BILL NUMBER: SB 331	AMENDED
	BILL TEXT

	AMENDED IN SENATE  APRIL 27, 2011

INTRODUCED BY   Senator Padilla

                        FEBRUARY 15, 2011

    An act to amend Sections 22973.1 and 22974.8 of, and to
add Section 22974.9 to,   An act to amend Sections 22973
and 22973.1 of, and to repeal and add Section 22974.8 of,  the
Business and Professions Code, relating to cigarettes and tobacco
products.



	LEGISLATIVE COUNSEL'S DIGEST


   SB 331, as amended, Padilla. Retail tobacco licenses.
   The California Cigarette and Tobacco Products Licensing Act of
2003 requires a retailer to obtain a license from the State Board of
Equalization to engage in the sale of cigarette and tobacco products
in this state.  Existing law requires an application for a
license to be filed on or before April 15, 2004.  A retailer
owning more than one retail location must obtain a separate license
for each retail location.
   The act specifies instances when the board is not required to
issue a license and  , subject to the results of a prescribed
survey,  requires the board to take action against a retailer of
a licensed location convicted of a violation of either the STAKE Act
or a specified prohibition, according to prescribed schedule.
   This bill would  delete the April 15, 2004, application
deadline and would  include the location of a retailer within
600 feet of a public or private elementary school among the instances
when the board is not required to issue a license to engage in the
sale of cigarette and tobacco products. It would also revise the
schedule of actions  that the bill would require  against a
retailer of a licensed location  located within 600 feet of a
public or private elementary or secondary school and  who
is convicted of an above-described violation, as specified.
   Vote: majority. Appropriation: no. Fiscal committee: yes.
State-mandated local program: no.


THE PEOPLE OF THE STATE OF CALIFORNIA DO ENACT AS FOLLOWS:

