Scrap industry backs regulation of oft-stolen items

Years into a scrap-metal boom that drives theft in cities across the country, the industry is backing Indiana legislation that could curb illegal activity involving two of the most frequently targeted items.

A Senate committee on Tuesday approved House Bill 1441, which would make it illegal to sell air-conditioner coils or catalytic converters without proof of ownership.

“We’re looking for a statewide solution to this,” said Ben Eisbart, vice president of compliance at Fort Wayne-based Steel Dynamics, the owner of OmniSource recycling. OmniSource has 15 scrap yards throughout Indiana, including four in Indianapolis.

OmniSource and the Institute of Scrap Recycling Industries have supported similar legislation in other states, most recently Florida, Eisbart said.

Indianapolis officials who wanted to tighten the city’s scrap-metal ordinance were negotiating with recycling-industry lobbyists last year when both sides agreed to drop the effort in favor of a statewide approach. Reps. Jud McMillan, R-Brookville, and Justin Moed, D-Indianapolis, authored the bill.

The bill is tailored to affect street-level fencing operations. A person won’t be able to sell a catalytic converter without proof of ownership of the parent vehicle. Similarly, one won't be able to sell an air-conditioner coil without the original receipt from the unit, or the receipt from a replacement unit. Window air-conditioner units wouldn’t require documentation.

The proposed law is unlikely to inconvenience the average citizen, Eisbart said.

“How many people clean out their garage and have 20 catalytic converters?” he asked.

Depending on the amount of precious metal inside, a catalytic converter may net $35 to $65 at a scrap yard, said Joel Squadrito, director of security at Steel Dynamics. Air-conditioners are also an easy target, but their internal components are worth even less — $25 to $50, he said. OmniSource doesn't buy either item because of the association with theft, but there are dozens of scrap yards in the state that do. 

There are 33 scrap yards in Marion County, Deputy Prosecutor Jennifer Jones said, and when thieves can't unload their goods in Indianapolis, they often head to Edinburgh or Franklin.

The bill exempts business people who deal scrap in the normal course of work, including auto-parts salvagers. The state already regulates auto salvagers, Moed said. In general, he said, “we didn’t want to limit business-to-business transactions.”

State law already requires scrap yards to photograph the materials they buy and the seller, and retain the records.

Back in 2008, Indianapolis police received reports of about $1 million a month in stolen metals, and at least one catalytic converter was stolen a day, Jones said.

The problem hasn't abated, Indianapolis City-County Councilor Jeff Miller said. Attending a meeting in the Fountain Square neighborhood Monday, Miller said residents talked about the theft of both an air-conditioner coil and a catalytic converter. "So it really is real," he said.

Although some rural senators expressed concerns that the bill would make it difficult for farmers to scrap vehicles left on their property, the bill passed the committee on a 6-1 vote.