Fiscal Note & Local Impact Statement

126 th General Assembly of Ohio

Ohio Legislative Service Commission

77 South High Street, 9th Floor, Columbus, OH 43215-6136 Phone: (614) 466-3615

Internet Web Site: http://www.lsc.state.oh.us/

BILL:

Sub. H.B. 150

DATE:

October 24, 2005

STATUS:

As Reported by House Commerce & Labor

SPONSOR:

Rep. Gibbs

LOCAL IMPACT STATEMENT REQUIRED:

No

Minimal cost

 


CONTENTS:

Requires a junk yard owner's license to be suspended if the owner fails to make required changes or improvements to the owner's junk yard and restricts the junk yard owner's activities during the suspension; increases the tax that may be imposed on an owner who does not make the required changes or improvements

 

State Fiscal Highlights

 

State FUND

FY 2006

FY 2007

FUTURE YEARS

General Revenue Fund

Revenues

Potential minimal gain from state court costs

Potential minimal gain from state court costs

Potential minimal gain from state court costs

Expenditures

- 0 -

- 0 -

- 0 -

Victims of Crime/Reparation Fund (Fund 402)

Revenues

Potential minimal gain from state court costs

Potential minimal gain from state court costs

Potential minimal gain from state court costs

Expenditures

- 0 -

- 0 -

- 0 -

Note: The state fiscal year is July 1 through June 30. For example, FY 2006 is July 1, 2005 June 30, 2006.

        New Penalty for Licensed Junk Yard Operators. This bill creates a new penalty. Namely, no licensed junk yard operator may accept junk for future resale during a suspension of the operator's license. Whoever violates this prohibition is guilty of a misdemeanor of the fourth degree. As a result, it is possible that some persons, who may not have been prosecuted and convicted under existing law, will be prosecuted and convicted. This creates the possibility that the state may gain locally collected court cost revenues that are deposited to the credit of the GRF and the Victims of Crime/Reparations Fund (Fund 402). It is uncertain how many cases will result from the penalty created by the bill, but it appears that the number is likely to be minimal.


Local Fiscal Highlights

 

LOCAL GOVERNMENT

FY 2006

FY 2007

FUTURE YEARS

Counties and Municipalities

Revenues

Potential minimal increase in revenue from fines and taxes

Potential minimal increase in revenue from fines and taxes

Potential minimal increase in revenue from fines and taxes

Expenditures

Potential minimal decrease due to more efficient enforcement; potential minimal increase in adjudication and administrative costs

Potential minimal decrease due to more efficient enforcement; potential minimal increase in adjudication and administrative costs

Potential minimal decrease due to more efficient enforcement; potential minimal increase in adjudication and administrative costs

Note: For most local governments, the fiscal year is the calendar year. The school district fiscal year is July 1 through June 30.

 

        Suspensions for Operators Out of Compliance. This bill requires the chief executive officer of the municipality or the county auditor to suspend the license of a junk yard owner for 90 days if the owner, after receiving a notice (under current law) to make changes and improvements necessary to conform to the Secondhand Dealers and Junk Yards Law, fails to make the required changes or improvements within the 60-day period specified in current law. This provision may result in a negligible increase in administrative costs to carry out the suspensions.

        License Revocation and Increased Penalty Taxes. At the end of the suspension, law enforcement personnel may make another inspection. If the required changes or improvements still have not been made, the chief executive officer of the municipality or the county auditor must revoke the owner's license. In addition to the revocation, the bill increases from $20 to $100 the tax that a delinquent owner is subject to for each day the violation persists. This provision may increase administrative expenses for counties and municipalities negligibly for any additional inspections that may need to be made. However, revenue to the counties and municipalities where the junk yards are located may also increase slightly from the increased daily tax amount on the owner.

        Local Criminal Justice Expenditures. Because this bill creates a new penalty, the bill could increase local criminal justice expenditures related to investigating, prosecuting, adjudicating, and sanctioning offenders who have violated the prohibition against licensees accepting junk for future resale during the 90 days in which a junk yard owner's license is suspended.

        Alternatively, the additional enforcement methods of license suspension and revocation may result in more efficiently processed cases, which could also minimally lower the costs of enforcement for counties and municipalities. Even so, the number of offenders affected would most likely be small, resulting in only minimal county or municipal justice system savings.

        The adjudication and administrative costs or any new revenues as a result of this bill could vary widely depending on the size of the county and the number of junk yards and secondhand dealers doing business in those counties.