  SECTION 1.  (a) In 2007, 20 percent of high school students in the
United States were current cigarette smokers--approximately 19
percent of females and 21 percent of males. Among racial and ethnic
subgroups, approximately 23 percent of white, 17 percent of Hispanic,
and 12 percent of African American high school students were current
cigarette smokers in 2007.
   (b) In 2006, approximately 6 percent of middle school students in
this country were current cigarette smokers, with estimates of 6
percent for females and 6 percent for males. Among racial and ethnic
subgroups, approximately 7 percent of white, 7 percent of Hispanic, 6
percent of African American, and 3 percent of Asian American middle
school students were current cigarette smokers in 2006.
   (c) Each day in the United States, approximately 3,600 young
people between 12 and 17 years of age initiate cigarette smoking, and
an estimated 1,100 young people become daily cigarette smokers.
   (d) Lower income areas are more likely to have higher rates of
underage tobacco sales and to be a hot spot for these sales.
   (e) In more densely populated areas, there is a positive
relationship between underage tobacco sales and the number of
schools.
   (f) In general, where there are more tobacco outlets, there will
also be more schools. Densely populated ZIP Code areas are shown to
have more schools, more tobacco outlets, and more underage tobacco
sales.
   (g) When examining school proximity and underage sales, gas
stations, discount stores, supermarkets, and pharmacies are
positively related to increased underage sales, while gas stations
with convenient stores are negatively associated.
   SEC. 2.    Section 22973 of the   Business
and Professions Code   is amended to read: 
   22973.  (a) An application for a license shall be filed on
 or before April 15, 2004, on  a form prescribed by
the board and shall include the following:
   (1) The name, address, and telephone number of the applicant.
   (2) The business name, address, and telephone number of each
retail location. For applicants who control more than one retail
location, an address for receipt of correspondence or notices from
the board, such as a headquarters or corporate office of the
retailer, shall also be included on the application and listed on the
license. Citations issued to licensees shall be forwarded to all
addressees on the license.
   (3) A statement by the applicant affirming that the applicant has
not been convicted of a felony and has not violated and will not
violate or cause or permit to be violated any of the provisions of
this division or any rule of the board applicable to the applicant or
pertaining to the manufacture, sale, or distribution of cigarettes
or tobacco products. If the applicant is unable to affirm this
statement, the application shall contain a statement by the applicant
of the nature of any violation or the reasons that will prevent the
applicant from complying with the requirements with respect to the
statement.
   (4) If any other licenses or permits have been issued by the board
or the Department of Alcoholic Beverage Control to the applicant,
the license or permit number of those licenses or permits then in
effect.
   (5) A statement by the applicant that the contents of the
application are complete, true, and correct. Any person who signs a
statement pursuant to this subdivision that asserts the truth of any
material matter that he or she knows to be false is guilty of a
misdemeanor punishable by imprisonment of up to one year in the
county jail, or a fine of not more than one thousand dollars
($1,000), or both the imprisonment and the fine.
   (6) The signature of the applicant.
   (7) Any other information the board may require.
   (b) The board may investigate to determine the truthfulness and
completeness of the information provided in the application. The
board may issue a license without further investigation to an
applicant for a retail location if the applicant holds a valid
license from the Department of Alcoholic Beverage Control for that
same location.
   (c) The board shall provide electronic means for applicants to
download and submit applications.
   (d) (1) A one-time license fee of one hundred dollars ($100) shall
be submitted with each application. An applicant that owns or
controls more than one retail location shall obtain a separate
license for each retail location, but may submit a single application
for those licenses with a one-time license fee of one hundred
dollars ($100) per location.
   (2) The one-time fee required by this subdivision does not apply
to an application for renewal of a license for a retail location for
which the one-time license fee has already been paid. If a license is
reinstated after its expiration, the retailer, as a condition
precedent to its reinstatement, shall pay a reinstatement fee of one
hundred dollars ($100).
   SEC. 2.   SEC. 3.   Section 22973.1 of
the Business and Professions Code is amended to read:
   22973.1.  (a) The board shall issue a license to a retailer upon
receipt of a completed application and payment of the fees prescribed
in Section 22973, unless any of the following apply:
   (1) The retailer, or if the retailer is not an individual, any
person controlling the retailer, has previously been issued a license
that is suspended or revoked by the board for violation of any of
the provisions of this division.
   (2) The application is for a license or renewal of a license for a
retail location that is the same retail location as that of a
retailer whose license was revoked or is subject to revocation
proceedings for violation of any of the provisions of this division,
unless:
   (A) It has been more than five years since a previous license for
the retail location was revoked.
   (B) The person applying for the license provides the board with
documentation demonstrating that the applicant has acquired or is
acquiring the premises or business in an arm's length transaction.
For purposes of this section, an "arm's length transaction" is
defined as a sale in good faith and for valuable consideration that
