Bill Text: IA HF2134 | 2019-2020 | 88th General Assembly | Introduced


Bill Title: A bill for an act relating to tobacco, tobacco products, alternative nicotine products, vapor products, and cigarettes, including the regulation and taxation of such products, providing penalties, and including effective date provisions.

Spectrum: Slight Partisan Bill (Democrat 2-1)

Status: (Introduced - Dead) 2020-01-27 - Introduced, referred to State Government. H.J. 137. [HF2134 Detail]

Download: Iowa-2019-HF2134-Introduced.html
House File 2134 - Introduced HOUSE FILE 2134 BY WINCKLER , WOLFE , and MOMMSEN A BILL FOR An Act relating to tobacco, tobacco products, alternative 1 nicotine products, vapor products, and cigarettes, including 2 the regulation and taxation of such products, providing 3 penalties, and including effective date provisions. 4 BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF IOWA: 5 TLSB 5280YH (6) 88 pf/jh
H.F. 2134 DIVISION I 1 LEGAL AGE RELATING TO TOBACCO, TOBACCO PRODUCTS, ALTERNATIVE 2 NICOTINE PRODUCTS, CIGARETTES, AND VAPING PRODUCTS 3 Section 1. Section 321.216C, Code 2020, is amended to read 4 as follows: 5 321.216C Use of driver’s license or nonoperator’s 6 identification card by underage person to obtain tobacco, tobacco 7 products, alternative nicotine products, vapor products, or 8 cigarettes. 9 A person who is under the legal age of eighteen as defined in 10 section 453A.1 , who alters or displays or has in the person’s 11 possession a fictitious or fraudulently altered driver’s 12 license or nonoperator’s identification card and who uses 13 the license or card to violate or attempt to violate section 14 453A.2, subsection 2 , commits a simple misdemeanor punishable 15 as a scheduled violation under section 805.8A, subsection 16 4 . The court shall forward a copy of the conviction to the 17 department. 18 Sec. 2. Section 453A.1, Code 2020, is amended by adding the 19 following new subsection: 20 NEW SUBSECTION . 16A. “Legal age” means twenty-one years of 21 age or older. 22 Sec. 3. Section 453A.2, subsections 1, 2, and 3, Code 2020, 23 are amended to read as follows: 24 1. A person shall not sell, give, or otherwise supply any 25 tobacco, tobacco products, alternative nicotine products, vapor 26 products, or cigarettes to any person under eighteen years who 27 is not of legal age. 28 2. A person under eighteen years of legal age shall not 29 smoke, use, possess, purchase, or attempt to purchase any 30 tobacco, tobacco products, alternative nicotine products, vapor 31 products, or cigarettes. 32 3. Possession of tobacco, tobacco products, alternative 33 nicotine products, vapor products, or cigarettes by an 34 individual under eighteen years of legal age does not 35 -1- LSB 5280YH (6) 88 pf/jh 1/ 22
H.F. 2134 constitute a violation under this section if the individual 1 under eighteen years of legal age possesses the tobacco, 2 tobacco products, alternative nicotine products, vapor 3 products, or cigarettes as part of the individual’s employment 4 and the individual is employed by a person who holds a valid 5 permit under this chapter or who lawfully offers for sale or 6 sells cigarettes or tobacco products. 7 Sec. 4. Section 453A.2, subsection 8, paragraph a, 8 subparagraph (2), Code 2020, is amended to read as follows: 9 (2) The compliance effort is conducted with the advance 10 knowledge of law enforcement officers and reasonable measures 11 are adopted by those conducting the effort to ensure that use 12 of tobacco, tobacco products, alternative nicotine products, 13 vapor products, or cigarettes by individuals under eighteen 14 years of legal age does not result from participation by any 15 individual under eighteen years of legal age in the compliance 16 effort. 17 Sec. 5. Section 453A.5, subsection 1, Code 2020, is amended 18 to read as follows: 19 1. The alcoholic beverages division of the department of 20 commerce shall develop a tobacco compliance employee training 21 program not to exceed two hours in length for employees and 22 prospective employees of retailers, as defined in sections 23 453A.1 and 453A.42 , to inform the employees about state and 24 federal laws and regulations regarding the sale of tobacco, 25 tobacco products, alternative nicotine products, vapor 26 products, and cigarettes to persons under eighteen years of 27 legal age and compliance with and the importance of laws 28 regarding the sale of tobacco, tobacco products, alternative 29 nicotine products, vapor products, and cigarettes to persons 30 under eighteen years of legal age. 31 Sec. 6. Section 453A.36, subsection 6, Code 2020, is amended 32 to read as follows: 33 6. Any sales of tobacco, tobacco products, alternative 34 nicotine products, vapor products, or cigarettes made through a 35 -2- LSB 5280YH (6) 88 pf/jh 2/ 22
H.F. 2134 cigarette vending machine are subject to rules and penalties 1 relative to retail sales of tobacco, tobacco products, 2 alternative nicotine products, vapor products, and cigarettes 3 provided for in this chapter . Cigarettes shall not be sold 4 through any cigarette vending machine unless the cigarettes 5 have been properly stamped or metered as provided by this 6 subchapter , and in case of violation of this provision, the 7 permit of the dealer authorizing retail sales of cigarettes 8 shall be revoked. Payment of the permit fee as provided 9 in section 453A.13 authorizes a cigarette vendor to sell 10 tobacco, tobacco products, alternative nicotine products, vapor 11 products, and cigarettes through vending machines. However, 12 tobacco, tobacco products, alternative nicotine products, vapor 13 products, and cigarettes shall not be sold through a vending 14 machine unless the vending machine is located in a place where 15 the retailer ensures that no person younger than eighteen years 16 of legal age is present or permitted to enter at any time. 17 Tobacco, tobacco products, alternative nicotine products, 18 vapor products, and cigarettes shall not be sold through 19 any cigarette vending machine if such products are placed 20 together with any nontobacco product, other than matches, in 21 the cigarette vending machine. This section does not require 22 a retail permit holder to buy a cigarette vendor’s permit if 23 the retail permit holder is in fact the owner of the cigarette 24 vending machines and the machines are operated in the location 25 described in the retail permit. 