00 Enrolled SB 84 01 Relating to the improper sale of tobacco products and to the testing and packaging of 02 cigarettes to be sold, offered for sale, or possessed in this state; relating to civil penalties for 03 the improper sale of tobacco products and to suspension of business license endorsements and 04 the right to obtain business license endorsements where the suspension is based on the 05 improper sale of tobacco products; relating to citations for certain offenses related to tobacco; 06 and providing for an effective date. 07 _______________ 08  * Section 1. AS 11.76.100(a) is amended to read: 09 (a) A person commits the offense of selling or giving tobacco to a minor if the 10 person 11 (1) negligently sells a cigarette, a cigar, tobacco, or a product 12 containing tobacco to a person under 19 years of age; 13 (2) is 19 years of age or older and negligently exchanges or gives a 01 cigarette, a cigar, tobacco, or a product containing tobacco to a person under 19 years 02 of age; [OR] 03 (3) maintains a vending machine that dispenses cigarettes, cigars, 04 tobacco, or products containing tobacco; or  05 (4) holds a business license endorsement under AS 43.70.075 and  06 allows a person under 19 years of age to sell a cigarette, a cigar, tobacco, or a  07 product containing tobacco. 08 * Sec. 2. AS 18 is amended by adding a new chapter to read:  09 Chapter 74. Cigarette Fire Safety.  10 Sec. 18.74.010. Requirement for sale. Except as provided by AS 18.74.060, a 11 person may not sell or offer to sell cigarettes in this state, or sell or offer to sell 12 cigarettes to another person located in this state, unless 13 (1) the cigarettes are tested under 14 (A) AS 18.74.030 and satisfy the performance standard in 15 AS 18.74.030(d); or 16 (B) AS 18.74.040 and satisfy an alternative performance 17 standard under AS 18.74.040; 18 (2) the cigarettes have been marked as required by AS 18.74.130; and 19 (3) a certification has been submitted by the manufacturer of the 20 cigarettes under AS 18.74.080. 21 Sec. 18.74.030. Testing of cigarettes. (a) Cigarettes shall be tested under 22 (1) the ASTM International Standard E2187-04, entitled "Standard 23 Test Method for Measuring the Ignition Strength of Cigarettes"; or 24 (2) a test method established under (b) of this section. 25 (b) The state fire marshal may adopt an ASTM International standard test 26 method that is adopted by the American Society of Testing and Materials after the 27 standard test method identified under (a) of this section if the state fire marshal finds 28 that the method does not result in a change in the percentage of full-length burns 29 exhibited by any tested cigarette when compared to the percentage of full-length burns 30 that the same cigarette would exhibit when tested under 31 (1) the standard test method identified under (a)(1) of this section; and 01 (2) the criteria established under (c) and (d) of this section. 02 (c) The testing under this section shall be conducted on 10 layers of filter 03 paper. A complete test trial consists of 40 replicate tests of each cigarette. The 04 performance standard required by (d) of this section may only be applied to a 05 complete test trial. 06 (d) When tested under this section, not more than 25 percent of the cigarettes 07 tested in a test trial may exhibit full-length burns. 08 Sec. 18.74.040. Alternative test methods. (a) If the state fire marshal 09 determines that cigarettes cannot be tested by a test method established in 10 AS 18.74.030(a), a manufacturer of the cigarettes shall propose an alternative test 11 method and performance standard for the cigarettes to the state fire marshal. On 12 approval of the proposed test method and a determination by the state fire marshal that 13 the performance standard proposed by the manufacturer is equivalent to the 14 performance standard prescribed by AS 18.74.030(d), the manufacturer may employ 15 the proposed alternative test method and performance standard to certify the cigarette 16 under AS 18.74.080. 