Existing law requires a person who weighs, measures, or counts a commodity and issues a statement or memorandum of the weight, measure, or count that is used as the basis for either the purchase or sale of that commodity or charge for service, to obtain a license as a weighmaster from the Department of Food and Agriculture, and imposes an annual license fee and various other requirements on weighmasters. Existing law, until January 1, 2019, requires a recycler or junk dealer who is an applicant for a new weighmaster license or a renewal of a weighmaster license to furnish specified additional information on the application, and requires a weighmaster who is a junk dealer or recycler to pay an additional annual fee of $500 to the department for each location at which the weighmaster operates, as specified. Existing law provides for license fees collected pursuant to these provisions to be deposited in the Department of Food and Agriculture Fund and continuously appropriated for the administration and enforcement of these provisions.

This bill would extend the operation of the requirements to furnish the additional application information and to pay the additional annual fee to January 1, 2024. By extending the collection of a fee deposited in a continuously appropriated fund, this bill would make an appropriation. The bill would also make nonsubstantive changes by deleting obsolete provisions.

Existing law requires a person who weighs, measures, or counts a commodity and issues a statement or memorandum of the weight, measure, or count that is used as the basis for either the purchase or sale of that commodity or charge for service, to obtain a license as a weighmaster from the Department of Food and Agriculture, and imposes an annual license fee and various other requirements on weighmasters. Existing law, until January 1, 2019, requires a recycler or junk dealer who is an applicant for a new weighmaster license or a renewal of a weighmaster license to furnish specified additional information on the application, and requires a weighmaster who is a junk dealer or recycler to pay an additional annual fee of $500 to the department for each location at which the weighmaster operates, as specified. Existing law provides for license fees collected pursuant to these provisions to be deposited in the Department of Food and Agriculture Fund and continuously appropriated for the administration and enforcement of these provisions.

This bill would extend the operation of the requirements to furnish the additional application information and to pay the additional annual fee to January 1, 2024. By extending the collection of a fee deposited in a continuously appropriated fund, this bill would make an appropriation. The bill would also make nonsubstantive changes by deleting obsolete provisions.

Existing law requires a person who weighs, measures, or counts a commodity and issues a statement or memorandum of the weight, measure, or count that is used as the basis for either the purchase or sale of that commodity or charge for service, to obtain a license as a weighmaster from the Department of Food and Agriculture, and imposes an annual license fee and various other requirements on weighmasters. Existing law, until January 1, 2019, requires a recycler or junk dealer who is an applicant for a new weighmaster license or a renewal of a weighmaster license to furnish specified additional information on the application. application, and requires a weighmaster who is a junk dealer or recycler to pay an additional annual fee of $500 to the department for each location at which the weighmaster operates, as specified, for the administration and enforcement of these expiring provisions.

This bill would extend the operation of the requirement requirements to furnish the specified additional application information and to pay the additional annual fee to January 1, 2024. The bill would also make nonsubstantive changes by deleting obsolete provisions.

Existing law requires a person who weighs, measures, or counts a commodity and issues a statement or memorandum of the weight, measure, or count that is used as the basis for either the purchase or sale of that commodity or charge for service, to obtain a license as a weighmaster from the Department of Food and Agriculture, and imposes an annual license fee and various other requirements on weighmasters. Existing law, until January 1, 2019, requires a recycler or junk dealer who is an applicant for a new weighmaster license or a renewal of a weighmaster license to furnish specified additional information on the application.

This bill would extend the operation of the requirement to furnish the specified additional application information to January 1, 2024. The bill would also make nonsubstantive changes by deleting obsolete provisions.

 THIRD READING  

Bill No: AB 2676

Author:

:

Vote:

SENATE BUS., PROF. & ECON. DEV. COMMITTEE: 9-0, 6/25/18

AYES: Hill, Fuller, Allen, Dodd, Galgiani, Glazer, Hernandez, Pan, Wilk

SENATE APPROPRIATIONS COMMITTEE: 7-0, 8/6/18

AYES: Portantino, Bates, Beall, Bradford, Hill, Nielsen, Wiener

ASSEMBLY FLOOR: 76-1, 5/30/18 - See last page for vote

SUBJECT:

SOURCE: West Coast Chapter of the Institute of Scrap Recycling Industries

DIGEST:

This bill extends the current requirements for a junk dealer or recycler to submit additional information to the Department of Food and Agriculture (DFA) when applying for a weighmaster's license, along with the payment of additional fees for each fixed location, until January 1, 2024.

ANALYSIS:

Existing law:

1. Defines a "secondhand dealer" to mean "any person, co-partnership, firm, or corporation whose business includes buying, selling, trading, taking in pawn, accepting for sale on consignment, accepting for auctioning, or auctioning secondhand tangible personal property," and specifies that a "secondhand dealer" does not include a coin dealer or participant at gun shows or events, as specified. (Business and Professions Code (Business and Professions Code (BPC) § 21626 (a))
2. Defines a "weighmaster" to mean any person who, for hire or otherwise, weighs, measures, or counts any commodity and issues a statement or memorandum of the weight, measure or count which is used as the basis for either the purchase or sale of that commodity or charge for service. (BPC § 12700)
3. Requires, in addition to any other requirements for issuance of a license as a weighmaster, if the applicant is a recycler or junk dealer, as defined, to provide to the DFA, the following information on an application for a weighmaster’s license: (BPC § 12703.1)
   1. A copy of the applicant’s current business license;
   2. A statement indicating that the applicant has obtained the appropriate storm water permit if necessary;
   3. A statement noting the applicant’s ability to comply with specified thumbprint and photographic technology;
   4. A statement that the applicant has requested to receive theft alert notifications, as specified; and,
   5. The name or names of any deputy weighmasters.
4. Requires a weighmaster who is a recycler or junk dealer to pay to the DFA the following license fee for each license year as applicable to the operation and sunsets that requirement on January 1, 2019: (BPC § 12704)
   1. $500 if operating at a fixed location;
   2. $500 for each additional fixed location; and
   3. $500 if the weighmaster is operating at other than a fixed location.

