Legislature(2007 - 2008)BELTZ 211
03/21/2007 01:30 PM Senate JUDICIARY
| Audio | Topic |
|---|---|
| Start | |
| SB84 | |
| Adjourn |
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+ teleconferenced
= bill was previously heard/scheduled
| + | SB 84 | TELECONFERENCED | |
| + | TELECONFERENCED |
SB 84-TESTING & PACKAGING OF CIGARETTES
CHAIR FRENCH announced the consideration of CSSB 84(L&C).
1:34:21 PM
SENATOR OLSON, Sponsor of SB 84, introduced his staff member,
Denise Licctoli and then he read the sponsor statement into the
record as follows:
SB 84 mandates that only self-extinguishing cigarettes
can be sold in Alaska, and establishes the testing and
certification requirements to assure that only self-
extinguishing cigarettes are sold in Alaska. Although
no cigarette could ever be called safe, so called
self-extinguishing or "fire safe" cigarettes are
reduced ignition propensity cigarettes. These are
cigarettes that are designed to be less likely than a
conventional cigarette to ignite soft furnishings such
as a couch or mattress. The bill also provides for the
marking of cigarette packaging in an approved and
easily identifiable manner to indicate they are fire
safe.
Cigarettes are the leading cause of home fire
fatalities in Alaska and the United States. The most
common material first ignited in home fires are
mattresses and bedding, upholstered furniture, and
floor coverings. A typical scenario for fires is when
a lit cigarette is forgotten or dropped by a smoker.
The cigarette fire can smolder for hours before it
flares up into a full blaze.
One fourth of victims of smoking-material fire
fatalities are not the smoker whose cigarette started
the fire; over one third of these are children. The
risk of dying in a residential structure fire caused
by smoking rises with age: 38 percent of fatal
smoking-material-fire victims are age 65 or older.
The most common technology used by cigarette
manufacturers for reduced cigarette ignition
propensity (RCIP) is to make the paper thicker in
places to slow down a burning cigarette. If such a
cigarette is left unattended, when the burn reaches
one of the thicker places or "speed bumps", the
burning will self-extinguish. Self-extinguishing
cigarettes meet established fire safety performance
standards.
Legislation similar to SB 84 has been enacted in New
York, Massachusetts, Vermont, New Hampshire,
California, and Illinois. A fire safe cigarette
mandate has also been approved for all of Canada. This
legislation is supported by the Alaska Fire Chiefs
Association, the Alaska Firefighters Association, and
Department of Public Safety, Division of Fire
Prevention.
SB 84 will save lives, as well as reduce injuries and
damage to property in Alaska.
SENATOR OLSON explained that part of his interest in the bill
stems from having treated children who were fire victims.
1:38:11 PM
CHAIR FRENCH opened public testimony.
RAY BAZAL, Western Regional Manager for the National Fire
Protection Association, spoke in support of SB 84. He relayed
that 6 states have passed similar legislation and 22 others are
in the process of doing so meaning that one quarter of the US
population is now protected by this law. Statistics from New
York indicate that in the six months after the law was passed
there was no reduction in cigarette tax revenue, but there was a
one third reduction in fire fatalities and an even higher
reduction in the number of fires. "Passing this bill will
absolutely save lives in Alaska and reduce injuries to people,
to firefighters, and reduce property damage."
1:41:31 PM
WARREN CUMMINGS, President, Alaska Fire Chiefs Association and
Fairbanks Fire Chief, spoke in support of SB 84. He reported
that in the last 10 years there have been 37 cigarette caused
fire fatalities in Alaska. Smokers aren't the only ones to die
in these fires: 34 percent are children of the smokers, 25
percent are neighbors or friends of the smokers, 14 percent are
spouses or partners, and 13 percent are the parents of the
smokers. In the 1980s it was predicted that self extinguishing
cigarettes would eliminate 3 out of 4 cigarette fire deaths. If
cigarette manufacturers had been producing only those cigarettes
since that time, approximately 15,000 lives would have been
saved throughout the US. This is good legislation he said.
