POLICY PLAYBOOK FOR E-CIGARETTES

Addressing the phenomenal growth of the U.S. vaping epidemic will require coordinated and evidence-based policy at local, state, and federal levels.

In 2020, Vaping Prevention Resource partnered with the Public Health Law Center to create the Policy Playbook for E-cigarettes.

The Policy Playbook provides state and local stakeholders with a framework of policies and practices to pursue, guidelines on policy implementation, case studies, and examples.

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Playbook

Policy Basics and Elements

Below are key elements to consider for your policy. For comprehensive guidance on policy basics and elements, download the full Playbook above.

Findings and Statement of Purpose

  • Detail the prevalence of e-cigarette use among youth and young adults (including community-specific data, where available) and the known health risks of e-cigarette use or vaping.
  • Explain how the policy is designed to address the problem.

Statement of Authority

  • Provide a clear, concise, and well-researched statement explaining the local government unit's authority to enact the law (such as school board, city council, board of health, or other local government entity).

Clear Definitions and Concise Language

  • Explicitly state which tobacco products are covered, yet be broad enough to anticipate and capture future product innovations. This can eliminate ambiguities that may arise when new products that are functionally similar to existing products enter the market.
  • Consider creating a comprehensive definition that covers all variations of e-cigarettes. Include, as part of the definition of an e-cigarette, all component parts and accessories, regardless of whether they are sold together or separately. This may help prevent ambiguities as to what is covered under the e-cigarette definition.
  • Consider adding language that presumes that all e-cigarette products contain nicotine, absent proof to the contrary. This potentially eases enforcement by placing the burden on the tobacco manufacturer or retailer to prove the e-cigarette does not contain nicotine rather than on the jurisdiction enforcing the policy.
  • Consider broadening existing definitions for "tobacco products" to include e-cigarettes.
  • Tailor your definitions to particular contexts and make them easy for the average person to understand. To ensure that inconsistencies or other problems do not occur, consult with a lawyer familiar with the laws of your jurisdiction, or contact the Public Health Law Center.

Clear Enforcement/Compliance Check Procedures

  • Ensure proposed penalties are appropriate, equitable, and legal within the particular jurisdiction. Effective enforcement of these policies often includes coordination among different enforcement agencies and consistent procedures throughout a community.
  • Consider using existing consumer protection laws to ensure the public is protected from false claims made about these products.

Well-Planned Implementation Process

  • Establish a process for publicizing the policy and educating the community, as well as for receiving, tracking, and following up on complaints.
  • Set a realistic date that the policy will take effect and communicate that date clearly.

Tobacco Retail Licensing

Tobacco retailer licensing is a foundational policy and should be one of the first policies communities implement. Jurisdictions with licensing can strengthen these policies. For comprehensive guidance on tobacco retail licensing, download the full Playbook above.

Background

  • A tobacco retailer licensing (TRL) law requires that all stores that sell tobacco products obtain a license to sell these products.
  • An effective TRL law should reflect the best public health policy practices, strike a balance between state and federal minimum standards, and impose clear and practical measures for implementation and enforcement by local governments.
  • As of 2020, 31 states, the District of Columbia, the Northern Mariana Islands, and the U.S. Virgin Islands require that retailers have a license to sell e-cigarettes.

Restrict the types of businesses that sell e-cigarettes by pursuing one or more of these options:

  • Replicate alcoholic beverage sales restrictions by limiting e-cigarette sales to specialty shops, which prohibit underage people from entering.
  • Prohibit specific businesses or organizations like pharmacies, healthcare institutions, or educational institutions from selling tobacco products. Jurisdictions with such restrictions have experienced reduced tobacco retail density, suggesting that even relatively simple policy solutions can have a measurable impact.
  • To combat online promotion and sales of tobacco products, require “tobacco retailers” to be in specific locations and to sell only to walk-in customers. Ordinances can also prohibit direct-to-consumer deliveries or shipments of any tobacco product.

Regulate where retailers can be located by:

  • Restricting how close e-cigarette retailers can be to each other, schools, or other areas frequented by children or young people.
  • Combining a density policy with a ban on tobacco sales in pharmacies to increase the impact on retailer density.
  • Restricting retail locations based on proximity to schools to reduce socioeconomic and racial disparities by decreasing retailer density in low-income neighborhoods.
  • Be wary of the potential that simply imposing a location restriction might cause retailers to congregate more densely in other areas.

