Rep. Norm Thurston — Voting Record

Bill

Number

H.B. 460 First Substitute (2023GS)

Sponsor

Rep. Ward, R.

Final action

Governor Signed 3/15/2023

Outcome

Became law — signed by Gov. Spencer J. Cox

Summary

What it does

• This bill:
• renames the Electronic Cigarette Substance and Nicotine Product Tax Restricted Account to the Electronic Cigarette Substance and Nicotine Product Proceeds Restricted Account;
• specifies that proceeds from certain settlements regarding the manufacture, marketing, distribution, or sale of electronic cigarette products be deposited into the restricted account amended in this bill; and
• makes technical and corresponding changes.

Every vote on this bill

Bill text

SETTLEMENT FUND AMENDMENTS
GENERAL SESSION
STATE OF UTAH
Chief Sponsor: Raymond P. Ward
Senate Sponsor: 
Jen Plumb
LONG TITLE
General Description:
This bill addresses the state's proceeds from certain settlement agreements related to
electronic cigarette products.
Highlighted Provisions:
This bill:
▸ renames the Electronic Cigarette Substance and Nicotine Product Tax Restricted
Account to the Electronic Cigarette Substance and Nicotine Product Proceeds
Restricted Account;
▸ specifies that proceeds from certain settlements regarding the manufacture,
marketing, distribution, or sale of electronic cigarette products be deposited into the
restricted account amended in this bill; and
▸ makes technical and corresponding changes.
Money Appropriated in this Bill:
None
Other Special Clauses:
None
Utah Code Sections Affected:
AMENDS:
26-7-10
, as last amended by Laws of Utah 2022, Chapter 255
59-14-804
, as enacted by Laws of Utah 2020, Chapter 347
59-14-807
, as last amended by Laws of Utah 2020, Fifth Special Session, Chapter 20
Be it enacted by the Legislature of the state of Utah:
Section 1. Section 
26-7-10
 is amended to read:
26-7-10.
Youth Electronic Cigarette, Marijuana, and Other Drug Prevention
Program.
(1) As used in this section:
(a) "Committee" means the Youth Electronic Cigarette, Marijuana, and Other Drug
Prevention Committee created in Section 
26B-1-204
.
(b) "Program" means the Youth Electronic Cigarette, Marijuana, and Other Drug
Prevention Program created in this section.
(2) (a) There is created within the department the Youth Electronic Cigarette,
Marijuana, and Other Drug Prevention Program.
(b) In consultation with the committee, the department shall:
(i) establish guidelines for the use of funds appropriated to the program;
(ii) ensure that guidelines developed under Subsection (2)(b)(i) are evidence-based and
appropriate for the population targeted by the program; and
(iii) subject to appropriations from the Legislature, fund statewide initiatives to prevent
use of electronic cigarettes, nicotine products, marijuana, and other drugs by youth.
(3) (a) The committee shall advise the department on:
(i) preventing use of electronic cigarettes, marijuana, and other drugs by youth in the
state;
(ii) developing the guidelines described in Subsection (2)(b)(i); and
(iii) implementing the provisions of the program.
(b) The executive director shall:
(i) appoint members of the committee; and
(ii) consult with the Utah Substance Use and Mental Health Advisory Council created
in Section 
63M-7-301
 when making the appointments under Subsection (3)(b)(i).
(c) The committee shall include, at a minimum:
(i) the executive director of a local health department as defined in Section 
26A-1-102
,
or the local health department executive director's designee;
(ii) one designee from the department;
(iii) one representative from the Department of Public Safety;
(iv) one representative from the behavioral health community; and
(v) one representative from the education community.
(d) A member of the committee may not receive compensation or benefits for the
member's service on the committee, but may receive per diem and travel expenses in
accordance with:
(i) Section 
63A-3-106
;
(ii) Section 
63A-3-107
; and
(iii) rules made by the Division of Finance under Sections 
63A-3-106
 and 
63A-3-107
.
(e) The department shall provide staff support to the committee.
