Lawmakers tangled in copper wire theft - Journal Record

March 20, 2008
OKLAHOMA CITY – A law passed last year to combat theft of copper wire seems to have had little effect on the thieves, but has had a significant negative impact on law-abiding citizens who buy and sell scrap metal. Lawmakers are revisiting the issue this year, but some are questioning whether the changes proposed would improve or further complicate the situation.

In the summer of 2006, the market price of used copper increased from about $1.50 a pound to more than $4 a pound, and a spate of thefts ensued. Small businesses, particularly those providing construction and electrical services, reported the theft of thousands of dollars in equipment and materials. All kinds of companies and some residential buildings were left without air conditioning when thieves stole the coils from their air conditioning units. Electricity utility OG&E is estimated to have lost about $2 million over the last two years in wire theft and damages as thieves preyed on the company’s electrical substations – which also led to power outages.

The Legislature responded with a law designed to help law enforcement track down thieves and return stolen property to the rightful owners. Lawmakers targeted metal dealers, who are likely to be the first to encounter the stolen property when thieves attempt to sell the material. Metal dealers were required to document the identification of those bringing in copper wiring for sale, and to store purchased metal for 10 days before it could be used, giving victims of theft the opportunity to identify their property.

Bill Cale, president of Yaffe Iron and Metal in Muskogee, said he appreciates the intent of the legislation, but the approach is flawed. Cale said the problem with the new law is clearly demonstrated by taking the strategy advocated to deal with copper thefts and applying that same strategy to thefts of the most stolen item in the world: money.

“To accept the logic this law is based on, that would be like saying Wal-Mart can’t accept cash, or that Wal-Mart should have to hold the cash for ten days,” said Cale. “They’re making the assumption that everybody who sells metal is a thief.” The 10-day storage rule has created new problems for dealers, who have to find additional storage space for the metals they purchase. Some large operations may conduct $200,000 in business in one day, and may have a considerable amount of metal to store. Dealers also have to pay for added security to guard the stockpiles from thieves who would steal the metal just to sell it back to the metal dealers. Yaffe has invested about $200,000 in security measures for the company’s seven locations in Oklahoma, said Cale.

The law creates difficulties in purchasing decisions, as the market price for certain metals fluctuates on a daily basis, said Cale. The 10-day waiting period imposed by the law means metal dealers can never tell how much the metal they buy will actually be worth by the time they are allowed to sell it on the market. State Rep. Guy Liebmann, R-Oklahoma City, brought Senate Bill 1856 before the House Economic Development and Financial Services Committee on Tuesday, acknowledging from the outset of the discussion that last year’s law has not had the desired effect on copper thefts. The bill, authored by state Sen. Cliff Branan, R-Oklahoma City, would impose more restrictions on the sale of copper to metal dealers. But Liebmann said the bill would likely wind up in a conference committee at the end of session, allowing all involved to craft a compromise measure.

New provisions proposed this year would require a seller of copper wire to provide proof that the metal being sold is his or her rightful property. Lawmakers also propose a prohibition on the sale of wiring that has had its coating burned off. Liebmann said thieves typically burn off the coating to make it more difficult, if not impossible, to determine where the wiring came from. Liebmann said the legislation was requested by local police departments.
State Rep. Mike Brown, D-Tahlequah, owner of NE OK Sign Co., said those provisions would hurt a lot of law-abiding citizens. In his community, a few elderly veterans supplement their income by scouring landfills looking for metal to sell. Those veterans would not be able to verify ownership of the metal, and so would lose that income source under the proposed law. State Rep. Ed Cannady, D-Whitefield, said he could not even verify ownership of the junk that has built up over several years in a ravine on his property. Brown said his employees are often called upon to tear out an old sign when they install a new sign. If the client has no use for the old materials, they will ask the workers to take the “junk” with them. Brown said he allows his employees to keep whatever materials they recover in this fashion. “They’ll save it up in buckets, and it adds up,” said Brown. “At the end of the year, the guys will haul it over to the dealer and sell it and they get to keep the money, kind of like a bonus.” That practice would be eliminated under the proposed law. Furthermore, in some old structures, the wiring is embedded in tar, and there is no way to remove the wiring without burning it free, said Brown. The wiring is worth less with the coating on, he added.

Committee member Rep. Wallace Collins, D-Norman, asked how the bill would be applied if the wiring was recovered from a structure that had sustained fire damage. Liebmann said that was a good question, which could be addressed in a conference committee.
Lobbyist Clayton Taylor told the committee the Oklahoma Recycling Association is open to discuss ways to verify the identity of metal sellers and their ownership of the items for sale, but the group is hoping to get some relief from the 10-day “tag and hold” requirements imposed last year.

Both Brown and Cale said they are very familiar with many of their customers, so the identification and documentation requirements may seem excessive. Often, the dealers’ familiarity with the community will help identify and catch copper thieves, said Cale.
“If a guy comes in here with this huge roll of industrial-gauge wire in the back of his pickup truck, that’s suspicious,” said Cale. “If I know the guy, and he’s an electrician that I know contracts with OG&E or somebody like that, that’s all right. Just recently, a local appliance store was robbed, and they called us and let us know what they were missing. A guy came in a few hours later trying to sell the stuff, so we called law enforcement and they caught the guy. That happens fairly frequently.”

A narrow majority of lawmakers on the committee voted to advance SB 1856, which will next be heard by the full House of Representatives. The bill was hobbled by having its title removed, ensuring further discussion on the measure before it can become law.


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