17 (b) Unless the state fire marshal demonstrates a reasonable basis why the 18 alternative test method should not be accepted under this chapter, the state fire marshal 19 shall authorize a manufacturer to use an alternative test method and performance 20 standard to certify cigarettes for sale in this state if the state fire marshal 21 (1) determines that another state has enacted reduced cigarette ignition 22 propensity standards that include a test method and performance standard that are the 23 same as those contained in this chapter; and 24 (2) finds that the officials responsible for implementing those 25 requirements have approved a proposed alternative test method and performance 26 standard for particular cigarettes proposed by a manufacturer as meeting the fire safety 27 standards of that state's law under a legal provision comparable to this section. 28 (c) All other applicable requirements of this chapter apply to the manufacturer 29 of the cigarettes tested under this section.  30 Sec. 18.74.050. Testing laboratories. (a) Testing of cigarettes under this 31 chapter shall be performed by a laboratory that has been accredited under standard 01 ISO/IEC 17025 of the International Organization for Standardization or by another 02 comparable accreditation standard required by the state fire marshal.  03 (b) A laboratory that conducts cigarette testing under this chapter shall 04 implement a quality control and quality assurance program that ensures the 05 repeatability of the testing results. The repeatability value may not be greater than 06 0.19. In this subsection, 07 (1) "quality control and quality assurance program" means the 08 laboratory procedures implemented to ensure that operator bias, systematic and 09 nonsystematic methodological errors, and equipment-related problems do not affect 10 the results of the testing quality control program; 11 (2) "repeatability" means the range of values within which the repeat 12 results of cigarette test trials from a single laboratory will fall 95 percent of the time.  13 Sec. 18.74.060. Testing for another purpose. AS 18.74.030 and 18.74.040 do 14 not require cigarettes to be tested if the cigarettes are tested for another purpose and 15 the testing is consistent with this chapter. 16 Sec. 18.74.065. Testing by state fire marshal. The state fire marshal may 17 perform testing of cigarettes to determine compliance with this chapter. If the state fire 18 marshal or a contractor of the state fire marshal performs testing to determine a 19 cigarette's compliance with the performance standard in AS 18.74.030(d) or an 20 alternative performance standard under AS 18.74.040, the testing shall be performed 21 under this chapter. 22 Sec. 18.74.070. Maintenance of records. A manufacturer shall keep for three 23 years copies of the reports of all tests conducted on all cigarettes offered for sale. The 24 manufacturer shall make copies of those reports available to the state fire marshal and 25 the attorney general on written request. 26 Sec. 18.74.080. Certification requirement. (a) A manufacturer shall submit to 27 the state fire marshal a certification that each cigarette listed in the certification has 28 been tested under AS 18.74.030 and satisfies the performance standard in 29 AS 18.74.030(d), or has been tested under AS 18.74.040 and satisfies an alternative 30 performance standard under AS 18.74.040. 31 (b) If a manufacturer has certified a cigarette under this section and 01 subsequently makes a change to the cigarette that is likely to alter its compliance with 02 the performance standard under AS 18.74.030(d) or an alternative performance 03 standard under AS 18.74.040, the cigarette may not be sold or offered for sale in this 04 state or sold to a person located in this state until the manufacturer retests the cigarette 05 under AS 18.74.030 or 18.74.040, the cigarette meets the performance standard under 06 AS 18.74.030(d) or the alternative performance standard under AS 18.74.040, and the 07 manufacturer maintains records of the retesting under AS 18.74.070. 08 (c) For each cigarette listed in a certification submitted under (a) of this 09 section, a manufacturer shall pay to the state fire marshal a fee of $250. The state fire 10 marshal may adjust this fee annually to ensure that it defrays the actual costs of the 11 processing, testing, enforcement, and oversight activities required by this chapter. 12 (d) Each cigarette certified under this section shall be recertified every three 13 years.  