26 Sec. 7. Section 453A.39, subsection 2, paragraphs b and c, 27 Code 2020, are amended to read as follows: 28 b. A manufacturer, distributor, wholesaler, retailer, or 29 distributing agent or agent thereof shall not give away any 30 tobacco, tobacco products, alternative nicotine products, vapor 31 products, or cigarettes to any person under eighteen years 32 of legal age, or within five hundred feet of any playground, 33 school, high school, or other facility when such facility is 34 being used primarily by persons under legal age eighteen for 35 -3- LSB 5280YH (6) 88 pf/jh 3/ 22
H.F. 2134 recreational, educational, or other purposes. 1 c. Proof of age shall be required if a reasonable person 2 could conclude on the basis of outward appearance that a 3 prospective recipient of a sample may be under eighteen years 4 of legal age. 5 Sec. 8. Section 453A.47B, Code 2020, is amended to read as 6 follows: 7 453A.47B Requirements for mailing or shipping —— alternative 8 nicotine products or vapor products. 9 A retailer shall not mail, ship, or otherwise cause to be 10 delivered any alternative nicotine product or vapor product in 11 connection with a delivery sale unless the retailer meets all 12 of the following apply conditions : 13 1. Prior to sale to the purchaser, the retailer verifies 14 that the purchaser is at least eighteen years of legal age 15 through or by one of the following: 16 a. A commercially available database, or aggregate of 17 databases, that is regularly used by government and businesses 18 for the purpose of age and identity verification. 19 b. Obtaining a copy of a valid government-issued document 20 that provides the name, address, and date of birth of the 21 purchaser. 22 2. The retailer uses a method of mailing, shipping, or 23 delivery that requires the signature of a person who is at 24 least eighteen years of legal age before the shipping package 25 is released to the purchaser. 26 Sec. 9. EFFECTIVE DATE. This division of this Act, being 27 deemed of immediate importance, takes effect upon enactment. 28 DIVISION II 29 LIMITATIONS ON SALE AND DISTRIBUTION OF VAPOR PRODUCTS WITH 30 CHARACTERIZING FLAVOR 31 Sec. 10. NEW SECTION . 453A.47E Prohibition on sale or 32 distribution of vapor products with characterizing flavor —— 33 penalties. 34 1. A retailer shall not offer for sale or sell, give, 35 -4- LSB 5280YH (6) 88 pf/jh 4/ 22
H.F. 2134 or otherwise supply in this state any vapor product with a 1 characterizing flavor. There shall be a rebuttable presumption 2 that a vapor product has a characterizing flavor if any 3 statement or claim made by the manufacturer or agent or 4 employee of the manufacturer, directed to consumers or to the 5 public, states or claims that the vapor product has or produces 6 a characterizing flavor. Such statements or claims include 7 but are not limited to those made through social media, the 8 product’s labeling or packaging, or other advertising used to 9 explicitly or implicitly communicate that the vapor product has 10 a characterizing flavor. 11 2. For the purposes of this section: 12 a. “Characterizing flavor” means a distinguishable taste 13 or aroma or both, other than the taste or aroma of tobacco, 14 imparted by a vapor product or any byproduct produced by the 15 vapor product. Characterizing flavors include but are not 16 limited to tastes or aromas relating to any fruit, chocolate, 17 vanilla, honey, candy, cocoa, dessert, alcoholic beverage, 18 menthol, mint, wintergreen, herb, or spice. 19 b. “Distinguishable” means perceivable by either the sense 20 of smell or taste. 21 3. a. A retailer who violates this section is subject to 22 permit suspension or revocation. 23 b. A retailer who violates this section is guilty of a 24 fraudulent practice. 25 DIVISION III 26 TAX ON VAPOR PRODUCTS 27 Sec. 11. Section 331.303, subsection 3, Code 2020, is 28 amended to read as follows: 29 3. Act upon applications for cigarette , tobacco product, 30 and vapor product tax permits in accordance with chapter 453A . 31 Sec. 12. Section 331.653, subsection 11, Code 2020, is 32 amended to read as follows: 33 11. Carry out duties relating to the seizure and forfeiture 34 of cigarettes, tobacco products, and vapor products, vehicles, 35 -5- LSB 5280YH (6) 88 pf/jh 5/ 22
