Travis Bastien, right, weighs items brought in by Mark Dennis of Detroit at Winston Brothers Iron and Metal. The state House passed rules that include waiting periods for payment, among other measures. (Max Ortiz / The Detroit News)
Michigan lawmakers are scrapping to find a consensus to combat an epidemic of precious metals theft, a situation that frustrates law enforcement officials, victims and area recycling yards.
At the center of the controversy is a behind-the-scenes battle over establishing more regulations and waiting periods before a scrap metal sale can be completed.
One side contends businesses are reluctant to agree to a waiting period for fear of giving up a revenue stream that is based in part on stolen property. Others argue that proposals could entangle legitimate commerce in governmental intervention and there are more effective, less-intrusive ways to fight illegal practices.
As the debate continues in Lansing, stories about metal theft prevail.
The Haskell Youth Center, for example, goes by the motto “We Exist Because We Agree to Co-exist” — a tough message for administrators to preach after the events of last spring. Surveillance camera footage from the early morning hours of May 13 showed three men with a ladder making off in the dark with parts stolen from the building’s four air-conditioning units.
Haskell, in northwest Flint, runs on a shoestring budget and was hardly in a position to deal with the $60,000-plus cost of replacing the damaged units.
“It’s telling about the morals of the people who did this,” said Jesse Carpenter, who runs programs for the Police Activities League. “They’re stealing from children, because that’s who we serve here. If you’re willing to do that, then you’re lower than anyone I know.”
The scrap metal issue was mentioned briefly Thursday by Gov. Rick Snyder in his State of the State address.
He urged the passage of legislation to attack the problem without specifying support for a particular strategy.
Late last year, the state House approved a scrapping crackdown measure in a 98-9 vote.
But the momentum slowed when the bill reached the Senate because it contains a three-day waiting period for payment on certain items, a provision opposed by the recycling/scrap metal industry.
Sara Wurfel, a spokeswoman for the governor, said Snyder addressed the issue “simply because he believes that this is a problem that must be resolved to help ensure public safety, fight blight and protect our homeowners, farmers and businesses from losing hard-earned money.”
Guilt by association
Phil Garelik has his own views of the metal theft issue. He’s been in the business since 1969 in one job or another. He has waited on company executives, murderers, rapists and child molesters. He was even shot in 1980 by thieves while working at a Detroit scrapyard owned by his father-in-law.
Garelik says there are good people in scrapping, but is concerned because the epidemic of thefts has hurt everyone in the business: guilt by association.
These days he works at the Winston Brothers Iron and Metal Co., an 80-year-old Detroit firm that collected scrap and recyclable material long before metal prices soared and made stealing lucrative. Trying to make sure everything the company agrees to buy is legitimate can be “overwhelming,” he said.
“The police don’t want us doing police work,” he said. “But that’s essentially what we’re asked to do.
“People come in here — legitimate customers — who want to get a few bucks in cash. All of these new restraints and all of this ID checking, it’s becoming Big Brother.”
The controversy is epitomized in a disagreement between two Democratic legislators representing Detroit, one of the hardest-hit areas in the nation for precious metal thefts. On opposite sides of the issue are term-limited state Rep. Rashida Tlaib and state Sen. Virgil Smith, who are squaring off in this summer’s primary election for the 4th District seat in the state Senate.
The House bill’s proponents want to give underfunded and undermanned police departments a three-day window to track the most oft-stolen items: copper wire, catalytic converters and air-conditioning condensers. It would give investigators three extra days to check complaints with local scrap yards about allegedly stolen material and the identity of those who robbed it.
“Oregon and other states have seen a significant decline in scrap metal theft with the waiting period,” said Tlaib, who has spent several years pushing metal theft legislation. “Thieves don’t want to have to come back for payment.”
Smith argues the waiting period is unnecessary, adding that extra measures in the Senate bill could prove just as effective. Those measures include the creation of an industrywide database that would store information from every transaction, including seller identification data, as well as a requirement that copper wire, catalytic converters and AC condensers sold to scrap yards be held for seven days before being moved off-site.
“I would argue that what’s come out of the Senate is a good compromise to what came from the House,” Smith said. The proposed payment delay, he added, would not likely have made it out of committee in the Senate.
The scrap metal industry has kicked its lobbying campaign into high gear since the legislation moved to the Senate. It had recycling operations from each district contact their senators to protest the House bill in what Smith describes as “fighting tooth and nail” to defeat the measure.
Roger Simon, who serves on the executive board of the Institute of Scrap Recycling Industry’s Michigan chapter, said the waiting period is a “nuisance” that would force customers to return a second time to get full payment. He argued delayed payments create accounting problems for scrap operators and, in the end, may not provide any benefit.
“We don’t see how it helps the situation,” Simon said. “We don’t see it as a deterrent to metal theft.”
Others see the industry’s opposition to a payment delay as indefensible. Andrew Arena, director of the Detroit Crime Commission, said a waiting period gives law enforcement a “fighting chance” at arresting metal thieves.
“I think there are certain people in the industry trying to create a scenario with plausible deniability where they can continue to deal in property that has been stolen,” said Arena, a former FBI agent. “I think that’s the truth.”