SB 89-AGE FOR TOBACCO/NICOTINE/E-CIG; TAX E-CIG  1:36:28 PM CHAIR BJORKMAN announced the consideration of SENATE BILL NO. 89 "An Act relating to tobacco, tobacco products, electronic smoking products, nicotine, and products containing nicotine; raising the minimum age to purchase, sell, exchange, or possess tobacco, a product containing nicotine, or an electronic smoking product; relating to the taxation of electronic smoking products and vapor products; and providing for an effective date." He stated that this is the fourth hearing of this bill and Tim Lamkin will provide a recap. 1:37:05 PM TIM LAMKIN, Staff, Senator Gary Stevens, Alaska State Legislature, Juneau, Alaska, gave a recap of and responded to question on SB 89. He stated that this bill aligns state law with federal law for sales of tobacco and e-cigarette products to individuals age 21 and older and establishes a 25 percent retail sales tax on e-cigarette products. CHAIR BJORKMAN noted there was a committee substitute (CS) two amendments for the committee to consider. He solicited a motion to adopt the proposed CS. 1:37:55 PM SENATOR GRAY-JACKSON moved to adopt the committee substitute (CS) for SB 89, work order 33-LS0247\S, as the working document. CHAIR BJORKMAN objected for purposes of discussion. 1:38:34 PM KONRAD JACKSON, Staff, Senator Jesse Bjorkman, Alaska State Legislature, Juneau, Alaska, presented the following summary of changes from CS version B to S for SB 89: [Original punctuation provided.] SUMMARY of CHANGES (from version B to version S) Reflected version S:  Change #1: Page 3, lines 17-19 The fine for a violation for underage possession was reduced from up to $300, to up to $150. A provision was also added for the court to offer a defendant, in lieu of paying a fine, the option of participating in an educational program on the risks of tobacco use; Change #2: Page 9, line 30 Added the tax on E-Cigs is "25% of the retail sales price" of the products; Change #3: Page 10, 19-20 Added the definition of Hemp products, given hemp products are being exempted from the tax program; Change #4: Page 12, after line 2 Deleted from version B was a subsection on tax credits and refunds, as they apply to wholesale tax structure, and this is a retail tax program; Change #5: Page 12, lines 17-19 Added an allowance for tax proceeds to be used for relief for schools in contracting with health advocates conducting smoking cessation seminars and installation of vaping detection devices; Change #6: Page 14, line 23 Increased the limit of nicotine concentration from 20 mg/mL to 60 mg/mL; Change #7: Page 16, line 18 Under the definition of "retailer," added "..in the business of selling [ESPs] at retail;" Change #8: Page 21, line 25 Moved the effective date from July 1, 2023 to January  1, 2024. This change also resulted in deleting Sections 2 and 10 from version B, as they were technical in nature. 1:41:45 PM CHAIR BJORKMAN removed his objection. Finding no further objection, CSSB 89, version S, was adopted as the working document. 1:42:08 PM SENATOR DUNBAR moved to adopt Amendment 1, work order 33- LS0247\B.1, for CSSB 89. He advised that the amendment was drafted to SB 89, version B, so the committee would need to grant Legislative Legal authority to make conforming changes to CSSB 89, version S if the amendment is adopted. 33-LS0247\B.1 Nauman 4/6/23 AMENDMENT 1 OFFERED IN THE SENATE BY SENATOR DUNBAR TO: SB 89 Page 1, line 2: Delete "sell," Page 2, line 5: Delete "21 [19]" Insert "19" Page 3, line 10: Delete "A" Insert "Except as provided in (e) of this  section, a [A]" Page 4, line 3: Delete "a new subsection" Insert "new subsections" Page 4, following line 5: Insert a new subsection to read: "(e) The provisions of (a) of this section do not apply to a person 19 or 20 years of age who is employed by a person with a business license endorsement under AS 43.70.075 and, as part of that employment, is selling a cigarette, a cigar, tobacco, a product containing tobacco, an electronic smoking product, or a product containing nicotine." Page 5, line 9: Delete "21 [19]" Insert "19" Page 22, line 3: Delete "(a)" Page 22, line 8, following "AS 11.76.105(d)": Insert "and (e)" Page 22, lines 19 - 22: Delete all material. CHAIR BJORKMAN objected for purposes of discussion. CHAIR BJORKMAN removed his objection. 1:45:24 PM SENATOR BISHOP asked whether the Anchorage Assembly collected analytical data showing the number of 19-year-olds operating in this space. SENATOR DUNBAR replied that he was unable to collect that data. Anecdotally, he relayed a story about a 19 or 20-year-old who said he would lose his job without this amendment. Senator Dunbar said that these entry-level positions are the kind of jobs that young people have the most access to and they should not be restricted from such employment. 1:46:27 PM SENATOR GRAY-JACKSON asked for the sponsor's position on Amendment 1. 1:46:45 PM MR. LAMKIN answered that first and foremost Senator Stevens wants to see progress on SB 89. He described the controlled access provision in state law and assured the members that the bill does not preclude someone who is 18 or 19 from the job, they just need a supervisor who is age 21 or older who is present to facilitate the transaction. 1:48:12 PM CHAIR BJORKMAN found no further objection and Amendment 1 was adopted. 1:48:26 PM SENATOR GRAY-JACKSON, on behalf of Senator Bjorkman, moved to adopt Amendment 2 to SB 89, [work order 33-LS0247\S.1]. 