reflects the fair market value in the open market between two
informed and willing parties, neither under any compulsion to
participate in the transaction. A sale between relatives, related
companies or partners, or a sale for the primary purpose of avoiding
the effect of the violations of this division that occurred at the
retail location, is presumed not to be made at "arm's length."
   (3) The retailer, or if the retailer is not an individual, any
person controlling the retailer, has been convicted of a felony
pursuant to Section 30473 or 30480 of the Revenue and Taxation Code.
   (4) The retailer does not possess all required permits or licenses
required under the Revenue and Taxation Code.
   (5) The application is for a license for a retail location that is
within 600 feet of a public or private elementary or secondary
school. This paragraph shall not be construed to prohibit the renewal
or transfer of a license for a retail location that is within 600
feet of any school.
   (b) (1) Any retailer who is denied a license may petition for a
redetermination of the board's denial of the license within 30 days
after service upon that retailer of the notice of the denial of the
license. If a petition for redetermination is not filed within the
30-day period, the determination of denial becomes final at the
expiration of the 30-day period.
   (2) Every petition for redetermination shall be in writing and
shall state the specific grounds upon which the petition is founded.
The petition may be amended to state additional grounds at anytime
prior to the date on which the board issues its order or decision
upon the petition for redetermination.
   (3) If the petition for redetermination is filed within the 30-day
period, the board shall reconsider the determination of the denial
and, if the retailer has so requested in the petition, shall grant
the retailer an oral hearing and shall give the retailer at least 10
days' notice of the time and place of the hearing. The board may
continue the hearing from time to time as may be necessary.
   (4) The order or decision of the board upon a petition for
redetermination becomes final 30 days after mailing of notice
thereof. 
  SEC. 3.    Section 22974.8 of the Business and
Professions Code is amended to read:
   22974.8.  (a) (1) The board shall take action against a retailer,
at a licensed location that is located more than 600 feet from a
public or private elementary or secondary school and who is convicted
of a violation of either the STAKE Act (Division 8.5 (commencing
with Section 22950) or Section 308 of the Penal Code, according to
the schedule set forth in subdivision (b).
   (2) Convictions of violations by a retailer at one retail location
may not be accumulated against other locations of that same
retailer.
   (3) Convictions of violations accumulated against a prior retail
owner at a licensed location may not be accumulated against a new
retail owner at the same retail location.
   (4) Prior to suspending or revoking a retailer's license to sell
cigarette and tobacco products, the board shall notify the retailer.
The notice shall include instructions for appealing the license
suspension or revocation.
   (b) (1) Upon the first conviction of a violation of either the
STAKE Act (Division 8.5 (commencing with Section 22950) or Section
308 of the Penal Code, the retailer shall receive a warning letter
from the board that delineates the circumstances under which a
retailer's license may be suspended or revoked and the amount of time
the license may be suspended or revoked. The retailer and its
employees shall receive training on tobacco control laws from the
State Department of Public Health upon a first conviction.
   (2) Upon the second conviction of a violation of either the STAKE
Act (Division 8.5 (commencing with Section 22950)) or Section 308 of
the Penal Code within 12 months, the retailer shall be subject to a
fine of five hundred dollars ($500).
   (3) Upon the third conviction of a violation of either the STAKE
Act (Division 8.5 (commencing with Section 22950)) or Section 308 of
the Penal Code within 12 months, the retailer shall be subject to a
fine of one thousand dollars ($1,000).
   (4) Upon the fourth to the seventh conviction of a violation of
either the STAKE Act (Division 8.5 (commencing with Section 22950))
or Section 308 of the Penal Code within 12 months, the board shall
suspend the retailer's license to sell cigarette and tobacco products
for 90 days.
   (5) Upon the eighth conviction of a violation of the STAKE Act
(Division 8.5 (commencing with Section 22950) or Section 308 of the
Penal Code within 24 months, the board shall revoke the retailer's
license to sell cigarette and tobacco products.
   (c) The decision of the board to suspend or revoke the retailer's
license may be appealed to the board within 30 days after the notice
of suspension or revocation. All appeals shall be submitted in
writing.
   (d) The board's authority to take action against retailers, as set
forth in this section, commences on the date of the release of the
results from the survey undertaken by the State Department of Public
Health pursuant to Section 22952 of the Business and Professions Code
Section 22952 to comply with Section 1926 of Title XIX of the
federal Public Health Service Act (42 U.S.C. 300x-26), and any
implementing regulations adopted in relation thereto by the United
States Department of Health and Human Services, showing that the
youth purchase survey finds that 13 percent or more of youth were
able to purchase cigarettes. The board's authority to take action
under this section is inoperative on or after the date of the
subsequent release of the results from the survey showing that less
than 13 percent of youth were able to purchase cigarettes.
   (e) This section shall not preempt or supersede any local tobacco
control laws other than those related to the collection of state
taxes. Local licensing laws may provide for the suspension or
revocation of the local license for any violation of a state tobacco
control law. 
