HB2724

SECTION 1. The legislature finds property crimes, specifically theft and burglary, are increasing at an alarming rate in Hawaii. In many cases, property is stolen and then sold for cash, which is then used to purchase illegal drugs. Transactions with pawnbrokers and secondhand dealers frequently present an opportunity for thieves to convert stolen property into cash. However, records of pawn transactions are manually prepared and submitted to the police. By the time the police can review these reports, the property and the thief are usually long gone.

The legislature further finds that modernizing the reporting of pawnbroker and secondhand dealer transactions to law enforcement agencies may reduce the impact of property crimes. The use of an electronic system to record and report daily transactions would reduce the time required to transfer the information from a pawnshop or secondhand dealer to the police department. A daily electronic reporting system would allow police to inspect and track pawnshop and secondhand dealer transactions in a timely manner, which would likely result in faster recovery of stolen items and apprehension of criminals.

The purpose of this Act is to facilitate the timely reporting of pawnbroker and secondhand dealer transactions, on a pilot basis in the county of Maui, by creating a five-year pilot program for the daily electronic reporting of transactions by pawnbrokers and secondhand dealers.

SECTION 2. Section 486M-2, Hawaii Revised Statutes, is amended to read as follows:

"§486M-2 Record of transactions. (a) Every dealer, or the agent, employee, or representative of the dealer shall, immediately upon receipt of any article, record the following information[~~, on a form~~] in a manner authorized by the chief of police in each county:

(1) The name and address of the dealer;

(2) The name, residence address, date of birth, and the age of the person from whom the article was received;

(3) The date and time the article was received by the dealer;

(4) The signature of the person from whom the article was received;

(5) The Hawaii [[]driver's[]] license number, or if the person does not possess a Hawaii [[]driver's[]] license, the number of and description of any government issued identification [~~which~~] that bears a photograph of the person from whom the article was received;

(6) A complete and accurate description of the article received, including all markings, names, initials, and inscriptions;

(7) A reasonable estimate of the fineness and weights of the precious and semiprecious metals and precious and semiprecious gems received; and

(8) The price paid by the dealer for each article.

(b) Upon request and at the discretion of the chief of police of each county, copies of all completed forms required by this section shall be surrendered, mailed, or electronically inputted and transmitted [~~via modem or by facsimile transmittal~~] to the chief of police or to the chief of police's authorized representative. The method of submittal to the chief of police shall be at the option of the [~~dealer.~~] chief of police."

SECTION 3. (a) The Maui county police department shall implement a pilot program for the daily electronic reporting of pawnbroker and dealer transactions.

(b) The pilot program shall be implemented no later than July 1, 2021, and shall operate for a period of five years.

(1) Every dealer shall perform daily electronic reporting via the Internet or computer disk in a manner and using software as directed by the county chief of police; provided that a dealer may continue using existing software deemed by the county chief of police to be sufficient to meet the electronic reporting requirements of this section. The daily report shall include all property pledged, received, traded, bartered, bought, or otherwise acquired during the twenty-four hours ending at 8:00 p.m. on the date of the report;

(2) If a dealer discovers an error in the daily electronic report required under paragraph (1), the dealer shall immediately correct the error. A dealer shall be allowed at least thirty days to correct an error in the daily report discovered by the county police department, commencing upon the receipt of notice of the error from the police department;

(3) If a dealer experiences a computer malfunction relating to the daily electronic reporting requirements of this section, the dealer shall be allowed a period of at least fifteen days to repair the malfunction. During this period, the dealer shall not be deemed in violation of this section if the dealer has notified the county police department of the malfunction and is making a bona fide effort to repair the malfunction;

(4) A dealer shall not be responsible for a delay in submitting daily electronic reports under this section resulting from a malfunction of the reporting database;

(5) During the period needed to address a reporting error under paragraph (2), a computer malfunction under paragraph (3), or a database malfunction under paragraph (4), the dealer and the county chief of police shall arrange a mutually acceptable alternative method by which the dealer shall provide the reportable data to the county chief of police;

(6) Regardless of the cause of any technical problem preventing a dealer from uploading daily electronic reports under this section, upon correction of the problem, the dealer shall upload every reportable transaction from every business day beginning on the day of the first occurrence of the problem;

(7) The dealer, in lieu of electronic reporting under this section, may manually record the transaction and deliver the paper tickets for the transaction twice a week to the county chief of police:

(A) For pawn transactions of less than $20; or

(B) If the dealer is unable to afford a computer and the software deemed necessary by the chief of police of the applicable county; and

(8) An administrative fee of $1.50 may be charged to the dealer to offset the administrative costs of the electronic reporting system for each pawn transaction:

(A) Reported electronically under this section; and

(B) Of at least $20 reported manually under paragraph (7)(B).

(d) The Maui county police department shall submit reports of the department's findings and recommendations, including any proposed legislation and a recommendation on whether the pilot program should be extended, with or without modifications, as follows:

(1) A first interim report to the president of the senate and speaker of the house of representatives, submitted no later than twenty days prior to the convening of the regular session of 2023;

(2) A second interim report to the president of the senate and speaker of the house of representatives, submitted no later than twenty days prior to the convening of the regular session of 2025; and

(3) A final report to the legislature, submitted no later than twenty days prior to the convening of the regular session of 2027.

SECTION 4. There is appropriated out of the general revenues of the State of Hawaii the sum of $ or so much thereof as may be necessary for fiscal year 2020-2021 for implementation and operation of a pilot program for electronic reporting of pawnbroker and secondhand dealer transactions.

The sum appropriated shall be expended by the Maui county police department for the purposes of section 3 of this Act.

SECTION 5. Statutory material to be repealed is bracketed and stricken. New statutory material is underscored.

SECTION 6. This Act shall take effect on July 1, 2020.

INTRODUCED BY:	_____________________________

HOUSE OF REPRESENTATIVES	H.B. NO.	2724
THIRTIETH LEGISLATURE, 2020
STATE OF HAWAII