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[Congressional Bills 106th Congress]
[From the U.S. Government Publishing Office]
[H.R. 5472 Introduced in House (IH)]

106th CONGRESS
  2d Session
                                H. R. 5472

 To provide grants for the purchase of firearms to States and units of 
  local government that enforce certain rules designed to protect the 
                  public from the misuse of handguns.

_______________________________________________________________________

                    IN THE HOUSE OF REPRESENTATIVES

                            October 12, 2000

Mrs. Tauscher (for herself, Mrs. McCarthy of New York, Mr. Blagojevich, 
Mr. Blumenauer, Ms. Carson, Mr. Crowley, Ms. Jackson-Lee of Texas, Ms. 
 Lee, Mrs. Maloney of New York, Mr. McGovern, Ms. Millender-McDonald, 
  Mr. Moran of Virginia, Mr. Nadler, Mrs. Napolitano, Ms. Norton, Ms. 
Pelosi, Ms. Schakowsky, Mrs. Jones of Ohio, Ms. Velazquez, Ms. Woolsey, 
  Mr. Lipinski, Mr. Rangel, Mr. Matsui, Mr. Hastings of Florida, Mr. 
 Engel, Ms. McCarthy of Missouri, Mr. Kennedy of Rhode Island, and Mr. 
   Weiner) introduced the following bill; which was referred to the 
                       Committee on the Judiciary

_______________________________________________________________________

                                 A BILL

 
 To provide grants for the purchase of firearms to States and units of 
  local government that enforce certain rules designed to protect the 
                  public from the misuse of handguns.

    Be it enacted by the Senate and House of Representatives of the 
United States of America in Congress assembled,

SECTION 1. SHORT TITLE.

    This Act may be cited as the ``Safer Guns for Safer Communities 
Act''.

SEC. 2. PURPOSE.

    The purposes of this Act are to encourage firearms importers, 
manufacturers, and dealers to import, make, market, and sell firearms 
in a responsible manner so as to protect the public from the misuse of 
handguns, and to provide for the responsible disposition of the 
firearms obtained by law enforcement agencies which are no longer 
needed by such agencies.

SEC. 3. FINDINGS.

    The Congress finds the following:
            (1) According to the Department of Health and Human 
        Services, 3,793 children and adolescents under 20 years of age 
        were killed with firearms in 1998.
            (2) The National Institute of Justice reported in a 
        national survey that, in 1994, 44,000,000 people--approximately 
        35 percent of households--owned 192,000,000 firearms, 
        65,000,000 of which were handguns. 74 percent of those people 
        were reported to own more than 1 firearm. Nearly 50 percent of 
        those people keep 1 or more firearms in an unsecured place and 
        without trigger locks.
            (3) In August 1999, the Department of Education reported 
        that, on an average day, more than 10 students are expelled for 
        bringing guns to school, and that nearly 4,000 students were 
        expelled in 1997-1998 for carrying a firearm onto school 
        grounds.
            (4) According to an article published in the Journal of the 
        American Medical Association in 1999, gunshot injuries in the 
        United States in 1994 will result in $2,300,000,000 in lifetime 
        medical costs. Nearly half of these costs will be borne by 
        United States taxpayers.
            (5) According to the Bureau of Alcohol, Tobacco and 
        Firearms, over 4,300,000 new firearms were available in the 
        United States in 1998.

SEC. 4. GRANT PROGRAM.

