BILL ANALYSIS                                                                                                                                                                                                    Ó



          SENATECOMMITTEE ON HEALTH
                          Senator Ed Hernandez, O.D., Chair

          BILL NO:                    SB 24     
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          |AUTHOR:        |Hill                                           |
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          |VERSION:       |April 6, 2015                                  |
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          |HEARING DATE:  |April 15, 2015 |               |               |
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          |CONSULTANT:    |Reyes Diaz                                     |
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           SUBJECT  :  Electronic cigarettes:  licensing and restrictions

           SUMMARY  :  Extends Stop Tobacco Access to Kids Enforcement Act  
          requirements to the sale of electronic cigarettes (e-cigs),  
          distinct from the definition of tobacco products, and requires  
          enforcement, as specified, to begin July 1, 2016; extends  
          current smoke-free laws and penalties to e-cigs; requires e-cig  
          cartridges to be in childproof packaging, as defined; broadens  
          the current definition of e-cigs, as specified; and requires all  
          retailers of e-cigs to apply for licensure to sell e-cigs, as  
          specified.  

          Existing law:
          1.Authorizes the California Department of Public Health (DPH),  
            under the Stop Tobacco Access to Kids Enforcement (STAKE) Act,  
            to assess civil penalties ranging from $400 to $6,000,  
            depending on the number of infractions, against any person,  
            firm, or corporation that sells, gives, or in any way  
            furnishes tobacco products to a person who is under the age of  
            18.

          2.Establishes "smoke-free laws," which prohibit the smoking of  
            tobacco products in various places, including, but not limited  
            to, school campuses, public buildings, places of employment,  
            apartment buildings, day care facilities, retail food  
            facilities, health facilities, and vehicles when minors are  
            present, and makes a violation of some of the prohibitions  
            punishable as an infraction.

          3.Defines "tobacco product" as any product containing tobacco  
            leaf, including, but not limited to, cigarettes, cigars, pipe  
            tobacco, snuff, chewing tobacco, dipping tobacco, bidis, or  
            any other preparation of tobacco.







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          4.Defines "electronic cigarette" as a device that can provide an  
            inhalable dose of nicotine by delivering a vaporized solution.  
            Prohibits a person from selling or otherwise furnishing an  
            electronic cigarette to a person under the age of 18.

          5.Requires the Board of Equalization (BOE), under the Cigarette  
            and Tobacco Products Licensing Act, to administer a statewide  
            program to license cigarette and tobacco products  
            manufacturers, importers, distributors, wholesalers, and  
            retailers. Requires a retailer to obtain a separate license  
            for each retail location that sells cigarettes and tobacco  
            products. Requires BOE to suspend or revoke a retailer's  
            license upon notification by DPH of certain STAKE Act  
            violations. Permits BOE to assess various civil penalties for  
            violations of the Licensing Act.
          
          This bill:
          1.Extends the requirements of the STAKE Act to the sale of  
            e-cigs, distinct from the definition of tobacco products, and  
            requires DPH to enforce the provisions related to e-cigs  
            beginning July 1, 2016. Makes it a crime if retailers fail to  
            post a notice on or after July 1, 2016, at each point of  
            purchase that states the sale of e-cigs to minors is illegal.

          2.Adds e-cigs to current smoke-free laws and makes the use of  
            them in restricted areas a crime, which is subject to the same  
            penalties as tobacco products. Requires establishments that  
            are currently required to post "no smoking" signs to also post  
            "no using electronic cigarettes" signs.

          3.Requires all cartridges for e-cigs and solutions for filling  
            or refilling an e-cig to be in childproof packaging, defined  
            as packaging that contains elements, including, but not  
            limited to, safety caps or blister packs, designed to protect  
            children from being able to open and ingest the contents.

          4.Broadens the current definition of e-cigs to include any  
            aerosol or vapor cartridge or other container of a solution,  
            that may or may not contain nicotine, that is intended to be  
            used with or in an e-cig.

          5.Requires retailers of e-cigs to apply for a license from BOE  
            to sell e-cigs beginning July 1, 2016, and to display the  
            license at each retail location by September 30, 2016.  








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            Requires BOE to administer a statewide program to license  
            e-cig retailers.

           FISCAL  
          EFFECT  :  This bill has not been analyzed by a fiscal committee.
           
          COMMENTS  :
          1.Author's statement.  According to the author, youth use of  
            e-cigs is on the rise. According to the National Institute on  
            Drug Abuse, youth use is now higher than that of traditional  
            cigarettes: 17.1 percent of 12th graders reported using an  
            e-cig in the past month, while only 13.6 percent reported  
            smoking a traditional cigarette in the past month.  
            Nevertheless, California's premier law to prevent youth access  
            to cigarettes and other tobacco products-STAKE Act-does not  
            extend to e-cigs. E-cig retailers also do not have to be  
            licensed by the state. Additionally, an increasing number of  
            children in California are being poisoned by e-cig liquids. In  
            2012, there were 28 calls to the California Poison Control  
            System for liquid nicotine poisoning; in 2013, there were 106  
            calls; and in 2014, there were 243 calls. At least 60 percent  
            of calls were for children 5 years old or younger. Nothing in  
            current law requires that e-cig liquids be equipped with child  
            proof packaging. Children can easily open and ingest the often  
            fruit flavored e-cig liquids. Nicotine liquids can be toxic  
            even if ingested in small amounts-just one teaspoon of liquid  
            nicotine can be deadly.  