1:43:50 PM
RUSTY BELANGER, Acting Director, Division of Fire Prevention,
Department of Public Safety (DPS), spoke in support of SB 84.
The bill embodies the division's mission statement to prevent
the loss of life and property from fire and explosion. As
previously mentioned, 27 lives and $8 million in property has
been lost in the last 10 years as a result of fires that started
with a cigarette as the ignition source. The division believes
that the number of fire related deaths in Alaska will be reduced
if cigarette manufacturers are required to meet the new safety
standards set forth in SB 84. He urged the committee to support
the issue.
SENATOR HUGGINS asked how many cigarette related fires are
attributable to roll your own type smoking material.
MR. BELANGER said he could try and get that information, but it
might not be broken down that way. The division looks at those
fires as having been caused by unattended smoking materials.
SENATOR HUGGINS said he wants to make sure that the bill really
would fix something.
CHAIR FRENCH asked Mr. Belanger to send the information via
email if he finds it broken down that way.
MR. BELANGER agreed.
1:47:38 PM
PAT EGGERS, First Vice-President, Alaska State Firefighters
Association, described SB 84 as huge legislation that will save
lives. He informed members that a great deal of relevant
information is available on the firesafe.org website.
1:48:42 PM
BOB EVANS, Lobbyist for Altria Corporation, said that for
several years the parent company, Philip Morris USA, has worked
with the national firefighters to develop legislation that would
address the safety issue and also provide business consistency
for Altria Corporation. In an ideal world Congress would provide
a single uniform standard, but because that's unlikely to happen
any time soon PMUSA has been working with firefighters and
legislatures in different states to make this bill happen. My
client supports this bill as drafted, he stated.
SENATOR WIELECHOWSKI noted the memorandum in the packet from
Michael White and asked if he is a corporate attorney for
Altria.
MR. EVANS explained that he and Mr. White are partners at Patton
Boggs, LLP. Mr. White has been retained by Arnold & Porter, LLP
to address the delegation issue. That legal entity is outside
counsel to Legislative Council.
SENATOR WIELECHOWSKI noted his finding that the legislature has
the authority to pass this law.
MR. EVANS said yes.
SENATOR WIELECHOWSKI asked if there is any sort of preemption
issue.
MR. EVANS said he isn't award of any, but he would defer to Mr.
White.
SENATOR HUGGINS asked if there might be an issue of underground
market cigarettes if this legislation were to pass.
MR. EVANS said he didn't know for sure, but he understands there
is no difference in taste so that wouldn't be a contributing
factor. To the extent that there is already an underground
market, he suspects it would be the same. This wouldn't
necessarily increase it.
CHAIR FRENCH asked for clarification that there is no economic
incentive to select one type over another.
MR. EVANS said that's correct; there is no economic advantage
whatsoever.
CHAIR FRENCH added that there could be cigarettes that don't
have a tax stamp, but tax is an entirely different issue.
MR. EVANS agreed completely.
SENATOR WIELECHOWSKI asked if self extinguishing cigarettes
would require the user to inhale more deeply.
MR. EVANS said he doesn't know, but he's been told there are no
increased health issues.
1:53:57 PM
EMILY NEENAN, Alaska Government Relations Director for the
American Cancer Society, said SB 84 doesn't affect the mission
to prevent cancer one way or the other. Responding to a previous
question she said that a colleague from New York told her that
smokers do not have to inhale more deeply to keep a cigarette
lit. Although she doesn't have any documentation, that is what
folks in the health field are saying.
As an aside she said she prefers to call these cigarettes self
extinguishing rather than fire safe because she doesn't like to
use safe and cigarette in the same sentence.
CHAIR FRENCH said the nomenclature is noted.
SENATOR WIELECHOWSKI said he would like to find out if these
cigarettes require deeper inhalation because that would endanger
thousands of users in the state. "... that's a judgment call or
certainly a fact that I want to be aware of," he said.