14 Sec. 18.74.090. Contents of certification. The certification required by 15 AS 18.74.080 must provide the following information for each cigarette listed in the 16 certification: 17 (1) the brand or trade name on the package; 18 (2) the style, such as "light" or "ultra-light"; 19 (3) the length in millimeters; 20 (4) the circumference in millimeters; 21 (5) the flavor, if applicable; 22 (6) whether the cigarette is filtered or nonfiltered; 23 (7) a description of the package; 24 (8) the marking approved under AS 18.74.120; 25 (9) the name, address, and telephone number of the laboratory that 26 conducted the test, if different than the manufacturer who conducted the test; and 27 (10) the date that the testing occurred. 28 Sec. 18.74.100. Banding requirement. Each cigarette listed in a certification 29 submitted under AS 18.74.080 that uses lowered permeability bands in the cigarette 30 paper to achieve compliance with the performance standard in AS 18.74.030(d) must 31 have at least two nominally identical bands on the paper surrounding the tobacco 01 column. At least one complete band must be located at least 15 millimeters from the 02 lighting end of the cigarette. For cigarettes on which the bands are positioned by 03 design, there must be at least two bands fully located at least 04 (1) 15 millimeters from the lighting end; and 05 (2) 10 millimeters from 06 (A) the filter end of the tobacco column; or 07 (B) the labeled end of the tobacco column of a nonfiltered 08 cigarette.  09 Sec. 18.74.110. Availability of certifications. The certification required by 10 AS 18.74.080 shall be made available to the attorney general for purposes consistent 11 with this chapter and to the department for the purpose of ensuring compliance with 12 AS 18.74.080. 13 Sec. 18.74.120. Packaging marking approval. (a) Before submitting a 14 certification of a cigarette under AS 18.74.080, a manufacturer shall present its 15 proposed packaging marking to the state fire marshal for approval. The state fire 16 marshal shall approve or disapprove the proposed packaging marking. Proposed 17 packaging marking shall be considered approved if the state fire marshal fails to act 18 within 10 business days after receiving a request for approval. 19 (b) Notwithstanding AS 18.74.130, the state fire marshal shall give a 20 preference to proposed packaging marking for a cigarette that is in use and approved 21 for the cigarette under the fire safety standards for cigarettes established by the law of 22 the state of New York, unless the state fire marshal demonstrates a reasonable basis 23 why the proposed packaging marking should not be approved under this chapter. 24 (c) Notwithstanding AS 18.74.130, the state fire marshal shall approve the use 25 of the letters "FSC" for "fire standards compliant" on proposed packaging marking to 26 indicate that the cigarettes comply with the performance standard in AS 18.74.030(d) 27 or an alternative performance standard under AS 18.74.040. 28 (d) A manufacturer may not change its approved packaging marking unless 29 the state fire marshal has approved the modification under this section. 30 (e) A wholesale dealer, an agent, and a retail dealer shall permit the state fire 31 marshal, the department, the attorney general, and the employees of those persons to 01 inspect packaging markings of cigarettes.  02 Sec. 18.74.130. Marking of cigarette packaging. (a) The packaging 03 containing a brand and style of cigarette that a manufacturer certifies under 04 AS 18.74.080 must be marked to indicate compliance with the requirements of this 05 chapter. The packaging marking must be in eight-point type or larger and consist of 06 (1) a modification of the universal product code to include a visible 07 mark printed at or around the area of the code; the mark may consist of alphanumeric 08 or symbolic characters and must be permanently stamped, engraved, embossed, or 09 printed in conjunction with the universal product code; 10 (2) any visible combination of alphanumeric or symbolic characters 11 permanently stamped, engraved, or embossed on the package or wrapping; or 12 (3) printed, stamped, engraved, or embossed text on the cigarette 13 package that indicates that the cigarettes satisfy the requirements of this chapter. 14 (b) A manufacturer shall use only one packaging marking and apply that 15 packaging marking uniformly to all packaging and to all brands marketed by the 16 manufacturer for sale in this state. 