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HomeMy WebLinkAboutOrdinance - 56-97 - Amending City Code Chapter 5 - Pawnbrokers & Precious Metal Dealers - 11/18/1997 CITY OF EDEN PRAIRIE ]HENNEPIN COUNTY, MINNESOTA ORDINANCE NO. 56-97 AN ORDINANCE OF THE CITY OF EDEN PRAIRIE, MINNESOTA AMENDING CITY CODE CHAPTER 5 BY ADDING A NEW SECTION 5.71 RELATING TO PAWNBROKERS AND PRECIOUS METAL DEALERS, AND ADOPTING BY REFERENCE CITY CODE CHAPTER 1 AND SECTION 5.99 WHICH, AMONG OTHER THINGS, CONTAIN PENALTY PROVISIONS. THE CITY COUNCIL OF THE CITY OF EDEN PRAIRIE, MINNESOTA, ORDAINS: Section 1. The Eden Prairie City Code shall be amended by adding Section 5.71 as follows: "SECTION 5.71. PAWNBROKERS AND PRECIOUS METAL DEALERS. Subd. 1. Purpose. The Council finds that pawnbrokers and precious metal dealers potentially provide an opportunity for the commission and concealment of crimes. Such businesses have the ability to receive and transfer stolen property easily and quickly. The Council also finds that consumer protection regulation is warranted in transactions involving pawnbrokers and precious metal dealers. The purpose of this section is to prevent pawnbroking and precious metal businesses from being used as facilities for commission of crimes and to ensure that such businesses comply with basic consumer protection standards, thereby protecting the public health, safety and general welfare of the citizens of the City. Subd. 2. Definitions. A. "Goods" means goods as defined in Minnesota Statutes, Section 336.9-105(f). B. "Item containing precious metal" means an item made in whole or in part of metal and containing more than one percent by weight of silver, gold, or platinum. C. "Minor" means any natural person under the age of 18 years. D. "Oversized items" means large items such as cars, boats, and other motorized vehicles and motorized equipment. E. A natural person, partnership, corporation, or other organization, which owns five percent(5%) or more of an applicant or licensee (and officers of such a corporation -1- or other organization) shall be deemed a "parent." A natural person, partnership, corporation, or other organization (and officers of such a corporation or other organization) owning five percent (5%) or more of a parent shall also be deemed a "parent.It F. (a) "Pawnbroker" means a person engaged in whole or in part in the business of lending money on the security of pledged goods left in pawn, or in the business of purchasing tangible personal property to be left in pawn on the condition that it may be redeemed or repurchased by the seller for a fixed price within a fixed period of time. (b) The following are exempt from the definition of "pawnbroker": any bank regulated by the state of Minnesota, the comptroller of the currency of the United States, the Federal Deposit Insurance Corporation, the board of governors of the Federal Reserve System or any other federal or state authority and their affiliates; any bank or savings association whose deposits or accounts are eligible for insurance by the Federal Deposit Insurance Corporation or any successor to it and all affiliates of those banks and savings associations; any state or federally chartered credit union; and any industrial loan and thrift company or regulated lender subject to licensing and regulation by the Department of Commerce of the State of Minnesota. G. "Pawnshop" means the location at which or premises in which a pawnbroker regularly conducts business. H. "Pawn Transaction" means any loan on the security of pledged goods or any purchase of pledged goods on the condition that the pledged goods are left with the pawnbroker and may be redeemed or repurchased by the seller for a fixed price within a fixed period of time. I. "Person" means an individual, partnership, corporation, limited liability company, joint venture, trust, association, or any other legal entity, however organized. J. "Pledged Goods" means tangible personal property other than choses in action, securities, bank drafts, or printed evidence of indebtedness, that are purchased by, deposited with, or otherwise actually delivered into the possession of a pawnbroker in connection with a pawn transaction. K. "Precious metal dealer" means any person engaging in the business of buying secondhand items containing precious metal, including, but not limited to,jewelry, watches, eating utensils, candlesticks, and religious and decorative objects. -2- L. "Precious metals" means silver, gold, or platinum. M. "Secondhand item" means tangible personal property, excluding motor vehicles, which has been previously used, rented, owned, or leased. Subd. 3. License Required. No person shall engage in the trade or business of pawnbroker or precious metal dealer within the City unless such person is currently licensed under this ordinance. Any pawn transaction made without benefit of a license is void. A separate license is required for each place of business. More than one license may be issued to a person upon compliance with this section for each license. Subd. 4. Exceptions to License Requirement. A. Precious metal dealers conducting the following transactions are not required to obtain a license under this Section. 1. Transactions at occasional "garage" or "yard" sales, or estate sales or farm auctions held at the decedent's residence, except that precious metal dealers must comply with the requirements of Minnesota Statutes, Sections 325F.734 to 325F.742, for these transactions. 