MS. NEENAN said she doesn't believe that's an issue, but she
would provide more information.
SENATOR HUGGINS asked if she knows the percentage of the roll
your own fraternity.
MS. NEENAN said she would try to provide that information, but
her general sense is it's a pretty small percentage.
SENATOR HUGGINS said as much as he dislikes tobacco smoking,
he'd hate for the next step to be a prohibition on roll your own
because they aren't self extinguishing.
CHAIR FRENCH asked what makes a cigarette self extinguishing
compared to one that continues to burn when it's left
unattended.
MS. NEENAN said she understands that self extinguishing
cigarettes have bands in the paper that don't burn if the
cigarette isn't actively smoked.
JOANNA BAILS, Department of Revenue (DOR), advised that DOR will
have some enforcement obligations.
CHAIR FRENCH asked her to describe DOR's role should the bill
become law.
MS. BAILS said the DOR fiscal note addresses the committee
substitute that Senator Olson was going to offer.
2:00:19 PM
CHAIR FRENCH thanked her for bringing that to his attention and
asked for a motion to adopt Version \O committee substitute
(CS).
SENATOR HUGGINS motioned to adopt Version \O, CS for SB 84,
labeled 25-LS0596\O, as the working document. There was no
objection.
MS. BAILS said she understands that the CS removes bill sections
dealing with a DOR maintained directory. DOR believes that with
that change it will have to maintain an additional directory
listing cigarettes that are approved for sale in the state and
the fiscal note reflects that cost. DOR expects it will need at
least a part-time person to maintain the separate directory and
educate taxpayers on the difference between the two directories.
She elaborated that as part of the Tobacco Master Settlement
Agreement the state passed legislation requiring DOR to maintain
a directory that identifies cigarettes that are either compliant
with the master settlement agreement or compliant with an escrow
statute that was adopted under Title 45. Because the master
settlement is so complex, it is best not to change the existing
directory and instead maintain a separate directory for the self
extinguishing cigarettes. DOR would need to educate retailers
about which brands meet both the self extinguishing and the MSA
standards. That is where the additional costs come from.
MS. BAILS added that based on the language in the bill, every
three years manufacturers would be required to pay a $250 fee
for each cigarette brand that is certified in the state. Up to
1,000 different brands could be certified, which would more than
cover the expected annual cost of about $40,000.
2:03:33 PM
SENATOR THERRIAULT said he could understand some one-time costs,
but he doesn't believe that the year after year expenses justify
a half-time position.
MS. BALES explained that the ongoing expenses include:
maintaining the new directory; cross referencing the master
settlement and the self extinguishing cigarette directories;
investigation activity to ensure that only the self
extinguishing cigarettes are stamped; seizing and destroying
cigarettes; and addressing potential legal costs.
SENATOR THERRIAULT said he would leave it to the finance
committee, but he believes that a lot of those expenses are
included in the ordinary business of the state.
2:06:11 PM
CHAIR FRENCH said he would like to discuss the 3/19/07
memorandum that Ms. Bannister issued. He asked her to describe
how the bill intersects with the interstate commerce clause.
THERESA BANNISTER, Legislative Counsel, explained that bringing
cigarettes to Alaska from another state places a burden on
interstate commerce and the US Constitution prohibits that if it
goes too far. Thus, the question will be whether the burden is
clearly excessive on the commerce that is going back and forth
versus the benefit that will be reaped. "I don't have enough
information to be able to evaluate that, but I wanted to bring
it up as an issue," she stated.
CHAIR FRENCH asked if she did any research into whether a
tobacco company had ever challenged a similar bill in another
state on those grounds.
MS. BANNISTER replied she had not.
CHAIR FRENCH asked her to address her observations in the bill
with respect to civil penalties.
MS. BANNISTER explained that the legislature can impose civil
rather than criminal penalties to regulate activity that is
addressed in statute. However, if the penalty is too high, then
it might be interpreted that the legislature actually thought
the activity was criminal. In that case all the protections that
accrue to a criminal penalty would accrue to the civil penalty.