17 Sec. 18.74.150. Copies. A manufacturer who certifies a cigarette under 18 AS 18.74.080 shall provide a copy of the certification to each wholesale dealer and 19 agent to whom the manufacturer sells the cigarette. The manufacturer shall also 20 provide the wholesale dealer and agent with sufficient copies of an illustration of the 21 cigarette packaging markings used by the manufacturer under AS 18.74.130 for each 22 retail dealer to whom the wholesale dealer or agent sells cigarettes. A wholesale dealer 23 or an agent shall provide a copy of the cigarette packaging markings received from a 24 manufacturer to each retail dealer to whom the wholesale dealer or agent sells 25 cigarettes.  26 Sec. 18.74.160. Penalties for violations. (a) A manufacturer, a wholesale 27 dealer, an agent, or another person who knowingly sells or offers to sell cigarettes 28 other than through retail sale and in violation of AS 18.74.010 is subject to a civil 29 penalty not to exceed 30 (1) $10,000 for a first violation; 31 (2) $25,000 for each violation that is not a first violation.  01 (b) A retail dealer who knowingly sells or offers to sell cigarettes in violation 02 of AS 18.74.010 is subject, for each sale or offer to sell, to a civil penalty not to 03 exceed 04 (1) $500 for a first violation in which the total number of cigarettes 05 sold or offered for sale does not exceed 1,000 cigarettes; 06 (2) $2,000 for each violation that is not a first violation and in which 07 the total number of cigarettes sold or offered for sale does not exceed 1,000 cigarettes; 08 (3) $1,000 for a first violation in which the total number of cigarettes 09 sold or offered for sale exceeds 1,000 cigarettes; 10 (4) $5,000 for a violation that is not a first violation and in which the 11 total number of cigarettes sold or offered for sale exceeds 1,000 cigarettes. 12 (c) The penalties against 13 (1) one manufacturer, wholesale dealer, agent, or other person under 14 (a) of this section may not exceed $100,000 for violations occurring during a 30-day 15 period; or 16 (2) one retail dealer under (b) of this section may not exceed $25,000 17 for violations occurring during a 30-day period. 18 (d) In addition to any other penalty prescribed by law, a person engaged in the 19 manufacture of cigarettes who knowingly makes a false certification under 20 AS 18.74.080 is subject to a civil penalty of at least $75,000 for a first violation and a 21 civil penalty not exceeding $250,000 for each violation that is not a first violation. 22 (e) A manufacturer who fails to make copies of reports available under 23 AS 18.74.070 within 60 days after receiving a written request from the state fire 24 marshal or the attorney general is subject to a civil penalty not to exceed $10,000 for 25 each day after the 60th day that the manufacturer does not make the copies available. 26 (f) If a person violates a provision of this chapter and a civil penalty is not set 27 for the violation, the person is subject to a civil penalty not to exceed $1,000 for a first 28 violation and a civil penalty not exceeding $5,000 for each violation that is not a first 29 violation. 30 Sec. 18.74.180. Separate accounting. The fee received under AS 18.74.080(c) 31 and the civil penalties imposed under AS 18.74.160 shall be deposited into the general 01 fund and separately accounted for under AS 37.05.142. The legislature may 02 appropriate the money accounted for under this section to the fire prevention and 03 public safety fund established under AS 18.74.210. 04 Sec. 18.74.190. Seizure of cigarettes. (a) If a person is offering for sale or has 05 made a sale of cigarettes in violation of AS 18.74.010, the state fire marshal, the 06 department, or a law enforcement agency shall seize and, subject to (b) of this section, 07 dispose of the cigarettes. 08 (b) Before disposal of cigarettes under (a) of this section, the state fire marshal 09 or the department shall 10 (1) provide the person from whom the cigarette was seized with notice 11 of the seizure and an opportunity for a hearing regarding the seizure; and 12 (2) permit the holder of the trademark rights in the cigarette brand to 13 inspect the cigarettes. 14 Sec. 18.74.200. Other remedies. In addition to any other remedy provided by 15 law, the state fire marshal or attorney general may file an action in superior court for a 16 violation of this chapter, including an action for injunctive relief or to recover costs or 17 damages suffered by the state because of a violation of this chapter, including 18 enforcement costs relating to the specific violation. Each violation of this chapter or of 19 the regulations adopted under this chapter constitutes a separate cause of action for 20 which the state fire marshal or attorney general may obtain relief. 