CSSB 84(L&C): "An Act relating to the testing and packaging of cigarettes to be sold, offered for sale, or possessed in this state; relating to compliance certifications by tobacco product manufacturers, a directory of tobacco product manufacturers, the affixing of stamps to cigarette packages, and cigarette tax stamps; and providing for an effective date."
00 CS FOR SENATE BILL NO. 84(L&C) 01 "An Act relating to the testing and packaging of cigarettes to be sold, offered for sale, or 02 possessed in this state; relating to compliance certifications by tobacco product 03 manufacturers, a directory of tobacco product manufacturers, the affixing of stamps to 04 cigarette packages, and cigarette tax stamps; and providing for an effective date." 05 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF ALASKA: 06 * Section 1. AS 18 is amended by adding a new chapter to read: 07 Chapter 74. Cigarette Fire Safety. 08 Sec. 18.74.010. Requirement for sale. Except as provided by AS 18.74.060, a 09 person may not sell or offer to sell cigarettes in this state, or sell or offer to sell 10 cigarettes to another person located in this state, unless 11 (1) the cigarettes are tested under 12 (A) AS 18.74.030 and satisfy the performance standard in 13 AS 18.74.030(d); or 14 (B) AS 18.74.040 and satisfy an alternative performance
01 standard under AS 18.74.040; 02 (2) the cigarettes have been marked as required by AS 18.74.130; and 03 (3) a certification has been submitted by the manufacturer of the 04 cigarettes under AS 18.74.080. 05 Sec. 18.74.030. Testing of cigarettes. (a) Cigarettes shall be tested under 06 (1) the ASTM International Standard E2187-04, entitled "Standard 07 Test Method for Measuring the Ignition Strength of Cigarettes"; or 08 (2) a test method established under (b) of this section. 09 (b) The state fire marshal may adopt an ASTM International standard test 10 method that is adopted by the American Society of Testing and Materials after the 11 standard test method identified under (a) of this section if the state fire marshal finds 12 that the method does not result in a change in the percentage of full-length burns 13 exhibited by any tested cigarette when compared to the percentage of full-length burns 14 that the same cigarette would exhibit when tested under 15 (1) the standard test method identified under (a)(1) of this section; and 16 (2) the criteria established under (c) and (d) of this section. 17 (c) The testing under this section shall be conducted on 10 layers of filter 18 paper. A complete test trial consists of 40 replicate tests of each cigarette. The 19 performance standard required by (d) of this section may only be applied to a 20 complete test trial. 21 (d) When tested under this section, not more than 25 percent of the cigarettes 22 tested in a test trial may exhibit full-length burns. 23 Sec. 18.74.040. Alternative test methods. (a) If the state fire marshal 24 determines that cigarettes cannot be tested by a test method established in 25 AS 18.74.030(a), a manufacturer of the cigarettes shall propose an alternative test 26 method and performance standard for the cigarettes to the state fire marshal. On 27 approval of the proposed test method and a determination by the state fire marshal that 28 the performance standard proposed by the manufacturer is equivalent to the 29 performance standard prescribed by AS 18.74.030(d), the manufacturer may employ 30 the proposed alternative test method and performance standard to certify the cigarette 31 under AS 18.74.080.
