HB 228: "An Act relating to the offense of selling or giving tobacco to a minor, to the accounting of fees from business license endorsements for tobacco products, to the disclosure of certain confidential cigarette and tobacco product information, to notification regarding a cigarette manufacturer's noncompliance with the tobacco product Master Settlement Agreement, to business license endorsements for sale of tobacco products, to citations and penalties for illegal sales of tobacco products; and providing for an effective date."
00 HOUSE BILL NO. 228 01 "An Act relating to the offense of selling or giving tobacco to a minor, to the accounting 02 of fees from business license endorsements for tobacco products, to the disclosure of 03 certain confidential cigarette and tobacco product information, to notification regarding 04 a cigarette manufacturer's noncompliance with the tobacco product Master Settlement 05 Agreement, to business license endorsements for sale of tobacco products, to citations 06 and penalties for illegal sales of tobacco products; and providing for an effective date." 07 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF ALASKA: 08 * Section 1. AS 11.76.100(d) is amended to read: 09 (d) A person who violates (a) of this section is guilty of a violation and upon 10 conviction is punishable by a fine of not less than 11 (1) $300 if the person does not hold a business license endorsement 12 issued under AS 43.70.075; 13 (2) $1,000 if the person has not been previously convicted of
01 violating this section and the person holds a business license endorsement issued 02 under AS 43.70.075; 03 (3) $2,000 if the person has been previously convicted once within 04 the past 24 months of violating this section and the person holds a business 05 license endorsement issued under AS 43.70.075; 06 (4) $5,000 if the person has been previously convicted more than 07 once within the past 24 months of violating this section and the person holds a 08 business license endorsement issued under AS 43.70.075. 09 * Sec. 2. AS 37.05.146(b)(4) is amended by adding a new subparagraph to read: 10 (XX) receipts of the Department of Community and Economic 11 Development for fees for business license endorsements for tobacco products 12 (AS 43.70.075); 13 * Sec. 3. AS 40.25 is amended by adding a new section to read: 14 Sec. 40.25.105. Disclosure of information for compliance with the tobacco 15 product Master Settlement Agreement. (a) Notwithstanding the provisions of 16 AS 40.25.100(a), the Department of Revenue may disclose information submitted to 17 the Department of Revenue relating to cigarette and tobacco products, cigarette and 18 tobacco product manufacturers, and cigarette and tobacco product retailers to the 19 attorney general and to other parties as the Department of Revenue determines 20 necessary to monitor and enforce compliance by cigarette and tobacco product 21 manufacturers with the tobacco product Master Settlement Agreement described in 22 AS 45.53.010 - 45.53.100. 23 (b) A person receiving information under this section shall maintain the 24 confidentiality that the Department of Revenue is required to extend under 25 AS 43.05.230 to the returns, reports, documents, determinations, and workpapers 26 furnished to that person under this section. 27 * Sec. 4. AS 43.50 is amended by adding a new section to read: 28 Sec. 43.50.145. Notification of noncompliance; confiscation of 29 noncomplying cigarettes. The department shall notify a licensee in writing when a 30 determination has been made that a cigarette manufacturer has failed to comply with 31 AS 45.53.020 or 45.53.040(a). The department's notification must contain the name
01 of the cigarette manufacturer that failed to comply and the affected brands of 02 cigarettes. The licensee shall, within 30 days after receiving the department's 03 notification under this section, destroy the brands of cigarettes covered by the notice 04 or return the brands of cigarettes to the manufacturer or distributor from which they 05 were purchased. Beginning on the 31st day after receipt of the notice, the brands of 06 cigarettes specified in the notice are contraband and subject to immediate confiscation. 07 The department may allow a credit for the tax on the returned or destroyed cigarettes. 