2. Transactions regulated by Minnesota Statutes, Section 80A. 3. Transactions regulated by the Federal Commodity Futures Commission Act. 4. Transactions involving the purchase of precious metal grindings, filings, slag, sweeps, scraps, or dust from an industrial manufacturer, dental lab, dentist, or agent thereof. 5. Transactions involving the purchase of photographic film, such a lithographic and x-ray film or silver residue or flake recovered in lithographic and x-ray film processing. 6. Transactions involving coins, bullion, or ingots. 7. Transactions in which the secondhand item containing precious metal is exchanged for a new item containing previous metal and the value of the new item exceeds the value of the secondhand item, except that a person who is a previous metal dealer by engaging in a transaction which is not exempted by this Section must comply with the requirements of Minnesota Statutes, Sections 325F.734 to 325F.742. -3- 8. Transactions between precious metal dealers if both dealers are licensed under Minnesota Statutes, Section 325F.733, or if the seller's business is located outside of the state and the item is shipped from outside the state to a dealer licensed under Minnesota Statutes, Section 325F.733. 9. Transactions in which the buyer of the secondhand item containing precious metal is engaged primarily in the business of buying and selling antiques, and the items are resold in an unaltered condition, except for repair, and the items are resold at retail, and the buyer paid less than $2,500 for secondhand items containing precious metals purchased within any period of 12 consecutive months. Subd. 5. Persons Ineligible. A. No license shall be issued or held by any person who: 1. Is a minor at the time the application is filed. 2. Has been convicted of any crime directly related to the licensed occupation and has not shown competent evidence of sufficient rehabilitation and present fitness to perform the duties of pawnbroker or precious metal dealer as prescribed by Minnesota Statutes, 1995, Section 364.03, Subdivision 3. 3. A person who is not of good moral character or repute. 4. Holds a liquor license under City Code. 5. In the judgment of the Council, is not the real parry in interest or beneficial owner of the business operated under the license, or 6. Has had a pawnbroker or precious metal dealer's license revoked anywhere within five (5) years of the license application, or 7. Is a corporation, partnership or other organization which has a parent who is or meets a condition set forth in subparagraphs 1. through 6. hereof. Subd. 6. Places Ineligible. A. No license shall be issued or held for any place or any business ineligible for a license under City Ordinance or State law. B. No license shall be issued or held for operation in any zoning district other than Regional Commercial or Regional Services Districts. -4- C. No license shall be issued or held for a place or business which holds a liquor license. D. No license shall be granted or held for operation on any premises on which taxes, assessments or other financial claims of the City or other government agency are delinquent and unpaid, except if an action has been commenced pursuant to the provisions of Minnesota Statutes Chapter 278, questioning the amount or validity of taxes, the Council may on application by the licensee waive strict compliance with this provision; no waiver may be granted, however, for taxes, or any portion thereof, which remain unpaid for a period exceeding one year after becoming due unless such one year period is extended through no fault of the licensee. E. No license shall be granted or held if the property on which the business is or is to be conducted is owned by a person who is ineligible for a license, except that a property owner who is a minor shall not make the premises ineligible under this subparagraph- F. No pawnshop shall be located within ten(10)driving miles of any gambling casino. No pawnshop, lawfully operating as of the date of the enactment of this section, shall be required to relocate or close as a result of this subparagraph. Subd. 7. License Application. A. In addition to any information which shall be required pursuant to any provision of Chapter 5 of the City Code every application for a license under this Section shall be made on a form supplied by the City, shall be verified and shall contain the following information: 1. If applicant is a natural person: a. The name, place.and date of birth, street, residence, address and telephone number of the applicant. b. Whether the applicant is a citizen of the United States or a resident alien. C. The name of the business under which the proposed licensee will operate. d. Whether the applicant is married or single. If married, the true name, place and date of birth and street address of applicant's spouse. -5- e. Street addresses at which applicant has lived during the preceding ten (10) years. f. Whether the applicant has ever been in military service. If so, the applicant shall, upon request, exhibit all discharges. g. Kind, name and location of every business, occupation or employment applicant (and spouse, if any), has been engaged in during the preceding ten(10) years. I Names and addresses of applicant's (and spouse, if any) employers and partners, if any, for the preceding ten (10) years. i. Whether applicant (or spouse, if any) has ever been convicted of a violation of any state law or local ordinance, other than a non- alcohol related traffic offense. If so, the applicant shall furnish information as to the time, place and offense for which convictions were had. j. Whether the applicant(or spouse, if any) has ever been engaged in operating a pawnshop or precious metal dealership or other business of a similar nature as an owner or employee. If so, applicant shall furnish information as to the time, place and length of time. k. Whether the applicant is the owner and operator of the business and if not, who is. 1. Whether the applicant has ever used or been known by a name other than applicant's true name, and if so, the name, or names, dates and places where used. In. The amount of the investment that the applicant has in the business, land, building, premises, fixtures, furniture, or stock in trade, and proof of the source of the money. n. A list of responsible persons, including the names of owners, managers and assistant managers, who may be notified or contacted by State or City employees in case of emergency. o. Whether the applicant holds a current pawnbroker or precious metal dealer license from any other governmental unit and whether the applicant is licensed under Minnesota Statutes, Section 471.924 or 325F.731 to 325F.744. -6- p. Whether the applicant has ever been denied a pawnbroker or precious metal dealer license from any other governmental unit. q. The location of the business premises. r. The legal description of the premises to be licensed, including a map of the area for which the license is sought, showing dimensions, location of buildings, street access and parking facilities. S. Whether all real estate and personal property taxes that are due and payable for the premises to be licensed have been paid, and if not paid, the years and amounts that are unpaid. 2. If applicant is a partnership: a. The name and address of each partner. b. The name and address of the managing partner, or partners, shall be designated. C. The interest of each partner in the partnership. d. If the partnership is required to file a certificate as to trade name under the provisions of Minnesota Statute, Chapter 333, a copy of the certificate certified by the Clerk of District Court shall be attached to the application. e. The information required of an applicant who is a natural person specified in subparagraphs 1. c., g., and i. through s. 3. If applicant is a corporation or other organization: a. Name, and if incorporated, the state of incorporation; b. A true copy of the certificate of incorporation, articles of incorporation or association agreements; C. The name of the manager or proprietor or other agent in charge of, or to be in charge of the premises to be licensed, and all information about said person as is required of an applicant who is a natural person specified in subparagraphs a. through s.. -7- d. The names and addresses of all persons who own five percent (5%) or more of, or who control the corporation or other organization(or who are officers of such corporation or other organization. e. The information required of an applicant who is a natural person specified in subparagraphs 1. c., g., and i. through s. 4. In addition to the information required of an applicant, an application shall contain the following information relating to the parents of an applicant: a. If the parent is a natural person, the information required of an applicant who is a natural person pursuant to Subd. 7, subparagraph 1. b. If the parent is a partnership, the information required of an applicant which is a partnership pursuant to Subd. 7, subparagraph 2. C. If the parent is a corporation or other organization the information required of an applicant which is a corporation or other organization pursuant to Subd. 7, subparagraph 3. 5. Other information which the City deems appropriate. B. No person shall make a false statement or material omission in a license application or investigation. Any false statement or material omission shall be grounds for denial, suspension, or revocation of a license. C. Each licensee shall have the continuing duty to properly notify the Chief of Police of the City of any change in the information or facts required to be furnished on the application for a license. This duty shall continue throughout the period of the license. Failure to comply with this section shall constitute cause for revocation or suspension of the license. Subd. 8. Fees. A. Every applicant for a license shall pay to the City an investigation fee. The fee shall be for the purpose of conducting a preliminary background and financial investigation of the applicant. If the Council believes that the public interest so warrants, it may require a similar investigation at the time of renewal of any license. If an investigation is ordered by the City Council at the time of license renewal, the applicant shall pay an investigation fee, except that the fee shall be the smaller of the stated dollar amount or the actual cost of the investigation. Except for an adjustment of the fee in the case of an investigation relating to a license renewal, there shall be no refund of the investigation fee for any person after an -8- investigation has begun. B. Each license shall expire on December 31st of the year in which it is issued. Fees for licenses issued during the license year shall