This bill:

1. Extends the current requirement for an applicant for a weighmaster’s license to provide specified information to the DFA on an application and pay an additional $500 fee for each fixed location, as specified, until January 1, 2024.
2. Makes one other technical and clarifying change.

Background

Enforcement of California's weights and measures laws and regulations is the responsibility of the Division of Measurement Standards (DMS) under the DFA. The DMS works with county sealers of weights and measures who, under the supervision and direction of the Secretary of DFA, carry out many of the weights and measures inspection and enforcement activities at the local level. The DFA is authorized to inspect all weighmasters, including those that are junk dealers and recyclers, to ensure compliance with recordkeeping and reporting requirements.

Under current law, an applicant seeking a weighmaster's license is required to complete an application and submit it with the proper fees and other required information. The type of information required on the application includes name, business license, contact information, a statement that the business can comply with thumb-printing and photographic requirements, a statement that the applicant has requested to receive theft alert notifications, business locations and the name or names of any deputy weighmasters. As a result of SB 485 (Calderon, Chapter 518, Statutes of 2013), applicants for a weighmaster's license or renewal were required to provide additional information on the application and pay a $500 fee for each fixed location where it operates to cover costs associated with the investigative work performed by DMS to review the additional material to help the DFA determine if a junk dealer or recycler business is operating a legitimate business. In order to verify the efficacy of these new requirements, SB 485 included a January 1, 2019, sunset date to give industry, DFA and other stakeholders an opportunity to review the additional application requirements and determine if they are helping to deter non-compliant junk dealers or recycling businesses who may deal in lost or stolen metal property. This bill now extends that sunset to January 1, 2024.

The current license fee a weighmaster is required to pay (depending on location), is: $75 for a weighmaster operating at a fixed location; $30 for each additional fixed location; $200 if the weighmaster is operating at other than a fixed location; and $20 for each deputy weighmaster. If the licensee is also a junk dealer or recycler, they are required to pay an additional $500 for each location. This bill extends that fee until January 1, 2024.

According to information in a 2016 report provided by the National Insurance Crime Bureau, “while the number of metal theft claims was increasing from 2006 through 2011, in 2012 the number of claims leveled off, and from 2014 through 2016 has been decreasing.” Further in a press release related to that report, it was noted that “Credit for these significant results is due, in large part, to the various state legislatures and municipalities that have enacted tough laws in recent years as a direct response to copper and other metal thefts. Many of these laws require scrap yards and other buyers of metal to document the transaction and require proof of identity to discourage thieves from trying to cash in. The laws passed in recent years may now be bearing fruit.”

FISCAL EFFECT: Appropriation: Fiscal Com.: Local:

According to the Senate Appropriations Committee, this bill generates annual estimated fee-generated revenue of $650,000 (special fund) to the DFA. Fee-generated revenue covers the cost of program administration.

SUPPORT: (Verified 8/7/18)

West Coast Chapter of the Institute of Scrap Recycling Industries (source)

SA Recycling

Schnitzer Steel Industries

OPPOSITION: (Verified 8/7/18)

None received

ARGUMENTS IN SUPPORT: The West Coast Chapter of the Institute of Scrap Recycling Industries writes in support, “AB 2676 is designed to continue a worthwhile program which assists law enforcement in eliminating the “rogue” recyclers. Our association members believe the additional cost to keep this program going is worth it.”

Schnitzer Steel Industries writes in support, “Since 2008, the recycling industry has been working with all stakeholders to find a way to curb metal thefts. In 2013, the Legislature passed SB 485 which increased the amount of information that must be provided on an application for a new weighmaster’s license or renewal in order to provide both the Department of Food and Agriculture (DFS) and the county sealers with better information to determine if a junk dealer or recycler business is operating a legitimate business. We are pleased to report that the Department of Food and Agriculture has stated that the inspection program has been a success. DFA has seen an increase in compliance rates of junk dealer/recycler businesses licensed as weighmasters. In 2014, 587 initial inspections were completed with a 24% non-compliance rate. By 2017, 566 initial inspections were completed and the non-compliance rate had dropped to 10%.”

SA Recycling writes in support, “Scrap metal recycling companies that refuse to follow environmental and recording companies not only create a competitive issue for companies like SA, they also have negative impact on the environment and create a source for thieves to sell stolen metal. [BPC] 12703.1 provides a logical and efficient way to enforce environmental and record keeping laws on scrap metal recycling companies.”

ASSEMBLY FLOOR: 76-1, 5/30/18

AYES: Acosta, Aguiar-Curry, Travis Allen, Arambula, Baker, Berman, Bigelow, Bloom, Bonta, Brough, Burke, Caballero, Calderon, Carrillo, Chau, Chávez, Chen, Chiu, Choi, Chu, Cooley, Cooper, Cunningham, Dahle, Daly, Eggman, Flora, Fong, Friedman, Gallagher, Cristina Garcia, Eduardo Garcia, Gipson, Gloria, Gonzalez Fletcher, Gray, Grayson, Harper, Holden, Irwin, Jones-Sawyer, Kalra, Kamlager-Dove, Kiley, Lackey, Levine, Limón, Low, Maienschein, Mathis, Mayes, McCarty, Medina, Melendez, Mullin, Muratsuchi, Nazarian, Obernolte, O'Donnell, Patterson, Quirk, Quirk-Silva, Reyes, Rodriguez, Rubio, Salas, Santiago, Steinorth, Mark Stone, Thurmond, Ting, Voepel, Waldron, Weber, Wood, Rendon

NOES: Cervantes

NO VOTE RECORDED: Frazier

Prepared by: 916-651-4104

8/8/18 12:40:07

**** END ****

SENATE COMMITTEE ON

Senator Anthony Portantino, Chair

2017 - 2018 Regular Session

AB 2676 (Gipson) - Weighmasters: junk dealers and recyclers: licenses: additional application information and fee

This bill does not meet the criteria for referral to the Suspense File.