H.F. 2134 and other property used in violation of cigarette , tobacco 1 product, or vapor product tax laws as provided in section 2 453A.32 . 3 Sec. 13. Section 331.756, subsection 19, Code 2020, is 4 amended to read as follows: 5 19. Assist, at the request of the director of revenue, in 6 the enforcement of cigar and cigarette, tobacco product, and 7 vapor product tax laws as provided in sections 453A.32 and 8 453A.49 . 9 Sec. 14. Section 453A.1, subsection 21, Code 2020, is 10 amended to read as follows: 11 21. “Place of business” is construed to mean and include any 12 place where cigarettes , alternative nicotine products, or vapor 13 products are sold or where cigarettes , alternative nicotine 14 products, or vapor products are stored within or without the 15 state of Iowa by the holder of an Iowa permit or kept for the 16 purpose of sale or consumption; or if sold from any vehicle 17 or train, the vehicle or train on which or from which such 18 cigarettes are sold shall constitute a place of business; 19 or for a business within or without the state that conducts 20 delivery sales, any place where alternative nicotine products 21 or vapor products are sold or where alternative nicotine 22 products or vapor products are kept for the purpose of sale. 23 Sec. 15. Section 453A.15, subsections 1, 2, and 4, Code 24 2020, are amended to read as follows: 25 1. The director may prescribe the forms necessary for the 26 efficient administration of this subchapter and may require 27 uniform books and records to be used and kept by each permit 28 holder or other person as deemed necessary. The director may 29 also require each permit holder or other person to keep and 30 retain in the director’s possession evidence on prescribed 31 forms of all transactions involving the purchase and sale of 32 cigarettes , alternative nicotine products, or vapor products, 33 or the purchase and use of stamps. The evidence shall be kept 34 for a period of three years from the date of each transaction, 35 -6- LSB 5280YH (6) 88 pf/jh 6/ 22
H.F. 2134 for the inspection at all times by the department. 1 2. Where a state permit holder sells cigarettes , 2 alternative nicotine products, or vapor products at retail, the 3 holder shall be required to maintain detailed records for sales 4 of cigarettes , alternative nicotine products, or vapor products 5 to be sold at retail and the cigarette , alternative nicotine 6 product, or vapor product sales records shall be kept separate 7 and apart. 8 4. Every permit holder or other person shall, when requested 9 by the department, make additional reports as the department 10 deems necessary and proper and shall at the request of the 11 department furnish full and complete information pertaining to 12 any transaction of the permit holder or other person involving 13 the purchase or sale or use of cigarettes , alternative nicotine 14 products, vapor products, or purchase of cigarette stamps. 15 The director shall specifically prescribe the forms necessary 16 and require each retailer to provide on the forms prescribed, 17 full and complete information pertaining to any cigarettes, 18 alternative nicotine products, or vapor products offered for 19 sale or sold by the retailer, including the type and brand of 20 the product. 21 Sec. 16. Section 453A.24, Code 2020, is amended to read as 22 follows: 23 453A.24 Carrier to permit access to records. 24 1. Every common carrier or person in this state having 25 custody of books or records showing the transportation of 26 cigarettes , alternative nicotine products, or vapor products 27 both interstate and intrastate shall give and allow the 28 department free access to those books and records. 29 2. The director may require by rule that common carriers 30 or the appropriate persons provide monthly reports to the 31 department detailing all information the department deems 32 necessary on shipments into and out of Iowa of cigarettes , 33 and tobacco products , alternative nicotine products, or vapor 34 products, as set forth in this subchapter I and subchapter II 35 -7- LSB 5280YH (6) 88 pf/jh 7/ 22
H.F. 2134 of this chapter . The director may require by rule that the 1 reports be filed by electronic transmission. 2 Sec. 17. Section 453A.32, subsection 6, Code 2020, is 3 amended to read as follows: 4 6. The provisions of this section applying to cigarettes 5 shall also apply to tobacco products and vapor products taxed 6 under subchapter II of this chapter . 7 Sec. 18. Section 453A.33, Code 2020, is amended to read as 8 follows: 9 453A.33 Seizure not to affect criminal prosecution. 10 The seizure, forfeiture, and sale of cigarettes, tobacco 11 products, vapor products, and other property under the terms 12 and conditions hereinabove set out pursuant to section 453A.32 , 13 shall not constitute any defense to the person owning or having 14 control or possession of the property from criminal prosecution 15 for any act or omission made or offense committed under this 16 chapter or from liability to pay penalties provided by this 17 chapter . 18 Sec. 19. Section 453A.35, subsection 1, paragraph b, Code 19 2020, is amended to read as follows: 20 b. The revenues generated from the tax on cigarettes 21 pursuant to section 453A.6, subsection 1 , and from the tax on 22 tobacco products as specified in section 453A.43, subsections 23 1, 2, 3, and 4 , and from the tax on vapor products as specified 24 in section 453A.47D shall be credited to the health care trust 25 fund created in section 453A.35A . 26 Sec. 20. Section 453A.35A, subsection 1, Code 2020, is 27 amended to read as follows: 28 1. A health care trust fund is created in the office of 29 the treasurer of state. The fund consists of the revenues 30 generated from the tax on cigarettes pursuant to section 31 453A.6, subsection 1 , and from the tax on tobacco products 32 as specified in section 453A.43, subsections 1, 2, 3, and 4 , 33 and from the tax on vapor products as specified in section 34 453A.47D, that are credited to the health care trust fund, 35 -8- LSB 5280YH (6) 88 pf/jh 8/ 22
