Legislative Briefs from the Legislative Reference Bureau Legislative Brief 08−4 April 2008 SCRAP METAL SALES REGULATIONS 2007 Wisconsin Act 64, passed by the legis- ing scrap metal consisting primarily of iron or lature and signed by Governor Jim Doyle on steel. The sole requirement for ferrous scrap is March 11, 2008, requires scrap metal dealers to that a dealer may only buy material from a per- ask for identification and proof of ownership son who is at least age 18. before purchasing scrap and certain other The law’s provisions (Sections 134.405 and metal items. The law does not apply to sales of 895.09, Wisconsin Statutes) apply to three items such as gold or silver coins or jewelry. defined classes of metal materials or items: Dealers must maintain sales records and make � “Metal article” means a manufactured item the records available to law enforcement offi- that consists of metal (which may be iron or cers investigating thefts of stolen property. It steel), is usable for its original intended pur- also allows the owners of certain metal items to pose without additional processing, repair, file civil suits to recover theft-related costs. or alteration; and is offered for sale for the value of metal it contains. Not included are Act 64 was introduced as 2007 Senate Bill antique or collectible articles, including jew- 473 on February 12, 2008, by Senators Plale, elry, coins, silverware, and watches. Hansen, Harsdorf, and eight others. It was � “Nonferrous scrap” means scrap metal con- cosponsored by Representatives Montgomery, sisting primarily of metal other than iron or Honadel, Zepnick, and 26 others. SB-473 steel, but does not include aluminum bever- passed the Senate unanimously and the age cans, used household items, items Assembly on a voice vote on February 28, 2008. removed from a structure during renovation It took effect on March 26, 2008. or demolition, or small quantities of nonfer- High metal prices spur thefts. Record and rous metals contained in large manufactured items. near-record prices for metal in recent years, fueled in part by demand in developing econo- � “Proprietary article” means a metal article stamped, engraved, stenciled, or marked to mies such as China, have led to a surge in the identify it as the property of a governmental theft of commodities such as copper, alumi- entity; telecommunications provider, public num, iron, and steel. Thieves have raided utility or electrical producer or transmitter; construction sites, homes, and businesses in cable operator; or a transportation, ship- search of electrical cable and plumbing fix- building, ship repair, mining, or manufactur- tures, siding, beer kegs, and other items. Public ing company. Articles include copper or alu- safety has been compromised by scavengers minum cables or wires, metal beer kegs, stealing manhole covers and sewer grates, manhole covers, grave markers or other cem- etery items, and railroad rails or spikes. street lamps, and roadside guardrails and has resulted in electric utility and cable TV outages. IDENTIFICATION; RECORD-KEEPING New Mexico and Washington have At the time of the sale, a seller or deliverer enacted laws regulating scrap metal dealers, of nonferrous scrap, metal articles, or propri- and legislation has recently been considered in etary articles must provide to the scrap metal about a dozen other states. dealer the motor vehicle operator license or other government-issued, current photo- CATEGORIES OF SCRAP METAL graphic identification which includes the per- The identification and record-keeping son’s full name, current address, date of birth, requirements of Act 64 (www.le- and ID number. Sellers must be over age 18. gis.state.wi.us/2007/data/acts/07Act64.pdf) The scrap metal dealer must record the generally do not apply to ferrous scrap, mean- seller’s or deliverer’s identification, the time Prepared by Dan Ritsche, Senior Legislative Analyst Reference Desk: (608) 266-0341 Web Site: www.legis.state.wi.us/lrb −2 − LB−08−4 and date of the purchase, the number and state must be maintained for not less than two years of issuance of the license plate on the seller’s or after the most recent transaction. deliverer’s vehicle, the weight of the scrap or Police access. A dealer’s records may be articles, and a description of the items received examined by a law enforcement officer who that is consistent with recognized national presents proper credentials at the dealer’s recycling industry guidelines. place of business during business hours. Also, Proof of ownership. If the purchase a law enforcement officer of the city, village, involves nonferrous scrap or a metal article, the town, or county in which a dealer conducts scrap metal dealer must obtain the seller’s business may request that all scrap metal deal- signed declaration that the seller is the owner of ers in the jurisdiction provide reports of all the items being sold. applicable purchases. Dealers must comply no later than the next business day. Municipalities For a proprietary article, the dealer must may specify that reports to police be in an elec- ask for documentation establishing lawful pos- tronic format. session, such a bill of sale, receipt, or letter of authorization. If the seller fails to provide own- PENALTIES ership evidence, the dealer must document A dealer who knowingly violates the law that he or she has made a diligent inquiry into and has not knowingly committed a previous whether the seller has a legal right to sell. Not offense may be subject to a fine not to exceed later than one business day after the purchase, $1,000 or imprisonment not to exceed 90 days, the dealer must submit to a local law enforce- or both. A second violation carries the same 90 ment department a report describing the pro- day sentence, with a fine of up to $10,000. Third prietary article and the seller’s ID information. and subsequent violations are a Class I felony, Retain records for two years. Records with a fine of not to exceed $10,000 or imprison- must be maintained at the dealer’s place of ment not to exceed 3 years and 6 months, or business regarding the seller’s or deliverer’s both. Each day constitutes a separate violation. identification and the description of the scrap Municipalities may enact local ordinances not or articles sold for not less than two years. more stringent than state law, except that a 1st Other than to law enforcement personnel, a class city (Milwaukee) may enact one more dealer may disclose personally identifiable stringent. information relating to scrap sales only to a suc- CIVIL SUITS FOR THEFT COSTS cessor in interest in the operation, resulting An owner of stolen items sold in violation from the sale, merger, assignment, restructur- of the law may bring a civil action against a ing, or change of control of the business. A law dealer seeking actual damages; lost profits; enforcement officer or agency that receives a costs, disbursements, and reasonable attorney report may disclose the information only to fees; and punitive damages if the court deter- another law enforcement officer or agency. mines the violation was committed for the pur- Commercial accounts. If purchases are pose of commercial advantage. The burden of made from a commercial enterprise with proof in such suits is “by the preponderance of whom the scrap dealer maintains an ongoing the evidence.” Awards will be reduced by any business relationship, the dealer must create a restitution collected in a criminal theft prosecu- record that includes the full name of the com- tion. “Value” of the items means the market mercial account; its business address and tele- value at the time of the theft or the cost to the phone number; the name of the responsible victim of replacing the property within a rea- contact person; the time, date, and value of sonable time after the theft, whichever is less, each purchase; and a description of the pre- including any costs that would be incurred in dominant types of scrap the dealer has pur- repairing or replacing any property damaged chased from that account. The ID information in the theft or removal of the scrap metal.