   SEC. 4.    Section 22974.8 of the   Business
and Professions Code   is repealed.  
   22974.8.  (a) (1) The board shall take action against a retailer,
convicted of a violation of either the Stake Act (Division 8.5
(commencing with Section 22950) or Section 308 of the Penal Code,
according to the schedule set forth in subdivision (b).
   (2) Convictions of violations by a retailer at one retail location
may not be accumulated against other locations of that same
retailer.
   (3) Convictions of violations accumulated against a prior retail
owner at a licensed location may not be accumulated against a new
retail owner at the same retail location.
   (4) Prior to suspending or revoking a retailer's license to sell
cigarette and tobacco products, the board shall notify the retailer.
The notice shall include instructions for appealing the license
suspension or revocation.
   (b) (1) Upon the first conviction of a violation of either the
STAKE Act (Division 8.5 (commencing with Section 22950) or Section
308 of the Penal Code, the retailer shall receive a warning letter
from the board that delineates the circumstances under which a
retailer's license may by suspended or revoked and the amount of time
the license may be suspended or revoked. The retailer and its
employees shall receive training on tobacco control laws from the
Department of Health Services upon a first conviction.
   (2) Upon the second conviction of a violation of either the STAKE
Act (Division 8.5 (commencing with Section 22950)) or Section 308 of
the Penal Code within 12 months, the retailer shall be subject to a
fine of five hundred dollars ($500).
   (3) Upon the third conviction of a violation of either the STAKE
Act (Division 8.5 (commencing with Section 22950)) or Section 308 of
the Penal Code within 12 months, the retailer shall be subject to a
fine of one thousand dollars ($1,000).
   (4) Upon the fourth to the seventh conviction of a violation of
either the STAKE Act (Division 8.5 (commencing with Section 22950))
or Section 308 of the Penal Code within 12 months, the board shall
suspend the retailer's license to sell cigarette and tobacco products
for 90 days.
   (5) Upon the eighth conviction of a violation of the STAKE Act
(Division 8.5 (commencing with Section 22950) or Section 308 of the
Penal Code within 24 months, the board shall revoke the retailer's
license to sell cigarette and tobacco products.
   (c) The decision of the board to suspend or revoke the retailer's
license may be appealed to the board within 30 days after the notice
of suspension or revocation. All appeals shall be submitted in
writing.
   (d) The board's authority to take action against retailers, as set
forth in this section, commences on the date of the release of the
results from the survey undertaken by the Department of Health
Services pursuant to Section 22952 of the Business and Professions
Code Section 22952 to comply with Section 1926 of Title XIX of the
federal Public Health Service Act (42 U.S.C. 300x-26), and any
implementing regulations adopted in relation thereto by the United
States Department of Health and Human Services, showing that the
youth purchase survey finds that 13 percent or more of youth were
able to purchase cigarettes. The board's authority to take action
under this section is inoperative on or after the date of the
subsequent release of the results from the survey showing that less
than 13 percent of youth were able to purchase cigarettes. 
   SEC. 4.   SEC. 5.   Section 
22974.9   22974.8  is added to the Health and
Safety Code, to read:
    22974.9.  22974.8.   (a) (1) The board
shall take action against a retailer  of a licensed location
that is located 600 feet or less of a public or private elementary or
secondary school and who is convicted of a   of a
licensed location who is convicted of a  violation of either the
STAKE Act (Division 8.5 (commencing with Section 22950) or Section
308 of the Penal Code, according to the schedule set forth in
subdivision (b).
   (2) Convictions of violations by a retailer at one retail location
may not be accumulated against other locations of that same
retailer.
   (3) Convictions of violations accumulated against a prior retail
owner at a licensed location may not be accumulated against a new
retail owner at the same retail location.
   (4) Prior to revoking a retailer's license to sell cigarette and
tobacco products, the board shall notify the retailer. The notice
shall include instructions for appealing the license revocation.
   (b) (1) Upon the first conviction of a violation of either the
STAKE Act (Division 8.5 (commencing with Section 22950)) or Section
308 of the Penal Code, the retailer shall receive a warning letter
from the board that delineates the circumstances under which a
retailer's license may be revoked. The retailer and its employees
shall receive training on tobacco control laws from the State
Department of Public Health upon a first conviction.  The
retailer shall also be subject to a fine of seven hundred fifty
dollars   ($750). 
   (2) Upon the second conviction of a violation of either the STAKE
Act (Division 8.5 (commencing with Section 22950)) or Section 308 of
the Penal Code within 12 months, the retailer shall  be
subject to a fine of five hundred dollars ($500).   be
subject to a fine of one thousand five hundred dollars ($1,500) and
suspension of the license for 25   days. 
   (3) Upon the third conviction of a violation of either the STAKE
Act (Division 8.5 (commencing with Section 22950)) or Section 308 of
the Penal Code within 12 months, the board shall revoke the retailer'
s license to sell cigarette and tobacco products.
   (c) The decision of the board to revoke the retailer's license may
be appealed to the board within 30 days after the notice of
revocation. All appeals shall be submitted in writing.
   (d) This section shall not preempt or supersede any local tobacco
control laws other than those related to the collection of state
taxes. Local licensing laws may provide for the suspension or
revocation of the local license for any violation of a state tobacco
control law.