be prorated according to the number of months remaining in the year. For this purpose an unexpired fraction of a month shall be counted as a whole month which shall have elapsed. C. No refund of any fee shall be made except as authorized by ordinance. Subd. 9. Bond Required. A. At the time of filing an application for a license, the applicant shall file a bond in the amount of$5,000 with the City Clerk. The bond, with a duly licensed surety company as surety thereon, must be approved as to form by the city attorney. The bond must be conditioned that the licensee shall observe the ordinances of the City, in relation to the business of pawnbroker and precious metal dealer, and that the licensee will account for and deliver to any person legally entitled thereto any property which may have come into the possession of the licensee as pawnbroker or precious metal dealer or in lieu thereof such licensee shall pay the person or persons the reasonable value thereof. Subd. 10. Granting of Licenses. A. No license shall be issued until the Police Department has conducted an investigation of the information set forth in the application, the applicant's moral character, and the applicant's financial status. All applicants must cooperate with this investigation. B. No license shall be issued until the Council has held a public hearing in accordance with the following: 1. Notice of the hearing shall be made in the same manner as that specified in City Code Section 11.78, Subd. 4 for an amendment affecting district boundaries. 2. No hearing shall be required for a renewal of license, but the Council may, at its option, hold a hearing. C. After investigation and hearing, the Council shall, at its discretion, grant or deny the application. A license may not be granted, 1. to a person who, -9- a. is ineligible to receive a license, b. has made a false statement or material omission in a license application or in response to an investigation, C. fails to respond to an investigation, or d. has violated any provision of City Code Section 5.71, or 2. for any ineligible place. Final approval of a license shall not be granted until the Council has given at least preliminary approval to any necessary land use request. If an application is granted for a location where a building is under construction or not ready for occupancy, the license shall not be delivered to the licensee until a certificate of occupancy has been issued for the licensed premises. Each license shall remain in full force and effect until surrendered, suspended, revoked, or expired. D. Each license shall be issued only to the applicant and for the premises described in the application. No license may be transferred to another person or place without application to the Council in the same manner as an application for a new license. The transfer of 25% or more of the ownership interests, or a controlling interest, whichever is less, of a licensee or a parent shall be deemed a transfer of the license. Transfer of a license without prior Council approval is a ground for revocation or suspension of the license. In addition, each day the licensee operates under the license after a transfer has taken place without obtaining Council approval shall be a separate violation of this ordinance. E. In the case of the death of a licensee who is a natural person, the personal representative of the licensee may continue operation of the business for not more than 90 days after the licensee's death. Subd. 11. Conditions of License. A. Generally. Every license is subject to the conditions in the following paragraphs, all other provisions of this Section 5.71, and of any other applicable provisions of the City Code or State law. B. Maintenance of Peace. Every licensee is responsible for the conduct of its place of business and the conditions of order in it. The act of any employee of the licensee shall be deemed the act of the licensee as well, and the licensee shall be -10- liable for all penalties provided by this ordinance equally with the employee, except criminal penalties. C. Display of License. Every license must be posted in a conspicuous place in the premises for which it is used. D. Record Keeping. At the time of a receipt of property, a licensee shall immediately record, in English, in an indelible ink, in a book or journal, which has page numbers that are pre-printed the following information: 1. An accurate description of the property including, but not limited to, any trademark, identification number, serial number, model number, brand name, or other identifying mark. 2. The date and time the item of property was received by the licensee. 3. The name, address, residence telephone number, date of birth, and reasonably accurate physical description, including height, sex and race, of the person from whom the property was received. 4. The amount of money loaned upon or paid for the property. 5. The identification number from one of the following forms of identification of the person from whom the property was received: a. a valid Minnesota photo driver's license' b. a Minnesota photo Identification Card; C. a photo identification card issued by the state (or province of Canada) of residency of the person from whom the property was received, and one other valid form of identification; 6. The amount paid or advanced. 