This amendment deletes the main body of Senate Substitute #1 for Senate Bill 300 and in lieu thereof creates a new Task Force for the development and implementation of Best Practice Guidelines for Delaware Federal Firearms Licensees (FFLs).

Legislation Document

SPONSOR:

Rep. Spiegelman

HOUSE OF REPRESENTATIVES

153rd GENERAL ASSEMBLY

HOUSE AMENDMENT NO. 1

TO

SENATE SUBSTITUTE NO. 1

FOR

SENATE BILL NO. 300

WHEREAS, the United States federal government first began regulating firearms with the passage of the National Firearms Act of 1934, focusing in this initial federal law on the ownership, regulation, and taxation of what we know today as “NFA Weapons” such as machine guns short-barreled rifles and shotguns. Delaware also regulates these firearms terming them “destructive weapons” and prohibiting their possession and use.

See 11 Del. C. § 1444

; and

WHEREAS, in 1938, the United States federal government added to the Federal Firearms Act of 1934 by adopting the Federal Firearms Act of 1938 wherein for the first time persons and businesses selling firearms were required to obtain federal licenses to do so and were designated as FFLs (Federal Firearms Licensees) falling under jurisdiction of the Department of the Treasury. It was under this Act that for the first time it became a federal offense to sell, give, or transfer a firearm to a “prohibited person.” Delaware also requires the licensing of deadly weapons dealers, see 24 Del. C. §§ 901 et seq., and also prohibits the possession by and transfer of firearms and deadly weapons to prohibited persons. (

See also, 11 Del. C. §§1448, 1454);

and

WHEREAS, in 1968 the United States Congress passed the 1968 Gun Control Act which repealed much of the 1938 Federal Firearms Act but incorporating therein much of the operative language from the 1938 Act pertaining to licensing and the lawful and unlawful possession of firearms. It is the 1968 Act under which the modern federal Bureau of Alcohol, Tobacco, Firearms and Explosives (ATF) regulates and polices the sale, manufacturing, and possession of firearms in everyday interstate commerce; and

WHEREAS, Congress has given the ATF broad regulatory authority over all aspects of the interstate commerce in arms, including and especially the local gun dealer known as an FFL (Federal Firearms Licensee); and

WHEREAS, included in the authority of the ATF is the licensing authority as set forth in 27 CFR Ch. II, Part 478 Subpart D §§ 478.41-487.60 and Due Process procedures for licensees (FFLs) as set forth in 27 CFR Ch. II, Part 478, Subpart E, §§ 487.71-478.78, inclusive; and

WHEREAS, ATF has further exercised its regulatory authority by implementing a robust recordkeeping requirement for FFLs as set forth in 27 CFR Ch. II, Part 478, Subpart H §§ 478.121-134; and

WHEREAS, the ATF routinely conducts firearms traces for federal, state and local law enforcement agencies in Delaware; and

WHEREAS, ATF employs “Agents” to conduct criminal investigations and “Industry Operations Inspectors (IOIs) to conduct inspections on individual FFLs and their businesses; and

WHEREAS, according to the ATF website, ATF Industry Operations Inspectors (IOIs) generally conduct unannounced inspections which include not just the FFL’s shop but also any off-site storage areas. During these inspections the IOI will:

“Review business operations including ownership and responsible person information;

“Evaluate the license’s internal controls and security measures;

“Verify that licensee is in compliance with state and local laws;

“Conduct a complete physical inventory of firearms;

“Review the acquisition & disposition (A&D) record, also known as the

bound book;

Review ATF forms, including

Forms 44 73;

“Suggest voluntary action or steps the licensee can take to improve compliance.” (Empasis and abbreviation in original)

See, ATF.gov/firearms/tools-and-services-firearms-industry/current-licensees/compliance-inspections. ; and

WHEREAS, federal law, 18 USC § 922, requires all FFLs to conduct a federal background check on each and every purchaser, known as a NICS check (Nationals Instant Check System). NICS is run by the Federal Bureau of Investigation (FBI); and

WHEREAS, Delaware law also requires that FFLs conduct NICS checks.

See 11 Del. C. §§1448A, 1448B, 1448D

; and

WHEREAS, Delaware law also requires “deadly weapons dealers” to be licensed (24 Del. C. § 901), to keep records (24 Del. C. § 904) and to conduct background checks (24 Del. C. § 904A).

