Legislature(2021 - 2022)ADAMS 519
05/07/2021 01:30 PM House FINANCE
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| Audio | Topic |
|---|---|
| Start | |
| HB132 | |
| HB110 | |
| Adjourn |
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+ teleconferenced
= bill was previously heard/scheduled
| += | HB 70 | TELECONFERENCED | |
| + | HB 197 | TELECONFERENCED | |
| + | HB 202 | TELECONFERENCED | |
| + | TELECONFERENCED | ||
| += | HB 110 | TELECONFERENCED | |
| += | HB 132 | TELECONFERENCED | |
HOUSE BILL NO. 110
"An Act raising the minimum age to purchase, sell,
exchange, or possess tobacco, a product containing
nicotine, or an electronic smoking product; relating
to transporting tobacco, a product containing
nicotine, or an electronic smoking product; relating
to the taxation of electronic smoking products; and
providing for an effective date."
2:09:15 PM
Co-Chair Merrick OPENED public testimony.
2:09:48 PM
JASON JONES, SELF AND OWNER, LEGION VAPOR, ANCHORAGE (via
teleconference), opposed HB 110 as it would negatively
affect his business. He believed that vaping changed his
life because it helped him quit smoking. He stated that he
vigilantly enforced the 21 year old age limit in his shop.
The Anchorage municipal tax had impacted his business. He
felt that the tax would harm adults 21 and over that vape
instead of smoke. He believed that tax would ruin his
business.
2:12:56 PM
ALYSSA KEILL, SELF, FAIRBANKS (via teleconference),
spoke in favor of HB 110. She was a part-time swimming
coach for teens. She relayed that when she asked the team
about vaping many admit to having tried vaping and raised
doubts about the health risks. She deduced that the doubt
sprang from the assertion that vaping was safer than
smoking. She asserted that safer did not mean safe.
Nicotine addiction was an addiction regardless of how it
was ingested. She thought the legislation showed that vapor
products were nicotine products and should be treated as
any other product containing nicotine. She felt that the
bill was a step in the right direction.
2:14:55 PM
ROYCE WALSTON, SELF, KETCHIKAN (via teleconference),
spoke in support of HB 110. He was a sophomore at Ketchikan
High School. He related that he saw fellow students using
Jule pods and vaping in school and out of school. It caused
the schools bathrooms to be shut down. He shared that he
worked for the Ketchikan Youth Alliance that was combined
with the Ketchikan Wellness Coalition and was working to
build a safer community. He thought the issue was important
because nicotine was a very addictive drug. He shared from
personal experience the way nicotine addiction had affected
people close to him who lost scholarships or their lives.
He spoke of his cousin being plagued with asthma that had
tried vaping and it caused his lung to collapse. His cousin
currently, better understood that vaping was dangerous. He
emphasized his support for taxing vaping products and
thought that it created equity amongst all nicotine
products. He asserted that individuals that vape influence
others to vape.
2:18:03 PM
Vice-Chair Ortiz asked if it was Mr. Walston's first time
testifying before a legislative committee. Mr. Walston
responded in the affirmative. Representative Ortiz praised
and appreciated his involvement.
Representative Rasmussen appreciated Mr. Walstons
testimony. She asked how his friends under 19 years of age
had been influenced and how they obtained the vaping
products. Mr. Walston stated that his peers were influenced
by older peers. He thought that those engaged in vaping who
were underage obtained the products through older peers,
or randomly found the products. He was uncertain about the
details.
Co-Chair Merrick commended Mr. Walston for his
participation and testimony.
2:19:43 PM
CARRIE NYSSEN, AMERICAN LUNG ASSOCIATION, VANCOUVER,
WASHINGTON (via teleconference), strongly supported HB 110.