 

Detailed Fiscal Analysis

 

Background

 

Current law requires county sheriffs to enforce permits issued to secondhand dealers and junk yards through the inspection of these facilities and the response to complaints. Currently, a violation of Chapter 4737. of the Revised Code would result in a civil action and a fine between $25 and $1,000 (please see the LSC Bill Analysis for details regarding the provisions in the Secondhand Dealers and Junk Yards Law). The Franklin County Municipal Court reported few, if any, charges related to the law governing junk yards and secondhand dealers in calendar year 2004. As of this writing, LSC fiscal staff has not gathered any evidence suggesting that the number of offenders of the Secondhand Dealers and Junk Yards Law that might be prosecuted as a result of the provisions of the bill will be very large.

 

State Fiscal Effects

 

This bill adds additional enforcement methods by which violators of the Secondhand Dealers and Junk Yards Law may be dealt with. These new methods include the suspension of a locally issued license for a noncompliant junk yard owner and subsequent revocation of the license if the remedies sought by local law enforcement are not provided. This bill also includes a new penalty for violations of the law governing junk yards and secondhand dealers. Specifically, no licensee may accept junk for future resale during the suspension. Whoever violates this prohibition is guilty of a misdemeanor of the fourth degree, which carries a maximum sentence of 30 days and a maximum fine of $250. This may minimally increase the state court cost revenue given to the GRF ($15 per case) and the Victims of Crime Reparation Fund ($9 per case). However, it is not certain how many more individuals would be prosecuted as a result of the bill. There would appear to be no new potential incarceration costs for the state as persons incarcerated as a result of convictions on misdemeanors of state statutes are typically housed in county jails.

 

Local Fiscal Effects

 

License Suspension and Increased Penalty

 

Current law requires semiannual inspections of junk yards by local law enforcement personnel. When these inspections reveal that the junk yard is not being managed in accordance with the requirements of the Secondhand Dealers and Junk Yards Law, the applicable local law enforcement personnel must immediately notify the junk yard owner of the particular deficiencies. The notice is sent to the owner by registered mail and describes the areas that are not in conformance with the law. A copy of the notice is also sent to the local officials in the area in which the junk yard is located. Current law also requires the junk yard owner to complete the modifications or improvements to the junk yard in 60 days. At the end of the 60-day period, the local law enforcement personnel must make a further inspection and if the changes have not been made, the owner of the junk yard is subject to a tax of $20 each day the violation persists.

 

This bill requires the chief executive officer of the municipality or the county auditor to suspend the license of a junk yard owner for 90 days if the owner, after receiving the notice under current law to make the necessary changes and improvements, fails to make the required changes or improvements within the 60-day period specified in current law.

 

At the end of the suspension, law enforcement personnel are to make another inspection. If the required changes or improvements still have not been made, the chief executive officer of the municipality or the county auditor must revoke the owner's license. In addition to the revocation, the bill increases the tax that a delinquent owner is subject to for each day the violation persists from $20 to $100. This provision may increase costs for counties and municipalities negligibly for any additional administrative costs to carry out any license suspensions and any additional inspections that may need to be made. However, revenue to the counties and municipalities the junk yard is located in may also increase slightly from the increased daily tax amount on the junk yard owner.

 

New Penalty

 

As noted above, this bill creates a new penalty. That is, no licensee may accept junk for future resale during the suspension. Whoever violates this prohibition is guilty of a misdemeanor of the fourth degree, which carries a maximum sentence of 30 days and a maximum fine of $250. As a result, some persons, who may not have been successfully prosecuted under existing law, could be prosecuted and sanctioned under this new penalty provision. This could in turn increase local criminal justice expenditures related to investigating, prosecuting, adjudicating, and sanctioning offenders who have violated the Secondhand Dealers and Junk Yards Law.

 

Any individuals charged with a first offense would most likely not be incarcerated since fourth degree misdemeanors typically do not result in jail stays, according to LSC fiscal analysts familiar with Ohio's criminal justice system. However, the severity of the sentence in a case involving a misdemeanor is entirely up to the judge's discretion, as several factors, such as available bed space in the jail, severity of the crime, the presence of a repeat offender, and the judge's attitudes about the crime in question, can influence the decision.

 

Alternatively, the additional enforcement methods of license suspension and revocation may result in more efficiently processed cases, which could also minimally lower the costs of enforcement for counties and municipalities. Even so, since the number of offenders affected would most likely be small, any county or municipal justice system savings are likely to be minimal.

 

Considering these factors, any increase in the annual operating costs of any given county or municipal criminal justice system seems unlikely to exceed minimal and could be offset or outweighed through efficiency gains in prosecuting and adjudicating these cases and the increased tax penalty revenue on a delinquent junk yard owner. However, it is also important to note that the adjudication and administrative costs or any new revenues as a result of this bill could vary widely depending on the size of the county and the number of junk yards and secondhand dealers doing business in those counties.

 

LSC fiscal staff: Jason Phillips, Budget Analyst

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