To a large degree the court will defer to the legislature
finding that it is a civil penalty, but you must keep that in
mind. Also keep in mind that the court will evaluate the size of
the penalty for the particular situation. She really didn't have
any idea what penalty is appropriate in this particular
situation, she said.
CHAIR FRENCH asked her to articulate any observations and
concerns in the bill with respect to delegation.
MS. BANNISTER explained that the legislature can delegate its
authority to make regulations to members of the executive branch
as long as it provides guidelines, otherwise it is an improper
delegation of authority. In this case the effect is that in
three sections of the bill the delegation of legislative
authority is to follow what New York law does. The question that
arises is whether or not in that particular situation the
legislature is exceeding its authority. A reason underlying the
issue is the concern that the people won't have an opportunity
to comment or get notice of any changes in New York law. The
court has stated that concern in the past, she said.
MS. BANNISTER said the federal government doesn't pay attention
to the delegation issue, but Alaska seems to allow some
delegation by reference to amended federal laws and it also
mentions some private organizations regarding a building code.
Because the language is there and the concept of delegating or
allowing another state's activities to affect what this state
does is unusual, and because it isn't clear what the court will
do it is an issue that the legislature ought to be aware of, she
stated.
2:14:49 PM
SENATOR THERRIAULT asked why language similar to the New York
law isn't written in to the statute now.
MS. BANNISTER said she doesn't know why that hasn't been done,
but she feels that the idea is to capture decisions that are
made in the future. In particular Section 18.74.220 says that
the New York standards shall be persuasive authority. "I see it
as embodying future decisions," she said.
SENATOR THERRIAULT said he understands that cigarette
manufacturers are looking for consistency, which is not
forthcoming from Congress so the suggestion to refer to just one
state's law is reasonable.
CHAIR FRENCH said he too senses the tension; it seems odd to
make explicit reference to New York laws and delegate the
decision making to that body.
SENATOR McGUIRE suggested the committee replace the word "shall"
with "may" on page 9, line 12. That way the record reflects that
this legislature is looking for consistency for the
manufactures.
2:17:53 PM
SENATOR WIELECHOWSKI stated the opinion that section 220 is
probably unconstitutional. "If we want to use the New York
statute then we should probably just put that in here," he
stated.
SENATOR McGUIRE asked the sponsor why adopting the New York
model isn't preferable to specifically referencing it in an
implementation clause.
2:18:43 PM
CHAIR FRENCH advised that Mr. White would be the next witness.
SENATOR OLSON said he'd like to hear from the next witness
before explaining why the bill is crafted a specific way.
MICHAEL D. WHITE ESQ., Partner, Patton Boggs, LLP, said their
client is Altria Corporate Services, Inc, parent company of
Phillip Morris USA (PMUSA). His firm was asked to look at this
legislation focusing in particular on the issues that
Legislative Counsel raised regarding the potential issue of
unconstitutional delegation. Review of the statutes and
authorities unequivocally indicates that there is no delegation
problem, thus no constitutional problem, he stated.
He referenced the March 20, 2007 memorandum and said he would
touch on two major points. First, the delegation issue may have
been a concern 60 years ago, but since that time the courts have
routinely upheld this type of legislation. Although it is true
that there is the concept in the law regarding delegation, what
it means now is there can't be complete abdication of authority.
Clearly government wouldn't work if legislators couldn't
delegate work to other branches of government to do regulations
and other daily business matters as part of state, local and
federal government.
MR. WHITE said case law that interprets the statutes makes it
clear that since the '60s, other than the extremely large
delegation of authority giving the governor the discretion to
rewrite the budget, every challenge based on a delegation has
been rejected by Alaska courts.
The specific examples in Sections 18.74.040 (b), 18.74.120 (b),
and 18.74.220 show that legislative authority is delegated to
the fire marshal to implement decisions to do his or her job by
making the authority from New York a deciding or persuasive
factor. Those standards are the ones that are necessary for the
fire marshal to do the job. "There is no unlawful delegation
because the court has said there is a sliding scale analysis.