21 Sec. 18.74.210. Fire prevention and public safety fund. (a) The fire 22 prevention and public safety fund is established. The fund consists of appropriations 23 made to the fund. 24 (b) The purpose of the fund is to pay the expenses of the state fire marshal and 25 the department for implementing and enforcing this chapter. 26 (c) Money appropriated to the fund may be spent for the purposes of the fund 27 without further appropriation. Money appropriated to the fund does not lapse. 28 Sec. 18.74.220. Implementation. The substance of the fire safety standards for 29 cigarettes established by the law of the state of New York and the implementation of 30 these standards by the state of New York shall be persuasive authority in the 31 implementation of this chapter by the state fire marshal and the attorney general. 01 Sec. 18.74.230 Review by state fire marshal. The state fire marshal shall 02 review the effectiveness of this chapter, report the state fire marshal's findings to the 03 legislature every three years on or by January 30 of the reporting year, and, if 04 appropriate, recommend legislation to improve the effectiveness of this chapter. 05 Sec. 18.74.240. Regulations. The state fire marshal may adopt regulations to 06 implement this chapter. 07 Sec. 18.74.250. Inspections. (a) The department may inspect cigarettes held by 08 wholesale dealers, agents, and retail dealers to determine if the cigarettes are marked 09 as required by AS 18.74.120 and 18.74.130. If the cigarettes are not marked as 10 required, the department shall notify the state fire marshal. 11 (b) To determine compliance with this chapter, the state fire marshal and the 12 attorney general may examine the books, papers, invoices, and other records of a 13 person who possesses, controls, or occupies premises where cigarettes are placed, 14 stored, sold, or offered for sale, and the stock of cigarettes on the premises. 15 (c) A person who possesses, controls, or occupies premises where cigarettes 16 are placed, sold, or offered for sale shall allow the state fire marshal and the attorney 17 general to make the inspections authorized by this section. 18 Sec. 18.74.260. Sale outside the state. This chapter may not be interpreted to 19 prohibit a person from manufacturing or selling cigarettes that do not meet the 20 requirements of this chapter if the cigarettes are or will be stamped for sale in another 21 state or are packaged for sale outside the United States and the person has taken 22 reasonable steps to ensure that the cigarettes will not be sold or offered for sale to 23 persons located in this state. 24 Sec. 18.74.270. Regulation by municipality. Notwithstanding any other 25 provision of law, a municipality may not enact or enforce an ordinance or another law 26 of the municipality that conflicts with this chapter.  27 Sec. 18.74.280. Relationship to federal law. This chapter does not apply if a 28 federal law is enacted that establishes a reduced cigarette ignition propensity standard 29 and preempts this chapter. 30 Sec. 18.74.290. Definitions. In this chapter, 31 (1) "agent" means a person authorized by the department to purchase 01 and affix stamps on packages of cigarettes under AS 43.50.500 - 43.50.700; 02 (2) "cigarette" means a roll for smoking of any size or shape, made 03 wholly or in part of tobacco, whether or not the tobacco is flavored, adulterated, or 04 mixed with another ingredient, if the wrapper or cover of the roll is made of paper or a 05 material other than tobacco; 06 (3) "department" means the Department of Revenue; 07 (4) "manufacturer" means 08 (A) a person who manufactures or otherwise produces 09 cigarettes, or causes cigarettes to be manufactured or produced anywhere, if 10 the manufacturer intends the cigarettes to be sold in this state, including 11 cigarettes intended to be sold in the United States through an importer; 12 (B) the first purchaser anywhere who intends to resell in the 13 United States cigarettes that are manufactured anywhere and that the original 14 manufacturer or maker does not intend to be sold in the United States; or 15 (C) a person who becomes a successor of a person described in 16 (A) or (B) of this paragraph; 17 (5) "retail dealer" means a person, other than a manufacturer or 18 wholesale dealer, who sells cigarettes or tobacco products; 19 (6) "sale" or "sell" means a sale, exchange, barter, and any other 20 manner of transferring the ownership of personal property; 21 (7) "wholesale dealer" means a person who 22 (A) sells cigarettes or tobacco products to retail dealers or other 23 persons for resale; and 24 (B) owns, operates, or maintains cigarette or tobacco vending 25 machines in, at, or on premises owned or occupied by another person. 