7. The maturity date of a pawn transaction and the amount due. 8. The monthly and annual interest rates, including all pawn fees and charges. E. Photographic Record. A pawnbroker or precious metal dealer must obtain a photograph of each person selling or pawning any property. The pawnbroker or precious metal dealer shall notify the person being photographed prior to taking his or her picture. The photograph shall be at least two inches in length by two inches in width and shall be immediately developed and referenced with the information regarding the person and the property sold or pawned. The major portion of the -11- photograph shall include a front facial pose. The photograph shall be retained by the pawnbroker or precious metal dealer for 30 days. F. Inspection of Records. The licensee shall make available the information required in paragraphs D. and E. above at all reasonable times for inspection by the City Police Department. The information required in subsection D. shall be retained by the pawnbroker or precious metal dealer for at least three years. G. Receipts. The licensee shall provide a receipt to the seller or pledger of any item of property received, which shall be numbered to correspond to the entry in the licensee's records and shall include: 1. The name, address, and phone number of the licensee. 2. The date on which the item was received by the licensee. 3. A description of the item received and amount paid to the pledger or seller in exchange for the item pawned or sold, and whether it was pawned or sold. 4. The signature of the licensee or agent. 5. If the property can be redeemed, a. The last regular business day by which the item must be redeemed by the pledger without risk that the item will be sold and the amount necessary to redeem the property on that date. b. The annual rate of interest charged on pawned items received. 6. The name and address of the seller or pledgor. H. Reports to Police. For the types of items listed below, the licensee must submit to the City Police Department on a daily basis a list of the specific items purchased or received that day. The list must be on forms approved by the City and must contain all of the information described in paragraph D. 1. Any item with a serial number, identification number, or "Operation Identification" number; 2. Cameras; 3. Electronic, audio, video or radar detection equipment; -12- 4. Precious jewelry, gems and metals; 5. Artist-signed or artist-attributed works of art; 6. Firearms, for which a dealer's license to deal in, is required by the laws of the State of Minnesota or the United States of America. 7. Any item not included in(1) - (6) above which the pawnbroker or precious metal dealer intends to sell for more than $200, except for furniture and kitchen or laundry appliances. I. Stolen or Lost Property. A pawnbroker or precious metal dealer must report to City police any item pledged or received, or sought to be pledged or received, if the pawnbroker or precious metal dealer has reason to believe that the article was stolen or lost. J. Police Restrictions on Sale or Redemption. Whenever the City Police Department notifies the licensee not to sell an item, the item shall not be sold or removed from the licensed premises until authorized to be released by the City Police Department. K. Holding Period. Any item received by the pawnbroker or precious metal dealer for which a report to the City police is required shall not be sold or otherwise transferred, or in the case of precious metal, melted down or dismantled, for 30 days after the date of such report to the police. However, a person may redeem a pawned item 72 hours after the item was received by the pawnbroker or precious metal dealer, excluding Sundays and legal holidays. L. Inspection of Items. 1. Inspection by City. The pawnbroker or precious metal dealer shall, at all times during the term of the license, allow the City Police Department to enter the premises where the pawnbroker or precious metals dealer business is located and any other premises where items purchased or received as part of the business are stored, for the purpose of inspecting such premises and the property therein to locate items suspected or alleged to have been stolen or otherwise improperly disposed of. 2. Inspection by Claimants. Additionally, all the items coming into possession of the licensee shall at all times be open to inspection and right of examination of any person claiming to have been the owner thereof or claiming to have any interest therein, when such person is accompanied by a City police officer. -13- M. Payment by Check. Payment by the licensee for any articles deposited, left, purchased, pledged or pawned, shall be made only by check, draft, or other negotiable or nonnegotiable instrument or order of withdrawal which is drawn against funds held by a financial institution. N. Gambling. No licensee may keep, possess, or operate, or permit the keeping, possession, or operation on the licensed premises of dice, slot machines, roulette wheels, punchboards, blackjack tables, or pinball machines which return coins or slugs, chips, or tokens or any kind, which are redeemable in merchandise or cash. No gambling equipment authorized under Minnesota Statutes, Sections 349.11 - 349.61, may be kept or operated and no raffles may be conducted on the licensed premises and/or adjoining rooms. The purchase of lottery tickets may take place on the licensed premises as authorized by the director of the lottery pursuant to Minnesota