Bill Summary:

Extends the current requirements for a junk dealer or recycler to submit additional information to the Department of Food and Agriculture (DFA) when applying for a weighmaster's license, along with the payment of additional fees for each fixed location, until January 1, 2024.

Fiscal Impact:

• Generates annual estimated fee-generated revenue of $650,000 (special fund) to the Department of Food and Agriculture. Fee-generated revenue covers the cost of program administration.

Background:

The CDFA’s Division of Measurement Standards (DMS) enforces California's weights and measures laws and regulations. The DMS works with county sealers of weights and measures who carry out many of the weights and measures inspection and enforcement activities at the local level. The inspection and testing of weighing and measuring devices is overseen by a County Sealer of Weights and Measures. In practice, this oversight involves the inspection and testing of packaged commodities and all commercially-used weighing and measuring devices.

Under current law, an applicant seeking a weighmaster's license must complete the application form and submit it with the proper fees and other required information, such as name, business license, contact information, a statement that the business can comply with thumb-printing and photographic requirements, a statement that the applicant has requested to receive theft alert notifications, business locations and the name or names of any deputy weighmasters. As a result of SB 485 (Calderon, Chapter 518, Statutes of 2013), applicants for a weighmaster's license or renewal were required to provide additional information and pay an additional $500 fee for each fixed location or other location where it operates to cover costs associated with the investigative work performed by DMS to review the additional material submitted on the application in order to help the DFA determine if a junk dealer or recycler business is operating a legitimate business. In order to verify the efficacy of these new requirements, SB 485 included a January 1, 2019, sunset date to give industry, DFA and other stakeholders an opportunity to review the additional application requirements and determine if they are helping to deter non-compliant junk dealers or recycling businesses who may deal in lost or stolen metal property. This bill would now extend that sunset to January 1, 2024.

The current license fee a weighmaster is required to pay (depending on location), is: $75 for a weighmaster operating at a fixed location; $30 for each additional fixed location; $200 if the weighmaster is operating at other than a fixed location; and $20 for each deputy weighmaster. If the licensee is also a junk dealer or recycler, they are required to pay an additional $500 for each location. This bill extends that fee until January 1, 2024.

Proposed Law:

Extends the current requirements for a junk dealer or recycler to submit additional information to the Department of Food and Agriculture (CDFA) when applying for a weighmaster's license, along with the payment of specified fees for each fixed location, until January 1, 2024.

Related Legislation:

• AB 236 (Lackey, Chapter 103, Statutes of 2015) adds pawnbrokers and secondhand dealers to the list of persons who are not weighmasters and makes other technical changes.
• SB 485 (Calderon, Chapter 518, Statutes of 2013), required a junk dealer or recycler to submit additional information regarding its junk dealer business to the CDFA when applying for a weighmaster's license or a renewal license; required the CDFA to complete an investigation of the information on the application or renewal within a specified period of time and revoke the license if the information submitted in the application or renewal is materially inaccurate; increases the fees that junk dealers or recyclers pay for each fixed location; and sunsets these provisions on January 1, 2019.

-- END --

SENATE COMMITTEE ON

BUSINESS, PROFESSIONS AND ECONOMIC DEVELOPMENT

Senator Jerry Hill, Chair

2017 - 2018 Regular

Bill No: Hearing Date: June 25, 2018

Subject:

SUMMARY:

Extends the current requirements for a junk dealer or recycler to submit additional information to the Department of Food and Agriculture (DFA) when applying for a weighmaster's license, along with the payment of additional fees for each fixed location, until January 1, 2024.

Existing law:

1. Defines a "secondhand dealer" to mean "any person, co-partnership, firm, or corporation whose business includes buying, selling, trading, taking in pawn, accepting for sale on consignment, accepting for auctioning, or auctioning secondhand tangible personal property," and specifies that a "secondhand dealer" does not include a coin dealer or participant at gun shows or events, as specified. (Business and Professions Code (Business and Professions Code (BPC) § 21626 (a))
2. Specifies that "secondhand dealers" are not persons who perform the services of an auctioneer for a fee or salary, or persons whose business is limited to the reconditioning and selling of major household appliances, as long as specified conditions are met. (BPC § 21626.5)
3. Defines a "weighmaster" to mean any person who, for hire or otherwise, weighs, measures, or counts any commodity and issues a statement or memorandum of the weight, measure or count which is used as the basis for either the purchase or sale of that commodity or charge for service. (BPC § 12700)
4. Requires, in addition to any other requirements for issuance of a license as a weighmaster, if the applicant is a recycler or junk dealer, as defined, to provide to the DFA, the following information on an application for a weighmaster’s license:
   (BPC § 12703.1)
5. A copy of the applicant’s current business license,
6. A statement indicating that the applicant has obtained the appropriate storm water permit if necessary;
7. A statement noting the applicant’s ability to comply with specified thumbprint and photographic technology;
8. A statement that the applicant has requested to receive theft alert notifications, as specified; and,
9. The name or names of any deputy weighmasters.
   