    (a) Program Authorized.--The Attorney General, in consultation with 
the Secretary of Housing and Urban Development and the Secretary of the 
Treasury, may provide a total of not more than 50 grants to eligible 
States and units of local government for a period not to exceed 3 
years.
    (b) Eligibility.--To be eligible to receive a grant award or funds 
under this section, a State or unit of local government shall submit a 
written application to the Attorney General that contains such 
information as the Attorney General may reasonably require and 
includes--
            (1) a commitment by the applicant that the applicant (or, 
        if funds provided to the applicant under this section are to be 
        provided to a qualified association of law enforcement officers 
        for the purchase of a firearm, a commitment by the association 
        that the association) will not purchase a firearm from an 
        importer or manufacturer of firearms unless--
                    (A) the Secretary of the Treasury has certified 
                that, during the 1-year period preceding the date of 
                the certification, the importer or manufacturer has 
                been in compliance with section 5 of this Act, and, 
                during the 5-year period preceding the date of the 
                certification, importer or manufacturer has not been 
                convicted of a violation of chapter 44 of title 18, 
                United States Code, that could have been punished by a 
                term of imprisonment exceeding 1 year; and
                    (B) the firearm was most recently imported into the 
                United States by an importer who is so certified, or 
                was manufactured by a manufacturer who is so certified;
            (2) a commitment by the applicant, and a certification by 
        the Secretary of the Treasury, that the applicant has in effect 
        rules and regulations requiring each law enforcement agency 
        under the jurisdiction of the applicant to comply with section 
        6;
            (3) a commitment by the applicant that, during the year for 
        which the grant award is made under this section, the applicant 
        will expend, from non-Federal sources, for the purchase of 
        firearms to be acquired with the grant funds, an amount equal 
        to not less than 25 percent of the amount of the grant award; 
        and
            (4) a commitment by the applicant that the applicant will, 
        in accordance with guidelines established by the Attorney 
        General, identify and collect data regarding the purchase and 
        disposal of firearms pursuant to this Act.
    (c) Use of Funds.--An entity that receives grant funds under this 
section shall use such grant funds only to purchase firearms from a 
licensed importer or licensed manufacturer who is in compliance with 
section 5.
    (d) Withhold Payments.--
            (1) In general.--If the Attorney General, in consultation 
        with the Secretary of the Treasury, finds that a recipient of 
        grant funds provided under this section has violated a 
        commitment made by the recipient pursuant to subsection (b), 
        the Attorney General shall withhold from the applicant for the 
        grant any payments that would otherwise be made to the 
        applicant under this section.
            (2) Redistribution.--Any funds that are withheld under 
        paragraph (1) shall be redistributed to other grantees that are 
        eligible to receive funds under this section.
    (e) Duties of the Attorney General.--The Attorney General of the 
United States--
            (1) shall to the extent practicable, provide an equitable 
        distribution of grants under this section among the regions of 
        the United States and among urban, suburban, and rural areas;
            (2) shall provide for the evaluation of programs 
        implemented pursuant to this section, which may include outcome 
        measures such as crime and victimization indicators, gun-
        related crime, quality of life measures, and community 
        perceptions;
            (3) shall issue such guidelines and regulations as may be 
        necessary to carry out the responsibilities of the Attorney 
        General under this section; and
            (4) may reserve for administrative expenses not more than 5 
        percent of the funds made available to carry out this section.
    (f) Duties of the Secretary of the Treasury.--The Secretary of the 
Treasury--
            (1) shall evaluate applications submitted pursuant to this 
        section, and make certifications, as appropriate, under 
        subsection (b)(2);
            (2) shall evaluate annually importers and manufacturers 
        from whom grantees under this section obtain firearms to 
        determine whether the importers and manufacturers are in 
        compliance with the conditions set forth in section 5, and 
        advise the Attorney General of the determinations;
            (3) shall evaluate annually the rules and regulations of 
        the grantees under this section to determine whether the 
        grantees are in compliance with section 5, and advise the 
        Attorney General of the determinations;
            (4) shall issue such guidelines and regulations, consistent 
        with the guidelines and regulations issued under subsection 
        (e)(4), as may be necessary to carry out the responsibilities 
        of the Secretary of the Treasury under this section; and
            (5) may reserve for administrative expenses not more than 5 
        percent of the funds made available to carry out this section.
    (g) Report.--Not later than 6 months after funds are paid to a 
grantee under this section, the grantee shall submit to the Attorney 
General a written report that describes how the funds have been used.
    (h) Limitations on Authorization of Appropriations.--
            (1) In general.--There are authorized to be appropriated to 
        carry out this section not more than $50,000,000 for each of 
        the fiscal years 2001 through 2003.
            (2) Allocation.--An amount equal to 95 percent of the 
        amount appropriated pursuant to paragraph (1) for a fiscal year 
        shall be made available to the Attorney General of the United 
        States, and an amount equal to 5 percent of the appropriated 
        amount shall be made available to the Secretary of the 
        Treasury.

SEC. 5. CODE OF CONDUCT.

