When I was in high school a good friend turned me on to a quirky radio program called “Swap Shop.”
The premise of the show was people calling in to buy, sell and trade hard-to-find items. A quick Internet search reveals the call-in show still exists on a radio station in Florida.
These days there’s a different kind of swap shop going on at scrap yards around the country. The resale of stolen metals – especially copper – to scrap yards and scrap dealers continues to escalate at alarming rates.
“It’s taken a life of its own,” Mokena, Ill.-based M. Cooper Supply’s Dennis Goode tells me. “We’re talking billions of dollars lost. The real numbers would be astronomical if we knew the true amount that has been stolen.”
Goode had metal totaling $10,000 stolen from his supply house. An additional $3,000 of his product was recovered from a Wisconsin scrap yard.
“There was just a story about $1.2 million worth of raw copper stolen out of a mill and transported to Long Beach (Calif.) to be put on a boat to go to China,” says Goode, who adds the pilfering even includes manhole covers.
“It’s out of hand. Copper is being stolen from electrical wiring in houses leading to some electrocution deaths because the power to the wiring is still on. At our place it was getting cut down and pushed through a hole in our fence.”
The good news is our industry is fighting back. Goode and other wholesalers are playing key roles along with American Supply Association Director of Government Affairs Dan Hilton in bringing about S. 3631, Metal Prevention Act of 2012. The legislation has the sponsorship of Sens. Amy Klobuchar, D-Minn., Lindsey Graham, R-S.C., and Chuck Schumer, D-N.Y.
If signed into law, the bill would make metal theft a federal offense, impose stricter documentation and recordkeeping requirements, put a cash payout limit of no more than $100 and make recommendations for federal sentencing guidelines.
This is the second time the bill has been introduced in Congress, Hilton says. With Congress recently beginning its new term, the legislation is expected to be reintroduced along with many other unaddressed bills from the previous session.
Hilton recalls meeting with two members of Congress about the bill and learning both had been victims of metal theft.
“Our next step is to educate other members of Congress, many who are brand new and unaware of this,” he explains. “Something like this requires constant education to move it forward. The bill is not controversial and it’s impacting the construction industry in general, as well as other stakeholders impacted by metal theft.”
Hilton doesn’t want to predict the future, but says the bill may have to tack on to larger bills, perhaps as an amendment. He notes the three sponsors are members of the Senate Judiciary Committee – where the bill goes.
“Much of the Affordable Care Act is a compilation of a number of previously introduced smaller bills,” he says. “It’s possible it needs to find something similar that serves as a vehicle to attach to. Tax reform probably will be the main thing for Congress along with immigration, but hopefully they can walk and chew gum at the same time and do a few things at once. We’re confident about this.”
To combat the problem at the local level, Goode suggests supply houses do perpetual cycle counts, keep vulnerable product away from main warehouse doors and be vigilant in reporting theft to local scrap recyclers.
Corrective action is happening at the state level. A new Illinois law went into effect Jan. 1 that strengthens record-keeping requirements for recyclable metal dealers and provides for increased penalties for sellers and dealers of stolen metal.
“If you steal 10,000 pounds of copper, that’s $50,000. Even the everyday stuff where a guy gets $200 here and $200 there, it adds up to hundreds of millions,” Goode says. “The price of copper has risen 400% in the last six or seven years. I know there are a lot of other problems in this country right now, but we have to stop the bleeding on this.”
We hope S.3631 will do just that.