10. Requires a weighmaster who is a recycler or junk dealer to pay to the DFA the following license fee for each license year as applicable to the operation and sunsets that requirement on January 1, 2019: (BPC § 12704)
11. $500 if operating at a fixed location;
12. $500 for each additional fixed location;
13. $500 if the weighmaster is operating at other than a fixed location.

This bill:

1. Extends the current requirement for an applicant for a weighmaster’s license to provide specified information to the DFA on an application and pay an additional $500 fee for each fixed location, as specified, until January 1, 2024.
   
2. Makes one other technical and clarifying change.

FISCAL EFFECT:

This bill is keyed fiscal by the Legislative Counsel. According to the Assembly Committee on Appropriations Analysis dated May 2, 2018, this bill will result in annual costs, recovered through fees, in the hundreds of thousands of dollars annually, for CDFA staff and cooperative agreements to administer the program and nnual revenue to CDFA in the range of $500,000 to $600,000 from fees charged to program participants.

COMMENTS:

1. Purpose. This bill is sponsored by the West Coast Chapter, Institute of Scrap Recycling Industries. According to the author, “[this bill] will extend the sunset provision [on existing law] which requires recyclers to submit additional information to procure a weigh master license and allows the Department of Food and Agriculture to continue to collect fees to cover costs of the program.”
2. Background.

Weights and measures. Enforcement of California's weights and measures laws and regulations is the responsibility of the Division of Measurement Standards (DMS) under the DFA. The DMS works with county sealers of weights and measures who, under the supervision and direction of the Secretary of DFA, carry out many of the weights and measures inspection and enforcement activities at the local level. County weights and measures officials inspect and test packaged commodities and all commercially used devices. DFA is authorized to inspect all weighmasters, including those that are junk dealers and recyclers, to ensure compliance with recordkeeping and reporting requirements with relation to the issuance of weighmaster certificates.

Current requirements for a weighmaster's license. Under current law, an applicant seeking a weighmaster's license is required to complete the application form and submit it with the proper fees and other required information. The type of information required on a current application includes name, business license, contact information, a statement that the business can comply with thumb-printing and photographic requirements, a statement that the applicant has requested to receive theft alert notifications, business locations and the name or names of any deputy weighmasters. As a result of SB 485 (Calderon, Chapter 518, Statutes of 2013), applicants for a weighmaster's license or renewal were required to provide additional information and pay an additional $500 fee for each fixed location or other location where it operates to cover costs associated with the investigative work performed by DMS to review the additional material submitted on the application in order to help the DFA determine if a junk dealer or recycler business is operating a legitimate business. In order to verify the efficacy of these new requirements, SB 485 included a January 1, 2019, sunset date to give industry, DFA and other stakeholders an opportunity to review the additional application requirements and determine if they are helping to deter non-compliant junk dealers or recycling businesses who may deal in lost or stolen metal property. This bill would now extend that sunset to January 1, 2024.

The current license fee a weighmaster is required to pay (depending on location), is: $75 for a weighmaster operating at a fixed location; $30 for each additional fixed location; $200 if the weighmaster is operating at other than a fixed location; and $20 for each deputy weighmaster. If the licensee is also a junk dealer or recycler, they are required to pay an additional $500 for each location. This bill extends that fee until January 1, 2024.

According to information in a 2016 report provided by the National Insurance Crime Bureau, “while the number of metal theft claims was increasing from 2006 through 2011, in 2012 the number of claims leveled off, and from 2014 through 2016 has been decreasing.” Further in a press release related to that report, it was noted that “Credit for these significant results is due, in large part, to the various state legislatures and municipalities that have enacted tough laws in recent years as a direct response to copper and other metal thefts. Many of these laws require scrap yards and other buyers of metal to document the transaction and require proof of identity to discourage thieves from trying to cash in. The laws passed in recent years may now be bearing fruit.”

Additionally, the sponsor provided information that metal theft reports via the Scrap TheftAlerts website has declined since 2015 after the implementation of AB 2312 (Nestande and Olsen, Chapter 608, Statutes of 2014). That bill required a junk dealer or recycler to request to receive metal theft alert notifications from an Internet-based theft alert system and requires a junk dealer or recycler to provide a statement that they have requested to receive theft alert notifications when seeking a weighmasters license. As reported, there were 218 theft alerts in 2015 and 91 reported in 2017.

1. Prior Related Legislation. AB 236 (Lackey, Chapter 103, Statutes of 2015) adds pawnbrokers and secondhand dealers to the list of persons who are not weighmasters and makes other technical changes.

SB 485 (Calderon, Chapter 518, Statutes of 2013), required a junk dealer or recycler to submit additional information regarding its junk dealer business to the CDFA when applying for a weighmaster's license or a renewal license; required the CDFA to complete an investigation of the information on the application or renewal within a specified period of time and revoke the license if the information submitted in the application or renewal is materially inaccurate; increases the fees that junk dealers or recyclers pay for each fixed location; and sunsets these provisions on January 1, 2019.

SB 757 (Berryhill of 2013), would have made conforming changes to authorize a junk dealer or recycler buying newspaper or California Redemption Value (CRV) containers, as specified, to accept as valid seller identification a passport from any country or a Matricula Consular issued by Mexico. It also specified that the term “secondhand dealer” did not include a junk dealer. NOTE: This bill was amended to address an unrelated issue: Groundwater management.

AB 909 (Gray of 2013), would have required the Board of State and Community Corrections to establish the Metal Theft Task Force Program to provide, evaluate and monitor grants disbursed to enhance the capacity of local law enforcement and prosecutors to deter, investigate, and prosecute metal theft and related metal theft crimes. NOTE: This bill was vetoed by Governor Brown.

