From local flavor ban ordinances to potential tax increases, the new year brings a fresh batch of tobacco challenges for convenience store retailers.
By Thomas Briant |
With the new year comes new challenges for retailers that sell tobacco products. Just like in 2020, key issues for retailers will encompass local, state and federal legislative and regulatory actions.
Local Flavor Ban Ordinances
In February 2020, the Food and Drug Administration (FDA) made most flavored cartridge- and pod-type vaping products illegal. Then, in September 2020, it became illegal to sell other vapor and tobacco products for which a required Premarket Tobacco Application (PMTA) was not filed with the FDA.
Local governments continue to propose flavor bans, claiming a need to address underage youth vaping, yet at the same time extending the bans to include a prohibition on the sale of traditional tobacco products (e.g., menthol cigarettes, flavored cigars, pipe tobacco, smokeless tobacco) and newer tobacco products, including some the FDA has determined are “modified risk,” which would be beneficial to the tobacco consumer and the health of the entire population.
In 2020, the National Association of Tobacco Outlets (NATO) monitored or opposed over 160 such local flavor ban ordinances, most in California and Massachusetts, and both states have also passed statewide flavored tobacco ban laws. Minnesota and Colorado also had multiple local ban proposals. Opposition by local retailers has successfully modified, delayed or stopped many proposed bans, notably Kansas City, Mo.; Missoula, Mont.; and Phoenix.
In addition, six lawsuits were filed in 2020 against local flavor ordinances — two against Philadelphia and others against Palo Alto, Calif.; Edina, Minn.; Los Angeles County and San Diego County. In Los Angeles County, the court upheld the ban, but a Philadelphia court preliminarily issued an injunction against that city’s ban.
California Flavored Tobacco Ban Law
California enacted Senate Bill 793, banning the sale of all flavored tobacco products, including vapor products, except shisha, premium cigars and loose-leaf tobacco, which was to be effective Jan. 1, 2021. The California Coalition for Fairness was formed to collect voter signatures on a referendum petition to have the state’s voters decide whether the law goes into effect or is repealed. The Coalition needed 623,212 valid voter signatures by Nov. 30, 2020. On Nov. 24, the Coalition submitted 1.02 million signatures, and on Dec. 7, the California Secretary of State issued a notice that county election officials must verify the signatures, a process that would extend beyond Jan. 1, 2021. A lawsuit was then filed to suspend the law pending signature verification; on Dec. 10, the Court suspended the law unless it is determined there are not enough valid signatures or the voters approve the ban in the Nov. 2022 election.
Proactive Measures Needed on 2021 Tax Increase Bills
The pandemic has resulted in significant state revenue shortfalls and increased expenses. Because states are required to balance their budgets every year, state lawmakers will likely consider tobacco product tax increases as one option during 2021 legislative sessions.
If you have not already done so, NATO urges you to communicate with the state lawmakers that represent the district(s) in which your store(s) are located and urge them to not support cigarette and tobacco tax increases.
New FDA Graphic Cigarette Warnings
In March 2020, the FDA ruled that 11 new text warnings with graphic color images must appear on cigarette packs, cartons and cigarette advertisements beginning June 18, 2021. Two lawsuits were filed, claiming the warnings violated free speech, exceeded the FDA’s authority and were improperly adopted. The original implementation date of Oct. 16, 2021, for the new warings has been extended by court order to Jan. 14, 2022.
Because of this postponement order, the FDA announced it strongly encourages manufacturers, wholesalers and retailers that create or produce their own cigarette advertising to submit their required warning rotational plans to the FDA by March 16, 2021, extending the original Dec. 16, 2020, deadline.
Both lawsuits continue; whether the new graphic warnings will be struck down, required in their current form, further delayed or amended may become known in 2021.
Thomas Briant is the executive director for the National Association of Tobacco Outlets (NATO).