House File 2371 - Introduced HOUSE FILE 2371 BY GOSA A BILL FOR An Act relating to scrap metal transactions including 1 establishing an application and permit system to sell scrap 2 metal, and making penalties applicable. 3 BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF IOWA: 4 TLSB 5359YH (2) 91 as/ko

H.F. 2371 Section 1. Section 714.27, Code 2026, is amended to read as 1 follows: 2 714.27 Scrap metal transactions and reporting —— penalties. 3 1. For purposes of this section , and unless the context 4 otherwise requires, the following definitions shall apply: 5 a. “Scrap metal” means any metal suitable for reprocessing. 6 “Scrap metal” does not include a motor vehicle or a catalytic 7 converter detached from a motor vehicle. 8 b. “Scrap metal dealer” means any person operating a 9 business at a fixed or mobile location that is engaged in one 10 of the following activities: 11 (1) Buying, selling, procuring, collecting, gathering, 12 soliciting, or dealing in scrap metal. 13 (2) Operating, managing, or maintaining a scrap metal yard. 14 c. “Scrap metal yard” means any yard, plot, space, 15 enclosure, building, mobile facility, or other place where 16 scrap metal is collected, gathered together, stored, or kept 17 for shipment, sale, or transfer. 18 2. a. A person who is a resident of Iowa shall not sell 19 scrap metal to a scrap metal dealer in this state unless 20 the person provides to the scrap metal dealer, at or before 21 the time of sale, the person’s name, address, and place of 22 business, if any, and presents to the scrap metal dealer 23 a valid driver’s license or nonoperator’s identification 24 card, military identification card, passport, or other 25 government-issued photo identification the person has obtained 26 a permit to sell scrap metal from the sheriff of the county 27 in which the person resides. A person who is not a resident 28 of Iowa shall not sell scrap metal to a scrap metal dealer in 29 this state unless the person has obtained a permit to sell 30 scrap metal from a sheriff located anywhere in the state. 31 The sheriff shall issue a permit to the person if all of the 32 following apply: 33 (1) The person has not been convicted of a violation of this 34 section more than two times . 35 -1- LSB 5359YH (2) 91 as/ko 1/ 6

H.F. 2371 (2) The person declares on an application provided by the 1 sheriff that the person is informed of and will comply with 2 this section. 3 (3) The person pays a permit fee of not more than five 4 dollars. 5 b. A scrap metal dealer shall not make an initial purchase 6 of scrap metal from a person without demanding and receiving 7 the information required by this subsection . However, after an 8 initial transaction, a scrap metal dealer may only require the 9 person’s name and place of business for subsequent purchases, 10 provided the scrap metal dealer retains all information 11 received during the initial transaction The state patrol of the 12 department of public safety shall develop the application and 13 permit in consultation with county sheriffs and sheet metal 14 dealers. All sheriffs shall use the application and permit 15 developed by the state patrol . 16 c. A sheriff shall keep a record of all permits issued 17 containing, at a minimum, the date of issuance, the name and 18 address of the person or entity, a photocopy of the person’s 19 identification or of the entity’s employee’s identification, 20 and a photograph of the person or of the entity’s employee. 21 d. A permit is valid statewide and expires on the person’s 22 birth date on the second calendar year after the calendar 23 year in which the permit is issued, or, if the permittee is 24 an entity, the permit expires on the date of issuance on the 25 second calendar year after the calendar year in which the 26 permit was issued. 27 e. A sheriff may investigate a person’s or entity’s 28 background prior to issuing a permit for purposes of 29 determining if the person or entity qualifies to be issued a 30 permit. Notwithstanding paragraph “a” , a permit may be denied, 31 suspended, or revoked at any time if a sheriff discovers that 32 information on an application is inaccurate, the person or 33 entity fails to comply with this section, or the person or 34 entity is convicted of a violation of this section or section 35 -2- LSB 5359YH (2) 91 as/ko 2/ 6

H.F. 2371 716.11. 1 3. a. A person shall not sell scrap metal to a scrap metal 2 dealer in this state unless the person provides to the scrap 3 metal dealer, at or before the time of sale, the person’s name, 4 address, and place of business, if any, a valid permit to sell 5 scrap metal, and presents to the scrap metal dealer a valid 6 driver’s license or nonoperator’s identification card, military 7 identification card, passport, or other government-issued photo 8 identification. 9 b. A scrap metal dealer shall not make an initial purchase 10 of scrap metal from a person without receiving the information 11 required by this subsection. However, after an initial 12 transaction, a scrap metal dealer may only require the person’s 13 name and place of business for subsequent purchases. 14 3. 4. A scrap metal dealer shall keep a confidential 15 register or log of each transaction, including a record of 16 the information required by subsection 2 3 . All records 17 and information kept pursuant to this subsection shall be 18 retained for at least two years, and shall be provided to a 19 law enforcement agency or other officer or employee designated 20 by a county or city to enforce this section upon request 21 during normal business hours when the law enforcement agency 22 or designated officer or employee of a county or city has 23 reasonable grounds to request such information as part of 24 an investigation. A law enforcement agency or designated 25 officer or employee of a county or city shall preserve the 26 confidentiality of the information provided under this 27 subsection and shall not disclose it to a third party, except 28 as may be necessary in enforcement of this section or the 29 prosecution of a criminal violation. 30 4. 5. All scrap metal transactions, other than those 31 transactions exempt pursuant to subsection 5 6 , in which the 32 total sale price exceeds fifty dollars shall require payment by 33 check or electronic funds transfer. 34 5. 6. The following scrap metal transactions are exempt 35 -3- LSB 5359YH (2) 91 as/ko 3/ 6

