BILL REQ. #:  H-0657.3 

Read first time 02/07/13.   Referred to Committee on Business & Financial Services.

     AN ACT Relating to scrap metal licensing; amending RCW 19.290.030, 19.290.060, and 19.290.080; adding new sections to chapter 19.290 RCW; adding a new section to chapter 43.24 RCW; and prescribing penalties.

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF WASHINGTON:

Sec. 1   RCW 19.290.030 and 2008 c 233 s 3 are each amended to read as follows:
     (1) No scrap metal business may enter into a transaction to purchase or receive private metal property or nonferrous metal property from any person who cannot produce at least one piece of current government-issued picture identification, including a valid driver's license or identification card issued by any state.
     (2) No scrap metal business may purchase or receive private metal property or commercial metal property unless the seller: (a) Has a commercial account with the scrap metal business; (b) can prove ownership of the property by producing written documentation that the seller is the owner of the property; or (c) can produce written documentation that the seller is an employee or agent authorized to sell the property on behalf of a commercial enterprise.
     (3) No scrap metal business may enter into a transaction to purchase or receive metallic wire that was burned in whole or in part to remove insulation unless the seller can produce written proof to the scrap metal business that the wire was lawfully burned.
     (4) ((No transaction involving private metal property or nonferrous metal property valued at greater than thirty dollars may be made in cash or with any person who does not provide a street address under the requirements of RCW 19.290.020.)) For transactions ((valued at greater than thirty dollars)) involving private metal property or nonferrous metal property, the person with whom the transaction is being made may only be paid by a nontransferable check, mailed by the scrap metal business to a street address provided under RCW 19.290.020, no earlier than ((ten)) five days after the transaction was made. A transaction occurs on the date provided in the record required under RCW 19.290.020. All scrap metal processors, scrap metal recycling centers, and scrap metals suppliers are required to complete a five day tag and hold involving private metal property or nonferrous metal property unless they digitally capture a copy of one piece of current government-issued picture identification, including a valid driver's license or identification card issued by any state and capture a picture of the material being sold.
     (5) No scrap metal business may purchase or receive beer kegs from anyone except a manufacturer of beer kegs or licensed brewery.

Sec. 2   RCW 19.290.060 and 2008 c 233 s 6 are each amended to read as follows:
     (1) Following notification((, either verbally or)) in writing((,)) from a commissioned law enforcement officer of the state or any of its political subdivisions that an item of private metal property, nonferrous metal property, or commercial metal property has been reported as stolen, a scrap metal business shall hold that property intact and safe from alteration, damage, or commingling, and shall place an identifying tag or other suitable identification upon the property. The scrap metal business shall hold the property for a period of time as directed by the applicable law enforcement agency up to a maximum of ((ten business)) ninety days.
     (2) A commissioned law enforcement officer of the state or any of its political subdivisions shall not place on hold any item of private metal property, nonferrous metal property, or commercial metal property unless that law enforcement agency reasonably suspects that the property is a lost or stolen item. Any hold that is placed on the property must be removed within ((ten business)) ninety days after the property on hold is determined not to be stolen or lost and the property must be returned to the owner or released.

NEW SECTION.  Sec. 3   A new section is added to chapter 19.290 RCW to read as follows:
     (1) It is unlawful for a person to engage in the business of a scrap metal processor or scrap metal recycler without having first applied for and received a scrap metal license.
     (2)(a) Except as provided in (b) of this subsection, a person or firm engaged in the unlawful activity described in this section is guilty of a gross misdemeanor.
     (b) A second or subsequent offense is a class C felony.