Statutes, Sections 349A.01 - 349A.15. O. Oversized Items. All items must be stored within the licensed premises building, except the City may permit the licensee to designate one (1) locked and secured warehouse building within the City within which the licensee may store oversized items. No item may be stored in the designated warehouse building that is not reported in the journal pursuant to subparagraph D above. The licensee shall permit immediate inspection of the warehouse at any time during business hours by the City Police Department. Oversized items may not be stored in parking lots or other outside areas. All provisions in this subparagraph regarding recordkeeping and reporting shall apply to oversized items. P. Off-Site Sales/Storage. All items accepted by a licensee at a licensed location in the City shall be for pledge or sale through a licensed location in the City. No licensee under this Section shall sell any items which are transferred from a non- licensed facility or a licensed facility outside the City. Q. Restrictions on Weapons. 1. A pawnbroker or precious metal dealer may not receive as a pledge, accept for consignment or sale, or otherwise deal in any firearm for which a dealer's license to deal in, is required by the laws of the State of Minnesota or the United States of America unless the pawnbroker or precious metal dealer holds such a firearms dealer's license. 2. A pawnbroker or precious metal dealer may not receive as a pledge or otherwise, or accept for consignment or sale, a firearm which a person is prohibited from possessing or transferring pursuant to the laws of the State of Minnesota or the United States of America. -14- Subd. 12. Printed Pawn Tickets. A. The following shall be printed on all pawn tickets: 1. "Any personal property pledged to a pawnbroker within this state is subject to sale or disposal when there has been no payment made on the account for a period of not less than 60 days past the date of the pawn transaction, renewal, or extension; no further notice is necessary. There is no obligation for the pledgor to redeem pledged goods, 2. The pledgor of this item attests that it is not stolen, it has no liens or encumbrances against it, and the pledgor has the right to sell or pawn the item, 3. This item is redeemable only by the pledgor to whom the receipt was issued, or any person identified in a written and notarized authorization to redeem the property identified in the receipt, or a person identified in writing by the pledgor at the time of the initial transaction and signed by the pledgor. Written authorization for release of property to persons other than the original pledgor must be maintained along with the original transaction record," and 4. A blank line for the pledgor's signature. B. The pledgor or seller in a pawn transaction shall sign a pawn ticket and receive an exact copy of the pawn ticket. Subd. 13. Suspensions and Revocations of License. A. Delinquent Taxes. The Council may suspend or revoke a license issued under this Section for operation on any premises on which real estate taxes, assessments or other financial claims of the City or of the State are due, delinquent, or unpaid. If an action has been commenced pursuant to the provisions of Minnesota Statutes Chapter 278, questioning the amount or validity of taxes, the Council may on application by the licensee waive strict compliance with this provision; no waiver may be granted, however, for taxes, or any portion thereof, which remain unpaid for a period exceeding one year after becoming due unless such one year period is extended through no fault of the licensee. B. Violations. 1. The Council may suspend for up to 60 days or revoke any license upon a finding that the licensee or an agent or employee of the licensee has failed -15- to comply with any State or Federal law or provisions of the City Code or ordinances. No suspension or revocation shall take effect until the licensee has been afforded an opportunity for a hearing pursuant to Minnesota Statutes, Sections 14.57 to 14.69, with the exception of the suspension provided for in paragraph 2. below. 2. Any conviction by the licensee for theft, burglary, robbery, receiving stolen property or any other crime or violation involving stolen property shall result in the immediate suspension pending a hearing on revocation of any license issued hereunder. C. No expiration, revocation, suspension, or surrender of any license shall impair or affect the obligation of any preexisting lawful contract between the licensee and any pledgor. D. The Police Chief of the City shall be notified by the City of any licensee whose license has expired or been surrendered, suspended, or revoked as provided by this section. Subd. 14. Effect of Nonredemption. A. A pledgor shall have no obligation to redeem pledged goods or make any payment on a pawn transaction. Pledged goods not redeemed within at least 60 days of the date of the pawn transaction, renewal, or extension shall automatically be forfeited to the pawnbroker, and qualified right, title, and interest in and to the goods shall automatically vest in the pawnbroker. B. The pawnbroker's right, title, and interest in the pledged goods under paragraph A. is qualified only by the pledgor's right, while the pledged goods remain in possession of the pawnbroker and not sold to a third party, to redeem the goods by paying the loan plus fees and/or interest