    (a) Requirements.--
            (1) Product standards.--
                    (A) Applicable to handguns.--
                            (i) Second ``hidden'' serial number.--The 
                        licensee shall not import, manufacture, or 
                        offer for sale a handgun unless the handgun 
                        has, on the exterior, a visible serial number, 
                        and has, on the interior frame or receiver, a 
                        second serial number that is visible only with 
                        the aid of an optical instrument.
                            (ii) External locking device.--During the 
                        24-month period beginning with the date of the 
                        enactment of this Act, the licensee shall not 
                        offer for sale a handgun that is not supplied 
                        with an external locking device that, when 
                        locked, prevents the operation of the handgun.
                            (iii) Internal locking device.--After the 
                        24-month period described in clause (ii), the 
                        licensee shall not import, manufacture, or 
                        offer for sale a handgun that does not 
                        incorporate a locking system which prevents the 
                        handgun from being operated without a key, 
                        combination, or use of another mechanism unique 
                        to the handgun.
                            (iv) Smart gun technology.--The licensee--
                                    (I) shall expend an amount equal to 
                                not less than 2 percent of the annual 
                                firearms sales revenues of the licensee 
                                on the development of a technology that 
                                recognizes only authorized users and 
                                permits a handgun to be used only by 
                                authorized persons; and
                                    (II) beginning 36 months after the 
                                date of the enactment of this Act, 
                                shall not import, design, manufacture, 
                                or offer for sale a handgun (other than 
                                a curio) that does not incorporate the 
                                technology, except that this 
                                requirement shall not apply to a 
                                handgun model that is in production as 
                                of such date of enactment.
                            (v) Child safety.--Beginning 12 months 
                        after the date of the enactment of this Act, 
                        the licensee shall not import, manufacture, or 
                        offer for sale a handgun that can be readily 
                        fired by a child who has not attained 6 years 
                        of age.
                            (vi) Minimum barrel length.--The licensee 
                        shall not import, manufacture, or offer for 
                        sale a handgun unless the barrel of the handgun 
                        is at least 3 inches in length or the average 
                        group diameter test result for the handgun is 
                        1.7 inches or less at 7 yards, 3.9 inches or 
                        less at 14 yards, and 6.3 inches or less at 21 
                        yards. For purposes of this clause, the average 
group diameter test result for a handgun is the arithmetic mean of the 
results of 3 separate trials, each performed on a different handgun of 
the same make and model as the handgun, and in each of which, 5 rounds 
are fired from the handgun at a target from the specified distance and 
the greatest distance in inches between the center of the holes made in 
the test target is the result of the trial.
                            (vii) Performance tests.--The licensee 
                        shall not import, manufacture, or offer for 
                        sale a handgun unless the handgun model has 
                        passed the following tests:
                                    (I) The handgun does not show any 
                                hairline crack or other evidence of 
                                material failure after a cartridge 
                                loaded to generate excess pressure (as 
                                set forth in accepted specifications 
                                for cartridges of this type) has been 
                                fired from each chamber of the handgun.
                                    (II) The handgun does not 
                                malfunction after the first 20 of 600 
                                rounds are fired from the handgun, and 
                                has 6 or fewer malfunctions and has no 
                                crack or breakage of an operating part 
                                of the handgun that increases the 
                                danger of injury after 600 rounds are 
                                fired from the handgun, in the manner 
                                described in this subclause. For 
                                purposes of this subclause, a 
                                malfunction caused by a failure to 
                                clean and lubricate, or by defective 
                                ammunition, shall be disregarded. In 
                                the firing of the handgun, the firing 
                                shall cease after each 100 rounds are 
                                fired and shall resume after any loose 
                                screws are tightened, the handgun is 
                                cleaned, or an empty magazine or 
                                cylinder is refilled to capacity, 
                                except that if the handgun loads other 
                                than with a detachable magazine, the 
                                firing shall cease for 10 minutes after 
                                each 50 rounds are fired. The handgun 
                                shall be fired using the ammunition 
                                recommended in the handgun manual, or 
                                if none is recommended, any standard 
                                ammunition of the correct caliber in 
                                new condition.
                            (viii) Drop test.--The licensee shall not 
                        import, manufacture, or offer for sale a 
                        handgun model that has fired after being test-
                        loaded and, with its hammer and striker set in 
                        each position in which the hammer and striker 
                        may be set so that it is ready to fire, dropped 
                        onto a steel plate or equivalent material of 
                        similar hardness from a height of 1 meter from 
                        each of the following positions:
                                    (I) normal firing position;
                                    (II) upside down;
                                    (III) on the grip;
                                    (IV) on the muzzle;
                                    (V) on either side; and
                                    (VI) on the exposed hammer or 
                                striker (or, if there is no exposed 