(See also 11 Del. C. §§1448A,1448B, 1448D)

; and

WHEREAS, in an effort to prevent prohibited persons from obtaining firearms by means of an intermediary otherwise known as a “straw purchaser,” Congress adopted a law prohibiting such transactions. 18 USC § 932 makes straw purchasing of a firearm on behalf of another a felony punishable by fine not to exceed $250,000 and imprisonment not to exceed 15 years. In the event the straw purchase results in the firearm being used in a felony, a drug trafficking crime or an act of terrorism, the term of imprisonment may be as much as 25 years in a federal prison. Delaware has also adopted laws making straw purchases criminal acts. (See 11 Del. C. §§ 1455, 1454, 1448A(g)); and

WHEREAS, ATF provides to all licensees (FFLs) the

Federal Firearms Licensee Quick Guide and Best Practices Guide

which can be accessed by going to

atf.gov.firearms/tools-and-services-firearms-industry/current-licensees/federal-firearms-licensee-quick -reference-and-best-practices-guide.

ATF also provides information to FFLs concerning safety and security in its ATF Publication 3317.2

“Safety and Security Information for Federal Firearms Licensees;”

and

WHEREAS, the National Shooting Sports Foundation (NSSF) is the Firearms Industry Trade Association representing all aspects of the firearms industry including local stocking dealers known as “Class I FFLs” and which the general public generally recognizes as their “local retail gun dealer.” NSSF is well known for its program designed to fight straw purchases which is known and trademarked as

“Don’t Lie for the Other Guy.”

Additionally, NSSF provides best practices guides including one specifically designed for retailers known as

“Retailer Compliance Resources.”

See,

nssf.org/firearm-industry-compliance-resources/#ffl.

; and

WHEREAS, The Delaware Association of Federal Firearms Licensees (DAFFL) is an association of local FFLs who are dedicated to ensuring that best practices are identified and employed by local FFLs and that member FFLs understand the law and follow the law. DAFFL is currently in the process of developing “best practices” to assist its members; and

WHEREAS, the Delaware State Sportsmen’s Association (DSSA) is a Delaware non-stock, non-profit members organization representing the law-abiding gun-owning citizens of Delaware and advocating for the enforcement of all laws that protect Delaware’s citizens. Included among DSSA’s membership are a number of FFLs. DSSA, like DAFFL and NSSF, has a vested interest in preventing straw purchases and in keeping firearms out of the hands of legally prohibited persons; and

WHEREAS, the current Fiscal Note for Senate Substitute No. 1 for Senate Bill 300 is set at $4,899,488.00 over three years; and

WHEREAS, the overwhelming majority of the regulatory, record keeping and security mandates contained in SS#1 for SB 300 duplicate current federal law and the ongoing efforts of the ATF and serves no useful law enforcement purpose; and

WHEREAS, the inherent additional cost that will be borne by each of the individual Delaware FFLs for the duplicative requirements already being performed pursuant to federal ATF regulation as the result of SS#1 for SB 300 will be catastrophic and will result in many of the smaller operators going out of business entirely. The DAFFL estimates that as many as 50% of Delaware’s currently licensed FFLs will be forced out of business within the first twelve (12) months SS#1 for SB 300 is in effect, thus depriving the State of the gross receipt and income taxes that might otherwise have flowed from those heretofore profitable businesses; and

WHEREAS, a provision similar to SS#1 for SB300 was adopted by the State of Illinois. It has been reported that within a year of enactment of that provision, which was also largely duplicative of the ATF regulations and existing federal law, ultimately resulted in approximately 50% of the then-existing FLLs going out of business, not because of regulatory or legal violations but because of the onerous and overwhelming financial burdens placed upon those small businesses by the new law; and

WHEREAS, the Senate Sponsor’s prime witness admitted during debate that less than 2% of FFLs are responsible for straw purchases nationally. There is absolutely no evidence of any Delaware FFLs knowingly facilitating a straw purchase. There are, however, many reported cases where Delaware FFLs have reported suspected attempted straw purchases; and

WHEREAS, to date, there have been no reported arrests or prosecutions of FFLs in Delaware for participating in or facilitating a straw purchase nor are there any reports of Delaware FFLs having their federal firearms licenses revoked for such offenses; and

WHEREAS, the Delaware Association of Federal Firearms Licensees, the National Shooting Sports Foundation and the Delaware State Sportsmen’s Association stand ready, willing and able to join with the Delaware State Police, the Delaware Division of Professional Regulation, the Delaware General Assembly, and the ATF to work cooperatively to develop and implement a Uniform Best Practices Guide to assist Delaware FFLs in identifying and preventing potential straw purchase situations and for developing a uniform protocol whereby Delaware FFLs may report suspected straw purchase attempts to the Delaware State Police for investigation and potential prosecution by the Delaware Department of Justice.