NEW SECTION.  Sec. 4   A new section is added to chapter 19.290 RCW to read as follows:
     Application for a scrap metal license or renewal of a scrap metal license shall be made on a form for this purpose, furnished by the department of licensing, and shall be signed by the license holder or his or her authorized agent and shall include the following information:
     (1) Name and address of the person, firm, partnership, association, limited liability company, or corporation under which name the business is to be conducted;
     (2) Names and residence address of all persons having an interest in the business or, if the owner is a corporation, the names and addresses of the officers thereof;
     (3) Certificate of approval of the chief of police of any city or town having a population of over five thousand persons and in all other instances a member of the Washington state patrol certifying that:
     (a) The applicant has an established place of business at the address shown on the application; and
     (b) In the case of a renewal of a scrap metal license, the applicant is in compliance with this chapter: PROVIDED, That the above certification in any instance can be made by an authorized representative of the department of licensing;
     (4) Documentation demonstrating that the business is in compliance with the terms of all applicable building code, zoning, and other land use regulatory ordinances.
     (5) Any other information that the department of licensing may require.

NEW SECTION.  Sec. 5   A new section is added to chapter 19.290 RCW to read as follows:
     The application, together with a fee of one thousand dollars per physical location, shall be forwarded to the department of licensing. Upon receipt of the application the department shall, if the application is in order, issue a scrap metal license authorizing the processor, recycler, or supplier to do business as such and forward the fee to the state treasurer, to be deposited in the scrap metal license account described in section 16 of this act. Upon receiving the certificate, the owner shall cause it to be prominently displayed in the place of business, where it may be inspected by an investigating officer at any time.

NEW SECTION.  Sec. 6   A new section is added to chapter 19.290 RCW to read as follows:
     Before issuing a scrap metal license, the department of licensing shall require the applicant to file with the department a surety bond in the amount of ten thousand dollars, running to the state of Washington and executed by a surety company authorized to do business in the state of Washington. The bond shall be approved as to form by the attorney general and conditioned upon the licensee conducting the business in conformity with the provisions of this chapter. Any person who has suffered any loss or damage by reason of fraud, carelessness, neglect, violation of the terms of this chapter, or misrepresentation on the part of the scrap metal processor or recycler, may institute an action for recovery against the licensee and surety upon the bond. However, the aggregate liability of the surety to all persons shall in no event exceed the amount of the bond.

NEW SECTION.  Sec. 7   A new section is added to chapter 19.290 RCW to read as follows:
     A license issued on the scrap metal license application remains in force until suspended or revoked and may be renewed annually upon reapplication and upon payment of a fee of five hundred dollars per physical location. A licensee who fails or neglects to renew the license before the assigned expiration date shall pay the fee for an original scrap metal license as provided in this chapter.
     Whenever a scrap metal processor, recycler, or supplier ceases to do business as such or the license has been suspended or revoked, the licensee shall immediately surrender the license to the department of licensing.

NEW SECTION.  Sec. 8   A new section is added to chapter 19.290 RCW to read as follows:
     The licensee shall obtain a special set of license plates in addition to the regular licenses and plates required for the operation of such vehicles. The special plates must be displayed on vehicles owned and/or operated by the licensee and used in the conduct of the business. The fee for these plates shall be five dollars for the original plates and two dollars for each additional set of plates bearing the same license number. A licensee with more than one licensed location in the state may use special plates bearing the same license number for vehicles operated out of any of the licensed locations.

NEW SECTION.  Sec. 9   A new section is added to chapter 19.290 RCW to read as follows:
     If a person whose scrap metal license has previously been canceled for cause by the department of licensing files an application for a license to conduct business as a scrap metal processor, recycler, or supplier, or if the department is of the opinion that the application is not filed in good faith or that the application is filed by some person as a subterfuge for the real person in interest whose license has previously been canceled for cause, the department may refuse to issue the person a license to conduct business as a scrap metal processor, recycler, or supplier.

NEW SECTION.  Sec. 10   A new section is added to chapter 19.290 RCW to read as follows:
     The director of licensing is hereby authorized to adopt reasonable rules and regulations not in conflict with provisions hereof for the proper operation and enforcement of this chapter.