                                hammer or striker, on the rear most 
                                part of the handgun).
                    (B) Applicable to pistols.--
                            (i) Safety device.--The licensee shall not 
                        import, manufacture, or offer for sale a pistol 
                        unless the pistol has a positive manually 
                        operated safety device, as determined by 
                        standards relating to imported firearms 
                        promulgated by the Bureau of Alcohol, Tobacco 
                        and Firearms.
                            (ii) Magazine disconnector.--After the 12-
                        month period that begins with the date of the 
                        enactment of this Act, the licensee shall not 
                        import, manufacture, or offer for sale a pistol 
                        for which a magazine disconnector is not 
                        available.
                            (iii) Chamber load indicator.--After the 
                        12-month period that begins with the date of 
                        the enactment of this Act, the licensee shall 
                        not import, manufacture, or offer for sale a 
                        pistol unless the pistol has a chamber load 
                        indicator that enables the operator to detect, 
                        without opening the chamber, whether there is 
                        ammunition in the chamber.
                            (iv) Inability to accept large capacity 
                        magazines.--The licensee shall not import, 
                        manufacture, or offer for sale a pistol that 
                        accepts a large capacity ammunition feeding 
                        device.
                            (v) Minimum length and height standards.--
                        The licensee shall not import, manufacture, or 
                        offer for sale a pistol that is less than 4 
                        inches in height, less than 6 inches in length, 
                        or less than 10 inches in combined height and 
                        length, unless the average group diameter test 
                        result for the pistol is 1.7 inches or less at 
                        7 yards, 3.9 inches or less at 14 yards, and 
                        6.3 inches or less at 21 yards. For purposes of 
                        this clause, the average group diameter test 
                        result for a pistol is the arithmetic mean of 
                        the results of 3 separate trials, each 
                        performed on a different pistol of the same 
                        make and model of the pistol, and in each of 
                        which, 5 rounds are fired from the handgun at a 
                        target from the specified distance and the 
                        greatest distance in inches between the center 
                        of the holes made in the test target is the 
                        result of the trial.
                            (vi) Firing pin block.--The licensee shall 
                        not import, manufacture, or offer for sale a 
                        pistol that does not have a firing pin block or 
                        lock.
                    (C) Applicable to revolvers.--The licensee shall 
                not import, manufacture, or offer for sale a pistol 
that does not have a safety feature which--
                            (i) automatically (for a double action 
                        revolver) or by manual operation (for a single 
                        action revolver) causes the hammer to retract 
                        so that the firing pin does not rest on the 
                        primer of the cartridge; and
                            (ii) is not disabled after a mass with a 
                        weight equal to that of the revolver is dropped 
                        5 times onto the rear of the hammer from a 
                        height of 1 meter in a line parallel to the 
                        barrel.
                    (D) Ban on sale of large capacity magazines.--The 
                licensee shall not import, manufacture, or offer for 
                sale a large capacity ammunition feeding device.
            (2) Packaging warnings.--Beginning 6 months after the date 
        of the enactment of this Act, the licensee shall not import, 
        manufacture, or offer for sale a handgun the packaging of which 
        does not include in 14 point boldface type the following 
        warning:
    ``This handgun is not equipped with a device that fully blocks use 
by unauthorized users. More than 200,000 handguns like this one are 
stolen from their owners every year in the United States. In addition, 
there are more than 1,000 suicides each year by younger children and 
teenagers who get access to firearms. Hundreds more die from accidental 
discharge. It is likely that many more children sustain serious wounds, 
or inflict such wounds accidentally to others. In order to limit the 
chance of such misuse, it is imperative that you keep this weapon 
locked in a secure place and take other steps necessary to limit the 
possibility of theft or accident. Failure to take reasonable 
preventative steps may result in innocent lives being lost, and in some 
circumstances may result in your liability for these deaths.''.
            (3) Sales and distribution rules.--The licensee shall 
        comply with the following:
                    (A) Authorized distributors and dealers.--The 
                licensee shall not transfer a firearm to a distributor 
                of or dealer in firearms unless the distributor or 
                dealer has entered into a written agreement with the 
                licensee to do the following:
                            (i) With respect to each firearms 
                        transaction between the distributor or dealer 
                        and a person who is not licensed under chapter 
                        44 of title 18, United States Code, and in the 
                        presence of the unlicensed person--
                                    (I) meet all requirements imposed 
                                by or under the chapter; and
                                    (II) transfer possession of the 
                                firearm to the unlicensed person.
                            (ii) Not sell a firearm at a gun show 
                        unless a criminal background check is required 
                        to be completed before each firearm sale at the 
                        gun show.
                    (C) Inventory tracking plan.--
                            (i) Electronic recording of acquisitions 
                        and dispositions.--After the 24-month period 
                        that begins with the date of the enactment of 
                        this Act, the licensee shall comply with the 
                        following:
                                    (I) Acquisitions.--Within 1 
                                business day after acquiring a firearm, 
                                the licensee shall record 
                                electronically the make, model, caliber 
                                or gauge, and serial number of the 
                                firearm.
                                    (II) Dispositions.--Within 1 
                                business day after disposing of a 
                                firearm, the licensee shall record 
                                electronically the disposition.
