BILL ANALYSIS ------------------------------------------------------------ |SENATE RULES COMMITTEE | SB 400| |Office of Senate Floor Analyses | | |1020 N Street, Suite 524 | | |(916) 651-1520 Fax: (916) | | |327-4478 | | ------------------------------------------------------------ VETO Bill No: SB 400 Author: Corbett (D), et al Amended: 9/2/09 Vote: 21 PRIOR SENATE VOTES NOT RELEVANT SENATE HEALTH COMMITTEE : 9-2, 9/10/09 AYES: Alquist, Aanestad, Cedillo, DeSaulnier, Leno, Maldonado, Negrete McLeod, Pavley, Wolk NOES: Strickland, Cox SENATE FLOOR : 24-14, 9/11/09 AYES: Aanestad, Alquist, Cedillo, Corbett, Correa, DeSaulnier, Ducheny, Florez, Hancock, Kehoe, Leno, Liu, Lowenthal, Maldonado, Negrete McLeod, Oropeza, Pavley, Price, Romero, Simitian, Steinberg, Wiggins, Wolk, Yee NOES: Ashburn, Benoit, Calderon, Cogdill, Cox, Denham, Dutton, Harman, Hollingsworth, Huff, Runner, Strickland, Walters, Wyland NO VOTE RECORDED: Padilla, Wright ASSEMBLY FLOOR : 50-29, 9/8/09 - See last page for vote SUBJECT : Tobacco SOURCE : Author DIGEST : Assembly Amendments delete the Senate version of the bill making the manufacture of California green CONTINUED SB 400 Page 2 vehicles," which the bill defines, eligible for subsidies under the California Alternative Energy and Advanced Transportation Financing Authority's program. This bill now updates the Stop Tobacco Access to Kids Enforcement Act to define electronic cigarettes under state law and to halt the sale of electronic cigarettes. ANALYSIS : Existing law: 1. Requires states to enact and enforce laws that prohibit the sale of cigarettes and tobacco products to minors under the age of 18. 2. Makes it a misdemeanor, subject to civil action and fines, any individual who knowingly or under circumstances furnishes, gives, or sells cigarettes or tobacco products to minors under the age of 18. 3. Provides that any individual desiring to engage in the sale of cigarettes or tobacco products as a distributor shall file with the Board of Equalization (BOE) an application for a distributor's license. A distributor must apply and obtain a license for each place of business where he or she will engage in the business of distributing cigarettes or tobacco products. 4. Provides that any individual desiring to engage in the sale of cigarettes or tobacco products as a wholesaler shall file with the BOE an application for a wholesaler's license. A wholesaler must apply and obtain a license for each place of business where he/she will engage in the business of selling cigarettes or tobacco products as a wholesaler. 5. Requires, under the Stop Tobacco Access to Kids Enforcement (STAKE) Act: A. Retailers from selling cigarettes and tobacco products to minors under the age of 18 and requires that retailers check identification of individuals trying to buy cigarettes and tobacco products who appear under the age of 18. SB 400 Page 3 B. Increases civil penalties and expands the number of agencies that are permitted to carry out investigations of illegal tobacco sales to minors from the Department of Public Health (DPH) to include the Attorney General and other state and local agencies. C. Makes certain violations of the STAKE Act a criminal offense. D. Requires DPH to take primary responsibility for enforcement of the STAKE Act and requires DPH to conduct random, onsite inspections of retail sites. E. Requires DPH to enlist the assistance of persons who are 15 or 16 years of age for this purpose and requires DPH to adopt and publish guidelines for the use of minors in inspections. F. Requires the peace officer accompanying the minor to re-enter the retail site following the completion of a sale and inform the seller of the random inspection. Existing law requires DPH, following an attempted sale, to notify the retailer of the inspection. G. Permits DPH to enter into an agreement with a local law enforcement agency for delegation of enforcement of the STAKE Act. H. Requires any enforcement by DPH, in cases where DPH has delegated enforcement to a local law enforcement agency, to be coordinated with the local law enforcement agency and prohibits duplication of enforcement activities that result in a duplication of civil penalties or assessments. I. Requires DPH to reimburse local law enforcement agencies for enforcement costs pursuant to delegation contracts from the Sale of Tobacco to Minors Control Account, which was created under the STAKE Act and receives moneys collected as civil penalties under the Act. SB 400 Page 4 This bill: 1. Deletes "tobacco substitute" from this bill's definition of tobacco product. 2. Deletes proposed definition of "tobacco substitute." 3. Classifies electronic cigarettes and any similar devices that can provide inhaled doses of nicotine by delivering a vaporized solution as a drug. 4. Expands the duties of DPH's Food and Drug Section inspectors so they can enforce the prohibition of the sale, distribution, or offering for sale of electronic cigarettes if they have not been approved or cleared by the federal Food and Drug Administration (FDA). 5. Requires that the suppliers and sellers of electronic cigarettes be in full compliance of established state law relevant to the distribution of tobacco products to minors. 6. Adds co-authors. 