NOW THEREFORE,

AMEND Senate Substitute 1 for Senate Bill 300 by deleting lines 3 through 574 inserting in lieu thereof the following:

“

§ 907. ESTABLISHING THE DELAWARE TASK FORCE FOR THE DEVELOPMENT AND IMPLEMENTATION OF BEST PRACTICES GUIDELINES FOR DELAWARE FEDERAL FIREARMS LICENSEES.

(a) The Delaware Task Force for the Development and Implementation of Best Practices Guidelines for Delaware Federal Firearms Licensees (hereinafter “The Task Force”) is hereby established. The Task Force shall be comprised of 15 members as follows:

(1) 2 members of the House of Representatives; 1 member of the majority party who is appointed by the Speaker of the House of Representatives who shall be a co-chair, and one member of the minority party who is appointed by the House Minority Leader.

(2) 2 members of the Senate; 1 member of the majority party who is appointed by the President Pro Tempore of the Senate, who shall be a co-chair, and 1 member of the minority party who is appointed by the Senate Minority Leader;

(3) A representative from the federal Bureau of Alcohol, Tobacco, Firearms, and Explosives (ATF);

(4) The Superintendent of the Delaware State Police (or designee);

(5) The Director of the Division of Professional Regulation (or designee);

(6) One representative designated by and representing each of the following organizations: the National Shooting Sports Foundation and the Delaware State Sportsmens’ Association;

(7) 2 current Federal Firearms Licensees (FFLs) from each county designated by and representing the Delaware Association of Federal Firearms Licensees.

(b) The Task Force is to study and report its findings and recommendations on the following topics:

(1) Best practices for identifying potential straw purchasers.

(2) Best practices for teaching FFLs and their employees how to identify a potential straw purchaser and the actions to be taken by the employee in such cases.

(3) Best practices for reporting straw purchases to the proper authorities and for interacting and cooperating with those authorities as they investigate straw purchase attempts.

(4) Best practices for preventing thefts of firearms and ammunition.

(5) Best practices for assisting and cooperating with law enforcement in the event of a case of theft of a firearm or ammunition.

(6) Best practices for hiring and screening potential employees.

(7) Best practices for protecting the business from burglaries and robberies.

(c) The co-chairs are responsible for guiding the administration of the Task Force by, at a minimum, doing all of the following:

(1) Supervising the preparation and distribution of meeting notices, agendas, minutes, correspondence and reports, including dissenting or minority reports if any, of the Task Force.

(2) Coordinating and convening a date, time, and place for the initial organizational meeting.

(3) Providing the Director of Legislative Services , after the first meeting of the Task Force, with a list of the members of the Task Force indicating therein by whom they were appointed or designated.

(4) Providing meeting notices, agendas, and minutes to the Director of the Division of Legislative Services

(5) Ensuring the final report and any dissenting or minority reports of the Task Force are submitted to all members of the General Assembly, the Governor, the Director, and the Librarian of the Division of Legislative Services, and the Public Archives.

(d) The office of the Director of Division of Professional Regulation shall be responsible for providing reasonable and necessary support for the Task Force.

(e) The Task Force shall complete its work and submit its final report on or before July 1, 2027.

”

SYNOPSIS

This amendment deletes the main body of Senate Substitute #1 for Senate Bill 300 and in lieu thereof creates a new Task Force for the development and implementation of Best Practice Guidelines for Delaware Federal Firearms Licensees (FFLs). The focus of the Task Force will be threefold: (1) Identifying best practices for preventing and reporting straw purchases. (2) Training FFLs and gun shop employees how to identify and avoid straw purchases, and (3) best practices designed to assist the FLL with fundamental security issues.

The original bill holds a projected price tag of $4,899,488 taxpayer dollars and does nothing more than duplicate current federal laws, regulations, recordkeeping, and procedures while exposing the individual businessperson to unduly burdensome expense which will most likely result in at least half of Delaware’s law-abiding FFLs being forced out of business.

If the true goal of SS#1 for SB 300 is to increase FFL vigilance and prevent potential straw purchases, this Amendment meets that goal head-on and saves the Delaware taxpayer roughly $4,899,488 over a three year period while also saving the from potential loss the Gross Receipt and Income tax dollars of those FFLs who would otherwise be forced out of business by the extravagant financial mandates contained in the original.