. SB 44 (Denham), Chapter 18, Statutes of 2003, authorized the counties of Monterey, San Luis Obispo, Santa Barbara, Santa Cruz, and San Benito, until July 1, 2010, to develop the Central Coast Rural Crime Prevention Programs modeled on the Central Valley Rural Crime Prevention Programs, to be administered by the county sheriff’s office in Monterey County and by the district attorney’s office in each of the other four counties.

REGISTERED SUPPORT / OPPOSITION:

Support

Air Conditioning Sheet Metal Association

Air Conditioning & Refrigeration Contractors Association

California Chapters of National Electrical Contractors Association (NECA)

California Legislative Conference of Plumbing, Heating and Piping Industry

Finishing Contractors Association of Southern California

Liberty Mutual Insurance

PacifiCorp

United Contractors

Western Line Constructers

Opposition

None

Analysis Prepared by:

Gabriel Caswell / PUB. S. / (916) 319-3744