Cap the number of retailers in defined areas by pursuing one or more of these options:

  • Combat disproportionate retail density in your jurisdiction &emdash; and the intentional targeting of low-income communities and communities of color &emdash; by limiting the number of licenses issued to tobacco retailers.
  • Set a cap on the number of vape shops or similar licenses issued in a specific jurisdiction. Once that number is reached, require prospective retailers to join a waiting list until an existing license becomes available.
  • To reduce the number of retailers over time, set an absolute cap on issuing new licenses. When a retailer closes, does not renew a license, retires the license, or enforcement action revokes a license, a new license is not issued in its place.
  • To address disproportionate density in a large geographic or metropolitan area, consider breaking the jurisdiction into several districts and limiting the number of retailers within each district.
  • Before adopting a retailer policy, conduct groundwork, population assessments, studies of existing retailers, and retailer education.

Restrict point-of-sale advertising with one or more of these options:

  • Prohibit retailers from honoring or redeeming coupons, multi-pack discounts, or any other type of price adjustment that would allow a customer to purchase a product at less than full retail price.
  • Restrict window sign space to no more than 30 percent, limit the type of displays stores can use (such as outdoor sandwich board-style ads), or prohibit advertisements within a certain distance of schools or playgrounds.
  • Carefully review any restrictions or limitations on advertisements and consult with legal counsel to avoid potential constitutional challenges.

Regulate product placement, which could include:

  • Prohibit self-service access to tobacco products by requiring product placement behind a counter and a clerk to assist.

Use Restrictions

E-cigarette use is often prohibited or restricted to protect public health in a variety of public places, workplaces, schools, multi-unit housing, and outdoor areas. See below for possible use restriction policy options. For comprehensive guidance, download the full Playbook above.

Background

  • Over 60 percent of the U.S. population is covered by local and state smoke-free laws that prohibit smoking in workplaces, including restaurants and bars. As of 2020, at least 17 states have smoke-free laws that prohibit e-cigarette use where smoking is prohibited &emdash; typically workplaces, restaurants, and bars.
  • Exposure to e-cigarette aerosol may pose significant negative health risks. Research has found at least twelve chemicals in e-cigarette aerosol are known to cause cancer, birth defects, or other reproductive harm.
  • Failure to include e-cigarettes in smoke-free laws or policies can undermine the intent of smoke-free laws and promote an environment that discourages smoking cessation.

Public Places and Workplaces

  • Include all elements of a good policy described in “Policy Basics & Elements” above, including relevant definitions for the venues or settings where e-cigarette use is to be prohibited.
  • Modify an existing smoke-free policy by revising the definitions of "smoking" or “tobacco product” to encompass e-cigarette use and products.
  • Enforcement and penalties vary by jurisdiction but typically include sanctions similar to those for smoking violations.

Schools

  • Research suggests that school policies prohibiting tobacco product use, when consistently enforced, significantly lower teen tobacco use rates.
  • When enforcing school policies, consider alternative enforcement measures other than suspension and expulsion, which disproportionately impact students of color. Instead, consider alternative therapeutic interventions, such as offering tobacco education programs, community service, and cessation resources.
  • Access sample language, enforcement provisions, and explanatory text in the Public Health Law Center’s commercial tobacco-free K-12 school model policy (linked in the Policy Playbook above).

Outdoor Places

  • Include e-cigarette use in outdoor smoke-free policies that cover areas such as parks, playgrounds, beaches, sidewalks, and other recreational areas and community spaces.
  • Adopt or expand smoke-free campus policies, which extend to all outside grounds, such as parking lots, and property – whether owned, leased, or rented.
  • Consider including business vehicles as a part of smoke- and vape-free policies.
  • To prevent challenges to this policy, implement effective community education to promote compliance and behavior changes.

