Legislature(2007 - 2008)BELTZ 211

02/27/2007 01:30 PM LABOR & COMMERCE


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* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
*+ SB 84 BURNING CAPABILITY OF CIGARETTES TELECONFERENCED
Heard & Held
Bills Previously Heard/Scheduled
+= SB 68 MOTOR VEHICLE INSURANCE TELECONFERENCED
Heard & Held
            SB  84-TESTING & PACKAGING OF CIGARETTES                                                                        
                                                                                                                                
CHAIR ELLIS announced SB 84 to be up for consideration.                                                                         
                                                                                                                                
SENATOR DONNY OLSON,  sponsor of SB 84, invited his  staff to the                                                               
witness table. He said that children  are a major portion of burn                                                               
statistics  and   that  SB  84   mandates  that   only  fire-safe                                                               
cigarettes can be sold in  Alaska and establishes the testing and                                                               
certification  requirements.  He  said that  so-called  fire-safe                                                               
cigarettes are  reduced ignition propensity cigarettes.  They are                                                               
designed  to be  less  likely than  a  conventional cigarette  to                                                               
ignite soft furnishings  such as a couch or a  mattress. The bill                                                               
also  provides  for the  marking  of  cigarette packaging  in  an                                                               
approved  and easily  identifiable  manner to  indicate that  the                                                               
contents are fire-safe.                                                                                                         
                                                                                                                                
He  stated  that  cigarettes  are   the  leading  cause  of  home                                                               
fatalities  in Alaska  and  the U.S.  The  most common  materials                                                               
first  ignited   in  home  fires  are   mattresses  and  bedding,                                                               
upholstered furniture  and floor coverings. Often  cigarettes are                                                               
lit, then  forgotten by a  smoker; it  can smolder for  hours. He                                                               
said this  legislation was brought  to his attention by  the Fire                                                               
Chiefs and it is also supported by Phillip Morris.                                                                              
                                                                                                                                
CHAIR ELLIS  stated that a  committee substitute, version  M, was                                                               
before the committee.                                                                                                           
                                                                                                                                
1:37:06 PM                                                                                                                    
DENISE  LICCTOLI,  staff to  Senator  Olson,  sponsor of  SB  84,                                                               
explained  the differences  in the  CS are  predominantly wording                                                               
changes. The title has been shortened  to reflect a change at the                                                               
end  of  the   bill,  which  removed  some   sections  that  were                                                               
referenced in it.                                                                                                               
                                                                                                                                
CHAIR  ELLIS said  he  supported  that and  asked  for the  major                                                               
changes to be explained first.                                                                                                  
                                                                                                                                
1:37:56 PM                                                                                                                    
MS.  LICCTOLI said  that Sec.  18.74.065 was  added to  allow the                                                               
fire marshal to perform testing  under the terms of this chapter.                                                               
The preferences given to the  package markings are standards that                                                               
are already  being used in  the State  of New York.  New language                                                               
was added  on page  6, lines  6 - 9,  saying "FSC"  meaning "fire                                                               
standards  compliant"  would be  accepted  as  a marking  on  the                                                               
cigarettes.                                                                                                                     
                                                                                                                                
She said  the next substantial  change was on  page 9, lines  9 -                                                               
12, where language now says the  state fire marshal shall use the                                                               
standards  of  New  York  as  persuasive  authority  rather  than                                                               
requiring the implementation as done in New York.                                                                               
                                                                                                                                
CHAIR  ELLIS said  he  knew  the industry  was  worried about  50                                                               
different standards in  50 different states and asked  if the New                                                               
York standards were more regular.                                                                                               
                                                                                                                                
MS. LICCTOLI answered yes; the  tobacco industry's concern from a                                                               
business  perspective is  that  each  state has  its  own way  of                                                               
dealing with  this law - and  that would mean different  types of                                                               
cigarettes. However,  because there is currently  no federal law,                                                               
most states that  have adopted this measure have  adopted the New                                                               
York law. So consistency is there.                                                                                              
                                                                                                                                
1:41:52 PM                                                                                                                    
Sections 2,  3, 4, and 5  were eliminated from the  original bill                                                               
because they regarded  tobacco tax laws that  are not appropriate                                                               
to  reference   in  talking  about  the   burning  propensity  of                                                               
cigarettes.                                                                                                                     
                                                                                                                                
1:42:43 PM                                                                                                                    
SENATOR BUNDE noted there was no  fiscal note from the state fire                                                               
marshal.                                                                                                                        
                                                                                                                                