H.F. 2371 from the requirements of this section : 1 a. Transactions in which the total sale price is fifty 2 dollars or less. 3 b. Transactions in which a scrap metal dealer is selling 4 scrap metal. 5 c. Transactions in which the person selling the scrap 6 metal is known to the scrap metal dealer purchasing the scrap 7 metal to be the officer, employee, or agent of an established 8 commercial or industrial business, operating from a fixed 9 location, that may reasonably be expected to produce scrap 10 metal during the operation of the business. 11 6. 7. a. The provisions of this section shall take 12 precedence over and supersede any local ordinance adopted by a 13 political subdivision that regulates scrap metal transactions. 14 b. Notwithstanding paragraph “a” of this subsection , a city 15 ordinance regarding scrap metal or other scrap material in 16 effect prior to January 1, 2012, in a city with a population 17 exceeding one hundred fifty thousand as shown by the 2010 18 federal decennial census may continue to be enforced by the 19 city which adopted it. 20 7. 8. A person who violates subsection 2 3 , paragraph “a” , 21 or a person who conducts a scrap metal transaction by or on 22 behalf of a scrap metal dealer who violates this section shall 23 be subject to a civil penalty as follows: 24 a. An initial violation shall subject the person to a civil 25 penalty in the amount of one hundred dollars. 26 b. A second violation within two years shall subject 27 the person to a civil penalty in the amount of five hundred 28 dollars. 29 c. A third or subsequent violation within two years shall 30 subject the person to a civil penalty in the amount of one 31 thousand dollars. 32 EXPLANATION 33 The inclusion of this explanation does not constitute agreement with 34 the explanation’s substance by the members of the general assembly. 35 -4- LSB 5359YH (2) 91 as/ko 4/ 6

H.F. 2371 This bill relates to scrap metal transactions including 1 establishing an application and permit system to sell scrap 2 metal. 3 The bill provides that a person who is a resident of Iowa 4 shall not sell scrap metal to a scrap metal dealer in this 5 state unless the person has obtained a permit to sell scrap 6 metal from the sheriff of the county in which the person 7 resides. A person who is not a resident of Iowa shall not sell 8 scrap metal to a scrap metal dealer in this state unless the 9 person has obtained a permit to sell scrap metal from a sheriff 10 located anywhere in the state. The sheriff shall issue a 11 permit to the person if all of the following apply: the person 12 has not been convicted of a violation of the bill more than two 13 times; the person declares on an application provided by the 14 sheriff that the person is informed of and will comply with the 15 provisions of the bill; and the person pays a permit fee of not 16 more than $5. 17 The bill directs the state patrol of the department of public 18 safety to develop the application and permit in consultation 19 with county sheriffs and sheet metal dealers, and requires all 20 sheriffs to use the application and permit developed by the 21 state patrol. A sheriff is required to keep a record of all 22 permits issued containing, at a minimum, the date of issuance, 23 the name and address of the person or entity, a photocopy 24 of the person’s identification or of the entity’s employee’s 25 identification, and a photograph of the person or of the 26 entity’s employee. 27 The bill provides that a permit is valid statewide and 28 expires on the person’s birth date on the second calendar year 29 after the calendar year in which the permit is issued, or, if 30 the permittee is an entity, the permit expires on the date of 31 issuance on the second calendar year after the calendar year 32 in which the permit was issued. A sheriff may investigate a 33 person’s or entity’s background prior to issuing a permit for 34 purposes of determining if the person or entity qualifies to be 35 -5- LSB 5359YH (2) 91 as/ko 5/ 6

H.F. 2371 issued a permit. A permit may be denied, suspended, or revoked 1 at any time if a sheriff discovers that information on an 2 application is inaccurate, the person or entity fails to comply 3 with the requirements of the bill, or the person or entity is 4 convicted of a violation of the bill or Code section 716.11. 5 The bill makes conforming changes related to renumbering. 6 -6- LSB 5359YH (2) 91 as/ko 6/ 6