                                    (III) Monthly backups.--The 
                                licensee shall maintain monthly backups 
                                of such records in a secure container 
                                designed to prevent loss by fire, 
                                theft, or other mishap.
                            (ii) Monthly inventory accounting.--The 
                        licensee shall account for all firearms 
                        acquired but not yet disposed of, through a 
                        monthly electronic inventory check, and 
                        maintain the account in a secure location.
                            (iii) Security of records.--The licensee 
                        shall maintain all ATF Form 4473 firearm 
                        transaction records at the licensee's business 
                        premises in a secure container designated to 
                        prevent loss by fire, theft, or other mishap.
                    (D) Security plan.--
                            (i) Firearms on display during business 
                        hours.--The licensee shall keep each firearm 
                        display case locked except when removing a 
                        single firearm to show a customer. The licensee 
                        shall not permit a customer to handle a firearm 
                        except under the direct supervision of an 
                        employee of the licensee.
                            (ii) Firearms on display outside of 
                        business hours.--Other than during business 
                        hours, the licensee shall store all firearms in 
                        a locked fireproof safe or vault in the 
                        licensee's business premises or in another 
                        secured and locked area.
                            (iii) Ammunition.--The licensee shall store 
                        ammunition separately from all firearms and in 
                        a manner inaccessible to customers.
                    (E) Juvenile protection.--
                            (i) Child safety locks.--The licensee shall 
                        not transfer possession or title to a handgun 
                        to a person not licensed under chapter 44 of 
                        title 18, United States Code, unless the 
                        transferee is provided with a secure gun 
                        storage or safety device for the handgun.
                            (ii) Adult supervision.--The licensee shall 
                        not permit an individual who has not attained 
                        18 years of age to be in any portion of the 
                        business premises of the licensee in which a 
firearm or ammunition is displayed, stored, offered for sale, or sold, 
unless the individual is accompanied by a parent or guardian of the 
individual.
                    (F) Multiple handgun sales.--
                            (i) Duties on date of sale.--On any date on 
                        which the licensee sells 2 or more handguns to 
                        a purchaser who is not licensed under chapter 
                        44 of title 18, United States Code, the 
                        licensee--
                                    (I) shall not transfer to the 
                                purchaser possession of more than 1 of 
                                the handguns; and
                                    (II) shall file with the Bureau of 
                                Alcohol, Tobacco and Firearms a 
                                multiple sales report with respect to 
                                the sale.
                            (ii) Release of remaining handguns after 14 
                        days.--During the 14-day period that begins 
                        with the date of such a sale, the licensee 
                        shall not transfer to the purchaser possession 
                        of any of the remaining handguns.
                    (G) Code of responsible business practices.--
                            (i) Quarterly reporting of handgun sales 
                        data to batf.--The licensee shall provide to 
                        the Bureau of Alcohol, Tobacco and Firearms 
                        quarterly reports of the firearm sales data of 
                        the licensee, downstream firearm sales data, 
                        and the volume of firearm sales by make, model, 
                        caliber, and gauge.
                            (ii) Ban on handguns readily convertible 
                        into machine guns.--The licensee shall not 
                        import, manufacture, or offer for sale a 
                        handgun that can be readily converted into a 
                        machinegun.
                            (iii) Ban on handguns designed to be 
                        fingerprint-resistant.--The licensee shall not 
                        import, manufacture, or offer for sale a 
                        firearm which is designed to be resistant to 
                        fingerprints.
                            (iv) No marketing to minors or for use in 
                        crime.--The licensee shall not market a firearm 
                        in a way that would make the firearm 
                        particularly appealing to individuals who have 
                        not attained 18 years of age, or by advertising 
                        the firearm as ``fingerprint-resistant''.
                            (v) Ban on nonimportable pistols.--The 
                        licensee shall not manufacture or offer for 
                        sale a pistol which it would be unlawful to 
                        import into the United States.
                            (vi) No firearm advertisements near schools 
                        or public housing.--The licensee shall not 
                        cause any advertisement for a firearm to be 
                        placed within 1,000 feet of any school or 
                        public housing property.
                            (vii) Verify validity of federal firearms 
                        license.--Before transferring a firearm to a 
                        person who claims to be licensed under chapter 
                        44 of title 18, United States Code, the 
                        licensee shall verify with the Bureau of 
                        Alcohol, Tobacco and Firearms that the person 
                        is so licensed.
                            (viii) No transfers to certain indictees.--
                        The licensee shall not transfer a firearm to 
                        another licensee if the licensee knows or has 
                        reasonable cause to believe that the other 
                        licensee is under indictment for a violation of 
                        chapter 44 of title 18, United States Code, or 
                        chapter 53 of the Internal Revenue Code of 
                        1986.
                            (ix) Implementation of security plan.--The 
                        licensee shall implement a security plan for 
                        securing all firearms of the licensee, 
                        including firearms being shipped by the 
                        licensee, which includes the following:
                                    (I) Controlled movement of 
                                employees and visitors.--The licensee 
