Please Note: Amendments by 2015 Michigan SB 304 clarifying the payment restrictions on Special Payment Items are included and noted in this summary. This summary does not include the Secondhand Dealers and Junk Dealers Act (MCL 445.401 et seq.), which specifically excludes a scrap processor, automotive recycler or a junkyard that deals principally in industrial scrap and is so licensed by the local unit of government.
"Scrap Metal" means:
"Ferrous Metal" means a metal that contains significant quantities of iron or steel.
"Nonferrous Metal" means a metal that does not contain significant quantities of Ferrous Metal but contains copper, brass, platinum group-based metals, aluminum, bronze, lead, zinc, nickel, or alloys of those metals.
"Public Fixture" means an item that contains ferrous or nonferrous metal and is owned or under the exclusive control of a governmental unit. The term includes, but is not limited to, a street light pole or fixture, road or bridge guardrail, traffic sign, traffic light signal, or historical marker.
Restricted Property, as used in this summary, means the following items as listed in MCL 445.430:
Special Payment Items, as used in this summary, means the following items as listed in MCL 445.426. Section 6(1):
Catalytic converters, unless the Seller is:
The following items are covered by the Purchase Restrictions - Section 9 provision as listed in MCL 445.429, Section 9(4):
"First Purchaser" means the first buyer of a manufactured item that contains ferrous or nonferrous metal in a retail or business-to-business transaction. A person that purchases Scrap Metal or Restricted Property in violation of this act, or an automotive recycler, pawnshop, Scrap Metal Recycler, or Scrap Processor is not considered a first purchaser.
"Seller" means a person that either regularly, sporadically, or on a 1-time basis receives consideration from any other person from the purchase by a scrap metal dealer of scrap metal offered by that seller.
"Industrial or Commercial Customer" means a person that operates from a fixed location and is a seller of scrap metal to a scrap metal dealer under a written agreement that provides for regular or periodic sale, delivery, purchase, or receiving of scrap metal.
"Governmental Unit" means a subdivision, agency, department, county, parish, municipality, or other unit of the government of the United States, this state, another state, or a foreign country.
"Scrap Metal Dealer" (referred to in this summary as Dealer) means a person or governmental unit that buys scrap metal and is not a first purchaser. The term includes, but is not limited to, a person, whether or not licensed under state law or local ordinance, that operates a business as a Scrap Metal Recycler, Scrap Processor, secondhand and junk dealer, or other person that purchases any amount of scrap metal on a regular, sporadic, or 1-time basis.
"Scrap Metal Recycler" means a person that purchases ferrous or nonferrous metal that is intended for recycling or reuse, whether regarded as a Scrap Processor, core buyer, or other similar business operation.
"Scrap Processor" is as defined in MCL 445.403, means a person, utilizing machinery and equipment and operating from a fixed location, whose principal business is the processing and manufacturing of iron, steel, nonferrous metals, paper, plastic, or glass, into prepared grades of products suitable for consumption by recycling mills, foundries, and other Scrap Processors.
"Scale Operator" means the employee of a Scrap Metal Dealer who operates or attends a scale that is used to weigh the scrap metal in a purchase transaction.
"Record" means a paper, electronic, or other generally accepted method of storing information in a retrievable form.
"Purchase Transaction" means a purchase of Scrap Metal, or the purchase of Restricted Property if the knowing purchase of or offer to purchase that Restricted Property is not prohibited, by a Scrap Metal Dealer. The term does not include any of the following:
Used or secondhand, distressed, or salvage vehicle or vehicle parts by:
In a Purchase Transaction, a Seller who is an individual or an individual acting as an agent or representative of a Seller must:
A Dealer must prepare and maintain a separate, accurate, and legible record of each Purchase Transaction. A Dealer may use an electronic record-keeping system if it allows immediate access to each Seller's purchase transaction activities, documents, and images, including record information, images of the payment if required by the Payment Restriction provision, and payment information contained within an electronic payment card or encrypted receipt if such a method is used to pay the Seller
A Purchase Transaction record must contain the following information:
The following information from the Seller, and the deliverer if the deliverer is not the Seller, which may be retained in a separate file and used for future transactions:
A photograph or digital, electronic, or video image of the Scrap Metal purchased that meets one of the following, even if each item of Scrap Metal is not shown:
If required by the Payment Restrictions provision, the photo, or digital or electronic image, of the Seller receiving payment by one of the following methods:
A Dealer is not required to prepare a record for a Purchase Transaction with an Industrial or Commercial Customer that meets all of the following:
Records must be retained for at least 1 year in a location readily accessible for inspection.
A Seller's thumbprint may be used only for identification purposes by the Dealer and investigation purposes by a law enforcement agency.
A local, state, or federal law enforcement agency, or railroad police in investigation of stolen railroad property, may inspect a Dealer's transaction records during normal business hours. The Dealer shall make the records, or copies of the records, available on request to any local, state, or federal law enforcement agency.
7 calendar day hold on any article containing Nonferrous Metal if the following apply:
The deliverer does not have a written receipt or Documentation and:
Exempts articles that have been tagged and held by a Dealer or that were not initially subject to tag and hold if resold directly to another Dealer.
MCL 445.429 (Section 9) includes restrictions that are similar to the requirements of the Restricted Property provision, but are listed and penalized separately in the law.