H.F. 2134 annually, pursuant to section 453A.35 . Moneys in the fund 1 shall be separate from the general fund of the state and shall 2 not be considered part of the general fund of the state. 3 However, the fund shall be considered a special account for 4 the purposes of section 8.53 relating to generally accepted 5 accounting principles. Moneys in the fund shall be used only 6 as specified in this section and shall be appropriated only 7 for the uses specified. Moneys in the fund are not subject to 8 section 8.33 and shall not be transferred, used, obligated, 9 appropriated, or otherwise encumbered, except as provided in 10 this section . Notwithstanding section 12C.7, subsection 2 , 11 interest or earnings on moneys deposited in the fund shall be 12 credited to the fund. 13 Sec. 21. Section 453A.40, subsections 1 and 3, Code 2020, 14 are amended to read as follows: 15 1. All persons required to obtain a permit or to be licensed 16 under section 453A.13 or section 453A.44 having in their 17 possession and held for resale on the effective date of an 18 increase in the tax rate cigarettes, little cigars, or tobacco 19 products , or vapor products upon which the tax under section 20 453A.6 , or 453A.43 , or 453A.47D has been paid, unused cigarette 21 tax stamps which have been paid for under section 453A.8 , 22 unused metered imprints which have been paid for under section 23 453A.12 , or tobacco products for which the tax has not been 24 paid under section 453A.46 , or vapor products for which the tax 25 has not been paid under section 453A.47D, shall be subject to 26 an inventory tax on the items as provided in this section . 27 3. The rate of the inventory tax on each item subject to 28 the tax as specified in subsection 1 is equal to the difference 29 between the amount paid on each item under section 453A.6 , 30 453A.8 , 453A.12 , or 453A.43 , or 453A.47D prior to the tax 31 increase and the amount that is to be paid on each similar item 32 under section 453A.6 , 453A.8 , 453A.12 , or 453A.43 , or 453A.47D 33 after the tax increase except that in computing the rate of the 34 inventory tax any discount allowed or allowable under section 35 -9- LSB 5280YH (6) 88 pf/jh 9/ 22
H.F. 2134 453A.8 shall not be considered. 1 Sec. 22. Section 453A.42, subsections 1, 2, 8, 9, 10, 12, 2 14, and 17, Code 2020, are amended to read as follows: 3 1. “Business” means any trade, occupation, activity, 4 or enterprise engaged in for the purpose of selling or 5 distributing tobacco products alternative nicotine products, or 6 vapor products in this state. 7 2. “Consumer” means any person who has title to or 8 possession of tobacco products , alternative nicotine products, 9 or vapor products in storage, for use or other consumption in 10 this state. 11 8. “Person” means any individual, firm, association, 12 partnership, joint stock company, joint adventure venture , 13 corporation, trustee, agency, or receiver, or any legal 14 representative of any of the foregoing individual, firm, 15 association, partnership, joint stock company, joint venture, 16 corporation, trustee, agency, or receiver . 17 9. “Place of business” means any place where tobacco 18 products , alternative nicotine products, or vapor products are 19 sold or where tobacco products , alternative nicotine products, 20 or vapor products are manufactured, stored, or kept for the 21 purpose of sale or consumption, including any vessel, vehicle, 22 airplane, train, or vending machine; or for a business within 23 or without the state that conducts delivery sales, any place 24 where alternative nicotine products or vapor products are sold 25 or where alternative nicotine products or vapor products are 26 kept for the purpose of sale, including delivery sales. 27 10. “Retail outlet” means each place of business from which 28 tobacco products , alternative nicotine products, or vapor 29 products are sold to consumers. 30 12. “Sale” means any transfer, exchange, or barter, in any 31 manner or by any means whatsoever, for a consideration, and 32 includes and means all sales made by any person. It includes 33 a gift by a person engaged in the business of selling tobacco 34 products , alternative nicotine products, or vapor products , 35 -10- LSB 5280YH (6) 88 pf/jh 10/ 22
H.F. 2134 for advertising, as a means of evading the provisions of this 1 subchapter , or for any other purposes whatsoever . 2 14. “Storage” means any keeping or retention of tobacco 3 products , alternative nicotine products, or vapor products for 4 use or consumption in this state. 5 17. “Use” means the exercise of any right or power 6 incidental to the ownership of tobacco products , alternative 7 nicotine products, or vapor products . 8 Sec. 23. Section 453A.45, subsection 3, Code 2020, is 9 amended to read as follows: 10 3. Every retailer and subjobber shall procure itemized 11 invoices of all tobacco products , alternative nicotine 12 products, and vapor products purchased. The invoices shall 13 show the name and address of the seller and the date of 14 purchase. The retailer and subjobber shall preserve a legible 15 copy of each invoice for three years from the date of purchase. 16 Invoices shall be available for inspection by the director or 17 the director’s authorized agents or employees at the retailer’s 18 or subjobber’s place of business. 19 Sec. 24. Section 453A.47A, subsection 10, paragraph b, Code 20 2020, is amended to read as follows: 21 b. Every retailer shall, when requested by the department, 22 make additional reports as the department deems necessary and 23 proper and shall at the request of the department furnish 24 full and complete information pertaining to any transaction 25 of the retailer involving the purchase or sale or use of 26 tobacco, tobacco products, alternative nicotine products, or 27 vapor products. The director shall specifically prescribe the 28 forms necessary and require each retailer to provide on the 29 forms prescribed full and complete information pertaining to 30 any tobacco, tobacco products, alternative nicotine products, 31 or vapor products offered for sale or sold by the retailer, 32 including the type and brand of the product. 33 Sec. 25. NEW SECTION . 453A.47D Tax on vapor products. 34 1. A tax is imposed upon all vapor products in this state 35 -11- LSB 5280YH (6) 88 pf/jh 11/ 22
