Chapter 5.20
PAWNSHOPS, SECONDHAND STORES, AND SCRAP METAL BUSINESSES
Sections:
5.20.015 Scrap metal businesses.
5.20.040 Hosted home parties for precious metal sales.
5.20.050 Application for license issuance or renewal – Role of State Department of Revenue – Fees.
5.20.090 False reporting to pawnbroker or dealer.
5.20.100 Prohibited acts – Penalties for violation.
5.20.120 Minimum age requirement.
5.20.130 License denial, revocation, or suspension.
5.20.135 Compliance with state law required.
5.20.010 License required.
It is unlawful for any person, firm or corporation to engage in the business of pawnbroker, secondhand dealer, or secondhand precious metal dealer without obtaining the proper license pursuant to this chapter. (Ord. 2018-013 § 1 (Exh. A); Ord. 2011-006 § 1 (Exh. A); Ord. 369 § 1, 1978)
5.20.015 Scrap metal businesses.
For purposes of this section, RCW 19.290.010 through 19.290.090, 19.290.240, and 19.290.250, as enacted or amended, are adopted as though fully set forth here. Any person engaging in scrap metal business must comply with this section. Failure to comply may result in penalties as set forth in RCW 19.290.070 and 19.290.080. (Ord. 2018-013 § 1 (Exh. A))
5.20.020 Definitions.
Unless the context clearly requires otherwise, the definitions in this section apply throughout this chapter.
A
“Automated kiosk” means a self-serve interactive machine that purchases secondhand electronic devices.
G
“Garage sale” means patio sale, yard sale, or any similar sale of used or secondhand merchandise offered for sale to the general public. No one regularly engaging in the business of selling such items may conduct garage sales. Garage sales are only allowed in residential zones and must be hosted by a resident of the dwelling unit offering the items for sale. Residents of separate dwelling units may combine their sales at the premises of one dwelling unit for a combined sale.
L
“Loan period” means the period of time from the date the loan is made until the date the loan is paid off, the loan is in default, or the loan is refinanced and new loan documents are issued, including all grace or extension periods. [Source: RCW 19.60.010]
M
“Melted metals” means metals derived from metal junk or precious metals that have been reduced to a melted state from other than ore or ingots, which are produced from ore that has not previously been processed.
“Metal junk” means any metal that has previously been milled, shaped, stamped, or forged and that is no longer useful in its original form, except precious metals.
N
“Nonmetal junk” means any nonmetal, commonly discarded item that is worn out, or has outlasted its usefulness as intended in its original form, except “nonmetal junk” does not include an item made in a former period which has enhanced value because of its age.
P
“Pawnbroker” means every person engaged, in whole or in part, in the business of loaning money on the security of pledges of personal property, or deposits or conditional sales of personal property, or the purchase or sale of personal property, and who maintains a fixed place of business within the state.
“Precious metals” means gold, silver, and platinum.
S
“Secondhand dealer” means every person engaged in whole or in part in the business of purchasing, selling, trading, consignment selling, or otherwise transferring for value, secondhand property including metal junk, melted metals, and precious metals, whether or not the person maintains a fixed place of business within the state. “Secondhand dealer” also includes persons or entities conducting business at flea markets or swap meets more than three times per year. “Secondhand dealer” also includes persons or entities operating an automated kiosk. “Secondhand dealer” does not include a retail purchaser of goods from a secondhand dealer.
“Secondhand precious metal dealer” means any person or entity engaged in whole or in part in the commercial activity or business of purchasing, selling, trading, consignment selling, or otherwise transferring for value, more than three times per year, secondhand property that is a precious metal, whether or not the person or entity maintains a permanent or fixed place of business within the state, or engages in the business at flea markets or swap meets. The terms “precious metal” and “secondhand property,” for purposes of transactions by a secondhand precious metal dealer, do not include: (1) gold, silver, or platinum coins, or other precious metal coins, that are legal tender, or precious metal coins that have numismatic or precious metal value, (2) gold, silver, platinum, or other precious metal bullion, or (3) gold, silver, platinum, or other precious metal dust, flakes, or nuggets.
“Secondhand property” means any item of personal property offered for sale which is not new, including metals in any form, except postage stamps, coins that are legal tender, bullion in the form of fabricated hallmarked bars, used books, and clothing of a resale value of $75.00 or less, except furs.