AB 841 (Torres of 2013), would have required junk dealers and recyclers to provide payment to sellers of nonferrous material by mailed check only, as specified. NOTE: This bill was vetoed by Governor Brown. In the Governor's veto message he stated that "he signed four bills last year to prevent more theft" ….What's really missing today is robust enforcement of our laws."

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.

1. Arguments in Support. The West Coast Chapter of the Institute of Scrap Recycling Industries writes in support, “AB 2676 is designed to continue a worthwhile program which assists law enforcement in eliminating the “rogue” recyclers. Our association members believe the additional cost to keep this program going is worth it.”

Schnitzer Steel Industries writes in support, “Since 2008, the recycling industry has been working with all stakeholders to find a way to curb metal thefts. In 2013, the Legislature passed SB 485 which increased the amount of information that must be provided on an application for a new weighmaster’s license or renewal in order to provide both the Department of Food and Agriculture (DFS) and the county sealers with better information to determine if a junk dealer or recycler business is operating a legitimate business. We are pleased to report that the Department of Food and Agriculture has stated that the inspection program has been a success. DFA has seen an increase in compliance rates of junk dealer/recycler businesses licensed as weighmasters. In 2014, 587 initial inspections were completed with a 24% non-compliance rate. By 2017, 566 initial inspections were completed and the non-compliance rate had dropped to 10%.”

SA Recycling writes in support, “Scrap metal recycling companies that refuse to follow environmental and recording companies not only create a competitive issue for companies like SA, they also have negative impact on the environment and create a source for thieves to sell stolen metal. [BPC] 12703.1 provides a logical and efficient way to enforce environmental and record keeping laws on scrap metal recycling companies.”

SUPPORT AND OPPOSITION:

Support:

West Coast Chapter of the Institute of Scrap Recycling Industries (sponsor)

SA Recycling

Schnitzer Steel Industries

Opposition:

None on file as of June 20, 2018.

-- END --

ASSEMBLY THIRD READING

ATR Bill Id:AB 2676

Author:(Gipson)

As Amended Ver:April 5, 2018

Majority vote

SUMMARY: Extends a January 1, 2019, sunset date by five years, and would additionally make a non-substantive change by deleting an obsolete provision. Specifically, this bill:

1. Specifies that, until January 1, 2024, in addition to any other requirements for issuance of a weighmaster's license, if the applicant is a recycler or junk dealer, the Department of Food and Agriculture (DFA) shall require the applicant to furnish all of the following information accurately on any application for a new license or the renewal of a license:
   1. A copy of the applicant's current business license;
   2. A statement indicating that the applicant has either filed an application for a stormwater permit or is not required to obtain a stormwater permit;
   3. A statement indicating that the applicant has the equipment necessary to comply with the photographic and thumbprinting requirements for the purchase and sale of nonferrous material, as specified, or a statement indicating that applicant will not be purchasing or selling nonferrous materials and is not required to comply as specified; and,
   4. The name or names of any deputy weighmasters.
2. Requires the DFA, until January 1, 2024, to issue a license to a junk dealer or recycler upon receipt of an application for a new license or renewal of a license that contains the required information and is accompanied by the appropriate fee, and additionally:
   1. Specifies that the DFA shall make a thorough investigation of all the information contained in the application or renewal within 90 days for a new license, and within one calendar year for a renewal of a license.
   2. Specifies that if the DFA determines that the information submitted is materially inaccurate, the DFA shall revoke the license issued to a junk dealer or recycler unless the junk dealer or recycler complies with the specified requirements within 14 days of notice from the DFA of a proposed revocation, as specified.
   3. Provides that a junk dealer or recycler whose license has been revoked is entitled to a hearing, as specified.
   4. Authorizes the Secretary of the DFA to enter into a cooperative agreement with any county sealer to carry out the specified provisions.

FISCAL EFFECT:

1. Annual costs, recovered through fees, in the hundreds of thousands of dollars annually, for DFA staff and cooperative agreements to administer the program.
2. Annual revenue to DFA in the range of $500,000 to $600,000 from fees charged to program participants.

COMMENTS: The National Insurance Crime Bureau (NICB) released a report in 2009 which reported that "thieves seem willing to go to any length to obtain the metal, which they can then sell to scrap dealers. Thieves have stripped sheets of metal from building rooftops, stolen memorial decorations from cemeteries, ripped apart air conditioners for the copper coils within, and stripped homes and buildings of wiring and piping. Frequently, the damage caused by such thefts is several times the value of the metal stolen…Thieves have removed wiring from traffic and railway signals and even posed as utility workers in order to remove large sections of thick utility cable from the sewers beneath city streets. Several thieves have been electrocuted trying to steal live electrical wiring." (Metal Theft Claims from January 2006 to November 2008, February 13, 2009, NICB).

Beginning in 2008, the Legislature began enacting measures in an effort to curb illegal metal scrapping by imposing a variety of restrictions and regulations. SB 485 (Calderon), Chapter 518, Statutes of 2013) the enabling legislation of the statute that is not set to sunset and the subject of this bill, provides the most recent legislative response to California's metal theft issue.

According to the author, "in 2013, the passage of SB 485 created additional requirements for recyclers who submit an application for a new weigh master license or the renewal of a weigh master license with the Department of Food and Agriculture, which absent, any legislative action will sunset in January of next year. [This bill,] AB 2676, will simply extend that sunset provision."