33-LS0247\S.1 Nauman 4/18/23 AMENDMENT 2 OFFERED IN THE SENATE BY SENATOR BJORKMAN TO: CSSB 89(L&C), Draft Version "S" Page 1, line 2: Delete "raising" Insert "relating to" Page 2, line 5: Delete "21" Insert "18" Page 2, line 25: Delete "A" Insert "Except as provided in (e) of this  section, a [A]" Page 3, line 20: Delete "a new subsection" Insert "new subsections" Page 3, following line 22: Insert a new subsection to read: "(e) The provisions of (a) of this section do not apply to a person 18, 19, or 20 years of age who is employed by a person with a business license endorsement under AS 43.70.075 and, as part of that employment, is selling a cigarette, a cigar, tobacco, a product containing tobacco, an electronic smoking product, or a product containing nicotine." Page 4, line 26: Delete "21" Insert "18" Page 21, line 5: Delete "(a)" Page 21, line 10, following "AS 11.76.105(d)": Insert "and (e)" Page 21, lines 21 - 24: Delete all material. CHAIR BJORKMAN objected for purposes of discussion. He said Amendment 1 permits a person 19 or 20 years of age to sell cigarettes, cigars, tobacco products, electronic smoking products and products containing nicotine as part of their employment. He argued that the age range should be expanded to include a person 18 years of age. An 18-year-old would be unemployable without an older person onsite and available to supervise. A college-age person who has graduated from high school should be able to work in this area. It would still be illegal with harsh punishments if they were to buy, sell, or possess these products in violation of the law. However, 18- year-olds should not be prevented from working in these establishments to fulfill their economic needs. The age should be 18 instead of 19. CHAIR BJORKMAN removed his objection and asked if there was further objection. 1:50:16 PM SENATOR DUNBAR objected for purposes of further discussion. He asked the bill sponsor whether there is a legal difference between 18- and 19-year-olds under existing law, and if so, whether Amendment 2 would cause SB 89 to roll back existing law on tobacco products. 1:51:58 PM MR. LAMKIN replied that this subject matter has a long, sordid history. State law is 19, currently. It has been 19 since the 1980s. The policy decision orbited around the idea that 18-year- olds are still in school. He offered the notion that if the state targets young adults and sub-adults who have social circles that include 15-, 16-, 17- and 18-year-olds, it is easier for those under 18 to access the products. Herein lies the core question. He asked whether the law is written to support adults at 18 or protect children under 18. 1:52:11 PM SENATOR DUNBAR commented that this is a challenging area. Young people are in a legal and societal liminal space. Young men are required to register for Selective Service at age 18 could be sent to war, however, many 18-year-olds are still in high school. He clarified that 19-year-olds are in high school too, though far fewer. He said that SB 89 should move in a positive direction of discouraging nicotine addiction and tobacco product use. An amendment to keep that age at 19 and 20 is neutral, whereas an amendment to drop the age to 18 is moving in the opposite direction. He said for that reason he maintains his objection to Amendment 2. 1:53:45 PM SENATOR GRAY-JACKSON said she cosponsored this legislation last year and she is a cosponsor this year. She thanked Mr. Lamkin for reiterating the importance of SB 89. She opposed the [amendment]. 1:54:19 PM At ease. 1:54:58 PM CHAIR BJORKMAN reconvened the meeting. 1:55:12 PM SENATOR GRAY-JACKSON corrected her previous statement stating that she supports the bill but not Amendment 2. 1:55:38 PM CHAIR BJORKMAN said he discourages teens from vaping and e- cigarette use; however, he does not want to discourage an 18- year-old high school graduate from working. This country values economic freedom, opportunity, and the ability to work and earn. He said that with freedom comes responsibility. People have the responsibility to make good choices and follow the law. Passing laws that prevent people who are above the age of adulthood from working is not in keeping with the spirit of liberty and freedom. Employers need employees to serve alcohol or to wait tables, people willing to do the work. As laws continue to restrict people from working, fewer people will be willing to work. 1:57:26 PM SENATOR DUNBAR responded to the comment about high school graduates who are 18 years of age. He said he could support the amendment, but not while the 18-year-old is in school. 1:58:28 PM SENATOR BISHOP commented he wants the bill to be effective and work. He found that Senator Dunbar made an important distinction. He stated that an 18-year-old who is still in high school has peer pressure from classmates. 1:59:24 PM SENATOR GRAY-JACKSON commented that these establishments are not the only establishments where 18-year-olds can find work. 2:00:02 PM CHAIR BJORKMAN moved to withdraw Amendment 2. Finding no objection, Amendment 2 was withdrawn. 2:00:25 PM SENATOR GRAY-JACKSON moved to report CSSB 89, work order 33- LS0247\S, as amended, from committee with individual recommendations and attached fiscal note(s). She further moved that the committee grant Legislative Legal the authorization to make technical and conforming changes. 2:00:49 PM CHAIR BJORKMAN found no objection and CSSB 89(L&C) was reported from the Senate Labor and Commerce Standing Committee.