01 (b) Unless the state fire marshal demonstrates a reasonable basis why the 02 alternative test method should not be accepted under this chapter, the state fire marshal 03 shall authorize a manufacturer to use an alternative test method and performance 04 standard to certify cigarettes for sale in this state if the state fire marshal 05 (1) determines that another state has enacted reduced cigarette ignition 06 propensity standards that include a test method and performance standard that are the 07 same as those contained in this chapter; and 08 (2) finds that the officials responsible for implementing those 09 requirements have approved a proposed alternative test method and performance 10 standard for particular cigarettes proposed by a manufacturer as meeting the fire safety 11 standards of that state's law under a legal provision comparable to this section. 12 (c) All other applicable requirements of this chapter apply to the manufacturer 13 of the cigarettes tested under this section. 14 Sec. 18.74.050. Testing laboratories. (a) Testing of cigarettes under this 15 chapter shall be performed by a laboratory that has been accredited under standard 16 ISO/IEC 17025 of the International Organization for Standardization or by another 17 comparable accreditation standard required by the state fire marshal. 18 (b) A laboratory that conducts cigarette testing under this chapter shall 19 implement a quality control and quality assurance program that ensures the 20 repeatability of the testing results. The repeatability value may not be greater than 21 0.19. In this subsection, 22 (1) "quality control and quality assurance program" means the 23 laboratory procedures implemented to ensure that operator bias, systematic and 24 nonsystematic methodological errors, and equipment-related problems do not affect 25 the results of the testing quality control program; 26 (2) "repeatability" means the range of values within which the repeat 27 results of cigarette test trials from a single laboratory will fall 95 percent of the time. 28 Sec. 18.74.060. Testing for another purpose. AS 18.74.030 and 18.74.040 do 29 not require cigarettes to be tested if the cigarettes are tested for another purpose and 30 the testing is consistent with this chapter. 31 Sec. 18.74.065. Testing by state fire marshal. The state fire marshal may
01 perform testing of cigarettes to determine compliance with this chapter. If the state fire 02 marshal or a contractor of the state fire marshal performs testing to determine a 03 cigarette's compliance with the performance standard in AS 18.74.030(d) or an 04 alternative performance standard under AS 18.74.040, the testing shall be performed 05 under this chapter. 06 Sec. 18.74.070. Maintenance of records. A manufacturer shall keep for three 07 years copies of the reports of all tests conducted on all cigarettes offered for sale. The 08 manufacturer shall make copies of those reports available to the state fire marshal and 09 the attorney general on written request. 10 Sec. 18.74.080. Certification requirement. (a) A manufacturer shall submit to 11 the state fire marshal a certification that each cigarette listed in the certification has 12 been tested under AS 18.74.030 and satisfies the performance standard in 13 AS 18.74.030(d), or has been tested under AS 18.74.040 and satisfies an alternative 14 performance standard under AS 18.74.040. 15 (b) If a manufacturer has certified a cigarette under this section and 16 subsequently makes a change to the cigarette that is likely to alter its compliance with 17 the performance standard under AS 18.74.030(d) or an alternative performance 18 standard under AS 18.74.040, the cigarette may not be sold or offered for sale in this 19 state or sold to a person located in this state until the manufacturer retests the cigarette 20 under AS 18.74.030 or 18.74.040, the cigarette meets the performance standard under 21 AS 13.74.030(d) or the alternative performance standard under AS 18.74.040, and the 22 manufacturer maintains records of the retesting under AS 18.74.070. 23 (c) For each cigarette listed in a certification submitted under (a) of this 24 section, a manufacturer shall pay to the state fire marshal a fee of $250. The state fire 25 marshal may adjust this fee annually to ensure that it defrays the actual costs of the 26 processing, testing, enforcement, and oversight activities required by this chapter. 27 (d) Each cigarette certified under this section shall be recertified every three 28 years. 29 Sec. 18.74.090. Contents of certification. The certification required by 30 AS 18.74.080 must provide the following information for each cigarette listed in the 31 certification:
01 (1) the brand or trade name on the package; 02 (2) the style, such as "light" or "ultra-light"; 03 (3) the length in millimeters; 04 (4) the circumference in millimeters; 05 (5) the flavor, if applicable; 06 (6) whether the cigarette is filtered or nonfiltered; 07 (7) a description of the package; 08 (8) the marking approved under AS 18.74.120; 09 (9) the name, address, and telephone number of the laboratory that 10 conducted the test, if different than the manufacturer who conducted the test; and 11 (10) the date that the testing occurred. 12 Sec. 18.74.100. Banding requirement. Each cigarette listed in a certification 13 submitted under AS 18.74.080 that uses lowered permeability bands in the cigarette 14 paper to achieve compliance with the performance standard in AS 18.74.030(d) must 15 have at least two nominally identical bands on the paper surrounding the tobacco 16 column. At least one complete band must be located at least 15 millimeters from the 17 lighting end of the cigarette. For cigarettes on which the bands are positioned by 18 design, there must be at least two bands fully located at least 19 (1) 15 millimeters from the lighting end; and 20 (2) 10 millimeters from 21 (A) the filter end of the tobacco column; or 22 (B) the labeled end of the tobacco column of a nonfiltered 23 cigarette. 24 Sec. 18.74.110. Availability of certifications. The certification required by 25 AS 18.74.080 shall be made available to the attorney general for purposes consistent 26 with this chapter and to the department for the purpose of ensuring compliance with 27 AS 18.74.080. 28 Sec. 18.74.120. Packaging marking approval. (a) Before submitting a 29 certification of a cigarette under AS 18.74.080, a manufacturer shall present its 30 proposed packaging marking to the state fire marshal for approval. The state fire 31 marshal shall approve or disapprove the proposed packaging marking. Proposed
01 packaging marking shall be considered approved if the state fire marshal fails to act 02 within 10 business days after receiving a request for approval. 03 (b) Notwithstanding AS 18.74.130, the state fire marshal shall give a 04 preference to proposed packaging marking for a cigarette that is in use and approved 05 for the cigarette under the fire safety standards for cigarettes established by the law of 06 the state of New York, unless the state fire marshal demonstrates a reasonable basis 07 why the proposed packaging marking should not be approved under this chapter. 08 (c) Notwithstanding AS 18.74.130, the state fire marshal shall approve the use 09 of the letters "FSC" for "fire standards compliant" on proposed packaging marking to 10 indicate that the cigarettes comply with the performance standard in AS 18.74.030(d) 11 or an alternative performance standard under AS 18.74.040. 12 (d) A manufacturer may not change its approved packaging marking unless 13 the state fire marshal has approved the modification under this section. 14 (e) A wholesale dealer, an agent, and a retail dealer shall permit the state fire 15 marshal, the department, the attorney general, and the employees of those persons to 16 inspect packaging markings of cigarettes. 17 Sec. 18.74.130. Marking of cigarette packaging. (a) The packaging 18 containing a brand and style of cigarette that a manufacturer certifies under 19 AS 18.74.080 must be marked to indicate compliance with the requirements of this 20 chapter. The packaging marking must be in eight-point type or larger and consist of 21 (1) a modification of the universal product code to include a visible 22 mark printed at or around the area of the code; the mark may consist of alphanumeric 23 or symbolic characters and must be permanently stamped, engraved, embossed, or 24 printed in conjunction with the universal product code; 25 (2) any visible combination of alphanumeric or symbolic characters 26 permanently stamped, engraved, or embossed on the package or wrapping; or 27 (3) printed, stamped, engraved, or embossed text on the cigarette 28 package that indicates that the cigarettes satisfy the requirements of this chapter. 29 (b) A manufacturer shall use only one packaging marking and apply that 30 packaging marking uniformly to all packaging and to all brands marketed by the 31 manufacturer for sale in this state.