08 * Sec. 5. AS 43.70.075(a) is amended to read: 09 (a) Unless a person has a business license endorsement issued under this 10 section for each location or outlet in a location where the person offers tobacco 11 products for sale, a person may not sell or allow a vending machine to sell in its 12 location or outlet cigarettes, cigars, tobacco, or other products containing tobacco as 13 a retailer at that location or outlet. Each [AN] endorsement required under this 14 section is in addition to any other license or endorsement required by law. A person 15 may not apply for an endorsement under this section for a location or outlet if an 16 endorsement issued for the same location or outlet is currently suspended or 17 revoked. An endorsement issued for a location or outlet to a person in violation 18 of this subsection is void. 19 * Sec. 6. AS 43.70.075(b) is amended to read: 20 (b) The department, upon payment of a fee of $100 [$25], shall issue a 21 business license endorsement to a person who applies for a business license under this 22 chapter, and may renew the endorsement issued under this subsection for a fee of $100 23 [$25]. The endorsement expires at the same time as the license to which it attaches. 24 * Sec. 7. AS 43.70.075(d) is amended to read: 25 (d) If a person who holds an endorsement issued under this section, or an 26 agent or an employee of a person who holds an endorsement issued under this section 27 acting within the scope of the agency or employment, has been convicted of violating 28 AS 11.76.100, 11.76.106, or 11.76.107, [OR VIOLATES A PROVISION OF THIS 29 SECTION OR A REGULATION IMPLEMENTING THIS SECTION ADOPTED 30 UNDER AS 43.70.090,] the department shall [MAY] suspend the endorsement for a 31 period of [NOT MORE THAN]
01 (1) 20 days if the person has not been previously convicted of 02 violating AS 11.76.100, 11.76.106, or 11.76.107; 03 (2) 45 days if, within the 24 months before the date of the 04 department's notice under (m) of this section, the person, or an agent or 05 employee of the person while acting within the scope of the agency or 06 employment of the person, was convicted once of violating AS 11.76.100, 07 11.76.106, or 11.76.107; [OR] 08 (3) [(2)] 90 days if, within the [PAST] 24 months before the date of 09 the department's notice under (m) of this section, the person, or an agent or 10 employee of the person while acting within the scope of the agency or 11 employment of the person, was [HAS BEEN PREVIOUSLY] convicted twice of 12 violating AS 11.76.100, 11.76.106, or 11.76.107, or a provision of this section or a 13 regulation implementing this section adopted under AS 43.70.090; or 14 (4) one year if, within the 24 months before the date of the 15 department's notice under (m) of this section, the person, or an agent or 16 employee of the person while acting within the scope of the agency or 17 employment of the person, was convicted more than twice of violating 18 AS 11.76.100, 11.76.106, or 11.76.107. 19 * Sec. 8. AS 43.70.075(e) is amended to read: 20 (e) Except as provided in (l) of this section, if [IF] a person who receives an 21 endorsement under this section has multiple retail locations or outlets in a location, a 22 suspension or revocation imposed under [(d) OF] this section applies only to the retail 23 outlet in the location in which the violation occurs. 24 * Sec. 9. AS 43.70.075 is amended by adding new subsections to read: 25 (k) If a person, or an agent or employee of the person while acting within the 26 scope of the agency or employment of the person, violates a provision of (a) or (g) of 27 this section, the department may suspend the person's business license endorsement or 28 right to obtain a business license endorsement for a period of not more than 29 (1) 45 days; or 30 (2) 90 days if, within the 24 months before the date of the department's 31 notice under (m) of this section, the person, or an agent or employee of the person
01 while acting within the scope of the agency or employment of the person, violates a 02 provision of (a) or (g) of this section. 03 (l) Notwithstanding (a) of this section, a person owning vending machines that 04 offer tobacco products for sale need obtain only one business license endorsement 05 under this section even if the person has vending machines in more than one outlet or 06 location in the state. The person who owns a vending machine that offers tobacco 07 products for sale and holds the business license issued under AS 43.70.020 is the 08 retailer and is required to obtain a business license endorsement issued under this 09 section. Notwithstanding (a) and (e) of this section, if an endorsement under this 10 section for the sale of tobacco products through vending machines is suspended or 11 revoked, the person may not sell cigarettes, cigars, tobacco, or other products 12 containing tobacco through any of the person's other vending machines in retail 13 locations or outlets that require an endorsement under this section. 