26  * Sec. 3. AS 37.05.146(c) is amended by adding a new paragraph to read: 27 (82) fees collected under AS 18.74.080. 28  * Sec. 4. AS 43.70.075(d) is amended to read: 29 (d) If a person who holds an endorsement issued under this section, or an 30 agent or an employee of a person who holds an endorsement issued under this section 31 acting within the scope of the agency or employment, has been convicted of violating 01 AS 11.76.100, 11.76.106, or 11.76.107, the department shall impose a civil penalty  02 as set out in this subsection. However, following a hearing under (m) of this  03 section, and based on evidence admitted at that hearing concerning questions  04 specified in (m)(4) and (6) of this section, the department may reduce by not  05 more than 10 days a suspension under (1) of this subsection, or by not more than  06 20 days a suspension under (2) of this subsection, or increase by not more than 10  07 days a suspension under (1) of this subsection, or by not more than 20 days a  08 suspension under (2) of this subsection. If a hearing is not requested, or if a  09 hearing is requested and the department determines that the evidence admitted  10 does not support increasing or decreasing the suspension, the department shall 11 suspend the endorsement for a period of 12 (1) 20 days and impose a civil penalty of $300 if the person has not 13 been previously convicted of violating AS 11.76.100, 11.76.106, or 11.76.107 and is 14 not otherwise subject to the sanctions described in (2) - (4) of this subsection; 15 (2) 45 days and impose a civil penalty of $500 if, within the 24 months 16 before the date of the department's notice under (m) of this section, the person, or an 17 agent or employee of the person while acting within the scope of the agency or 18 employment of the person, was convicted once of violating AS 11.76.100, 11.76.106, 19 or 11.76.107; 20 (3) 90 days and impose a civil penalty of $1,000 if, within the 24 21 months before the date of the department's notice under (m) of this section, the person, 22 or an agent or employee of the person while acting within the scope of the agency or 23 employment of the person, was convicted twice of violating AS 11.76.100, 11.76.106, 24 or 11.76.107, or a provision of this section or a regulation implementing this section 25 adopted under AS 43.70.090; or 26 (4) one year and impose a civil penalty of $2,500 if, within the 24 27 months before the date of the department's notice under (m) of this section, the person, 28 or an agent or employee of the person while acting within the scope of the agency or 29 employment of the person, was convicted more than twice of violating AS 11.76.100, 30 11.76.106, or 11.76.107. 31  * Sec. 5. AS 43.70.075(m) is amended to read: 01 (m) The department may initiate suspension of a business license endorsement 02 or the right to obtain a business license endorsement under this section by sending the 03 person subject to the suspension a notice by certified mail, return receipt requested, or 04 by delivering the notice to the person. The notice must contain information that 05 informs the person of the grounds for suspension, the length of any suspension sought, 06 and the person's right to administrative review. A suspension begins 30 days after 07 receipt of notice described in this subsection unless the person delivers a timely 08 written request for a hearing to the department in the manner provided by regulations 09 of the department. If a hearing is requested under this subsection, an administrative  10 law judge [A HEARING OFFICER] of the office of administrative hearings 11 (AS 44.64.010) shall determine the issues by using the preponderance of the evidence 12 test and shall, to the extent they do not conflict with regulations adopted under 13 AS 44.64.060, conduct the