She voiced that increasing prices decreased consumption,
discouraged, and delayed use of the dangerous products. She
offered that 95 percent of adult tobacco users began before
the age of 21. A delay in age for the first use of vaping
and tobacco products reduced the risk of addition. Youth
exposure to nicotine during critical years of brain
development could cause lasting adverse consequences. She
indicated that nicotine addition could occur after minimal
exposure to tobacco products. Lung development continued
into the teen years and exposure to toxins impaired healthy
lung development. She advocated for a comprehensive
approach to decrease the youth use of electronic
cigarettes. Raising the age and the cost were evidence
based policies that would protect youth. The American Lung
Association supported removing the penalty provisions in
the bill.
2:21:54 PM
Representative Josephson asked Ms. Nyssen to repeat her
last sentence. Ms. Nyssen replied that she referred to the
penalty for possession of tobacco use. She elaborated that
the penalty had no evidence that it worked and harmed
youth.
2:22:26 PM
JAY OKU, SELF, CALIFORNIA (via teleconference), spoke in
strong opposition to HB 110 primarily due to the dangers
posed by black-market activity. He believed that vaping
helped offset the leading cause of preventable death. He
alleged that the negative effects of vaping were
hyperbole. He claimed that no one was dying from vaping.
He listed some statistics on the topic of children and
vaping and stated that less than one percent of current
young vapors had not first experienced nicotine by smoking.
He argued that by attributing harmful affects to vaping it
discouraged some smokers from using vaping products to quit
smoking. He indicated that the current federal age for
vaping was 21 and should be strictly enforced, and that
enforcement efforts should be increased. He felt that
specialty vape shops were compliant and not the problem. He
believed that the black-market was the problem.
2:25:23 PM
TERRANCE ROBBINS, SELF, KETCHIKAN (via teleconference),
spoke in support HB 110. He believed that raising taxes on
nicotine products resulted in a reduction in the use of
smoking products, especially among the most vulnerable
populations that included youth. He relayed that 90 percent
of all adult tobacco users became addicted to nicotine
before the age of 18. On January 1, 2017, the City of
Ketchikan enacted an excise tax on tobacco products that
included vape devices. He shared that results were
positive, and a survey showed a reduction in adults smoking
rates declined by 24 percent in 2017. He cited limited data
that concluded the Ketchikan Gateway Borough School
District experienced a 63 percent decrease in cigarette use
from 2015 to 2019 and youth vaping increased by 51 percent.
He found data that did not favor fines or punitive measures
for youth as a deterrent to tobacco use.
2:28:43 PM
CHARLES EDGE, SELF, FAIRBANKS (via teleconference), spoke
to HB 110. He shared that he was 20 when he enlisted in the
armed forces and felt the bill needed a military exemption
clause and did not favor the age increase to 21. He noted
that he was always carded when purchasing vape products in
Fairbanks stores. He believed that underage children would
obtain vaping products regardless of the law. It would take
away the choice of legal law-abiding adults. He noted that
the bill allowed adults to purchase e-cigarettes for their
children and felt that the bill sent mixed signals.
2:31:43 PM
Representative Rasmussen thanked Mr. Edge. She encouraged
him to continue to call-in and testify.
2:32:10 PM
ALEX MCDONALD, SELF, FAIRBANKS (via teleconference),
opposed HB 110. He pointed out that the subject of taxing
vaping products had been brought up during the Walker
Administration and did not pass at the time. He suggested
that a tax under the present pandemic situation was not
favored. He also noted that the Fairbanks North Star
Borough and Fairbanks City Council had recently voted down
a similar tax. He cited a study that concluded that the
combustible delivery system of nicotine posed the danger
and that non-combustible methods posed less risk and cost
that state less in healthcare costs. He urged members to
oppose the bill.
2:35:01 PM
PATRICIA PATTERSON, SELF, SOLDOTNA (via teleconference),
opposed the bill because she wanted it amended. She shared
that she owned a tobacco store and a marijuana store. She
voiced that many of electronic devices sold in tobacco and
marijuana stores were empty. She believed that the bill
would cause confusion and possibly apply the 75 percent tax
in the marijuana store. She advised only taxing nicotine
and to omit the provisions taxing the electronic
components.