14 (m) The department may initiate suspension of a business license endorsement 15 or the right to obtain a business license endorsement under this section by sending the 16 person subject to the suspension a notice by certified mail, return receipt requested, or 17 by delivering the notice to the person. The notice must contain information that 18 informs the person of the grounds for suspension, the length of any suspension sought, 19 and the person's right to administrative review before the department. A suspension 20 begins 30 days after receipt of notice described in this subsection unless the person 21 delivers a timely written request for a hearing to the department in the manner 22 provided by regulations of the department. If a hearing is requested under this 23 subsection, a hearing officer of the department shall determine the issues by using the 24 preponderance of the evidence test and shall conduct the hearing in the manner 25 provided by regulations of the department. A hearing under this subsection is limited 26 to the following questions: 27 (1) was the person holding the business license endorsement, or an 28 agent or employee of the person while acting within the scope of the agency or 29 employment of the person, convicted by plea or judicial finding of violating 30 AS 11.76.100, 11.76.106, or 11.76.107; 31 (2) if the department does not allege a conviction of AS 11.76.100,
01 11.76.106, or 11.76.107, did the person, or an agent or employee of the person while 02 acting within the scope of the agency or employment of the person, violate a provision 03 of (a) or (g) of this section; 04 (3) within the 24 months before the date of the department's notice 05 under this subsection, was the person, or an agent or employee of the person while 06 acting within the scope of the agency or employment of the person, convicted of 07 violating AS 11.76.100, 11.76.106, or 11.76.107 or adjudicated for violating a 08 provision of (a) or (g) of this section. 09 (n) The commissioner may 10 (1) adopt the proposed decision of a hearing officer under this section; 11 (2) remand the matter for further proceedings; or 12 (3) reject the proposed decision, review the record, and issue a 13 decision based on the record. 14 (o) After notice and a hearing, the department may revoke a business license 15 endorsement or increase a period of suspension if the department finds that, during a 16 period of suspension, a person continues the conduct for which the endorsement or the 17 right to obtain an endorsement was suspended. A person whose endorsement or right 18 to obtain an endorsement is revoked or suspended under this subsection may not apply 19 for or obtain an endorsement under this chapter. A period of revocation or suspension 20 imposed under this subsection may not exceed two years. 21 (p) If a person who holds an endorsement issued under this section violates (f) 22 of this section, the department may impose a civil penalty not to exceed $250 for each 23 day of the violation, but the department may not suspend or revoke a business license 24 endorsement. The total civil penalty imposed under this subsection for each violation 25 may not exceed $5,000. 26 (q) The department may adopt regulations to establish an administrative 27 hearing process for actions taken by the department under this section. AS 44.62 28 (Administrative Procedure Act) does not apply to a hearing under this section. 29 (r) For purposes of this section, the sale of a product containing tobacco by an 30 agent or employee of a person who holds or is required to hold a business license 31 endorsement under this section at the location or outlet in a location for which the
01 endorsement was or was required to be issued is rebuttably presumed to have been a 02 sale within the person's scope of agency or employment. 03 (s) If a person violates (a) of this section, the department may impose a civil 04 penalty not to exceed $250 for each day of the violation. The total civil penalty 05 imposed under this subsection for each violation may not exceed $5,000. The civil 06 penalty described in this subsection may be imposed in addition to a suspension of a 07 business license endorsement or the right to obtain a business license endorsement 08 ordered by the department under (k) or (o) of this section. 09 * Sec. 10. AS 43.70.105 is amended by adding a new subsection to read: 10 (b) Notwithstanding an exemption provided by (a) of this section, a person 11 who sells cigarettes, cigars, tobacco, or other products containing tobacco as a retailer 12 must have a business license under AS 43.70.020 and a business license endorsement 13 required under AS 43.70.075. 