(4) On or before October 31 of each year, the department shall report to:
(a) the Health and Human Services Interim Committee regarding:
(i) the use of funds appropriated to the program;
(ii) the impact and results of the program, including the effectiveness of each program
funded under Subsection (2)(b)(iii), during the previous fiscal year;
(iii) a summary of the impacts and results on reducing youth use of electronic cigarettes
and nicotine products by entities represented by members of the committee, including those
entities who receive funding through the Electronic Cigarette Substance and Nicotine Product
[
Tax
] 
Proceeds
 Restricted Account created in Section 
59-14-807
; and
(iv) any recommendations for legislation; and
(b) the Utah Substance Use and Mental Health Advisory Council created in Section
63M-7-301
, regarding:
(i) the effectiveness of each program funded under Subsection (2)(b)(iii) in preventing
youth use of electronic cigarettes, nicotine products, marijuana, and other drugs; and
(ii) any collaborative efforts and partnerships established by the program with public
and private entities to prevent youth use of electronic cigarettes, marijuana, and other drugs.
Section 2. Section 
59-14-804
 is amended to read:
59-14-804.
Taxation of electronic cigarette substance, prefilled electronic
cigarette, alternative nicotine product, nontherapeutic nicotine device substance, and
prefilled nontherapeutic nicotine device.
(1) (a) Beginning on July 1, 2020, a tax is imposed upon the following:
(i) an electronic cigarette substance; and
(ii) a prefilled electronic cigarette.
(b) Beginning on July 1, 2021, a tax is imposed upon the following:
(i) a nontherapeutic nicotine device substance; and
(ii) a prefilled nontherapeutic nicotine device.
(c) Beginning on July 1, 2021, a tax is imposed upon an alternative nicotine product.
(2) (a) The amount of tax imposed under Subsections (1)(a) and (b) is .56 multiplied by
the manufacturer's sales price.
(b) (i) The tax under Subsection (1)(c) on an alternative nicotine product is imposed:
(A) at a rate of $1.83 per ounce; and
(B) on the basis of the net weight of the alternative nicotine product as listed by the
manufacturer.
(ii) If the net weight of the alternative nicotine product is in a quantity that is a
fractional part of one ounce, a proportionate amount of the tax described in Subsection
(2)(b)(i)(A) is imposed:
(A) on that fractional part of one ounce; and
(B) in accordance with rules made by the commission in accordance with Title 63G,
Chapter 3, Utah Administrative Rulemaking Act.
(3) If a product is sold in the same package as a product that is taxed under Subsection
(1), the tax described in Subsection (2) shall apply to the wholesale manufacturer's sale price of
the entire packaged product.
(4) (a) A manufacturer, jobber, distributor, wholesaler, retailer, consumer, or user shall
pay the tax levied under Subsection (1) at the time that an electronic cigarette substance, a
prefilled electronic cigarette, an alternative nicotine product, a nontherapeutic nicotine device
substance, or a prefilled nontherapeutic nicotine device is first received in the state.
(b) A manufacturer, jobber, distributor, wholesaler, retailer, consumer, or user may not
resell an electronic cigarette substance, a prefilled electronic cigarette, an alternative nicotine
product, a nontherapeutic nicotine device substance, or a prefilled nontherapeutic nicotine
device to another distributor, another retailer, or a consumer before paying the tax levied under
Subsection (1).
(5) (a) The manufacturer, jobber, distributor, wholesaler, retailer, consumer, or user
shall remit the taxes collected in accordance with this section to the commission.
(b) The commission shall deposit revenues generated by the tax imposed by this
section into the Electronic Cigarette Substance and Nicotine Product [
Tax
] 
Proceeds
 Restricted
Account created in Section 
59-14-807
.
Section 3. Section 
59-14-807
 is amended to read:
59-14-807.
Electronic Cigarette Substance and Nicotine Product Proceeds
Restricted Account.