Unless the Seller has specific written Documentation that the Seller is the owner, agent, or person with authority to possess and sell the following, a Seller shall not sell or offer for sale and a nonferrous Dealer shall not purchase any of the following:
A person shall not knowingly sell or attempt to sell to a Dealer, and a Dealer shall not knowingly purchase or offer to purchase the following:
A commemorative, decorative, or other cemetery-related or apparently ceremonial article, unless:
Metal articles or materials removed from property owned by a railroad company or from a railroad right-of-way, unless the Seller is:
A silver alloy telecommunication battery with a threaded insert terminal connection (not including a battery used in auto or mobile equipment), unless the Seller is:
For Purchase Transactions with Industrial or Commercial Customers, a Dealer must use one of the following payment methods, as agreed to by the Dealer and Customer:
By one of the following methods; if the payment is mailed, the Dealer may mail the payment to the street address or post office box as directed by the Customer:
For Purchase Transactions with Sellers that are not Industrial or Commercial Customers and that do not involve Special Payment Items, a Dealer must pay by:
An electronic payment card or encrypted receipt that may only be converted to cash in an ATM that is:
For Purchase Transactions involving Special Payment Items, if the purchase price for the transaction is less than $25, or if the total purchase price for all of a Seller’s purchase transactions involving Special Payment Items in a business day is less than $25, a Dealer must pay by:
If the purchase price for the transaction involving Special Payment Items is $25 or more, or if the total purchase price for all of a Seller’s purchase transactions for Special Payment Items in a business day is $25 or more, for those Special Payment Items only payment must be made by mailing one of the following to the Seller at the address shown on the ID card presented for the record (italicized text clarifying payment restriction added by SB 304):
Representatives of the scrap metal industry may, in consultation with the Dept. of State Police, develop or contract for the development of a web-based electronic database of Special Payment Item transactions. If selected by the State Police, the scrap metal representatives may implement, operate, and maintain the database. The database must:
Allow a Dealer to report all of the following information concerning the purchase of 1 or more Special Payment Items by noon of the next business day:
If one or more databases are developed, the State Police shall notify each group of companies whether the features of their database meet the above requirements. The State Police shall select a single shared electronic database that meets the above requirements for implementation and operation. A person objecting to the selection may file a petition with the State Police that describes the basis of their objection; the State Police shall provide them with an administrative hearing, conducted as a contested case under the Administrative Procedures Act of 1969, 1969 PA 306, MCL 24.201 to 24.328.
If the database is implemented, beginning no later than 30 days after the database is determined in operation by the State Police and after the State Police publishes notice that the database is implemented and operational, a Dealer shall:
A Dealer shall register with or subscribe to, maintain that registration or subscription, and use in the conduct of its business, an internet-based database available to Dealers, law enforcement agencies, and the general public that lists and tracks, at a minimum, thefts of Scrap Metal. The database may be reasonably limited in terms of time and geographical area. ISRI's ScrapTheftAlert.com is considered appropriate; a Dealer may register with or subscribe to any other database that provides substantially the same services.
A Dealer must make each theft alert or similar notice available to each employee engaged in purchasing or weighing Scrap Metal sold or offered for sale to the Dealer, and ensure those employees review on a daily basis any recent alerts or notices that they have not previously reviewed.
By July 1, 2016, the State Police shall provide a written report to the governor, the speaker of the house, and the senate majority leader on the effectiveness of the amendments made by 2013 Michigan HB 4593 in reducing Scrap Metal theft and assisting in the investigation and prosecution of Scrap Metal theft, as well as any recommendations for further legislative action.
An individual that has been convicted of a crime involving the theft, the conversion, or the sale of Scrap Metal may not enter into a Purchase Transaction.
A person who violates the Recordkeeping, Retention, Information Confidentiality, Inspection, Tag and Hold, or Purchase Restrictions - Section 9 provisions, and knows or should have known they have violated the provisions, is guilty of a misdemeanor punishable by a fine of up to $500 and/or imprisonment for up to 93 days. If a violation of the Recordkeeping provision is the result of a malfunction of an electronic recordkeeping system, it is an affirmative defense that the Dealer diligently pursued repair of the system after the malfunction occurred, and implemented and maintained a manual recordkeeping system for Purchase Transactions that occurred while the electronic system was malfunctioning.
A Dealer that purchases Scrap Metal or Restricted Items and knew or should have known that it was stolen, or a person who sells Scrap Metal or Restricted Items to a Dealer and knew or should have known that it was stolen, is guilty of a felony punishable by:
A person that violates this act knowing or having reason to know that the person is violating this act is responsible for a state civil infraction and may be ordered to pay a civil fine of not more than $5,000.
If a Special Payment Items Reporting Database is implemented, a Dealer that knowing fails to register with and report to the database is responsible for a state civil infraction and shall pay a civil fine of $500 for the first violation, $1,000 for a second violation, and $5,000 for a third or subsequent violation.
A person may bring a private cause of action against a Seller or a Dealer, in a court of competent jurisdiction, for monetary damages suffered from violation of this act. If the court finds the violation included the purchase or sale of stolen property and the Dealer in an action against the Dealer, or the Seller in an action against the Seller, knew or should have known the property was stolen, the court shall award treble damages for the value of the property stolen, meaning the greatest of the replacement cost of the stolen property, the cost of repairing damage caused by the larceny, or the total of the replacement and repairs costs. The court may also aware costs and reasonable attorney fees.
The remedies under this act are cumulative and do not affect the ability or right of any other person, local governmental unit, or state or federal governing unit to bring any action under this or any other civil, criminal, or regulatory act or ordinance that is otherwise not prohibited by law.
This act does not exempt or release any person from obtaining and maintaining a license under, or complying with any strictures contained in, any other act or ordinance.
Under MCL 750.356, for a person who commits larceny by stealing Scrap Metal, the value of the property stolen will be determined as the greatest of the replacement cost of the stolen property, the cost of repairing damage caused by the larceny, or the total of the replacement and repairs costs.
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This summary of State Metals Theft Laws is being viewed on this website under license and is owned and copyrighted by Institute of Scrap Recycling Industries, Inc. ("ISRI"),1615 L Street, N.W., Suite 600, Washington, DC 20036.