H.F. 2134 at the rate of fifty percent of the wholesale sales price of 1 the vapor product. The tax shall be imposed on any component 2 part or accessory of a vapor product, whether or not sold 3 separately, that is necessary to and used during the operation 4 of a vapor product, including but not limited to any cartridge 5 or other container of a solution or other substance, which may 6 or may not contain nicotine, that is intended to be used with 7 or in an electronic cigarette, electronic cigar, electronic 8 cigarillo, electronic pipe, or similar product or device. 9 2. The tax on vapor products shall be imposed at the point 10 of retail sale to consumers in this state. The amount of the 11 tax shall be added to the selling price of each vapor product 12 sold in this state and shall be collected from the purchaser so 13 that the ultimate consumer bears the burden of the tax. 14 3. For the purposes of this section, “wholesale sales price” 15 means the price charged to a wholesaler or distributor by 16 the manufacturer of a vapor product, the price charged to a 17 retailer by a wholesaler or distributor of the vapor product, 18 or, if the retailer is the manufacturer of the vapor product, 19 the retail sales price of the vapor product, whichever of the 20 applicable prices is highest. 21 Sec. 26. Section 453A.48, subsection 3, Code 2020, is 22 amended to read as follows: 23 3. The director may exchange information with the officers 24 and agencies of other states administering laws relating to the 25 taxation of tobacco products and vapor products . 26 Sec. 27. Section 453A.51, Code 2020, is amended to read as 27 follows: 28 453A.51 Assessment of cost of audit. 29 The department may employ auditors or other persons to 30 audit and examine the books and records of a permit holder or 31 other person dealing in tobacco products or vapor products 32 to ascertain whether the permit holder or other person has 33 paid the amount of the taxes required to be paid by the permit 34 holder or other person under the provisions of this chapter . 35 -12- LSB 5280YH (6) 88 pf/jh 12/ 22
H.F. 2134 If the taxes have not been paid, as required, the department 1 shall assess against the permit holder or other person, as 2 additional penalty, the reasonable expenses and costs of the 3 investigation and audit. 4 DIVISION IV 5 ONLINE MARKETING OF VAPOR PRODUCTS TO CHILDREN —— RESTRICTIONS 6 Sec. 28. NEW SECTION . 453A.39A Vapor products —— marketing 7 and advertising restrictions —— penalties. 8 1. a. A retailer shall not advertise vapor products in 9 a place of business unless the advertisement is placed in a 10 location where the retailer ensures the advertisement is not 11 visible to any person under legal age. 12 b. A retailer who violates this subsection is subject 13 to permit suspension or revocation and the following civil 14 penalties: 15 (1) A two hundred dollar penalty for the first violation. 16 (2) A five hundred dollar penalty for a second violation 17 within three years of the first violation. 18 (3) A one thousand dollar penalty for a third or subsequent 19 violation within three years of the first violation. 20 c. The penalty imposed in this subsection is in addition 21 to the tax, penalty, and interest imposed in other sections 22 of this chapter. Each day a violation occurs counts as a new 23 violation for purposes of this subsection. 24 2. a. An operator of an internet site, online or cloud 25 computing service, online application, or mobile application 26 directed to persons under legal age, shall not market or 27 advertise a vapor product on that internet site, online 28 or cloud computing service, online application, or mobile 29 application. 30 b. An operator of an internet site, online or cloud 31 computing service, online application, or mobile application 32 who has actual knowledge that a person under legal age is using 33 its internet site, online or cloud computing service, online 34 application, or mobile application, and which user is a person 35 -13- LSB 5280YH (6) 88 pf/jh 13/ 22
H.F. 2134 under legal age, shall not market or advertise a vapor product 1 to a person under legal age, if the marketing or advertising is 2 directed to the person under legal age, based upon information 3 specific to that person, including the person’s profile, 4 activity, address, or location sufficient to establish contact 5 with the person and excluding internet protocol address and 6 product identification numbers for the operation of a service. 7 The operator shall be deemed to be in compliance with this 8 subsection if the operator takes reasonable actions in good 9 faith designed to avoid marketing or advertising a vapor 10 product to persons under legal age. 11 c. An operator of an internet site, online or cloud 12 computing service, online application, or mobile application 13 directed to persons under legal age or an operator of an 14 internet site, online or cloud computing service, online 15 application, or mobile application who has actual knowledge 16 that a person under legal age is using its internet site, 17 online or cloud computing service, online application, or 18 mobile application shall not knowingly use, disclose, or 19 compile, or allow another person to use, disclose, or compile, 20 the personal information of the person under legal age if that 21 operator has actual knowledge that the person’s personally 22 identifiable information will be used for the purpose of 23 marketing or advertising to the person a vapor product. 24 d. An operator of an internet site, online or cloud 25 computing service, online application, or mobile application 26 directed to persons under legal age, in which marketing or 27 advertising is provided by an advertising service, in lieu 28 of compliance with paragraph “a” shall instead notify the 29 advertising service, in a manner directed by the advertising 30 service, that the internet site, online or cloud computing 31 service, online application, or mobile application is directed 32 to persons under legal age. 33 e. An advertising service which provides marketing or 34 advertising for an internet site, online or cloud computing 35 -14- LSB 5280YH (6) 88 pf/jh 14/ 22