T
“Transaction” means a pledge, or the purchase of, or consignment of, or the trade of any item of personal property by a pawnbroker or a secondhand dealer from a member of the general public. (Ord. 2018-013 § 1 (Exh. A); Ord. 2011-006 § 1 (Exh. A); Ord. 369 § 2, 1978)
5.20.025 Exemptions.
This chapter does not apply to the following:
A. Retailers that sell secondhand merchandise that the retailer did not pay to receive from, or offer to sell on consignment on behalf of, any individual;
B. Retailers that offer trade-in value for used items similar or identical to the item being purchased;
C. Retailers that are registered with the Secretary of State as a charitable organization that sell secondhand items received through donation;
D. Persons or groups conducting up to four garage-type sales within a calendar year. (Ord. 2018-013 § 1 (Exh. A))
5.20.030 Automated kiosks.
A secondhand dealer may use an automated kiosk to purchase secondhand property in the city of Sequim, if the automated kiosk complies with all requirements under RCW 19.60.020(1) and 19.60.105 as enacted or amended. (Ord. 2018-013 § 1 (Exh. A))
5.20.040 Hosted home parties for precious metal sales.
Any person or entity who hosts a precious metal sale at a private residence in the city of Sequim must comply with RCW 19.60.095 as enacted or amended. Any secondhand precious metal dealer who attends a hosted home party in the city of Sequim must comply with RCW 19.60.095 as enacted or amended. (Ord. 2018-013 § 1 (Exh. A); Ord. 2011-006 § 1 (Exh. A); Ord. 369 § 4, 1978)
5.20.050 Application for license issuance or renewal – Role of State Department of Revenue – Fees.
The city of Sequim participates in the Business Licensing Service operated through the Washington State Department of Revenue. See Chapter 5.04 SMC. All applications for issuance or renewal of any licenses required under this chapter must be made to and filed with the Business Licensing Service, which furnishes the forms, collects the applicable fees, establishes expiration dates, and provides renewal notices. The city finance department receives the applications for issuance or renewal from the Business Licensing Service and forwards a copy to the chief of police for purposes of monitoring the licensee’s compliance with this code and other local and state laws. (Ord. 2018-013 § 1 (Exh. A); Ord. 2011-006 § 1 (Exh. A); Ord. 369 § 5, 1978)
5.20.060 License fees.
Any license fees required under this chapter are established by resolution at the city’s discretion and collected by the Business Licensing Service of the Washington State Department of Revenue at the time of application. (Ord. 2018-013 § 1 (Exh. A); Ord. 2011-006 § 1 (Exh. A); Ord. 2005-029 § 2; Ord. 369 § 6, 1978)
5.20.070 Records required – Duty to record information regarding property other than precious metal property – Duty to record information regarding precious metal property.
A. Property Other Than Precious Metal. Before making any transaction involving nonprecious metal included within the activities described in this chapter, every pawnbroker, secondhand dealer, or secondhand precious metal dealer, or agent of such pawnbroker or dealer, must verify the identity of the customer by some bona fide means of identification. This information must be maintained in a book or other permanent record at their place of business, be legibly written in the English language at the time of each transaction, and consist of a record containing at a minimum all of the following:
1. The signature of the person with whom the transaction is made;
2. The time and date of the transaction;
3. The name of the person or employee or the identification number of the person or employee conducting the transaction, as required by the applicable chief of police or the county’s chief law enforcement officer;
4. The name, date of birth, sex, height, weight, race, and address and telephone number of the person with whom the transaction is made;
5. A complete description of the property pledged, bought, or consigned, including the brand name, serial number, model number or name, any initials or engraving, size, pattern, and color or stone or stones, and, in the case of firearms, the caliber, barrel length, type of action, and whether it is a pistol, rifle, or shotgun;
6. The price paid or the amount loaned;
7. The type and identifying number of identification used by the person with whom the transaction was made, which must consist of a valid driver’s license or identification card issued by any state or two pieces of identification issued by a governmental agency, one of which must be descriptive of the person identified. At all times, one piece of current government-issued picture identification will be required; and
8. The nature of the transaction, a number identifying the transaction, the store identification as designated by the applicable law enforcement agency, or the name and address of the business and the name of the person or employee conducting the transaction, and the location of the property.
This record must be open to inspection by law enforcement at all times during ordinary business hours or at reasonable times if ordinary business hours are not kept. This record must be maintained wherever that business is conducted, or at the principal place of business if the transaction occurred via automated kiosk, for three years following the date of the transaction.
B. Precious Metal Property. Every secondhand precious metal dealer must meet all requirements set forth in subsection A of this section for any transaction involving precious metal property bought or received from an individual. In addition, the record must contain a complete description of the precious metal property pledged, bought, or consigned, including the brand name, serial number, model number or name, any initials or engraving, size, pattern, and color of stone or stones. All records must be legibly written in the English language at the time and place of each transaction. The records required under this section must be open to inspection by law enforcement at all times during ordinary business hours or at reasonable times if ordinary business hours are not kept. This record must be maintained wherever that business is conducted for three years following the date of the transaction.
