Legislature(2021 - 2022)SENATE FINANCE 532
04/11/2022 09:00 AM Senate FINANCE
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| Audio | Topic |
|---|---|
| Start | |
| SB45 | |
| SB164 | |
| Adjourn |
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+ teleconferenced
= bill was previously heard/scheduled
| += | SB 45 | TELECONFERENCED | |
| += | SB 164 | TELECONFERENCED | |
| + | TELECONFERENCED | ||
SENATE BILL NO. 45
"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."
9:05:34 AM
Co-Chair Bishop relayed that it was the second hearing for
SB 45. The committee had previously opened and closed
public testimony. The committee intended to consider a
Committee Substitute (CS) and one proposed amendment.
Co-Chair Stedman MOVED to ADOPT proposed committee
substitute for SB 45, Work Draft 32-LS0311\D (Nauman,
4/5/22).
Co-Chair Bishop OBJECTED for discussion.
9:06:20 AM
ERIN SHINE, STAFF, SENATOR CLICK BISHOP, highlighted that
the proposed CS removed the mandatory product manufacturer
liability insurance policy requirement. It removed a
prohibition on flavored electronic smoking products and
bifurcated the excise tax rate between tobacco products.
The tax rate would stay at 75 percent of wholesale and
would include an electronic smoking product (which included
close-systems electronic smoking products), which was now
an excise tax rate of 45 percent.
Ms. Shine addressed an Explanation of Changes document
(copy on file):
Updated Title
Section 3
Amends AS 11.76.105(c) to reduce the existing
violation fine of $500 to be not more than $300 for
possession of tobacco, an electronic smoking product
or a product containing nicotine by a person under 21
years of age.
Section 4
Adds a new subsection, AS 11.76.105(d), that directs
the court system to treat violations for possession of
tobacco and ESP products similar to a traffic
violation, with a maximum fine of $300, and to waive
mandatory court appearance. This replaces Section 4 of
version O, relating to prohibition of internet sales,
as that is now addressed in Section 11 and 19 of
version D, below, allowing internet sales but with 3rd
party age verification.
Section 10
The section pertaining to mandatory product
manufacturer liability insurance policy was struck
from Version O, and instead replaced Section 10 by
adding a new subsection in Version D, AS
11.81.900(b)(69), that provides a definition of
"nicotine."
Section 14
Amends AS 43.50.300 by establishing an excise tax rate
of 45% of the wholesale price of the Eliquid contained
in an ESP.
Section 15
Amends AS 43.50.300 by adding a new subsection (c)
that provides a definition of "closed system
electronic smoking product"
Section 16
Amends AS 43.50.310(b) to exclude marijuana products
from any provisions of the bill.
Section 18
Amends AS 43.50.320 to:
? delete the prohibition of flavored electronic
smoking products; and
? adds a prohibition of marketing electronic smoking
product, including a flavored products in a manner
likely to promote the use of them by a person under 21
years of age.
9:10:00 AM
Ms. Shine continued to address the Explanation of Changes
document:
Section 27
Amends AS 43.50.390 to provide a reference to the
definition of "nicotine" established in Section 10.
Section 32
Amends AS 45.50.471(b)(58) with conforming changes
made in Section 18, relating to unlawful marketing
practices.
Section 35
Conforming changes to the applicability section as
well as providing a grandfather clause for persons 19
years of age or older who are employed on the
effective date of the act by a person with a business
license endorsement to sell tobacco products.
Section 36
Amends the effective date from "January 1, 2022" to
"July 1, 2023"
Ms. Shine noted that in Section 33 there was a section of
existing law missing from the original bill draft, which
had now been added on page 17. The language had been
omitted via a drafting error in the previous version of the
bill.
Co-Chair Bishop WITHDREW his OBJECTION. There being NO
further OBJECTION, it was so ordered. The CS for SB 45 was
ADOPTED.
9:12:19 AM
SENATOR GARY STEVENS, SPONSOR, explained that the bill was
very simple and was about protecting children from becoming
addicted to nicotine. He shared that he had been working on
the legislation for seven years, during which time the
products addressed in the bill continued to evade any
meaningful public policy to restrict youth access. He
suggested that the more time that passed, the greater
number of young Alaskans would become addicted. He thought
it was common knowledge that the products were unhealthy.
He thought the state seemed to be giving tacit approval
that the products were safe, and he strongly disagreed.