14 * Sec. 11. AS 44.29 is amended by adding new sections to read: 15 Article 1A. Citations Concerning Tobacco Products. 16 Sec. 44.29.092. Citation for certain offenses concerning tobacco products. 17 The Department of Health and Social Services may issue a citation for a violation of 18 AS 11.76.100, 11.76.106, or 11.76.107 if there is probable cause to believe a person 19 has violated AS 11.76.100, 11.76.106, or 11.76.107. Each day a violation continues 20 after a citation for the violation has been issued constitutes a separate violation. 21 Sec. 44.29.094. Procedure and form of citation. (a) A citation issued under 22 AS 44.29.092 must be in writing and must contain a notice to appear in court. A 23 person receiving the citation is not required to sign the notice. 24 (b) The time specified in the notice to appear in court on the citation shall be 25 at least five days, not including weekends and holidays, after the issuance of the 26 citation, unless the person cited requests an earlier appearance in court. 27 (c) The department is responsible for the issuance of books containing the 28 appropriate form of citations and shall maintain a record of each book issued and each 29 form contained in the book. The department shall require and retain a receipt for each 30 book issued under this subsection to an agent or employee of the department. 31 (d) The department shall deposit the original or a copy of the form of citation
01 with a court having jurisdiction over the alleged offense. Upon deposit with the court, 02 the citation may be disposed of only by trial in the court or other official action taken 03 by the magistrate, judge, or prosecutor. The department may not dispose of a citation, 04 copies of a citation, or the record of issuance except as required under this subsection 05 and (e) of this section. 06 (e) The department shall require the return of a copy of each citation issued by 07 the department and all copies of a citation that have been spoiled or upon which an 08 entry has been made and not issued to an alleged violator. The department shall also 09 maintain, in connection with each citation, a record of the disposition of the charge by 10 the court where the original copy of the citation is deposited. 11 (f) If the form of citation conforms to court rules and includes the essential 12 facts constituting the offense charged, and if the citation is sworn to as required under 13 the state laws for a complaint charging commission of the offense alleged in the 14 citation, then the citation, when filed with a court having jurisdiction in this state, is 15 considered to be a lawful complaint for the purpose of prosecution. 16 (g) In this section, "department" means the Department of Health and Social 17 Services. 18 * Sec. 12. The uncodified law of the State of Alaska is amended by adding a new section to 19 read: 20 TRANSITION: REGULATIONS. The Department of Community and Economic 21 Development, the Department of Revenue, and the Department of Health and Social Services 22 may immediately proceed to adopt regulations necessary to implement changes to their 23 respective authorities made by this Act. The regulations take effect under AS 44.62 24 (Administrative Procedure Act), but not before the effective date of the respective statutory 25 changes. 26 * Sec. 13. The uncodified law of the State of Alaska is amended by adding a new section to 27 read: 28 TRANSITION: BUSINESS LICENSE ENDORSEMENTS FOR LOCATIONS AND 29 OUTLETS. Notwithstanding AS 43.70.075(a), as amended by sec. 5 of this Act, a person 30 who, on the effective date of sec. 5 of this Act, holds a business license endorsement under 31 AS 43.70.075(a) as that subsection existed on the day before the effective date of sec. 5 of this
01 Act, does not have to obtain an additional business license endorsement for every location or 02 outlet in a location where the person offers tobacco products for sale until the current 03 endorsement expires. Upon expiration of the business license endorsement held on the 04 effective date of sec. 5 of this Act, the person shall obtain a business license endorsement for 05 every location or outlet in a location where the person offers tobacco products for sale, as 06 required by AS 43.70.075(a), as amended by sec. 5 of this Act. 07 * Sec. 14. Sections 3 - 5, 12, and 13 of this Act take effect immediately under 08 AS 01.10.070(c). 09 * Sec. 15. Sections 2 and 6 of this Act take effect July 1, 2001. 10 * Sec. 16. Except as provided in secs. 14 and 15 of this Act, this Act takes effect January 1, 11 2002.