REVISED
SESSION OF 2019
SUPPLEMENTAL NOTE ON SUBSTITUTE FOR SENATE
BILL NO. 219
As Amended by Senate Committee of the Whole

Brief*
Sub. for SB 219, as amended, would amend the Scrap
Metal Theft Reduction Act (Act), as follows.
The bill would establish the Scrap Metal Data Repository
Fund (Fund) in the State Treasury, to be administered by the
Director of the Kansas Bureau of Investigation (KBI).
Expenditures from the Fund would be made in accordance
with appropriation acts upon warrants of the Director of
Accounts and Reports issued pursuant to vouchers approved
by the Director of the KBI or designee. Moneys credited to the
Fund would be expended for the administration of the duties,
functions, and operating expenses incurred under the
provisions of the Act. The Attorney General could transfer
moneys from the Scrap Metal Theft Reduction Fee Fund to
the Fund via procedures specified by the bill.
The bill would replace references to the Attorney
General with references to the KBI in provisions regarding the
scrap metal database, making the KBI responsible for
establishing and maintaining the database. Language would
be added allowing information from the database to be
provided to the Attorney General. The review deadline and
sunset date for a Kansas Open Records Act exception for the
information maintained in the database would be extended for
four years, until July 1, 2024. An outdated database report
requirement would be replaced with a requirement that the
Attorney General submit annual reports on or before
____________________
*Supplemental notes are prepared by the Legislative Research
Department and do not express legislative intent. The supplemental
note and fiscal note for this bill may be accessed on the Internet at
http://www.kslegislature.org
February 1, beginning in 2020, regarding the implementation,
administration, and enforcement of the Act. The report would
be submitted to the President of the Senate, the Speaker of
the House of Representatives, and the Senate and House
Committees on Judiciary.
The bill would add language prohibiting any entity
contracting with the Attorney General or the KBI to provide or
maintain the database from requiring a scrap metal dealer
(dealer) to contract with the entity for the authority to release
proprietary or confidential data, including customer
information. Such entities would be prohibited from charging
any fee to the dealer as a condition of providing information to
the database required by the Act, including an electronic
submission fee.
The bill would state that a dealer providing information to
the database as required by the Act shall not be subject to
civil liability for any claim arising from the negligence or
omission by the State of Kansas or any contracting entity in
the collection, storing, or release of information provided by
the dealer to the database.
Requirements in a statute related to information a seller
of regulated scrap metal must provide and the dealer’s
register of such information would be amended to require the
seller’s telephone number be provided and included in the
register; remove a requirement that a legible fingerprint be
obtained from a seller if the seller uses an official
governmental document for a country other than the United
States to meet certain requirements; allow a copy of a card or
document already in a dealer’s register to suffice for
subsequent transactions; remove civil penalties for failure to
comply with these requirements; and remove a provision
making these requirements unenforceable from June 1, 2017,
to January 1, 2020. A provision that the dealer forward the
information required by this statute to the database would be
amended to require such forwarding occur for each
transaction within 72 hours of the transaction.

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 In statutes regarding scrap metal dealer registration, the
bill would remove criminal history records check and
fingerprinting requirements for persons filing for registration.
Effective January 1, 2020, the bill would set the registration
and registration renewal fees at “not more than $500.” Under
current law, the registration fee is set at “not less than $500
nor more than $1,500” and the renewal fee is set at “not more
than $1,500.” The bill also would remove language making
some provisions of these statutes unenforceable from June 1,
2017, to January 1, 2020.

Background
The bill was introduced by the Senate Committee on
Ways and Means. As introduced, the bill would have created
an excise tax upon scrap metal dealers on the purchase of
scrap metal, transferred database responsibility from the
Attorney General to the KBI, and changed the registration
and renewal fees to not more than $750.
In the Senate Committee on Judiciary hearing,
representatives of the City of Wichita, Wichita Police
Department, Wichita Park and Recreation Department, and
Cox; a representative of the Kansas Association of Chiefs of
Police, Kansas Peace Officers Association, and Kansas
Sheriffs Association; and a representative of Kansas Electric
Cooperatives, also on behalf of Kansas Electric Power
Cooperative, Kansas Municipal Utilities, Liberty Utilities,
Midwest Energy, Sunflower Electric Power Corp., and
Westar/Kansas City Power and Light (Evergy), testified in
support of the bill. Representatives of Kansas Association of
Broadcasters; Kansas Cable Telecommunications
Association; Kansas Cooperative Council; Kansas Farm
Bureau; and a representative of Kansas Agribusiness
Retailers Association, Kansas Grain and Feed Association,
and Renew Kansas Biofuels Association provided written-only
testimony supporting the bill.