H.F. 2134 service, online application, or mobile application directed 1 to persons under legal age, and which has received the notice 2 required by paragraph “d” , shall not market or advertise on 3 the internet site, online or cloud computing service, online 4 application, or mobile application a vapor product. 5 f. This subsection shall not be construed to require 6 an operator of an internet site, online or cloud computing 7 service, online application, or mobile application to collect 8 age information about users. 9 g. The marketing and advertising restrictions described in 10 this subsection shall not apply to the incidental placement 11 of vapor products embedded in content if the content is not 12 distributed by or at the direction of the operator primarily 13 for the purposes of marketing and advertising a vapor product. 14 h. As used in this subsection: 15 (1) “Advertising service” means a person who provides, 16 creates, plans, or handles marketing or advertising for another 17 person. 18 (2) “Content” means information of any kind, including but 19 not limited to text, images, audio, and video. 20 (3) Internet site, online or cloud computing service, online 21 application, or mobile application directed to persons under 22 legal age” means any internet site, online or cloud computing 23 service, online application, or mobile application that is 24 targeted or intended to reach an audience that is composed 25 predominantly of persons under legal age. An internet site, 26 online or cloud computing service, online application, or 27 mobile application shall not be deemed directed to persons 28 under legal age solely because it refers or links to another 29 internet site, online or cloud computing service, online 30 application, or mobile application directed to persons under 31 legal age by using information location tools, including a 32 directory, index, reference, pointer, or hypertext link. 33 (4) “Market or advertise” or “marketing or advertising” means 34 making a communication or arranging for a communication to be 35 -15- LSB 5280YH (6) 88 pf/jh 15/ 22
H.F. 2134 made, in exchange for compensation, about a product or service 1 the primary purpose of which is to encourage recipients of the 2 communication to purchase or use the product or service. 3 (5) “Operator” means a person who owns an internet site, 4 online or cloud computing service, online application, or 5 mobile application. “Operator” does not include any third party 6 that operates, hosts, or manages, but does not own, an internet 7 site, online or cloud computing service, online application, 8 or mobile application on the owner’s behalf or processes 9 information on the owner’s behalf. 10 (6) “Person under legal age” means a person who is under the 11 legal age as defined in section 453A.1. 12 (7) “Personally identifiable information” means any 13 personally identifiable information about a user of a 14 commercial internet site, online or cloud computing service, 15 online application, or mobile application that is collected 16 online by the operator of that commercial internet site, 17 online service, online application, or mobile application from 18 that user and maintained by the operator in an accessible 19 form, including a first and last name, a physical address, an 20 electronic mail address, a telephone number, a social security 21 number, or any other identifier that permits the physical 22 or online contacting of the user, and any other information 23 concerning the user collected by the operator of the commercial 24 internet site, online service, online application, or mobile 25 application from the user and maintained in personally 26 identifiable form in combination with any identifier described 27 in this subparagraph. 28 (8) “User” means an individual that uses an internet site, 29 online or cloud computing service, online application, or 30 mobile application. 31 i. (1) The following civil penalties shall be imposed for a 32 violation of this subsection: 33 (a) A two hundred dollar penalty for the first violation. 34 (b) A five hundred dollar penalty for a second violation 35 -16- LSB 5280YH (6) 88 pf/jh 16/ 22