Co-Chair Bishop asked if the sponsor was comfortable with
the proposed CS.
Senator Stevens stated he was fine with the CS.
9:13:54 AM
TIM LAMKIN, STAFF, SENATOR GARY STEVENS, had nothing to add
but was available to answer questions.
Senator Wielechowski referenced the change to allow flavors
and asked if the sponsor had any concerns.
Mr. Lamkin suggested that the CS contained what could be
interpreted as a compromise, where it was recognized that
there were legitimate instances of adults that had used the
products to stop smoking cigarettes and may have a
legitimate reason to prefer the flavored product. He
continued that the compromise was struck that included
provisions allowing that it was unlawful for marketing that
would promote minor use of the products.
Senator Wielechowski asked if the CS would allow for the
sale or marketing of flavors such as Fruit Loops or Lucky
Charms.
Mr. Lamkin thought the matter would be called into question
and the references could be cited as unlawful marketing.
Senator Wilson MOVED to ADOPT Amendment 1:
TO: CSSB45(FIN), Draft Version "D"
Page 7, line 3, following "is":
Insert "15 [AT THE RATE OF 75] percent of the
wholesale price of"
Co-Chair Bishop OBJECTED for discussion.
Senator Wilson spoke to Amendment 1. He explained that the
main point of the bill was to reduce underage usage, which
would conform to the federal law. He thought the bill was
being saddled with penalties. He cited that some of the
products referenced were considered by the Food and Drug
Administration to be appropriate for the protection of
public health and were used for smoking cessation tools.
Instead of raising the age to 21, he considered that a less
harmful alternative should be encouraged. He clarified that
he did not encourage smoking and did not personally use the
products. He thought a less lethal alternative should be
offered. He explained that the intent was to lower the vape
tax to 15 percent instead of the proposed rate of 45
percent.
9:17:36 AM
AT EASE
9:17:59 AM
RECONVENED
Co-Chair Bishop asked if there was further discussion on
the amendment.
Senator Wielechowski asked how the sponsor felt about the
amendment offered by Senator Wilson.
Senator Stevens was opposed to the amendment.
Co-Chair Bishop MAINTAINED his OBJECTION. A roll call vote
was taken on the motion.
IN FAVOR: Wilson
OPPOSED: Wielechowski, Hoffman, Olson, Bishop, Stedman
The MOTION FAILED (1/5).
9:19:31 AM
AT EASE
9:20:48 AM
RECONVENE
Co-Chair Bishop relayed that the committee would request
updated fiscal notes and set the bill aside until the new
fiscal notes were available.
SB 45 was HEARD and HELD in committee for further
consideration.
9:21:08 AM
AT EASE
9:24:17 AM
RECONVENED
| Document Name | Date/Time | Subjects |
|---|---|---|
| SB 45 Work Draft ver. D 4.5.22.pdf |
SFIN 4/11/2022 9:00:00 AM |
SB 45 |
| SB 45 Explanation of Changes ver. O to D 4.5.22.pdf |
SFIN 4/11/2022 9:00:00 AM |
SB 45 |
| SB 45 Amendment #1 Wilson.pdf |
SFIN 4/11/2022 9:00:00 AM |
SB 45 |
| SB 164 ver. B_Explaination of Changes.pdf |
SFIN 4/11/2022 9:00:00 AM |
SB 164 |
| SB 164 Document C_SCS1 AgencySummary.pdf |
SFIN 4/11/2022 9:00:00 AM |
SB 164 |
| SB 164 Document A_SCS1 ProjectDetailByAgency.pdf |
SFIN 4/11/2022 9:00:00 AM |
SB 164 |
| SB 164 Document B_SCS1 AgencySummary UGF Only.pdf |
SFIN 4/11/2022 9:00:00 AM |
SB 164 |
| SB 164 work draft B.pdf |
SFIN 4/11/2022 9:00:00 AM |
SB 164 |
| SB 45 04-11-2022 Taxpayers Protection Alliance Testimony RE SB45.pdf |
SFIN 4/11/2022 9:00:00 AM |
SB 45 |
| SB 164 Public Testimony Packet 4.pdf |
SFIN 4/11/2022 9:00:00 AM |
SB 164 |
| SB 164 4.19.2022 Letter of Support to increase Capital Budget CSSB 164 - Senator Bishop.pdf |
SFIN 4/11/2022 9:00:00 AM |
SB 164 |