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 Representative Frownfelter, the Attorney General, the
Director of the KBI, and a representative of the Sedgwick
County District Attorney testified as neutral conferees.
Senator Tyson and representatives of scrap metal
dealers testified in opposition to the bill. Representatives of
scrap metal dealers provided written-only testimony opposing
the bill.
The Senate Committee amended the bill to remove the
excise tax provisions, adjust the seller information
requirements and effective date under current law, remove
the dealer fingerprinting and criminal history records check
requirements under current law, and change the dealer
registration and renewal fees to not more than $500. The
Senate Committee also recommended the amended contents
be placed into a substitute bill.
The Senate Committee of the Whole amended the bill to
restore and adjust the Attorney General’s reporting
requirement; remove “email address” from the additions to
the information a seller must provide; restore use of official
governmental documents from countries other than the
United States to meet some requirements; specify dealers
must forward the required information within 72 hours of each
transaction; extend the sunset date for the Kansas Open
Records Act exception; and add language prohibiting
contracting entities from requiring certain contracts or fees
from dealers and providing immunity to dealers for certain
civil liability related to database information.
[Note: The following fiscal note information does not
reflect the Senate Committee or Senate Committee of the
Whole amendments to the bill, including the removal of the
excise tax provisions and the change in the registration and
renewal fee amounts. An updated fiscal note was not
available at the time of Senate Committee of the Whole
action.]
According to the fiscal note prepared by the Division of
the Budget on the bill, as introduced, the Department of
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Revenue indicates that enactment of the bill would require a
total of $2,477,322 from the State General Fund in FY 2020
to implement the excise tax provisions in the bill and to
modify the automated tax system.
The Attorney General’s Office (Office) indicates that the
enactment of the bill would result in additional expenditures of
$99,293 from the State General Fund in FY 2020 for 1.00
Special Agent FTE position. The Office also states that
enactment of the bill would result in at least $65,220 in
revenue from scrap metal dealer registration fees, based on
the estimated 87 scrap metal dealers in the state ($750 x 87
scrap metal dealers). Enactment of the bill would also result
in additional revenue from the excise tax on scrap metal.
Additionally, the Office would make transfers from the Scrap
Metal Theft Reduction Fund to the Scrap Metal Data
Repository Fund under the KBI to support the cost of
administrating the repository. However, the additional revenue
from the excise tax and the amount of the subsequent
transfers to the KBI that would offset the costs of the
repository cannot be estimated.
The KBI indicates enactment of the bill would result in
additional expenditures of between $65,950 and $180,950
from the State General Fund in FY 2019 and between
$91,823 and $236,823 from the State General Fund in FY
2020. Of the FY 2019 amounts, $5,950 would be for one-time
costs for office supplies and computer equipment to prepare
an office for 1.00 Program Consultant FTE position, which
would be filled in FY 2020. The agency states it would need
to contract with a third party to build the database and it has
contacted two contracting providers for estimates. One
contracting provider indicated that initial costs in FY 2019
would be $60,000. The KBI states that there may be private
grant funding available through this provider. A second
contracting provider indicated it could provide a database in
FY 2019 for between $150,000 and $175,000 depending on
the number of scrap metal dealers in the database. Of the FY
2020 amounts, $61,823 would be for salaries and wages to
hire the program consultant and costs to support the

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database would range between $30,000 and $175,000
depending on which contracting provider is used. Any fiscal
effect associated with enactment of the bill is not reflected in
The FY 2020 Governor’s Budget Report.


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Statutes affected:
As introduced: 50-6, 45-229
Sub: 50-6, 45-229
{As Amended by Senate Committee of the Whole}: 50-6