accrued up to the date of redemption. C. A pawn transaction that involves holding only the title to the property is subject to Minnesota Statutes, 1995, Chapter 168A or 336. Subd. 15. Permitted Charges. A. Notwithstanding any other statute, ordinance, rule, regulation, or section 325J.13, a pawnbroker may contract for and receive a pawnshop charge not to exceed three percent per month of the principal amount advanced in the pawn transaction plus a reasonable fee for storage and services. A fee for storage and services may not exceed $20 if the property is not in the possession of the pawnbroker. -16- B. The pawnshop charge allowed under paragraph A. shall be deemed earned, due, and owing as of the date of the pawn transaction and a like sum shall be deemed earned, due, and owing on the same day of the succeeding month. However, if full payment is made more than two weeks before the next succeeding date the pawnbroker shall remit one-half of the pawnshop charge for that month to the pledgor. C. Interest shall not be deducted in advance, nor shall any loan be divided or split so as to yield greater interest or fees than would be permitted upon a single, consolidated loan or for otherwise evading any provisions of this section. D. Any interest, charge, or fees contracted for or received, directly or indirectly, in excess of the amount permitted under this Subdivision, shall be uncollectible and the pawn transaction shall be void. E. A schedule of charges permitted by this Subdivision shall be posted on the pawnshop premises in a place clearly visible to the general public. Subd. 16. Records; Prohibitions. A pawnbroker and any clerk, agent, or employee of a pawnbroker shall not: A. Make any false entry in the records of pawn transactions; B. Falsify, obliterate, destroy, or remove from the place of business the records, books, or accounts relating to the licensee's pawn transactions; C. Refuse to allow the appropriate law enforcement agency, the attorney general, or any other duly authorized state or federal law enforcement officer to inspect the pawn records or any pawn goods in the person's possession during the ordinary hours of business or other times acceptable to both parties; D. Fail to maintain a record of each pawn transaction for three years. E. Accept a pledge or purchase property from a person under the age of 18 years. F. Make any agreement requiring the personal liability of a pledgor or seller, or waiving any provision of this Subdivision, or providing for a maturity date less than one month after the date of the pawn transaction. G. Fail to return pledged goods to a pledgor or seller, or provide compensation as set forth in Minnesota Statutes, 1995, section 325J.09, upon payment of the full amount due the pawnbroker unless either the date of redemption is more than 60 days past the date of the pawn transaction, renewal, or extension and the -17- pawnbroker has sold the pledged goods pursuant to section 325J.06, or the pledged goods have been taken into custody by a court or a law enforcement officer or agency. H. Sell or lease, or agree to sell or lease, pledged or purchased goods back to the pledgor or seller in the same, or a related, transaction. I. Sell or otherwise charge for insurance in connection with a pawn transaction. J. Remove pledged goods from the pawnshop premises or other storage place approved by City at any time before unredeemed, pledged goods are sold pursuant to Minnesota Statutes, 1995, section 325J.06. Subd. 17. Redemption; Risk of Loss. Any person to whom the receipt for pledged goods was issued, or any person identified in a written and notarized authorization to redeem the pledged goods identified in the receipt, or any person identified in writing by the pledgor at the time of the initial transaction and signed by the pledgor shall be entitled to redeem or repurchase the pledged goods described on the ticket. In the event the goods are lost or damaged while in possession of the pawnbroker, the pawnbroker shall compensate the pledgor, in cash or replacement goods acceptable to the pledgor, for the fair market value of the lost or damaged goods. Proof of compensation shall be a defense to any prosecution or civil action. Subd. 18. Motor Vehicle Title Pawn Transactions; Special Provisions. A. In addition to the other requirements of this section, a pawnbroker who holds a title to a motor vehicle as part of a pawn transaction shall: 1. be licensed as a used motor vehicle dealer under Minnesota Statutes, 1995, section 168.27, and post such license on the pawnshop premises; 2. verify that there are no liens or encumbrances against the motor vehicle with the Minnesota Department of Public Safety; and 3. verify that the pledgor has automobile insurance on the motor vehicle as required by law. B. A pawnbroker may not sell a motor vehicle covered by a pawn transaction until 90 days after recovery of the motor vehicle. Subd. 19. Penalty. Except as otherwise provided in State law, any person violating any provision of this ordinance shall be subject to the penalties established in Section 5.99 -18- of the City Code. Any fine or sentence imposed shall not affect the right of the City to suspend or revoke a license as the Council deems appropriate." Section 2. City Code Chapter 1 entitled "General Provisions and Definitions Applicable to the Entire City Code Including Penalty for Violation" and Section 5.99 entitled "Violation a Misdemeanor" are hereby adopted in their entirety, by reference, as though repeated verbatim herein. Section 3. This ordinance shall become effective from and after its passage and publication. FIRST READ at a regular meeting of the City Council of the City of Eden Prairie on the 18th day of November, 1997, and finally read and adopted and ordered published at a regular meeting of the City Council of said City on the� N day of &M-&t— , 1997. i� City Clerk ayor PUBLISHED in the Eden Prairie News on the f/ day of December, 1997. -19- CITY OF EDEN PRAIRIE SUMMARY OF ORDINANCE 56-97 AN ORDINANCE OF THE CITY OF EDEN PRAIRIE, MINNESOTA AMENDING CITY CODE CHAPTER 5 BY ADDING A NEW SECTION 5.71 RELATING TO PAWNBROKERS AND PRECIOUS METAL DEALERS, AND ADOPTING BY REFERENCE CITYCODE CHAPTER 1 AND SEC- TION Affidavit of Publication SEC- TION 5.99 WHICH,AMONG OTHER THINGS, CONTAIN PENALTY PRO- VISIONS. Southwest Suburban Publishing The following is only a summary of Ordinance No. 56-97. The full text is available for public inspection by any person during regular office hours at the State of Minnesota office of the City Clerk: )SS. Application The ordinance applies to pawnbro- County of Hennepin keys and precious metal dealers.A pawn- broker is aperson engaged in the business of lending money on the security of pledged goods left in pawn or of purchasing per- sonal property to be left in pawn on the Stan Rolfsrud,being duly sworn,on oath says that he is the authorized agent of the publisher of condition that it may be tedeaned by the the newspaper known as the Eden Prairie News and has full knowledge of the facts herein stated sellerforaf odptioaxthwaf edperiod asfollows: oftime.A no"d+adetisaperson (A)This newspaper has complied with the requirements constituting qualification as a legal engaging sadx a—,%S econd- newspaper,as provided by Minnesota Statute 331A.02,331A.07,and other applicable laws,as handitamaeomllsidi W0111102"L These amended. are items cont�iwataaa�tiasaas�rcent by weight of silver, gold or phdaum. (B)The printed public notice that is attached to this Affidavit and identified as No. Persons engaging in c:ettainbusinessesare was published on the date or dates and in the newspaper stated in the attached Notice and said exempt from the definition of pawnbro- Notice is hereby incorporated as part of this Affidavit.Said notice was cut from the columns of ker. Precious metal dealers are exempt the newspaper specified.Printed below is a copy of the lower case alphabet from A to Z,both from certain transactions, inclusive,and is hereby acknowledged as being the kind and size of type used in the composition LicenseRequued and publication of the Notice: A person may not engage in the busi- ness of pawnbroker or precious metal abcdefghijkhnnopgrs dealer without a license. The ordinance specifieswhoareineH,gibieforalicense.A license*may not operate abusiness in any B district other than the Regional Commer- Stan Rolfsru , anager cial and Regional Service Districts. The ordinance specifies certain other places or his designated agent which are ineligible for the operation of a licensed business. Granting of the Subscribed and sworn before me on license is subject to receipt of acompleted application and the holding of a public hearing by the City Council. No license may be transferred to another person or this l�day of UW4A U r , 1997 place. _ GWEN M. RADUENZ Conditions of License NOTARY PUSS —MINNE80TA The ordinance requires licensees upon tsY cot!r.!fSs101%EXPIRES 1-97 receipt of property to make and keep records describing the property,the per- son from whom the property is received, Notary Public the amount paid or advanced and other information.In addition,thelicenseemust obtain aphotograph of eachperson selling or pawning property. Records must be available for inspection by the city police department.In addition,the licensee must RATE INFORMATION provide information on a daily basis to the city police department of specified prop- Lowest classified rate paid by commercial users for comparable space....$16.00 per column inch erty received by a licensee. All property - Penalty - - ie above matter...............................$16.00 per column inch received by a licensee is subjectto inspec- A violation of the ordinance consti- matter..............................................$8.05 per column inch lion by the city police department and by tutes a misdemeanor under City Code. persons claiming to havebeen the owner to FIRST READ at aregular meeting of have an interest in the property accompa- the City Council of the City of Eden Prairie nied by a city police officer. A licensee on the 18th day of November,1997,and must also provide a receipt to the seller or finally read and adopted and ordered pub- pledgor of property received containing lished in summary form at a regularmeet- specified information. ing of the City Council of said City on the Other Provisions 2nd day of December,1997. The ordinance includes limitations upon a licensee's receipt or dealing in ATTEST: /s/John Frane firearms; provides for suspensions and revocations of licenses;consumer protec- Cityy Clerk /s/Jean L.Harris lion provisions relating to redemption of . property and permitted charges; certain Mayor prohibitions concerning records and p (Published in the Eden Prairie News on 8) recordk rn ;and special visions re- lating to motor vehicle title pawn transac- tions.