MS. LICCTOLI said  the fire marshal was on line  to testify if he                                                               
wanted to ask him that question.                                                                                                
                                                                                                                                
CHAIR ELLIS said the committee would come back to him.                                                                          
                                                                                                                                
SENATOR STEVENS asked  if the sponsor statement  is applicable to                                                               
the CS.                                                                                                                         
                                                                                                                                
SENATOR OLSON replied that it applies to version M as well.                                                                     
                                                                                                                                
1:43:56 PM                                                                                                                    
SENATOR  BUNDE  asked  if  this  bill would  raise  the  cost  of                                                               
cigarettes in Alaska since they are special manufacture.                                                                        
                                                                                                                                
MS.  LICCTOLI replied  that other  states have  found that  their                                                               
price doesn't go up.                                                                                                            
                                                                                                                                
CHAIR ELLIS asked if "self-extinguishing"  was an accurate way to                                                               
characterize these cigarettes.                                                                                                  
                                                                                                                                
MS. LICCTOLI replied that another  name used is reduced cigarette                                                               
propensity (RCP),  which means  they tend not  to burn  when left                                                               
unattended.                                                                                                                     
                                                                                                                                
SENATOR  OLSON  said he  has  also  heard them  called  fire-safe                                                               
cigarettes.  The  Coalition  for   Fire  Safe  Cigarettes  has  a                                                               
comparison of  the ones proposed  in this legislation  to regular                                                               
cigarettes.                                                                                                                     
                                                                                                                                
SENATOR STEVENS asked if this had worked in other states.                                                                       
                                                                                                                                
SENATOR OLSON  replied that those  facts exist, but he  would let                                                               
the fire marshal present them.                                                                                                  
                                                                                                                                
CHAIR ELLIS noted that people can testify on either version.                                                                    
                                                                                                                                
1:47:30 PM                                                                                                                    
STEVE "RUSTY" BELANGER, State  Fire Marshal, Anchorage, supported                                                               
SB  84.  In reference  to  the  fiscal  note,  he said  that  254                                                               
different brands  of cigarettes  are recognized  by the  state of                                                               
Alaska and the  bill requires the manufacturer  of each cigarette                                                               
to pay a $250 fee, which comes to about $263,000.                                                                               
                                                                                                                                
MR.  BELANGER  said  because  the legislation  is  so  recent  in                                                               
several other states the statistics  were being tabulated as they                                                               
spoke. However, New York is seeing good results.                                                                                
                                                                                                                                
1:51:23 PM                                                                                                                    
SENATOR  BUNDE said  it sounded  like  the fiscal  note would  be                                                               
positive, but he  wanted to know how much the  testing would cost                                                               
the fire  marshal and  he thought  the DOR might  want to  have a                                                               
fiscal note regarding bootlegging.                                                                                              
                                                                                                                                
1:52:17 PM                                                                                                                    
DOUG  SCHRAGE, Anchorage  fireman, said  that cigarettes  are the                                                               
major  cause  of  structural fires,  both  fatal  and  non-fatal.                                                               
Frequently it's  not the smoker  who gets killed or  injured, but                                                               
rather innocent children.                                                                                                       
                                                                                                                                
1:53:06 PM                                                                                                                    
WARREN CUMMINGS, Alaska Fire  Chiefs Association, Fairbanks, said                                                               
he preferred the term  "self-extinguishing cigarettes" instead of                                                               
the   "Coalition  for   Fire-safe  Cigarettes."   He  said   this                                                               
legislation is about saving lives  and cigarettes are the leading                                                               
cause of home fire fatalities in  the United States - killing 700                                                               
to 900 people,  smokers and non-smokers alike per  year. In 2003,                                                               
smoking material  structure fires  killed 760 people  and injured                                                               
1,520 others in  the US; in Alaska 5 people  died. One-quarter of                                                               
the  victims of  smoking  material fire  fatalities  are not  the                                                               
smokers whose  cigarette started the  fire, 34 percent  are their                                                               
children, 25  percent are  neighbors or  friends, 14  percent are                                                               
the spouses or partners and 13 percent are the parents.                                                                         
                                                                                                                                
Research from  the mid-1980s predicted that  fire-safe cigarettes                                                               
would  eliminate  3  out  of  4  cigarette  fire-related  deaths.                                                               
Research from  New York  shows that  fatalities declined  by one-                                                               
third in not quite a half-year.                                                                                                 
                                                                                                                                