hearing in the manner provided by regulations of the 14 department. A hearing under this subsection is limited to the following questions: 15 (1) was the person holding the business license endorsement, or an 16 agent or employee of the person while acting within the scope of the agency or 17 employment of the person, convicted by plea or judicial finding of violating 18 AS 11.76.100, 11.76.106, or 11.76.107; 19 (2) if the department does not allege a conviction of AS 11.76.100, 20 11.76.106, or 11.76.107, did the person, or an agent or employee of the person while 21 acting within the scope of the agency or employment of the person, violate a provision 22 of (a) or (g) of this section; 23 (3) within the 24 months before the date of the department's notice 24 under this subsection, was the person, or an agent or employee of the person while 25 acting within the scope of the agency or employment of the person, convicted of 26 violating AS 11.76.100, 11.76.106, or 11.76.107 or adjudicated for violating a 27 provision of (a) or (g) of this section;  28 (4) did the person holding the business license endorsement  29 establish that the person holding the business license endorsement had adopted  30 and enforced an education, a compliance, and a disciplinary program for agents  31 and employees of the person as provided in (t) of this section;  01 (5) did the person holding the business license endorsement  02 overcome the rebuttable presumption established in (w) of this section;  03 (6) within five years before the date of the violation that is the  04 subject of the hearing, did the department establish that the person holding the  05 business license endorsement  06 (A) previously violated (a) or (g) of this section;  07 (B) previously violated AS 11.76.100, 11.76.106, or  08 11.76.107 at a location or outlet in a location for which the person holds a  09 business license endorsement, or had an agent or employee previously  10 violate AS 11.76.100, 11.76.106, or 11.76.107; this subparagraph does not  11 apply to a prior conviction that served to enhance a suspension period  12 under (d)(2) - (4) of this section; or  13 (C) engaged at a location owned by the person in other  14 conduct that was or is likely to result in the sale of tobacco to a person  15 under 19 years of age in violation of AS 11.76.100, 11.76.106, or 11.76.107. 16  * Sec. 6. AS 43.70.075 is amended by adding new subsections to read: 17 (t) Based on evidence provided at the hearing under (m)(4) - (6) of this 18 section, the department may reduce the license suspension period under (d) of this 19 section if the person holding the business license endorsement establishes that, before 20 the date of the violation, the person had 21 (1) adopted and enforced a written policy against selling cigarettes, 22 cigars, tobacco, or products containing tobacco to a person under 19 years of age in 23 violation of AS 11.76.100, 11.76.106, or 11.76.107; 24 (2) informed the person's agents and employees of the applicable laws 25 and their requirements and conducted training on complying with the laws and 26 requirements; 27 (3) required each agent and employee of the person to sign a form 28 stating that the agent and employee has been informed of and understands the written 29 policy and the requirements of AS 11.76.100, 11.76.106, and 11.76.107; 30 (4) determined that the agents and employees of the person had 31 sufficient experience and ability to comply with the written policy and requirements of 01 AS 11.76.100, 11.76.106, and 11.76.107; 02 (5) required the agents and employees of the person to verify the age 03 of purchasers of cigarettes, cigars, tobacco, or other products containing tobacco by 04 means of a valid government issued photographic identification; 05 (6) established and enforced disciplinary sanctions for noncompliance 06 with the written policy or the requirements of AS 11.76.100, 11.76.106, and 07 11.76.107; and 08 (7) monitored the compliance of the agents and employees of the 09 person with the written policy and the requirements of AS 11.76.100, 11.76.106, and 10 11.76.107. 11 (u) A reduction in the period of suspension under this section may not be 12 granted more than once in a 12-month period for a location or outlet in a location for 13 which the person holds a business license. 