H.F. 2134 within three years of the first violation. 1 (c) A one thousand dollar penalty for a third or subsequent 2 violation within three years of the first violation. 3 (2) Each day a violation occurs counts as a new violation 4 for purposes of this subsection. 5 DIVISION V 6 SMOKE-FREE AIR ACT —— VAPING PRODUCTS 7 Sec. 29. Section 142D.1, subsections 2 and 3, Code 2020, are 8 amended to read as follows: 9 2. The general assembly finds that environmental tobacco 10 smoke causes and exacerbates and vapor products cause and 11 exacerbate disease in nonsmoking adults and children. These 12 findings are sufficient to warrant measures that regulate 13 smoking in public places, places of employment, and outdoor 14 areas in order to protect the public health and the health of 15 employees. 16 3. The purpose of this chapter is to reduce the level of 17 exposure by the general public and employees to environmental 18 tobacco smoke and vapor products in order to improve the public 19 health of Iowans. 20 Sec. 30. Section 142D.2, subsection 21, Code 2020, is 21 amended to read as follows: 22 21. “Smoking” means inhaling, exhaling, burning, or carrying 23 any lighted or heated cigar, cigarette, pipe, or any other 24 tobacco product or plant product, whether natural or synthetic, 25 in any manner or in any form. “Smoking” includes the use of 26 a vapor product, in any manner or in any form, and the use 27 of any device or delivery system that contains or delivers 28 nicotine or any other substance intended for human consumption 29 through inhalation of vapor or aerosol. “Smoking” does not 30 include smoking that is associated with a recognized religious 31 ceremony, ritual, or activity, including but not limited to 32 burning of incense. 33 Sec. 31. Section 142D.2, Code 2020, is amended by adding the 34 following new subsection: 35 -17- LSB 5280YH (6) 88 pf/jh 17/ 22
H.F. 2134 NEW SUBSECTION . 23. “Vapor product” means the same as 1 defined in section 453A.1. 2 DIVISION VI 3 VAPING POLICIES FOR SCHOOLS 4 Sec. 32. Section 256.7, Code 2020, is amended by adding the 5 following new subsection: 6 NEW SUBSECTION . 34. Adopt by rule evidence-informed 7 guidelines applicable to all students in kindergarten through 8 grade twelve in every school district and accredited nonpublic 9 school to increase student knowledge of the facts about and to 10 prevent the use of vapor products as defined in section 453A.1. 11 EXPLANATION 12 The inclusion of this explanation does not constitute agreement with 13 the explanation’s substance by the members of the general assembly. 14 This bill relates to the regulation and taxation of tobacco, 15 tobacco products, alternative nicotine products, vapor 16 products, and cigarettes. 17 Division I of the bill provides that the legal age relative 18 to tobacco, tobacco products, alternative nicotine products, 19 vapor products, and cigarettes is 21 years of age. The bill 20 provides that a person shall not sell, give, or otherwise 21 supply any tobacco, tobacco products, alternative nicotine 22 products, vapor products, or cigarettes to any person under 23 legal age; that a person under legal age shall not smoke, use, 24 possess, purchase, or attempt to purchase any tobacco, tobacco 25 products, alternative nicotine products, vapor products, or 26 cigarettes. The bill makes conforming changes in the Code 27 for exceptions to possession of tobacco, tobacco products, 28 alternative nicotine products, vapor products, or cigarettes 29 by an individual under legal age if the individual possesses 30 the product as part of the individual’s employment and if the 31 individual is involved in a compliance effort. The bill also 32 provides that relative to vending machines, tobacco, tobacco 33 products, alternative nicotine products, vapor products, and 34 cigarettes shall not be sold through a vending machine unless 35 -18- LSB 5280YH (6) 88 pf/jh 18/ 22
H.F. 2134 the vending machine is located in a place where the retailer 1 ensures that no person younger than legal age is present or 2 permitted to enter at any time. The bill provides that for the 3 purposes of giving away these products or providing samples, 4 the recipient must be of legal age. The bill also provides 5 that for delivery sales, the retailer must verify that the 6 purchaser is at least of legal age and must use a method of 7 mailing, shipping, or delivery that requires the signature of a 8 person who is at least of legal age before the shipping package 9 is released to the purchaser. 10 The division takes effect upon enactment. 11 Division II of the bill relates to limitations on the sale 12 or distribution of vapor products with characterizing flavor. 13 The bill prohibits a retailer (any person engaged in the 14 business of selling tobacco, tobacco products, alternative 15 nicotine products, or vapor products to ultimate consumers) 16 from offering for sale, giving, or otherwise supplying in this 17 state any vapor product with a characterizing flavor. There 18 shall be a rebuttable presumption that a vapor product has a 19 characterizing flavor if any statement or claim made by the 20 manufacturer or agent or employee of the manufacturer, directed 21 to consumers or to the public, states or claims that the 22 vapor product has or produces a characterizing flavor. Such 23 statements or claims include but are not limited to those made 24 through social media, the product’s labeling or packaging, or 25 other advertising used to explicitly or implicitly communicate 26 that the vapor product has a characterizing flavor. The bill 27 defines “characterizing flavor” as a distinguishable taste 28 or aroma or both, other than the taste or aroma of tobacco, 29 imparted by a vapor product or any byproduct produced by the 30 vapor product. Characterizing flavors include but are not 31 limited to tastes or aromas relating to any fruit, chocolate, 32 vanilla, honey, candy, cocoa, dessert, alcoholic beverage, 33 menthol, mint, wintergreen, herb, or spice. A retailer 34 who violates this provision is subject to permit suspension 35 -19- LSB 5280YH (6) 88 pf/jh 19/ 22