2:37:55 PM
ROBIN MINARD, MATSU HEALTH FOUNDATION, WASILLA (via
teleconference), spoke in favor of the legislation. The
bill aligned state law to federal statute by raising the
minimum age from 19 to 21 for all tobacco products and
taxed e-cigarettes at the same rate as other tobacco
products. She was already aware of the effectiveness of
tobacco taxes, which fostered non-use of tobacco among
youth, encouraged smokers to quit, and reduced the overall
consumption of tobacco. Increased taxes also had a positive
effect on non-smokers with less exposure to secondhand
smoke. She furthered that e-cigarette vapor had been found
to contain flavors, propylene glycol, glycerin, heavy
metals, carcinogens, and metal nano particles and could not
be regarded as harmless. She indicated that inconsistent
research had been attributed to much of the vape research
proponents touting its safe use. She encouraged the
committee to move HB 110 forward.
2:40:24 PM
SHAUN D'SYLVA, ALASKA SMOKE FREE TRADE ASSOCIATION, SEATTLE
(via teleconference), owned stores in Fairbanks, Wasilla,
and Anchorage. He opposed the bill. He stated that research
suggested that vaping was clearly better than smoking. He
asserted that in Minnesota and Massachusetts increased e-
cigarette taxes encouraged people to smoke tobacco over
vaping. He noted that in some places in Alaska there was a
55 percent tax on e-cigarettes. He stated that the industry
did not advertise any longer. He noted another study that
claimed the air inside of a vape store was cleaner than
outside air. He urged members to look at studies
encouraging vaping as a method to stop smoking.
2:44:17 PM
JESSI WALTON, SELF, FAIRBANKS (via teleconference), opposed
HB 110. She considered vaping a consumer created
alternative. She believed that a 75 percent tax would
force her to turn to the black market. She thought that
people would return to smoking combustible cigarettes and
that the bill was bad policy. She urged members to oppose
HB 110
2:45:34 PM
EMILY NENON, ALASKA GOVERNMENT RELATIONS DIRECTOR, AMERICAN
CANCER SOCIETY, ANCHORAGE (via teleconference), had worked
on cancer prevention policy for 20 years. She shared that
she worked on the tobacco tax legislative effort in 2004.
She noted that tax statutes had not changed since that
time, but the markets had with the introduction of e-
cigarettes in 2007. She thanked the bill sponsor and staff
for bringing the bill forward. She indicated that it was
noteworthy that e-cigarettes were not considered a
cessation product nor had any company applied to the FDA
for them to be classified as such. Combustible cigarettes
had over 3000 chemical compounds of which 70 were known
human carcinogens. She reasoned that it was not difficult
for a vape product to be less harmful than combustible
cigarettes. Tobacco use cost the state $438 million in
healthcare costs. She was available for questions.
2:47:49 PM
DON ENSLOW, SELF, ANCHORAGE (via teleconference), spoke in
strong support of HB 110. He was a safety professional for
43 years and had to measure air contaminants for exposure
limits on job sites. He indicated that chemical products in
e-cigarettes included propylene glycol, which when heated
turned into formaldehyde and acetaldehyde that were both
carcinogens. In the workplace, the OSHA exposure limits for
propylene glycol was .05 parts per million and for
formaldehyde it was .5 parts per million. Very small
amounts of the chemicals could be detrimental to human
health. He furthered that even though the FDA had not begun
its review of e-cigarettes, researchers know that vaping
devices contained propylene glycol and related carcinogens,
diacetone, diethylene glycol, metals, and benzene. He
believed that increasing taxes would be a monetary
deterrent to the use of vaping products.
2:50:55 PM
JAMIE MORGAN, GOVERNMENT RELATIONS REGIONAL LEAD, AMERICAN
HEART ASSOCIATION, SACRAMENTO, CALIFORNIA (via
teleconference), indicated that the American Heart
Association fully supported HB 110. She believed that there
was an epidemic in the use of vaping products among youth.
