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The Judiciary Committee heard testimony March 2 on a bill that would increase regulations on the sale of used catalytic converters in Nebraska.

LB994, introduced by Omaha Sen. Steve Lathrop, would require purchasers of used catalytic converters to record the VIN number, year, make and model of the motor vehicle from which the converter was obtained. Additionally, it would require purchasers to pay for catalytic converters by check, sent by U.S. mail, and to keep a catalytic converter in the condition in which it was purchased for five business days.

A catalytic converter is a device incorporated into a motor vehicle’s exhaust system that converts pollutant gasses into less harmful ones. Typically, it has a thin coating made of precious metals such as platinum, palladium and rhodium.

Lathrop said the selling of stolen catalytic converters is a significant problem in Lincoln and Omaha. Individuals, often those addicted to drugs, crawl under cars in the middle of the night to steal converters and sell them at scrap metal facilities for a “quick dollar,” he said.

“[The bill’s provisions] are intended to help stop this and interrupt the process for those trying to get a quick dollar by stealing precious metals,” Lathrop said. “The idea of this bill is to slow down the process so there isn’t that immediate gratification.”

In support of the bill was Lt. Kyle Steffen, speaking on behalf of the Omaha Police Department. Steffen said OPD saw a 2,400 percent increase in catalytic converter thefts in 2021 compared to years prior. On average, he said, replacing a catalytic converter can cost between $1,000 and $2,500, however on commercial vehicles, the cost can be much higher.

“There are several reasons these thefts have been skyrocketing in Nebraska as well as nationwide,” Steffen said. “They are easy to steal, they are difficult to track, they are extremely valuable and they are quickly converted into cash.”

Brian Jackson, assistant chief of the Lincoln Police Department, also spoke in favor of the proposal. Jackson said LPD has directed several projects toward reducing thefts in Lincoln, such as examining sales data, proactive patrols and educating officers and community members. Despite these efforts, he said, the city saw nearly 1,000 converters stolen in 2021.

“Thefts of catalytic converters in Lincoln represent approximately $1,000 of loss to each community member victimized,” he said. “This is approaching $1 million of loss for residents of the city of Lincoln.”

Brian Urwin of Student Transportation of America, an independent school bus service, testified in support. He said that in the last 14 months the company has lost $424,800 in Omaha due to catalytic converter theft despite $175,000 worth of security improvements, including added fencing, cameras and live security.

“It seems that nothing we do stops them,” Urwin said. “We got hit last night for another $16,000.”

In opposition to LB994 was Mike Vail of Alter Trading. Vail said that after the Lincoln City Council approved an ordinance in 2021 implementing stricter regulations, Alter Trading’s business went down by 80 percent while the sale of catalytic converters increased. The problem isn’t lack of regulation, he said, it’s that certain scrap metal recyclers are accepting catalytic converters outside the scope of existing law.

“There’s a huge distinction in the recycling industry [between] those that are doing it right and those that are doing it wrong,” Vail said. “Our opposition to this bill is because, as written, it doesn’t fix the problem.”

Gary Griessmeyer testified on behalf of Sadoff Iron and Metal in opposition to the bill. Griessmeyer said collecting the motor vehicle VIN numbers would serve no purpose unless each VIN also is independently verified by the purchaser. Additionally, he said, increasing regulations without targeting companies who don’t follow the law won’t change the market.

“Trying to decrease the market by having this bill isn’t going to happen,” Griessmeyer said. “The market for this precious metal is driven by the values worldwide.”

The committee took no immediate action on LB994.

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