                                shall ensure that employee and visitor 
                                movement into and out of the 
                                manufacturer's facility is only through 
                                designated security control points, 
                                that a visitor is admitted only after 
                                positive identification and 
                                confirmation of the purpose of the 
                                visit, and that each employee and each 
                                visitor passes through a metal detector 
                                before leaving.
                                    (II) Designation of restricted 
                                areas.--The licensee shall designate 
                                any area where a firearm is assembled 
                                or stored as a restricted area, 
                                authorize access to such a restricted 
                                area only for an employee whose work 
                                requires the employee to enter the area 
                                or for an escorted visitor, and install 
                                any protective barrier necessary to 
                                deny or impede unauthorized access to 
                                any restricted area.
                                    (III) Entry detection system.--The 
                                licensee shall ensure that there is a 
                                system to detect unauthorized entry 
                                into any facility or area where a 
                                firearm, ammunition, or a component of 
                                a firearm is stored.
                                    (IV) Shipping rules.--The licensee 
                                shall not ship a firearm except in a 
                                secure carton that does not bear an 
                                identifying mark or word indicating 
                                that the carton contains a firearm. The 
                                licensee shall--
                                            (aa) secure a large carton 
                                        in which a firearm is shipped 
                                        with steel strapping in 2 
                                        different directions;
                                            (bb) ship a firearm only by 
                                        carrier or freight forwarder 
                                        who warrants in writing that 
                                        the carrier or forwarder 
                                        conducts criminal background 
                                        checks on all delivery 
                                        personnel and reports all 
                                        thefts or losses of firearms to 
                                        the Bureau of Alcohol, Tobacco 
                                        and Firearms within 48 hours 
                                        after discovery; and
                                            (cc) inspect periodically 
                                        the local facilities of any 
                                        such carrier or forwarder.
                            (x) Background checks.--The licensee shall 
                        not transfer a firearm to a person who is not 
                        licensed under chapter 44 of title 18, United 
                        States Code, unless the national instant 
                        criminal background check system established 
                        under section 103 of the Brady Handgun Violence 
                        Prevention Act notifies the licensee that the 
                        information available to the system does not 
                        demonstrate that the receipt of a firearm by 
                        the prospective transferee would violate 
                        subsection (g) or (n) of section 922 of such 
                        title or State law.
                            (xi) Qualified purchasers.--The licensee 
                        shall not transfer a firearm to a person who is 
                        not licensed under chapter 44 of title 18, 
                        United States Code, unless the person 
demonstrates to the licensee, in such manner as the Secretary of the 
Treasury shall by regulations prescribe that the person knows how to 
load, operate, unload, and safely store the firearm, and how to engage 
and disengage all safety devices on or transferred with the firearm.
                            (xii) No sale to straw purchaser.--The 
                        licensee shall not sell a firearm to any 
                        individual who the licensee knows or has 
                        reasonable cause to believe is purchasing the 
                        firearm for a person who is prohibited by law 
                        from receiving a firearm.
            (4) Employee training.--The licensee shall require--
                    (A) all employees of the licensee to attend annual 
                training developed in consultation with the Bureau of 
                Alcohol, Tobacco and Firearms that includes training 
                in--
                            (i) the law governing firearms transfers;
                            (ii) how to recognize an individual who may 
                        be purchasing a firearm for a person who is 
                        prohibited by law from receiving a firearm and 
                        other means by which unlawful firearms 
                        purchases are attempted, how to recognize 
                        indications that a firearm may be diverted for 
                        later sale or transfer to a person who may not 
                        lawfully receive a firearm, and how to respond 
                        to such attempts and indications; and
                            (iii) the safe handling and storage of 
                        firearms; and
                    (B) new employees of the licensee--
                            (i) before handling or selling a firearm on 
                        behalf of the licensee, to attend training on 
                        the topics set forth in subparagraph (A), based 
                        on materials developed for the annual training; 
                        and
                            (ii) thereafter, to attend the annual 
                        training.
    (b) Exemptions Relating to Law Enforcement Agencies and the 
Military.--Subsection (a)(1) shall not apply to--
            (1) the importation or manufacture of a firearm for 
        transfer to, or possession by, the United States or a 
        department or agency of the United States, or a State or a 
        department, agency, or political subdivision of a State; or
            (2) the transfer of a firearm to, or the possession of a 
        firearm by, a law enforcement officer employed by an entity 
        referred to in paragraph (1) of this subsection, for a law 
        enforcement purpose, regardless of whether the law enforcement 
        officer is on or off-duty.
    (c) Definitions.--In this section, the terms ``State'', 
``firearm'', ``licensed importer'', ``licensed manufacturer'', 
``ammunition'', ``Secretary'', ``handgun'', ``large capacity ammunition 
feeding device'', ``machinegun'', and ``secure gun storage or safety 
device'' shall have the meanings given in section 921(a) of title 18, 
United States Code.