She relayed that current or prior cigarette smokers were
more prone to becoming ill with Covid-19. She declared that
e-cigarettes were not safe and increased the risk of
stroke, heart attack, and coronary heart disease. Young
adults using e-cigarettes experienced arterial stiffness
and blood vessel damage similar to smokers. The AHA
supported public policy that regulated and taxed e-
cigarettes similarly to all other tobacco products and
favored raising the legal age to 21. Studies showed that
youth were price sensitive to increased tobacco taxes and
costs. She advised removing the language regarding
possession and punishment from the bill.
2:53:45 PM
Representative LeBon deduced that marijuana vaping products
were not taxed. He asked if AHA had a position on the
implications of marijuana use. Ms. Morgan relayed that the
AHA did not have a position on marijuana use. However, AHA
held the position that wherever smoking tobacco is
prohibited, smoking marijuana should also be prohibited to
be consistent with smoke free air.
2:54:53 PM
REPRESENTATIVE SARA HANNAN, SPONSOR, spoke to
Representative LeBon's question. She informed
Representative LeBon that cannabis vaping was taxed.
Cannabis taxation happened at the grow level and was taxed
at the same rate regardless of the method of ingestion.
2:55:29 PM
Co-Chair Merrick CLOSED public testimony.
2:55:55 PM
NICOLE REYNOLDS, DEPUTY DIRECTOR, TAX DIVISION OF THE
DEPARTMENT OF REVENUE (via teleconference), reviewed the
published zero fiscal note [FN 3 (REV)] for the Department
of Revenue. She indicated that the department did not
anticipate a revenue impact from the age change, as most
sellers have already adjusted selling practices to reflect
federal law. She explained that DOR did not have statewide
data regarding the sales of vaping products therefore the
division used data from the Matanuska-Susitna Borough's tax
on e-cigarette sales and updated population data to develop
an estimated tax base for Alaska. In the absence of
statewide data on electronic cigarette sales, there was a
wide range of uncertainty around the revenue estimates. The
division estimated that the tax would generate an
additional $1 million in revenue in FY 2022 and $2.4
million in FY 2023, rising with inflation to $2.7 million
in FY 2027. The reason for the lower revenue estimate in FY
2022 was twofold; revenue would only be collected for half
of the fiscal year because the bill would take effect
halfway through FY 2022, and it's assumed that distributors
would stockpile inventory before the tax takes effect. The
entirety of the revenue would be deposited into the General
Fund (GF).
2:58:47 PM
CLINT FARR, OPERATIONS MANAGER, DIVISION OF PUBLIC HEALTH,
DEPARTMENT OF HEALTH AND SOCIAL SERVICES (via
teleconference), discussed the publish zero fiscal note [FN
2 (DHS)] for the Department of Health and Social Services.
He indicated that there would be no fiscal impacts to the
Division of Public Health or expected to experience an
increased workload. He was available for questions.
2:59:44 PM
SHARON WALSH, DEPUTY DIRECTOR, DIVISION OF CORPORATIONS,
BUSINESS AND PROFESSIONAL LICENSING, DEPARTMENT OF
COMMERCE, COMMUNITY AND ECONOMIC DEVELOPMENT (via
teleconference), spoke to the published zero fiscal note
[FN 1 (CED)] He commented that there would be no fiscal
impacts on the division.
3:00:22 PM
Representative Thompson shared a concern. He indicated
there were about 2 dozen convenience-type stores inside of
gas stations in Fairbanks where individuals that were 19
years of age worked. He worried that they would lose their
income if the bill was adopted.
Co-Chair Merrick voiced that amendments were due for HB 110
by 6:00 pm on Tuesday, May 11, 2021. She also set a
deadline for HB 85 on May 11, 2021, at 6 pm.
HB 110 was HEARD and HELD in committee for further
consideration.
| Document Name | Date/Time | Subjects |
|---|---|---|
| HB 110 Public Testimony by 051021.pdf |
HFIN 5/7/2021 1:30:00 PM |
HB 110 |
| HB 132 Amendments 1-3 051121.pdf |
HFIN 5/7/2021 1:30:00 PM |
HB 132 |