The broader the delegation - i.e. the closer you get to
abdication - the more scrutiny the court will give that
delegation." Furthermore, he said, if this is unlawful
delegation then a good portion of the laws the legislature has
passed would be unlawful delegations. That includes the Alaska
Wage and Hour Act, federal tax laws, antitrust laws, and various
probate laws. In those the legislature has implicitly adopted
laws from other jurisdictions as binding upon the state.
2:23:52 PM
SENATOR WIELECHOWSKI said he doesn't have a big problem
delegating authority to the fire marshal, but he does have a
problem delegating to what is done in another state. Noting that
all the references for delegations listed in the memo are to
federal code, he asked if any Alaska legislation directs use of
another state's law as a persuasive authority.
MR. WHITE clarified that it doesn't matter that the delegation
references are to federal code rather than another state's code,
because both are foreign governments with respect to the
legislative authority that exists under State of Alaska
sovereignty. He further explained that there are a number of
uniform acts that are not federal legislation such as the
Uniform Child Custody Jurisdiction Act and the Uniform Probate
Code. Promulgated by an association, those laws seek a
nationwide uniform standard in an area that lacks uniformity.
Responding to the specific question, he said he is not familiar
with any specific reference to a state law other than the fact
that all Alaska law is based on Oregon law and his understanding
is that it would not be inappropriate for the Alaska Legislature
to adopt by reference something in Oregon statute.
2:26:20 PM
CHAIR FRENCH asked if he is aware of any challenge of self
extinguishing cigarette legislation by Altria, PMUSA, or any
tobacco company with respect to the issue of interstate
commerce.
MR. WHITE said no; Altria supports the legislation and would not
challenge any such legislation on those grounds.
SENATOR WIELECHOWSKI asked if he would challenge this
legislation on any grounds and if he foresees any federal
preemption issues here.
MR. WHITE said he couldn't say because he doesn't know what his
client is thinking, but in his mind he can't see a challenge of
this type of law. With regard to preemption his understanding is
there is no federal law, thus there can be no preemption issue.
Congress could but has not regulated in this area so states are
free to do so.
CHAIR FRENCH asked about his client's perspective on civil
penalties and whether it would be challenged as amounting to a
criminal fine because of size and severity.
MR. WHITE reiterated he couldn't speak for Altria, but he does
not believe this would amount to an unlawful criminal sanction -
particularly in light of the strong legislative intent that
these be civil penalties.
2:29:16 PM
CHAIR FRENCH stated his intention to hold the bill to finish
reviewing Mr. White's legal memorandum. He asked the sponsor if
he had any further observations on the bill.
SENATOR OLSON said Ms. Licctoli had additional information.
2:30:01 PM
DENISE LICCIOLI, Staff to Senator Olson, said she has no legal
background so deferring the delegation issue to this committee's
expertise was intentional. Nonetheless, she can attest that the
manufacturers believe that lacking federal regulation, it is
very important to establish nationwide uniformity.
CHAIR FRENCH asked if states with a similar law reference New
York law or embed New York law in statute as Senator
Wielechowski suggested.
MS. LICCIOLI said the website referenced previously has model
legislation as well as the laws from the states that have passed
this legislation. Essentially all have adopted and made
reference to New York law. The model legislation is stronger
than what is suggested in SB 84.
SENATOR OLSON said he feels strongly about this issue and he
introduced the bill to affect the lives of those who have been
negatively affected in the past. As far as the concern about
having to inhale more deeply, he said smokers have made a
conscious choice. Children who are fire victims weren't there by
choice and were in fact expecting to be protected.
SENATOR THERRIAULT noted the Department of Public Safety fiscal
note for $83,000 per year and commented that for years the fire
associations have been looking for a funding source similar to
the Police Standards Council. It's an annual appropriation, but
this could be an answer to a long-standing problem.
CHAIR FRENCH held SB 84 in committee.
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