SEC. 6. DISPOSITION OF FIREARMS BY LAW ENFORCEMENT AGENCIES.

    (a) In General.--The law enforcement agency shall not dispose of a 
firearm except by destroying the firearm or transferring the firearm to 
another law enforcement agency.
    (b) Provision of Information to National Tracing Center.--The law 
enforcement agency, on acquiring or disposing of a firearm, shall 
notify the Bureau of Alcohol, Tobacco and Firearms of--
            (1) the make, model, and serial number of the firearm; and
            (2) the date of the acquisition or disposition.
    (c) Maintenance of Information on Firearms Transfers by Law 
Enforcement Agencies; Use of Information To Trace Firearms Used in 
Crime.--The Bureau of Alcohol, Tobacco and Firearms shall collect and 
maintain the information provided pursuant to subsection (b), and may 
use the information to assist a law enforcement agency to trace 
firearms used in crime.

SEC. 7. INSPECTION AUTHORITY.

    Section 923(g)(1)(B) of title 18, United States Code, is amended--
            (1) in clause (ii)(II), by striking ``or'';
            (2) in clause (iii), by striking the period and inserting 
        ``; or''; and
            (3) by adding at the end the following:
            ``(iv) for evaluating compliance of a licensed importer or 
        licensed manufacturer with section 5 of the Safer Guns for 
        Safer Communities Act.''.

SEC. 8. EVALUATION.

    The National Institute of Justice shall, to the extent practicable, 
evaluate the effect, if any, of the grant program in reducing gun-
related crime in the jurisdictions in which the recipients of grants 
under this Act are located.
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