01 Sec. 18.74.150. Copies. A manufacturer who certifies a cigarette under 02 AS 18.74.080 shall provide a copy of the certification to each wholesale dealer and 03 agent to whom the manufacturer sells the cigarette. The manufacturer shall also 04 provide the wholesale dealer and agent with sufficient copies of an illustration of the 05 cigarette packaging markings used by the manufacturer under AS 18.74.130 for each 06 retail dealer to whom the wholesale dealer or agent sells cigarettes. A wholesale dealer 07 or an agent shall provide a copy of the cigarette packaging markings received from a 08 manufacturer to each retail dealer to whom the wholesale dealer or agent sells 09 cigarettes. 10 Sec. 18.74.160. Penalties for violations. (a) A manufacturer, a wholesale 11 dealer, an agent, or another person who knowingly sells or offers to sell cigarettes 12 other than through retail sale and in violation of AS 18.74.010 is subject to a civil 13 penalty not to exceed 14 (1) $10,000 for a first violation; 15 (2) $25,000 for each violation that is not a first violation. 16 (b) A retail dealer who knowingly sells or offers to sell cigarettes in violation 17 of AS 18.74.010 is subject, for each sale or offer to sell, to a civil penalty not to 18 exceed 19 (1) $500 for a first violation in which the total number of cigarettes 20 sold or offered for sale does not exceed 1,000 cigarettes; 21 (2) $2,000 for each violation that is not a first violation and in which 22 the total number of cigarettes sold or offered for sale does not exceed 1,000 cigarettes; 23 (3) $1,000 for a first violation in which the total number of cigarettes 24 sold or offered for sale exceeds 1,000 cigarettes; 25 (4) $5,000 for a violation that is not a first violation and in which the 26 total number of cigarettes sold or offered for sale exceeds 1,000 cigarettes. 27 (c) The penalties against 28 (1) one manufacturer, wholesale dealer, agent, or other person under 29 (a) of this section may not exceed $100,000 for violations occurring during a 30-day 30 period; or 31 (2) one retail dealer under (b) of this section may not exceed $25,000
01 for violations occurring during a 30-day period. 02 (d) In addition to any other penalty prescribed by law, a person engaged in the 03 manufacture of cigarettes who knowingly makes a false certification under 04 AS 18.74.080 is subject to a civil penalty of at least $75,000 for a first violation and a 05 civil penalty not exceeding $250,000 for each violation that is not a first violation. 06 (e) A manufacturer who fails to make copies of reports available under 07 AS 18.74.070 within 60 days after receiving a written request from the state fire 08 marshal or the attorney general is subject to a civil penalty not to exceed $10,000 for 09 each day after the 60th day that the manufacturer does not make the copies available. 10 (f) If a person violates a provision of this chapter and a civil penalty is not set 11 for the violation, the person is subject to a civil penalty not to exceed $1,000 for a first 12 violation and a civil penalty not exceeding $5,000 for each violation that is not a first 13 violation. 14 Sec. 18.74.180. Separate accounting. The fee received under AS 18.74.080(c) 15 and the civil penalties imposed under AS 18.74.160 shall be deposited into the general 16 fund and separately accounted for under AS 37.05.142. The legislature may 17 appropriate the money accounted for under this section to the fire prevention and 18 public safety fund established under AS 18.74.210. 19 Sec. 18.74.190. Seizure of cigarettes. (a) If a person is offering for sale or has 20 made a sale of cigarettes in violation of AS 18.74.010, the state fire marshal, the 21 department, or a law enforcement agency may seize and dispose of the cigarettes. 22 (b) Before disposal of cigarettes under (a) of this section, the state fire marshal 23 or the department shall 24 (1) provide the person from whom the cigarette was seized with notice 25 of the seizure and an opportunity for a hearing regarding the seizure; and 26 (2) permit the holder of the trademark rights in the cigarette brand to 27 inspect the cigarettes. 28 Sec. 18.74.200. Other remedies. In addition to any other remedy provided by 29 law, the state fire marshal or attorney general may file an action in superior court for a 30 violation of this chapter, including an action for injunctive relief or to recover costs or 31 damages suffered by the state because of a violation of this chapter, including