C. Altered or Defaced Serial Numbers. Any item where the manufacturer’s make, model, or serial number, personal identification number, or identifying marks engraved or etched upon an item of personal property have been defaced, changed, removed, altered, or obliterated in any manner cannot be accepted for loan, purchase, or consignment. Any person recording such item must immediately notify the city of Sequim police department pursuant to SMC 5.20.080(B). (Ord. 2018-013 § 1 (Exh. A); Ord. 2011-006 § 1 (Exh. A); Ord. 369 § 7, 1978)
5.20.080 Duty to report to law enforcement – Duties upon notification that property is reported stolen.
A. Every pawnbroker, secondhand dealer, and secondhand precious metal dealer must regularly provide the Sequim police chief or the chief’s designee a full, true and correct transcript of the record of all transaction details as set forth in RCW 19.60.020 and 19.60.025. Such transcript must be reported in the manner and at the intervals specified by the chief of police, which may include electronic transmission via a designated vendor acting as a clearinghouse for local or regional law enforcement.
B. Every pawnbroker, secondhand dealer, and secondhand precious metal dealer, who has good cause to believe that any property in their possession has been previously lost or stolen, must promptly report that fact to the applicable law enforcement officer, together with the name of the owner, if known, and the date when and the name of the person from whom it was received. (Ord. 2018-013 § 1 (Exh. A); Ord. 2011-006 § 1 (Exh. A); Ord. 369 § 8, 1978)
5.20.090 False reporting to pawnbroker or dealer.
Any person who supplies any false information or false identification to any pawnbroker, secondhand dealer, secondhand precious metal dealer, or employee or agent thereof is guilty of a misdemeanor. (Ord. 2018-013 § 1 (Exh. A); Ord. 2011-006 § 1 (Exh. A); Ord. 369 § 9, 1978)
5.20.100 Prohibited acts – Penalties for violation.
Any pawnbroker, secondhand dealer, secondhand precious metal dealer, or employee or agent thereof is prohibited from violating any provision of RCW 19.60.066 or 19.60.067, the penalties for which range from gross misdemeanor to Class C felony.
Pawnbrokers, secondhand dealers, and secondhand precious metal dealers are prohibited from purchasing personal property on the condition of selling it back at a stipulated time and price greater than the purchase price to avoid the interest and fee restrictions under Chapter 19.60 RCW. (Ord. 2018-013 § 1 (Exh. A); Ord. 2011-006 § 1 (Exh. A); Ord. 369 § 10, 1978)
5.20.110 Retention of property – Retention of precious metal property – Inspection by law enforcement.
Pawnbrokers, secondhand dealers, and secondhand precious metal dealers must fully comply with all provisions of RCW 19.60.050, 19.60.055 and 19.60.057 with respect to retention of property bought or received in pledge or on consignment and must allow inspection of such property by law enforcement officers as set forth in those statutes. (Ord. 2018-013 § 1 (Exh. A); Ord. 2011-006 § 1 (Exh. A); Ord. 369 § 11, 1978)
5.20.120 Minimum age requirement.
Pawnbrokers, secondhand dealers and secondhand precious metal dealers are prohibited from making transactions described under this chapter with any person under the age of 18 years. (Ord. 2018-013 § 1 (Exh. A); Ord. 2011-006 § 1 (Exh. A); Ord. 369 § 12, 1978)
5.20.130 License denial, revocation, or suspension.
A. Except for scrap metal business licenses, the city council has the authority to deny, suspend, or revoke any license granted under this chapter upon application by the chief of police. Scrap metal licensing is handled through the Washington State Department of Licensing.
B. Any appeal of a decision to deny, suspend, or revoke a license must follow the procedures set forth in SMC 5.04.140.
C. Causes for denial, suspension, or revocation of a license include but are not limited to the following:
1. Failure to present true and correct information upon the license application.
2. Failure to comply with reporting duties.
3. Conviction of the licensee or employee for dealing in or possessing stolen goods.
4. Any reason identified in SMC 5.04.130.
5. Failure to comply with this chapter. (Ord. 2018-013 § 1 (Exh. A); Ord. 2011-006 § 1 (Exh. A); Ord. 2001-014 § 2; Ord. 369 § 13, 1978)
5.20.135 Compliance with state law required.
Pawnbrokers, secondhand dealers, and secondhand precious metal dealers must comply with Chapter 19.60 RCW as now existing or as hereafter amended. In any case where the Sequim Municipal Code is more restrictive than Chapter 19.60 RCW, the provisions of the Sequim Municipal Code apply. [Source RCW 19.60.075]
Compliance with state law specifically includes compliance with all statutory and regulatory provisions regarding retention of property, inspection of property by law enforcement, allowable interest rates and fees, process for sales of pledged property, and written documentation of transactions. (Ord. 2018-013 § 1 (Exh. A); Ord. 2011-006 § 1 (Exh. A))
5.20.140 Violation.
Violation of this chapter is subject to the penalties and provisions as set forth in Chapter 1.13 SMC – Code Enforcement. (Ord. 2019-013 (Exh. B); Ord. 2011-006 § 1 (Exh. A); Ord. 369 § 14, 1978)