Multi-Unit Housing

  • Include an introduction that explains the policy’s purpose including: clearly defined terms, descriptions of all who must comply (such as residents, guests, and business visitors), and detailed implementation and enforcement information.
  • Review model smoke-free multi-unit housing policies from the Public Health Law Center linked in the Playbook above.
  • Vary enforcement provisions depending on whether policies are in an ordinance or adopted by landlords or building owners. An ordinance could contain a provision requiring all multi-unit residential leases to incorporate new lease terms restricting smoking. A jurisdiction could then take enforcement action against the property owner or landlord for violating the ordinance.
  • Approach enforcement of housing policies with health equity in mind. Consider community education, engagement, and buy-in, as well as providing information about and access to free cessation support.

Pricing Policies

Increasing the price of commercial tobacco products, including e-cigarettes, can reduce tobacco initiation and encourage cessation, especially among youth. For comprehensive guidance on pricing policies, download the full Playbook above.

Price Discounts: Background

  • The tobacco industry uses price discounting strategies to undermine the effect of taxes on tobacco products. These promotions are often marketed and redeemed at the point-of-sale.
  • Tobacco companies spend billions of dollars annually to lower the cost of their products through various price discounting strategies, including coupons, cents- or dollars-off promotions, buy-one-get-one-free deals, and multi-pack offers (e.g., two-for-one pricing).

Possible options for policy strategies to combat price discounts:

Establish minimum prices for commercial tobacco products, including e-cigarettes.

  • Given the price-sensitivity of young people, set minimum price standards for commercial tobacco products to yield significant public health gains in reducing youth initiation and use.
  • Consider crafting the policy so the product price increases over time, either by a fixed amount annually or by tying the increase to inflation.

Prohibit price discounts for commercial tobacco products.

  • Explicitly prohibit price discounting to keep the price of commercial tobacco products, including e-cigarettes, high and to reduce consumption.
  • Prohibit all or some forms of price discounting, including the redemption of coupons, cents-or dollars-off promotions, buy-one-get-one-free deals, and multi-pack offers.
  • Review more information on these strategies in Death on a Discount: Regulating Tobacco Product Pricing - linked in the Playbook above.

E-cigarette Taxes: Background

  • The most common pricing strategy to combat tobacco use is to raise state cigarette excise taxes. Increasing the price of a pack of cigarettes by 10 percent has been shown to reduce smoking rates by an average of 3 to 5 percent, as more smokers quit and fewer potential smokers start. This effect is greatest among youth, who are particularly sensitive to the price of tobacco products.
  • E-cigarette taxation to date has occurred at the state and local level. This is because taxation is an area of commercial tobacco regulation in which the FDA has no regulatory authority, and Congress has not acted to tax e-cigarettes at the federal level.
  • Because every state’s tax code is different, communities and policymakers seeking to tax e-cigarettes should work with an attorney familiar with their jurisdiction’s tax code.
  • Local jurisdictions may have the authority to impose their own taxes, although their ability to do this will likely depend on the availability of resources to administer and enforce a taxation program.

Possible options for policy strategies for e-cigarette taxes:

Tax specific parts of e-cigarette products.

  • E-cigarettes and their component parts may be subject to taxes differently, depending on how they are sold or their functionality. Some jurisdictions may tax e-liquid that is sold in nicotine cartridges that cannot be removed, but may not tax a device that is sold separately from the cartridge.
  • Consider including all e-liquid and parts of the device necessary for its operation in the tax base. Such an approach could exempt accessories, such as lanyards or carrying cases, as well as products that have a universal application, such as batteries.

Consider where to levy the tax.

  • Vape shops often mix e-liquid at the retail level, creating a different, more valuable product. This is in contrast to cigarettes, which are sold to the consumer in a form identical to that passed on by the distributor or wholesaler.
  • To address this issue, require retail vape shops that mix product on-site to obtain a special retail license, or define the shops as “manufacturers.” The feasibility of this approach will be jurisdiction-specific and likely depend on factors such as whether there is a statewide licensing system, an e-cigarette tax can be integrated into the existing system, or the tax code needs to be updated to incorporate new products.

Plan how to structure the tax.

  • Most jurisdictions have either opted to impose a specific tax on the volume of e-liquid or the amount of nicotine in a product, or they have opted to adopt an “ad valorem tax,” which taxes the final product at a percentage of the assessed value of the item.
  • Create an e-cigarette tax on parity with other tobacco products to avoid unintentionally influencing marketing and use patterns.
  • In the context of e-cigarettes, an ad valorem tax could minimize the potential negative effects of a volume-based tax, which might incentivize the sale of products separately, or result in higher nicotine concentrations. An ad valorem tax also has the additional benefit of inherently including an inflation adjustment, as well as potentially being easier to integrate into an existing tax scheme.