          2.E-cigs. According to a 2014 report by the World Health  
            Organization (WHO), e-cigs are battery heated devices that  
            deliver nicotine by heating solution that users inhale. E-cig  
            cartridges (e-liquids) contain liquid nicotine, and chemicals  
            introduced into a liquid vehicle produce aromas and various  
            flavors such as tobacco, chocolate mint, cotton candy, gummy  
            bear, and grape. The concentration of nicotine varies both  
            across different manufacturers and sometimes within the same  
            brand. The report states that although some e-cigs are shaped  
            to look like conventional cigarettes, they also take the form  
            of everyday items like pens and USB flash drives.

          3.Are e-cigs safe? The Food and Drug Administration (FDA) states  
            that the safety and efficacy of e-cigs has not been fully  
            studied. Some of the uncertainty stems from the wide variety  
            of devices and liquids available, and therefore separate  
            components need to be studied, including the e-cig device, the  








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            e-liquid, the inhaled aerosol, and the exhaled aerosol that  
            may be inhaled secondhand. E-cig devices vary in their  
            engineering, battery voltage, and ability to heat the  
            e-liquid, meaning e-liquids can deliver a different aerosol  
            and nicotine dose depending on the device. E-liquids currently  
            have no requirements for labeling, and The National Institute  
            of Health (NIH) states that there is poor correlation between  
            labeled and actual nicotine content.

            A July 2014 report, "Electronic nicotine delivery systems  
            (ENDS)," by the WHO stated that existing evidence shows e-cigs  
            do not produce merely a water vapor but an aerosol that poses  
            serious threats to adolescents and fetuses. The aerosol  
            inhaled by smokers contains ultra-fine particulate matter that  
            gets trapped in the small airways of the lungs. According to a  
            2013 study entitled "Does electronic cigarette consumption  
            cause passive vaping?," aerosol exhaled by e-cig smokers  
            contains nicotine, formaldehyde, and other chemicals, although  
            at much lower levels than emissions from conventional  
            cigarettes, and nicotine metabolites were found in nonsmokers  
            exposed to the exhaled aerosol. A 2012 publication from  
            Reproductive Toxicology showed a wide variety of toxicity on  
            human cells, and that toxicity did not correlate with nicotine  
            concentration but did correlate with the amount of flavor  
            additives that were used. Since California passed legislation  
            prohibiting the sale of e-cigs to minors, the Attorney  
            General's office has been investigating a number of e-cig  
            companies that sell products on the Internet to ensure  
            compliance with the statute, as well as other consumer  
            protection provisions. Many companies are coming into  
            compliance voluntarily.  

          4.Health risks and increase in use of e-cigs. DPH's State Health  
            Officer released a report in January 2015, "A Community Health  
            Threat," about e-cigs that cites, among other things, the  
            concern about the health risks of e-cigs and the growing  
            number of e-cig users. E-cig poisonings increased from seven  
            in 2012 to 154 in 2014. By the end of 2014, e-cig poisonings  
            to young children tripled in one year, making up more than 60  
            percent of all e-cig poisoning calls, according to the report.  
            The State Health Officer also noted that in California, use of  
            e-cigs among those between the ages of 18 and 29 tripled in  
            one year, from 2.3 percent to 7.6 percent. Nearly 20 percent  
            of these young adult e-cig users had never smoked traditional  
            cigarettes. The State Health Officer concludes that there is a  








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            high need to educate the public about e-cig safety concerns  
            and that existing laws currently in place to protect minors  
            and the general public from traditional tobacco products  
            should be extended to cover e-cigs.
             
          5.Marketing of e-cigs as cessation devices. The DPH report also  
            cites the unrestricted marketing tactics for e-cigs. E-cig  
            marketing continues to claim they are a safer alternative to  
            traditional cigarettes. To date, the effectiveness of e-cigs  
            as cessation aids has not been proven by e-cig companies or  
            approved by the FDA as such. The report states that a number  
            of studies actually show that e-cig users are no more likely  
            to quit than smokers of traditional cigarettes, and in one  
            study, 89 percent of e-cig users were still using them one  
            year later. Dual use of e-cigs and traditional cigarettes  
            continues to rise, which, according to the report, may be  
            attributed to the unrestricted marketing of e-cigs. E-cig  
            companies are using tactics previously used by tobacco  
            companies that have since been banned. These include running  
            unrestricted ads and promotions on TV, radio, and social  
            media, and in magazines, newspapers, and retail stores, as  
            well as sponsoring sport and music events and giving out free  
            samples, according to the report. 