In support of this bill, the West Coast Chapter of the Institute of Scrap Recycling Industries (ISRI) writes:

IRSI was also the sponsor of the original bill (SB 485) which established the current program which is the subject of this bill. […] The bill would extend the sunset provision in the current law in order to keep the enforcement provisions in place relative to the Division of Measurement Standards authority in helping police the recycling industry in order to prevent what is known as "rogue recycling." A rogue recycler is an entity that does not abide by the current law relative to background checks of customers, proper payment methods, and business licensing requirements. Over the years, it has become readily apparent that additional laws on the books are not necessary. The problem is not the lack of sufficient statutory muscle, but the dire lack of judicial enforcement. Simply stated, few local police agencies have the desire to redirect their scarce resources to enforce the metal theft laws. This is a budgetary issue and not an issue of substantive law. The passage of SB 485 helped relieve the budgetary stress on law enforcement and placed the weights and measures agents on the front line in the fight against the outlaw rogue recyclers. Because recyclers are required to have scales which measure up to state standards, and because County Sealers (i.e., weights and measures agent/enforcers) are public safety officers, who better than they to enforce the law relative to the rogue recyclers.

Analysis Prepared by: Nichole Rapier / P. & C.P. / (916) 319-2200 FN: 0003032

Date of Hearing: May 2, 2018

ASSEMBLY COMMITTEE ON APPROPRIATIONS

Lorena Gonzalez Fletcher, Chair

ABPCA Bill Id:AB 2676

Author:(Gipson) – As Amended Ver:April 5, 2018

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

SUMMARY:

This bill extends, from January 1, 2019, to January 1, 2024, the date by which the California Department of Food and Agriculture (CDFA) may issue and renew junk dealer and recycler licenses.

FISCAL EFFECT:

1. Annual costs, recovered through fees, in the hundreds of thousands of dollars annually, for CDFA staff and cooperative agreements to administer the program.
2. Annual revenue to CDFA in the range of $500,000 to $600,000 from fees charged to program participants.

COMMENTS:

Background and purpose. This bill extends a January 1, 2019, sunset date by five years thereby extending the weighmasters licensing inspection program, which requires weighmaster applicants to provide additional information on applications and imposes specified obligations on CDFA. According to the author:

In 2013, the passage of SB 485 created additional requirements for recyclers who submit an application for a new weighmaster license or the renewal of a weighmaster license with the Department of Food and Agriculture, which absent any legislative action will sunset in January of next year. This bill, AB 2676, will simply extend that sunset provision.

Analysis Prepared by: Jessica Peters / APPR. / (916) 319-2081

Date of Hearing: April 3, 2018

ASSEMBLY COMMITTEE ON PRIVACY AND CONSUMER PROTECTION

Ed Chau, Chair

ABPCA Bill Id:AB 2676 (

Author:Gipson) – As Introduced Ver:February 15, 2018

SUBJECT: Weighmasters: junk dealers and recyclers: new licenses and license renewals: additional application information

SUMMARY: This bill would extend a January 1, 2019, sunset date by five years, and would additionally make a non-substantive change by deleting an obsolete provision. Specifically, this bill would:

1. Specify that, until January 1, 2024, in addition to any other requirements for issuance of a weighmaster's license, if the applicant is a recycler or junk dealer, the Department of Food and Agriculture (DFA) shall require the applicant to furnish all of the following information accurately on any application for a new license or the renewal of a license:

• A copy of the applicant's current business license;
• A statement indicating that the applicant has either filed an application for a stormwater permit or is not required to obtain a stormwater permit;
• A statement indicating that the applicant has the equipment necessary to comply with the photographic and thumbprinting requirements for the purchase and sale of nonferrous material, as specified, or a statement indicating that applicant will not be purchasing or selling nonferrous materials and is not required to comply as specified; and,
• The name or names of any deputy weighmasters.

1. Require the DFA, until January 1, 2024, to issue a license to a junk dealer or recycler upon receipt of an application for a new license or renewal of a license that contains the required information and is accompanied by the appropriate fee, and additionally:

• Specifies that the DFA shall make a thorough investigation of all the information contained in the application or renewal within 90 days for a new license, and within one calendar year for a renewal of a license.
• Specifies that if the DFA determines that the information submitted is materially inaccurate, the DFA shall revoke the license issued to a junk dealer or recycler unless the junk dealer or recycler complies with the specified requirements within 14 days of notice from the DFA of a proposed revocation, as specified.
• Provides that a junk dealer or recycler whose license has been revoked is entitled to a hearing, as specified.
• Authorizes the Secretary of the DFA to enter into a cooperative agreement with any county sealer to carry out the specified provisions.
  

EXISTING LAW:

1. Specifies that the DFA is generally responsible for the supervision of weights and measures and weighing and measuring devices sold or used in the state. (Bus. & Prof. Code Sec. 12100.)
   
2. Provides that the duty of carrying out and enforcing its provisions and requirements is vested in the Secretary of DFA and in each sealer acting under the supervision and direction of the Secretary. (Bus. & Prof. Code Sec. 12103.5.)
   
3. Authorizes the Secretary of DFA to inspect the work of the local sealers, and to inspect the weights, measures, balances or any other weighing or measuring devices of any person. (Bus. & Prof. Code Sec. 12105.)
   
4. Defines a weighmaster as "any person who, for hire or otherwise, weighs, measures, or counts any commodity and issues a statement or memorandum of the weight, measure or count which is used as the basis for either the purchase or sale of the commodity or charge for service." (Bus. & Prof. Code Sec. 12700.)
   
5. Specifies that no person shall perform weighmaster acts unless licensed as a weighmaster and unless the current license fee and any penalty has been paid, and requires the weighmaster to submit the name or names of deputy weighmasters with the appropriate fees. (Bus. & Prof. Code Sec. 12703.)
   