01 enforcement costs relating to the specific violation. Each violation of this chapter or of 02 the regulations adopted under this chapter constitutes a separate cause of action for 03 which the state fire marshal or attorney general may obtain relief. 04 Sec. 18.74.210. Fire prevention and public safety fund. (a) The fire 05 prevention and public safety fund is established. The fund consists of appropriations 06 made to the fund. 07 (b) The purpose of the fund is to pay the expenses of the state fire marshal for 08 implementing and enforcing this chapter. 09 (c) Money appropriated to the fund may be spent for the purposes of the fund 10 without further appropriation. Money appropriated to the fund does not lapse. 11 Sec. 18.74.220. Implementation. The substance of the fire safety standards for 12 cigarettes established by the law of the state of New York and the implementation of 13 these standards by the state of New York shall be persuasive authority in the 14 implementation of this chapter by the state fire marshal and the attorney general. 15 Sec. 18.74.230 Review by state fire marshal. The state fire marshal shall 16 review the effectiveness of this chapter, report the state fire marshal's findings to the 17 legislature every three years on or by January 30 of the reporting year, and, if 18 appropriate, recommend legislation to improve the effectiveness of this chapter. 19 Sec. 18.74.240. Regulations. The state fire marshal may adopt regulations to 20 implement this chapter. 21 Sec. 18.74.250. Inspections. (a) The department may inspect cigarettes held by 22 wholesale dealers, agents, and retail dealers to determine if the cigarettes are marked 23 as required by AS 18.74.120 and 18.74.130. If the cigarettes are not marked as 24 required, the department shall notify the state fire marshal. 25 (b) To determine compliance with this chapter, the state fire marshal and the 26 attorney general may examine the books, papers, invoices, and other records of a 27 person who possesses, controls, or occupies premises where cigarettes are placed, 28 stored, sold, or offered for sale, and the stock of cigarettes on the premises. 29 (c) A person who possesses, controls, or occupies premises where cigarettes 30 are placed, sold, or offered for sale, shall allow the state fire marshal and the attorney 31 general to make the inspections authorized by this section.
01 Sec. 18.74.260. Sale outside the state. This chapter may not be interpreted to 02 prohibit a person from manufacturing or selling cigarettes that do not meet the 03 requirements of this chapter if the cigarettes are or will be stamped for sale in another 04 state or are packaged for sale outside the United States and the person has taken 05 reasonable steps to ensure that the cigarettes will not be sold or offered for sale to 06 persons located in this state. 07 Sec. 18.74.270. Regulation by municipality. Notwithstanding any other 08 provision of law, a municipality may not enact or enforce an ordinance or another law 09 of the municipality that conflicts with this chapter. 10 Sec. 18.74.280. Relationship to federal law. This chapter does not apply if a 11 federal law is enacted that establishes a reduced cigarette ignition propensity standard 12 and preempts this chapter. 13 Sec. 18.74.290. Definitions. In this chapter, 14 (1) "agent" means a person authorized by the department to purchase 15 and affix stamps on packages of cigarettes under AS 43.50.500 - 43.50.700; 16 (2) "cigarette" means a roll for smoking of any size or shape, made 17 wholly or in part of tobacco, whether or not the tobacco is flavored, adulterated, or 18 mixed with another ingredient, if the wrapper or cover of the roll is made of paper or a 19 material other than tobacco; 20 (3) "department" means the Department of Revenue; 21 (4) "manufacturer" means 22 (A) a person who manufactures or otherwise produces 23 cigarettes, or causes cigarettes to be manufactured or produced anywhere, if 24 the manufacturer intends the cigarettes to be sold in this state, including 25 cigarettes intended to be sold in the United States through an importer; 26 (B) the first purchaser anywhere who intends to resell in the 27 United States cigarettes that are manufactured anywhere and that the original 28 manufacturer or maker does not intend to be sold in the United States; or 29 (C) a person who becomes a successor of a person described in 30 (A) or (B) of this paragraph; 31 (5) "retail dealer" means a person, other than a manufacturer or