H.F. 2134 or revocation. Additionally, a retailer who violates this 1 provision is guilty of a fraudulent practice. The penalties 2 applicable to a fraudulent practice are based on the amount of 3 money or value of the property or services involved and range 4 from a simple misdemeanor when the amount does not exceed $300, 5 to a class “C” felony, punishable by confinement for no more 6 than 10 years and a fine of at least $1,000 but not more than 7 $10,000, when the amount involved exceeds $10,000. 8 Division III of the bill relates to taxes on vapor products. 9 The bill imposes a tax on vapor products in the state at the 10 rate of 50 percent of the wholesale sales price of the vapor 11 product. The tax shall be imposed on any component part or 12 accessory of a vapor product, whether or not sold separately, 13 that is necessary to and used during the operation of a vapor 14 product, including but not limited to any cartridge or other 15 container of a solution or other substance, which may or may 16 not contain nicotine, that is intended to be used with or in an 17 electronic cigarette, electronic cigar, electronic cigarillo, 18 electronic pipe, or similar product or device. The tax is 19 imposed at the point of retail sale to consumers in this 20 state. The amount of the tax shall be added to the selling 21 price of each vapor product sold in this state and shall be 22 collected from the purchaser so that the ultimate consumer 23 bears the burden of the tax. The bill defines “wholesale sales 24 price” as the price charged to a wholesaler or distributor by 25 the manufacturer of a vapor product, the price charged to a 26 retailer by a wholesaler or distributor of a vapor product, or, 27 if the retailer is the manufacturer of the vapor product, the 28 retail sales price of a vapor product, whichever applicable 29 price is highest. 30 The bill makes other conforming changes. Existing 31 penalties for violations of the provisions of Code chapter 453A 32 (cigarette and tobacco taxes and regulation of alternative 33 nicotine products and vapor products), including permit 34 revocation or suspension and civil penalties, are applicable to 35 -20- LSB 5280YH (6) 88 pf/jh 20/ 22
H.F. 2134 violations of the bill. 1 Division IV of the bill relates to the marketing and 2 advertising of vapor products. The bill prohibits a retailer 3 from advertising vapor products in a place of business unless 4 the advertisement is placed in a location where the retailer 5 ensures the advertisement is not visible to any person under 6 legal age. The bill also prohibits an operator of an internet 7 site, online or cloud computing service, online application, 8 or mobile application directed to persons under legal age, 9 from marketing or advertising a vapor product on that internet 10 site, online or cloud computing service, online application, 11 or mobile application. If such person has actual knowledge 12 that a person under legal age is using its internet website, 13 online or cloud computing service, online application, or 14 mobile application, and which user is that person under legal 15 age, the person is prohibited from marketing or advertising a 16 vapor product to that person under legal age, if the marketing 17 or advertising is directed to the person under legal age, based 18 upon information specific to that person. If such person 19 has actual knowledge that a person under legal age is using 20 its internet site, online or cloud computing service, online 21 application, or mobile application, the person is prohibited 22 from knowingly using, disclosing, or compiling, or allowing 23 another person to use, disclose, or compile, the personal 24 information of the person under legal age if that operator has 25 actual knowledge that the person’s personally identifiable 26 information will be used for the purpose of marketing or 27 advertising to the person a vapor product. If marketing or 28 advertising is provided by an advertising service, the internet 29 site, online or cloud computing service, or online application, 30 or mobile application shall notify the advertising service, in 31 a manner directed by the advertising service, that the internet 32 site, online or cloud computing service, online application, or 33 mobile application is directed to persons under legal age and 34 the advertising service which provides marketing or advertising 35 -21- LSB 5280YH (6) 88 pf/jh 21/ 22
H.F. 2134 for an internet site, online or cloud computing service, online 1 application, or mobile application directed to persons under 2 legal age, and which has received the notice required shall 3 not market or advertise on the internet site, online or cloud 4 computing service, online application, or mobile application a 5 vapor product. The provision is not to be construed to require 6 an operator of an internet site, online or cloud computing 7 service, online application, or mobile application to collect 8 age information about users and the marketing and advertising 9 restrictions shall not apply to the incidental placement of 10 vapor products embedded in content if the content is not 11 distributed by or at the direction of the operator primarily 12 for the purposes of marketing and advertising a vapor product. 13 A person who violates a provision of the division is subject 14 to applicable permit suspension and revocation and civil 15 penalties. 16 Division V relates to the smoke-free air Act (Code chapter 17 142D). The bill amends the definition of “smoking” to include 18 reference to vapor products and other devices or delivery 19 systems that contain or deliver nicotine or other substances 20 through inhalation of vapor or aerosol. 21 Division VI requires the state board of education to adopt by 22 rule evidence-informed guidelines applicable to all students 23 in kindergarten through grade 12 in every school district and 24 accredited nonpublic school to increase student knowledge of 25 the facts about and prevent the use of vapor products. 26 -22- LSB 5280YH (6) 88 pf/jh 22/ 22
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