6. Requires a weighmaster to obtain and pay a license fee. Requires, until January 1, 2019, a weighmaster who is a recycler or a junk dealer or is performing services on behalf of a recycler or junk dealer shall also pay to the department additional fees in the amount of $500, as specified. (Bus. & Prof. Code Sec. 12704.)
   
7. Requires all license fees collected to be deposited in the DFA fund to be expended by the DFA for the administration and enforcement. (Bus. & Prof. Code Sec. 12709.)
8. Until January 1, 2019, specifies that in addition to any other requirements for issuance of a weighmaster's license, if the applicant is a recycler or junk dealer, the DFA shall require the applicant to furnish all of the following information accurately on any application for a new license or the renewal of a license:
   • A copy of the applicant's current business license;
   • A statement indicating that the applicant has either filed an application for a stormwater permit or is not required to obtain a stormwater permit;
   • A statement indicating that the applicant has the equipment necessary to comply with the photographic and thumbprinting requirements for the purchase and sale of nonferrous material, as specified, or a statement indicating that applicant will not be purchasing or selling nonferrous materials and is not required to comply as specified; and,
   • The name or names of any deputy weighmasters. (Bus. & Prof. Code Sec. 12703.1(a).)
9. Requires the DFA, until January 1, 2019, to issue a license to a junk dealer or recycler upon receipt of an application for a new license or renewal of a license that contains the required information and is accompanied by the appropriate fee, and additionally:
   • Specifies that the DFA shall make a thorough investigation of all the information contained in the application or renewal within 90 days for a new license, and within one calendar year for a renewal of a license.
   • Specifies that if the DFA determines that the information submitted is materially inaccurate, the DFA shall revoke the license issued to a junk dealer or recycler unless the junk dealer or recycler complies with the specified requirements within 14 days of notice from the DFA of a proposed revocation, as specified.
   • Provides that a junk dealer or recycler whose license has been revoked is entitled to a hearing, as specified.
   • Authorizes the Secretary of the DFA to enter into a cooperative agreement with any county sealer to carry out the specified provisions. (Bus. & Prof. Code Sec. 12703.1(b).)
     

FISCAL EFFECT: Unknown

COMMENTS:

1. Purpose of this bill: This bill extends a January 1, 2019, sunset date by five years thereby extending the weighmasters’ licensing inspection program, which require weighmaster applicants to provide additional information on applications, and imposes specified obligations on the DFA. This bill is sponsored by the West Coast Chapter of the Institute of Scrap Recycling Industries.
2. Author’s statement: According to the author, “in 2013, the passage of SB 485 created additional requirements for recyclers who submit an application for a new weigh master license or the renewal of a weigh master license with the Department of Food and Agriculture, which absent, any legislative action will sunset in January of next year. [This bill,] AB 2676, will simply extend that sunset provision.”
3. Junk dealing and recycling: Enforcement of California’s weights and measures laws and regulations is the responsibility of the Division of Measurement Standards (DMS) under the DFA. The DMS works with county sealers of weights and measures who, under the supervision and direction of the Secretary of DFA, carry out many of the weights and measures inspection and enforcement activities at the local level. County weights and measures officials inspect and test packaged commodities and all commercially used devices. Weights and measures officials have the authority to issue citations for misdemeanor and infraction violations involving weights and measures laws. The DFA is authorized to inspect all weighmasters, including those that are junk dealers and recyclers, to ensure compliance with recordkeeping and reporting requirements with relation to the issuance of weighmaster certificates.

According to the Institute of Scrap Recycling Industries, Inc., nonferrous metals (non-iron based metals including copper, stainless steel, and aluminum) are among the few materials that do not degrade or lose their chemical or physical properties in the recycling process. Accordingly, these metals have the capacity to be recycled nearly an infinite number of times. While nonferrous metals only make up a small percentage of the total quantity of material recycled in the United States every year, they account for more than half of the total earnings in the scrap metal industry. Domestically, the value of the nonferrous scrap industry increased 28 percent in 2009, reaching nearly $40 billion in 2010. In terms of volume, it has been reported that nonferrous scrap materials make up a small percentage of the total quantity of material recycled in the United States, but by value it accounts for more than half of the total earnings of the scrap recycling industry.

1. Metal theft crisis: The National Insurance Crime Bureau (NICB) released a report in 2009 which reported that “thieves seem willing to go to any length to obtain the metal, which they can then sell to scrap dealers. Thieves have stripped sheets of metal from building rooftops, stolen memorial decorations from cemeteries, ripped apart air conditioners for the copper coils within, and stripped homes and buildings of wiring and piping. Frequently, the damage caused by such thefts is several times the value of the metal stolen…Thieves have removed wiring from traffic and railway signals and even posed as utility workers in order to remove large sections of thick utility cable from the sewers beneath city streets. Several thieves have been electrocuted trying to steal live electrical wiring." (Metal Theft Claims from January 2006 to November 2008, February 13, 2009, NICB).
2. Legislative response. Beginning in 2008, the Legislature began enacting measures in an effort to curb illegal metal scrapping by imposing a variety of restrictions and regulations. SB 691 (Calderon, Ch. 730, Stats. 2008) required sellers of nonferrous metals to give their thumbprints and show government identification and proof of address. AB 884 (Berryhill, Ch. 731, Stats. 2008) additionally required recyclers to hold payment for three days, and AB 1778 (Ma, Ch. 733, Stats 2009) also required payments of $50 or more to be made by check. Yet by 2012 the problem had not subsided. That year the Los Angeles Times reported that “the state is in the throes of a metal theft epidemic, fueled by scrap yards’ willingness to pay high prices for copper and steel that can be resold to hungry factories in Asia.” (Garrison, The Los Angeles Times, Illegal scrap yards in California a burgeoning problem, August 21, 2012.)