1:55:36 PM                                                                                                                    
MR. CUMMINGS said  this bill also has penalties  for selling non-                                                               
self-extinguishing cigarettes, which  are pretty substantial. So,                                                               
he reasoned there would be added  revenue to the state if regular                                                               
cigarettes  get  bootlegged. He  closed  saying  the Alaska  Fire                                                               
Chiefs support the committee substitute for this bill.                                                                          
                                                                                                                                
1:56:18 PM                                                                                                                    
SENATOR  BUNDE said  he  heard that  unattended  cooking was  the                                                               
leading cause of housing fire fatalities.                                                                                       
                                                                                                                                
MR. CUMMINGS  responded that  there are  more cooking  fires, but                                                               
they don't result in fatalities.                                                                                                
                                                                                                                                
CHAIR ELLIS said he hoped  the Department of Revenue could answer                                                               
Senator Bunde's question about fiscal notes.                                                                                    
                                                                                                                                
1:57:06 PM                                                                                                                    
JOANNA BALES, Excise Audit Manager,  Department of Revenue (DOR),                                                               
said she  is the program manager  of the state cigarette  tax and                                                               
asked if the CS removes the DOR from the bill.                                                                                  
                                                                                                                                
MS.  LICCTOLI replied  that it  removes the  department from  the                                                               
tobacco tax  section, but  it does not  remove the  Department of                                                               
Revenue from the bill.                                                                                                          
                                                                                                                                
CHAIR ELLIS said he would hold the bill in committee.                                                                           
                                                                                                                                
1:58:14 PM                                                                                                                    
SENATOR BUNDE said he was  concerned about bootlegging of regular                                                               
cigarettes to  avoid the tax  and asked  if this would  cause the                                                               
DOR additional challenges.                                                                                                      
                                                                                                                                
MS. BALES replied  that under this bill, the  department would be                                                               
trading one job for another.  Currently a directory of cigarettes                                                               
that  are approved  for sale  in the  state is  maintained. Those                                                               
cigarettes have  to meet all  the state and  federal requirements                                                               
before they  can be  sold. So,  this would  be a  new requirement                                                               
that would  be added  to the  other requirements  for cigarettes.                                                               
Experience has shown that people  try to bring in cigarettes that                                                               
aren't  on the  approved  directory anyway  - sometimes  ordering                                                               
them over  the Internet. The department's  challenges wouldn't be                                                               
any different  and its fiscal  note wouldn't be either.  She said                                                               
it's important to have this  kind of legislation and the majority                                                               
of  people who  buy cigarettes  buy  the ones  that come  through                                                               
legal channels.                                                                                                                 
                                                                                                                                
She  noted that  the  state of  New York  put  out a  preliminary                                                               
report in 2005  about the fire-safe cigarettes it  required to be                                                               
sold since August of 2000. It  talks about all the issues brought                                                               
up in committee. It found that  consumers don't want to smoke the                                                               
old cigarettes versus the fire-safe ones.                                                                                       
                                                                                                                                
SENATOR  BUNDE asked  if the  packets would  be stamped  like the                                                               
current tax stamp and he asked who would stamp them.                                                                            
                                                                                                                                
MS. BALES  replied that  the packets would  still come  through a                                                               
distributor  who  would  stamp   them.  This  bill  requires  all                                                               
retailers  in the  state to  get pictures  of what  the packaging                                                               
will look like so they know  they are stamping product that is in                                                               
compliance with the law.                                                                                                        
                                                                                                                                
2:02:39 PM                                                                                                                    
RAY  BIZAL, Western  Regional Manager,  National Fire  Protection                                                               
Association (NFPA),  supported SB 84.  He said that six  states -                                                               
New  York, Massachusetts,  Vermont, New  Hampshire, Illinois  and                                                               
California -  have already  passed similar  laws. One  quarter of                                                               
the  U.S. population  is  protected by  this law  and  as is  the                                                               
entire nation of  Canada. Statistics are available  for the first                                                               
six  months in  New  York and  indicate that  there  has been  no                                                               
reduction in  cigarette tax revenue  as a  result of the  law and                                                               
further the  New York  Office of Fire  Prevention reports  a one-                                                               
third reduction in cigarette-related  fire fatalities and an even                                                               
higher  reduction in  the number  of cigarette-related  fires. He                                                               
said 22 other legislatures are considering this issue this year.                                                                
                                                                                                                                
2:06:11 PM                                                                                                                    
SENATOR STEVENS moved to adopt the  CS to SB 84, version M. There                                                               
were no objections and it was so ordered.                                                                                       
                                                                                                                                
CHAIR ELLIS said he would hold the bill until Thursday.                                                                         

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