NEW SECTION.  Sec. 11   A new section is added to chapter 19.290 RCW to read as follows:
     The state of Washington hereby fully occupies and preempts the entire field of regulation of scrap metal processors, recyclers, or suppliers within the boundaries of the state. Any political subdivision in this state may enact or enforce only those laws and ordinances relating to the regulation of scrap metal processors, recyclers, or suppliers that are specifically authorized by state law and are consistent with this chapter. The local ordinances shall have the same or lesser penalty as provided for by state law. Local laws and ordinances that are inconsistent with, more restrictive than, or exceed the requirements of state law shall not be enacted and are hereby preempted and repealed, regardless of the code, charter, or home rule status of such political subdivision.

NEW SECTION.  Sec. 12   A new section is added to chapter 19.290 RCW to read as follows:
     (1) If it appears to the director of licensing that an unlicensed person has engaged in an act or practice constituting a violation of this chapter, or a rule adopted or an order issued under this chapter, the director may issue an order directing the person to cease and desist from continuing the act or practice. The director shall give the person reasonable notice of and opportunity for a hearing. The director may issue a temporary order pending a hearing. The temporary order remains in effect until ten days after the hearing is held and becomes final if the person to whom the notice is addressed does not request a hearing within fifteen days after receipt of the notice.
     (2) The director of licensing may assess a fine of up to one thousand dollars with the final order for each act or practice constituting a violation of this chapter by an unlicensed person.

NEW SECTION.  Sec. 13   A new section is added to chapter 19.290 RCW to read as follows:
     (1) The department of licensing or its authorized agent may examine or subpoena any persons, books, papers, records, data, vehicles, or metal property bearing upon the investigation or proceeding under this chapter.
     (2) The persons subpoenaed may be required to testify and produce any books, papers, records, data, vehicles, or metal property that the director of licensing deems relevant or material to the inquiry.
     (3) The director of licensing or an authorized agent may administer an oath to the person required to testify, and a person giving false testimony after the administration of the oath is guilty of perjury in the first degree under RCW 9A.72.020.
     (4) A court of competent jurisdiction may, upon application by the director, issue to a person who fails to comply, an order to appear before the director of licensing or officer designated by the director, to produce documentary or other evidence touching the matter under investigation or in question.

NEW SECTION.  Sec. 14   A new section is added to chapter 19.290 RCW to read as follows:
     The provisions of this chapter shall be liberally construed to the end that traffic in stolen private metal property or nonferrous metal property may be prevented, and irresponsible, unreliable, or dishonest persons may be prevented from engaging in the business of processing, recycling, or supplying scrap metal in this state and reliable persons may be encouraged to engage in businesses of processing, recycling, or supplying scrap metal in this state.

Sec. 15   RCW 19.290.080 and 2007 c 377 s 8 are each amended to read as follows:
     (1) Each violation of the requirements of this chapter that are not subject to the criminal penalties under RCW 19.290.070 shall be punishable, upon conviction, by a fine of not more than one thousand dollars.
     (2) Within two years of being convicted of a violation of any of the requirements of this chapter that are not subject to the criminal penalties under RCW 19.290.070, each subsequent violation shall be punishable, upon conviction, by a fine of not more than ((two)) five thousand dollars.

NEW SECTION.  Sec. 16   A new section is added to chapter 43.24 RCW to read as follows:
     (1) There is created in the state treasury an account to be known as the scrap metal license account. All fees received by the department of licensing for scrap metal licenses, registration, or renewals and the civil penalties assessed and collected by the department of licensing under RCW 19.290.080 shall be forwarded to the state treasurer who shall credit the moneys to the scrap metal license account.
     (2) All expenses incurred in carrying out the scrap metal licensing activities of the department of licensing shall be paid from the account as authorized by legislative appropriation. Any residue in the account shall be accumulated and shall not revert to the general fund at the end of the biennium.
     (3) The director of the department of licensing shall biennially prepare a budget request based on the anticipated costs of administering the scrap metal licensing activities of the department which shall include the estimated income from scrap metal fees.