SB 485 (Calderon, Ch. 518, Stats. 2013), the enabling legislation of the statute that is not set to sunset and the subject of this bill, provides the most recent legislative response to California’s metal theft issue. That bill increased the amount of information that must be provided on an application for a new weighmaster’s license or renewal in order to provide both the DFA and the county sealers with better information to determine if a junk dealer or recycler business is operating a legitimate business. SB 485 also increased the application fee in order to cover the costs associated with investigating the increased amount of information, and additionally provided DMS with the authority to verify the accuracy of information submitted on an application and take appropriate disciplinary action in the event that an applicant submitted false information. In order to verify the efficacy of these new requirements, SB 485 included a January 1, 2019, sunset date to give industry, DFA and other stakeholders an opportunity to review the additional application requirements and determine if they are helping to deter non-compliant junk dealers or recycling businesses who may deal in lost or stolen metal property. This bill would now extend that sunset to January 1, 2024.

Regarding SB 485, DFA writes, “From our perspective, this inspection program has been a success. Omissions and violations are being corrected. The majority of inspection work is being performed by county staff, and inspections are performed within the time limits prescribed by law. Our increased oversight of junk dealers/recyclers has undoubtedly had a positive effect, to deter fraud and criminal activity.” DFA further reports an increase in compliance rates of junk dealer/recycler businesses licensed as weighmasters, and a dramatic decrease in statewide metal theft. Specifically, in 2014 there were 542 reported metal thefts in California, down to 8 in 2017.

In support of this bill, the West Coast Chapter of the Institute of Scrap Recycling Industries (ISRI) writes:

IRSI was also the sponsor of the original bill (SB 485) which established the current program which is the subject of this bill. […] The bill would extend the sunset provision in the current law in order to keep the enforcement provisions in place relative to the Division of Measurement Standards authority in helping police the recycling industry in order to prevent what is known as “rogue recycling.” A rogue recycler is an entity that does not abide by the current law relative to background checks of customers, proper payment methods, and business licensing requirements. Over the years, it has become readily apparent that additional laws on the books are not necessary. The problem is not the lack of sufficient statutory muscle, but the dire lack of judicial enforcement. Simply stated, few local police agencies have the desire to redirect their scarce resources to enforce the metal theft laws. This is a budgetary issue and not an issue of substantive law. The passage of SB 485 helped relieve the budgetary stress on law enforcement and placed the weights and measures agents on the front line in the fight against the outlaw rogue recyclers. Because recyclers are required to have scales which measure up to state standards, and because County Sealers (i.e., weights and measures agent/enforcers) are public safety officers, who better than they to enforce the law relative to the rogue recyclers.

Regarding the issue of budget and the scarcity of resources, staff notes that SB 485 contained two provisions with sunset dates. One provision, which this bill would extend by another five years, required additional information on applications for weighmasters’ licenses and mandating that the DFA to investigate applications, and another provision which increased the application fee to cover the increased costs association with investigating the applications. Notably, this bill would only extend the sunset date on the former provision, thereby eliminating the mechanism which funded the inspection program. Accordingly, the author may wish to consider amending this bill to extend the sunset on both provisions to ensure that the inspection program is adequately funded for the next five years.

Suggested amendment

Amend Bus. & Prof. Code Sec. 12704 to remain in effect until January 1, 2024.

1. Arguments in support: SA recycling writes in support, “AB 2676 [would] extend the requirements of SB 485 as set for in California Business and Professions Code 12703.1 which mandates that metal recyclers provide proof of certain requirements before being issued a weighmasters license. SA is a scrap metal company that operates over 40 scrap metal recycling facilities in California. Scrap metal recycling companies that refuse to follow environmental and recording companies not only create a competitive issue for companies like SA, they also have negative impact on the environment and create a source for thieves to sell stolen metal. Business and Professions Code 12703.1 provides a logical and efficient way to enforce environmental and record keeping laws on scrap metal recycling companies.

Sims Metal Management, also in support, writes, “these additional requirements: providing a current business license, stormwater permit, statement certifying they have the equipment necessary to comply with the law, and that they have signed on to the Scrap Theft Alert notifications ensures that those in the junk dealer and recycling industry are operating in a safe and legitimate manner.”

1. Related legislation: SB 1161 (Stone) would require payment for nonferrous material to be made in the form of a donation to a nonprofit organization, unless the material is delivered by a junk dealer or recycler, as specified.
2. Prior legislation: SB 485 (Calderon, Ch. 518, Stats. 2013) required, until January of 2019, a junk dealer or recycler to submit additional information when applying for a weighmaster’s license or a renewal license, and required the DFA to complete an investigation of the application within a specified time period, as specified.

AB 316 (Carter, Ch. 317, Stats. 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 two or three years and a fine not to exceed $10,000, as specified.

AB 1778 (Ma, Ch. 733, Stats. 2009) required recyclers to obtain identifying information of individuals who bring in more than $50 worth of California Redemption Value recyclables and newspapers. AB 1778 also required that payments of $50 or more be made by check.

SB 447 (Maldonado, Ch. 732, Stats. 2008) 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, Ch. 731, Stats. 2008) 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, Ch. 730, Stats. 2008) 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 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.

REGISTERED SUPPORT / OPPOSITION:

Support

West Coast Chapter of the Institute of Scrap Recycling Industries (sponsor)

SA Recycling

Sims Metal Management

Opposition

None received.

Analysis Prepared by: Nichole Rapier / P. & C.P. / (916) 319-2200