(1) There is created within the General Fund a restricted account known as the
"Electronic Cigarette Substance and Nicotine Product [
Tax
] 
Proceeds
 Restricted Account."
(2) The Electronic Cigarette Substance and Nicotine Product [
Tax
] 
Proceeds
 Restricted
Account consists of:
(a) revenues collected from the tax imposed by Section 
59-14-804
; [
and
]
(b) all money received by the attorney general or the Department of Commerce as a
result of any judgment, settlement, or compromise of claims pertaining to alleged violations of
law related to the manufacture, marketing, distribution, or sale of electronic cigarette products,
as defined in Section 
76-10-101
:
(i) if the total amount of the judgment, settlement, or compromise received by the state
exceeds $1,000,000; and
(ii) after reimbursement to the attorney general and the Department of Commerce for
expenses related to the matters described in Subsection (2)(b); and
[
(b)
] 
(c)
 amounts appropriated by the Legislature.
(3) For each fiscal year, beginning with fiscal year 2021, and subject to appropriation
by the Legislature, the Division of Finance shall distribute from the Electronic Cigarette
Substance and Nicotine Product [
Tax
] 
Proceeds
 Restricted Account:
(a) $2,000,000 which shall be allocated to the local health departments by the
Department of Health 
and Human Services
 using the formula created in accordance with
Section 
26A-1-116
;
(b) $2,000,000 to the Department of Health 
and Human Services
 for statewide
cessation programs and prevention education;
(c) $1,180,000 to the Department of Public Safety for law enforcement officers aimed
at disrupting organizations and networks that provide tobacco products, electronic cigarette
products, nicotine products, and other illegal controlled substances to minors;
(d) $3,000,000 which shall be allocated to the local health departments by the
Department of Health 
and Human Services
 using the formula created in accordance with
Section 
26A-1-116
;
(e) $5,084,200 to the State Board of Education for school-based prevention programs;
and
(f) $2,000,000 to the Department of Health 
and Human Services
 for alcohol, tobacco,
and other drug prevention, reduction, cessation, and control programs that promote unified
messages and make use of media outlets, including radio, newspaper, billboards, and
television.
(4) (a) The local health departments shall use the money received in accordance with
Subsection (3)(a) for enforcing:
(i) the regulation provisions described in Section 
26-57-103
;
(ii) the labeling requirement described in Section 
26-57-104
; and
(iii) the penalty provisions described in Section 
26-62-305
.
(b) The Department of Health 
and Human Services
 shall use the money received in
accordance with Subsection (3)(b) for the Youth Electronic Cigarette, Marijuana, and Other
Drug Prevention Program created in Section 
26-7-10
.
(c) The local health departments shall use the money received in accordance with
Subsection (3)(d) to issue grants under the Electronic Cigarette, Marijuana, and Other Drug
Prevention Grant Program created in Section 
26A-1-129
.
(d) The State Board of Education shall use the money received in accordance with
Subsection (3)(e) to distribute to local education agencies to pay for:
(i) stipends for positive behaviors specialists as described in Subsection
53G-10-407
(4)(a)(i);
(ii) the cost of administering the positive behaviors plan as described in Subsection
53G-10-407
(4)(a)(ii); and
(iii) the cost of implementing an Underage Drinking and Substance Abuse Prevention
Program in grade 4 or 5, as described in Subsection 
53G-10-406
(3)(b).
(5) (a) The fund shall earn interest.
(b) All interest earned on fund money shall be deposited into the fund.
(6) Subject to legislative appropriations, funds remaining in the Electronic Cigarette
Substance and Nicotine Product [
Tax
] 
Proceeds
 Restricted Account after the distribution
described in Subsection (3) may only be used for programs and activities related to the
prevention and cessation of electronic cigarette, nicotine products, marijuana, and other drug
use.