14 (v) Notwithstanding (d) of this section, in place of a hearing under (m) of this 15 section, the department and the person holding the business license endorsement may 16 enter into a memorandum of agreement regarding the imposition of a suspension and 17 civil penalties based on a violation of AS 11.76.100, 11.76.106, or 11.76.107. The 18 memorandum of agreement must contain a provision that the person holding the 19 business license endorsement admits or does not contest that a violation of 20 AS 11.76.100, 11.76.106, or 11.76.107 occurred and accepts the imposition of 21 suspension and civil penalty under this section. Based on the memorandum of 22 agreement, the department may reduce the period of suspension. For violations 23 involving AS 11.76.100, 11.76.106, or 11.76.107, the department may not reduce the 24 period of suspension by more than 10 days under (d)(1) of this section or by more than 25 20 days under (d)(2) of this section. The department may not agree to a reduction in 26 the period of suspension more than once in a 12-month time period for a location or 27 outlet in a location for which the person holds a business license endorsement. 28 (w) For purposes of (m)(5) of this section, a conviction for a violation of 29 AS 11.76.100, 11.76.106, or 11.76.107 by the agent or employee of the person who 30 holds the business license endorsement is rebuttably presumed to constitute proof of 31 the fact that the agent or employee negligently sold a cigarette, a cigar, or tobacco, or a 01 product containing tobacco to a person under 19 years of age. The person who holds 02 the business license endorsement may overcome the presumption by establishing by 03 clear and convincing evidence that the agent or employee did not negligently sell a 04 cigarette, a cigar, or tobacco, or a product containing tobacco to a person under 19 05 years of age in violation of AS 11.76.100, 11.76.106, or 11.76.107 as alleged in the 06 citation issued to the agent or employee. The presentation of evidence authorized by 07 this subsection does not constitute a collateral attack on the conviction described in 08 this subsection. 09 (x) Notwithstanding (d), (t), or (v) of this section, a period of suspension may 10 not be reduced for a violation of AS 11.76.100(a)(4). 11  * Sec. 7. AS 44.29.094 is amended by adding a new subsection to read: 12 (h) The department shall notify the person who holds the business license 13 endorsement required by AS 43.70.075(a) that the person's agent or employee has 14 received a citation for a violation of AS 11.76.100, 11.76.106, or 11.76.107. The 15 department may make the notification by delivering a copy of the citation or another 16 document that includes the essential facts constituting the violation charged. The 17 department shall accomplish the delivery by 18 (1) hand delivery of the citation or other document to a person who 19 confirms that the person serves in a management or supervisory position at the 20 location, or outlet in a location, where the alleged violation occurred; or 21 (2) mailing the citation or other document by first class mail to the 22 person who holds the business license endorsement; the department shall use the 23 person's most current address that the Department of Commerce, Community, and 24 Economic Development has on file for the person's business license endorsement 25 under AS 43.70.075; the citation or other document shall be postmarked within five 26 business days after the citation is issued. 27  * Sec. 8. The uncodified law of the State of Alaska is amended by adding a new section to 28 read: 29 TRANSITION. (a) AS 18.74.010, enacted by sec. 2 of this Act, does not prohibit a 30 wholesale dealer or retail dealer from selling or offering to sell an inventory of cigarettes 31 existing on the effective date of sec. 2 of this Act if the wholesale dealer or retail dealer 01 establishes that 02 (1) state tax stamps were affixed to the cigarettes under AS 43.50 before the 03 effective date of sec. 2 of this Act; and 04 (2) the inventory was purchased before the effective date of sec. 2 of this Act 05 in comparable quantity to the inventory purchased during the same period of the previous 06 year. 07 (b) In this section, "retail dealer," "sell," and "wholesale dealer" have the meanings 08 given in AS 18.74.290. 09  * Sec. 9. Section 2 of this Act takes effect on the first day of the 13th month after the month 10 in which this Act becomes law under AS 01.10.070.