txt

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.