7. Makes technical and conforming changes. Background In 1992, Congress passed Section 1926 of Title XIX of the federal Public Health Service Act, commonly called the Synar Amendment. The Synar Amendment requires states to pass and enforce laws that prohibit the sale of tobacco to individuals under 18 years of age. It also requires that federal alcohol and substance abuse block grant funding be applied to enforcing state law in a manner that can reasonably be expected to reduce the illegal sales rate of tobacco products to minors. Up to 40 percent of the block grant funding can be withheld from states for not complying with the Synar Amendment. In May 1994, the Department of Health Services, Tobacco Control Section and tobacco control advocates from 23 counties throughout the state undertook an unprecedented SB 400 Page 5 massive effort to document how easily available tobacco products were to minors. Over 400 youth, 13-17 years of age, surveyed more than 1,800 retail stores. The results of the 1994 Youth Purchase Survey indicated that the illegal sales rate was 52.1 percent. Synar Amendment and the STAKE Act . In 1992, Congress passed the Synar Amendment, which requires states to pass and enforce laws that prohibit the sale of tobacco to minors. It also requires that federal alcohol and substance abuse block grant funding be applied to enforcing state law in a manner that can reasonably be expected to reduce the illegal sales rate of tobacco products to minors. Up to 40 percent of the block grant funding can be withheld from states for not complying with the Synar Amendment. SB 1927 (Hayden), Chapter 1009, Statutes of 1994, enacted the STAKE Act to address the increase in tobacco sales to minors in California and fulfill the federal mandate. Authority for enforcement and responsibility for implementation of the Act was delegated to the then-Department of Health Services' Food and Drug Branch, which is required to: 1. Implement the program to reduce the illegal sale of tobacco products to minors and to conduct sting operations using 15 and 16 year old minors. 2. Operate a toll-free number for the public to report illegal tobacco sales to minors. 3. Assure that tobacco retailers post signs, which include the toll-free number, to report violations. 4. Assure that clerks check the identification of youthful-appearing persons prior to a sale. 5. Assess civil penalties ranging from $200 to $6,000 against store owners for violations. 6. Comply with the Synar Amendment and prepare an annual report for the federal government, Legislature, and the Governor regarding enforcement activities and their SB 400 Page 6 effectiveness. FISCAL EFFECT : Appropriation: No Fiscal Com.: Yes Local: No According to the Assembly Appropriations Committee, costs are deemed minor, if any, nonreimbursable incarceration costs as this bill changes the definition of an existing crime. SUPPORT : (Verified 9/9/09) Breathe California California Medical Association California Tobacco Control Alliance Community Advocate Teens of Today Coalition ARGUMENTS IN SUPPORT : According to the author's office, a study published by the Journal of the National Cancer Institute found that teens were more likely to be influenced to smoke by cigarette marketing than by peer pressure. The author's office states that a similar report published by the Journal of the American Medical Association discovered that approximately one-third of underage experimentation with smoking was attributable to tobacco company marketing efforts. The most recent innovation in marketing tobacco products to the public is electronic cigarettes. Electronic cigarettes are a tobacco substitute that is being marketed as a healthy and smokeless alternative to traditional cigarettes. These devices are battery-operated, rechargeable drug delivery devices that look similar to cigarettes and allow the user to inhale a smokeless vapor that often contains nicotine. According to the author's office, electronic cigarettes are unregulated by both state and federal laws. The author's office claims that because the producers of electronic cigarettes, many of which are predominantly foreign-based companies, have not applied for approval from the FDA, some retailers have taken the opportunity to market and sell these products to adults and minors, alike, through using SB 400 Page 7 shopping mall kiosks and promoting flavored cartridges. This bill seeks to prohibit the sale, distribution, or offering for sale of electronic cigarettes in California as long as they have not been approved or certified by the federal FDA. GOVERNOR'S VETO MESSAGE: "I am returning Senate Bill 400 without my signature. While I support restricting access of electronic cigarettes to children under the age of 18, I cannot sign a measure that also declares them a federally regulated drug when the matter is currently being decided through pending litigation. Items defined as 'tobacco products' are legal for anyone over the age of 18. If adults want to purchase and consume these products with an understanding of the associated health risks, they should be able to do so unless and until federal law changes the legal status of these tobacco products. For this reason, I am unable to sign this bill." ASSEMBLY FLOOR : AYES: Ammiano, Arambula, Beall, Block, Blumenfield, Brownley, Buchanan, Caballero, Charles Calderon, Carter, Chesbro, Coto, Davis, De La Torre, De Leon, Eng, Evans, Feuer, Fong, Fuentes, Furutani, Galgiani, Hall, Hayashi, Hernandez, Hill, Huber, Huffman, Jones, Krekorian, Lieu, Bonnie Lowenthal, Ma, Mendoza, Monning, Nava, John A. Perez, V. Manuel Perez, Portantino, Ruskin, Salas, Saldana, Skinner, Solorio, Swanson, Torlakson, Torres, Torrico, Yamada, Bass NOES: Adams, Anderson, Bill Berryhill, Tom Berryhill, Blakeslee, Conway, Cook, DeVore, Duvall, Emmerson, Fletcher, Fuller, Gaines, Garrick, Gilmore, Hagman, Harkey, Jeffries, Knight, Logue, Miller, Nestande, Niello, Nielsen, Silva, Smyth, Audra Strickland, Tran, SB 400 Page 8 Villines NO VOTE RECORDED: Vacancy DLW:mw 1/11/10 Senate Floor Analyses SUPPORT/OPPOSITION: SEE ABOVE **** END ****