01 wholesale dealer, who sells cigarettes or tobacco products; 02 (6) "sale" or "sell" means a sale, exchange, barter, and any other 03 manner of transferring the ownership of personal property; 04 (7) "wholesale dealer" means a person who 05 (A) sells cigarettes or tobacco products to retail dealers or other 06 persons for resale; and 07 (B) owns, operates, or maintains cigarette or tobacco vending 08 machines in, at, or on premises owned or occupied by another person. 09 * Sec. 2. AS 43.50.460(a) is amended to read: 10 (a) Every tobacco product manufacturer whose cigarettes are sold in this state, 11 whether directly or through a distributor, retailer, or similar intermediary or 12 intermediaries, shall execute and deliver on a form or in the manner prescribed by the 13 commissioner a certification to the commissioner, not [NO] later than April 30 of each 14 year, certifying, under penalty of perjury, that, as of the date of the certification, the 15 tobacco product manufacturer is complying with AS 18.74 and is either a 16 participating manufacturer or is in full compliance with AS 45.53. 17 * Sec. 3. AS 43.50.465 is amended to read: 18 Sec. 43.50.465. Directory of cigarettes approved for sale and importation. 19 Not later than July 30 of each year, the commissioner shall develop and make 20 available for public inspection a directory listing all tobacco product manufacturers 21 that have provided current and accurate certifications conforming to the requirements 22 of AS 43.50.460 and all brand families that are listed in those certifications, except as 23 follows: 24 (1) the commissioner may not include or retain in the directory the 25 name or brand families of any nonparticipating manufacturer that fails to provide the 26 required certification or whose certification the commissioner determines is not in 27 compliance with AS 43.50.460, unless the commissioner has determined that the 28 violation has been cured to the satisfaction of the commissioner; 29 (2) neither a tobacco product manufacturer nor brand family shall be 30 included or retained in the directory if the commissioner concludes that 31 (A) for a nonparticipating manufacturer, all escrow payments
01 required under AS 45.53 for any period for any brand family, regardless of 02 whether listed by the nonparticipating manufacturer, have not been fully paid 03 into a qualified escrow fund governed by a qualified escrow agreement that has 04 been approved by the Department of Law; [OR] 05 (B) all outstanding final judgments, including interest on those 06 judgments, for violations of AS 45.53 have not been fully satisfied for the 07 brand family and the manufacturer; or 08 (C) the manufacturer's cigarettes do not comply with 09 AS 18.74; 10 (3) the commissioner shall update the directory as necessary in order to 11 correct mistakes and to add or remove a tobacco product manufacturer or brand 12 families to keep the directory in conformity with the requirements of AS 43.50.460 - 13 43.50.495; 14 (4) every licensee shall provide to the commissioner, and update as 15 necessary, an electronic mail address for the purpose of receiving any notifications 16 that may be required by AS 43.50.460 - 43.50.495. 17 * Sec. 4. AS 43.50.600 is amended to read: 18 Sec. 43.50.600. Stamps prohibited on cigarette packages not complying 19 with federal and state laws. A licensee or the licensee's authorized agent or designee 20 may not affix a stamp to a cigarette package if the cigarettes 21 (1) may not be acquired, held, owned, imported, possessed, sold, or 22 distributed in this state under AS 43.50.400 or AS 18.74; or 23 (2) are not in compliance with other state or federal laws. 24 * Sec. 5. AS 43.50.700(9) is amended to read: 25 (9) "unstamped cigarettes" means a package containing cigarettes that 26 is not affixed with the stamp required by AS 43.50.500 - 43.50.700 or is affixed with a 27 stamp in violation of AS 43.50.600 or in a denomination less than the tax levied 28 under this chapter. 29 * Sec. 6. The uncodified law of the State of Alaska is amended by adding a new section to 30 read: 31 TRANSITION. (a) AS 18.74.010, enacted by sec. 1 of this Act, does not prohibit a
01 wholesale dealer or retail dealer from selling or offering to sell an inventory of cigarettes 02 existing on the effective date of this Act if the wholesale dealer or retail dealer establishes that 03 (1) state tax stamps were affixed to the cigarettes under AS 43.50 before the 04 effective date of this Act; and 05 (2) the inventory was purchased before the effective date of this Act in 06 comparable quantity to the inventory purchased during the same period of the previous year. 07 (b) In this section, "retail dealer," "sell," and "wholesale dealer" have the meanings 08 given in AS 18.74.290. 09 * Sec. 7. This Act takes effect on the first day of the 13th month after the month in which 10 this Act becomes law under AS 01.10.070.