          6.Related legislation. SB 140 (Leno), recasts and broadens the  
            definition of "tobacco product" in current law to include  
            e-cigs as specified; extends current restrictions and  
            prohibitions against the use of tobacco products to e-cigs;  
            and extends current licensing requirements for manufacturers,  
            importers, distributors, wholesalers, and retailers of tobacco  
            products to e-cigs. SB 140 passed the Senate Health Committee  
            by a vote of 6-1.

            AB 216 (Garcia), raises the allowable fine for selling e-cigs  
            to a minor. AB 216 is currently set for hearing in the  
            Assembly Governmental Organization Committee.

            AB 768 (Thurmond), would prohibit the use of e-cigs in any  
            baseball stadium, including the dugout and locker rooms. AB  
            768 passed out of the Assembly Arts, Entertainment, Sports,  
            Tourism, and Internet Media Committee on April 7, 2015, on a  
            4-2 vote and is pending hearing in the Assembly Governmental  
            Organization Committee.
            
          7.Prior legislation. SB 648 (Corbett), of 2014, would have made  








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            the provision of the STAKE Act restricting the sale of  
            cigarette and tobacco products from vending machines  
            applicable to e-cigs, as defined. SB 648 died in the Assembly  
            Appropriations Committee.

            AB 320 (Nazarian), of 2013, would have prohibited the use of  
            tobacco and nicotine products in a county office of education,  
            charter school or school district-owned or leased building, on  
            school or district property, and in school or district  
            vehicles; would have also required school districts, charter  
            schools, and county offices of education to prominently  
            display signs at all entrances to school property stating  
            "Tobacco use is prohibited"; would have include in its  
            prohibition nicotine-delivery devices, such as e-cigs. AB 320  
            died in the Assembly Appropriations Committee.

            SB 882 (Corbett), Chapter 310, Statutes of 2010, made it  
            unlawful, to the extent not preempted by federal law, for a  
            person to sell or otherwise furnish an e-cig to a person under  
            the age of 18.

            SB 400 (Corbett), of 2009, would have defined e-cigs as drugs  
            under state law, made them subject to the Sherman Food, Drug,  
            and Cosmetic Law, and allowed DPH to halt the sale,  
            distribution, or offering of e-cigs as part of its enforcement  
            of the STAKE Act. SB 400 was vetoed by Governor Schwarzenegger  
            who stated that while he supported restricting access of  
            e-cigs to children under the age of 18, he could not sign a  
            measure that also declared them a federally regulated drug  
            when the matter is being decided through pending litigation.  
            He noted that items defined as "tobacco products" are legal  
            for anyone over the age of 18, and 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.

            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 that prohibited  
            the sale of cigarettes and tobacco products to minors.
            
          8.Support.  Supporters argue that the increase in e-cig use,  
            sales, and marketing is alarming. They state that use has  
            increased particularly by youth who use the devices to smoke  








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            illegal substances. Calls to poison control centers have also  
            risen because of children accessing e-cig cartridges.  
            Supporters believe that this bill will curb youth e-cig use by  
            extending STAKE Act laws to e-cigs, as well as requiring that  
            e-cig packaging be childproof.

          9.Support if amended. The BOE supports this bill if it is  
            amended to provide adequate funding for BOE to administer the  
            expansion of existing Licensing Act provisions to include  
            e-cigs, without any impact to the various cigarette and  
            tobacco product tax funds (the General Fund, Breast Cancer  
            Fund, Cigarette and Tobacco Products Surtax Fund [Prop.99],  
            and the California Children and Families Trust Fund [Prop.  
            10]).

          10.Oppose unless amended.  Organizations writing in opposition,  
            unless the bill is amended, argue that this bill threatens  
            decades of tobacco control and public health campaigns in  
            California by distinguishing e-cigs from tobacco products.  
            They state that the tobacco industry has been working  
            diligently to ensure that e-cigs are defined separately from  
            tobacco products in order to weaken regulation of e-cigs.  
            Also, by not including all components that make up e-cigs,  
            certain parts sold separately could still be sold to minors.  
            They argue that the FDA and DPH recommend that e-cigs be  
            regulated in the same manner as tobacco products. These  
            organizations would like to see this bill amended to include  
            only the requirement that e-cig cartridges be packaged in a  
            childproof manner.

          11.Policy Comment.  The FDA is in the process of finalizing  
            regulations to treat e-cigs like tobacco products, which is  
            also a recommendation in DPH's report. In the opinion of  
            staff, the author may wish to consider whether this bill's  
            distinction of e-cigs from tobacco products would create a  
            conflict with pending federal action regarding e-cigs. 
          
           SUPPORT AND OPPOSITION  :
          Support:  California College and University Police Chiefs
                    California Poison Control System
                    Coalition Engaged in a Smoke-free Effort (CEASE)
                    Junior League of California, State Public Affairs  
               Committee
                    Kings County Tobacco-Free Partnership









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          Oppose:   American Cancer Society Cancer Action Network (unless  
                    amended)
                    American Heart Association/American Stroke Association  
                    (unless amended)
                    American Lung Association in California (unless  
                    amended)
                    California Medical Association (unless amended)
                    Health Access California (unless amended)
                    An individual



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