Consider possible enforcement obstacles.

  • Seek input from those who are charged with implementing and enforcing any proposed tax policy. This will help you plan for the unique, jurisdiction-specific nature of tax collection and enforcement.
  • Incorporate e-cigarette taxes into existing tobacco-product tax laws. This will make the implementation and enforcement much easier than it would be if a completely new tax scheme is created.

More Advanced State & Local Policy Options

Along with the policies previously described, states and local jurisdictions may want to consider other strategies to regulate e-cigarettes, depending on their community’s goals, resources, tobacco control history, stakeholders, political will and support, state preemption, and other considerations.

See below for more advanced policy options to consider.

Sales Restrictions

  • Restrict the sales of commercial tobacco products, including electronic cigarettes, to limit youth access, use, and initiation to these products.
  • Include sales restrictions as part of a broader licensing structure or, where a licensing scheme is not feasible, as stand-alone policies.
  • Restrict the sales of some classes of tobacco products, such as flavored e-cigarettes, which are known to be very popular among youth.
  • Establish a minimum legal sales age for tobacco products.

Restrict Sales of Flavored E-cigarettes

  • Most youth and young adults who use e-cigarettes report using a flavored product, and many claim they were drawn to e-cigarettes because "they come in flavors I like." Restricting the sales of flavored e-cigarettes would likely offer substantial public health benefits in reducing e-cigarette initiation and use.
  • Close loopholes in federal policy. States and local governments are increasingly closing the gap related to the federal regulation of sales of flavored tobacco products. In September 2020, California became the second state (after Massachusetts) to pass a fairly comprehensive prohibition on the sales of flavored tobacco products, including e-cigarettes and menthol-flavored cigarettes. Many local jurisdictions have enacted similar measures.

Tobacco 21 Policies

  • National data indicates that 95 percent of adults who smoke begin smoking before they turn 21. In December 2019, Congress passed amendments to the Tobacco Control Act, which raised the minimum legal sales age for tobacco products from 18 to 21. Despite this law, states and local jurisdictions with minimum legal sales ages under 21 should still consider amending their laws.
  • Align state and local jurisdiction policies with federal law to provide clarity for retailers and ease enforcement for state and local authorities. Moreover, funding for states and U.S. territories from the Substance Abuse and Mental Health Services Administration ("SAMHSA") under the Synar Amendments will be tied to the new federal legal sales age of 21.
  • Raise the age above 21. It is important to note that the federal law merely sets a floor, not a ceiling; states and local jurisdictions remain free to raise their minimum legal sales age beyond 21.

Legal Challenges and Considerations

Below is an overview of considerations and possible legal challenges to e-cigarette policies. For a comprehensive overview of these considerations, download the Playbook linked above.

Authority & Preemption

  • Ensure your state or jurisdiction has the authority to enact the regulation. While states have the authority to pass regulations restricting or prohibiting commercial tobacco sales or use, a local government's authority depends largely upon the authority a state has reserved for itself and what it has delegated to local governments through special legislation, home rule charters, or similar laws.
  • Local jurisdictions should investigate its state's tobacco regulatory scheme to ensure that the local government is not preempted from enacting tobacco or e-cigarette regulations.

“Takings” Under the Fifth Amendment of the U.S. Constitution

  • The Fifth Amendment of the U.S. Constitution states, in part: “[N]or shall private property be taken for public use, without just compensation.” This is commonly referred to as the “Takings Clause.”
  • There are two ways the government can take property under the Fifth Amendment:
    • A possessory taking (which involves physical occupation, as in eminent domain) and
    • A regulatory taking (which occurs when a law impedes a property owner’s investment so significantly that it amounts to a “taking” of the property).
  • E-cigarette manufacturers and vendors may argue that because these products make up a substantial portion of their sales, any state or local regulation that prohibits their sale constitutes a “taking.”
  • To determine whether or not the law constitutes a taking requires a fact-specific analysis of the nature of the action balanced against the interests involved.

First Amendment Challenges

  • Although the Tobacco Control Act allows states and localities to place some restrictions on tobacco marketing, the First Amendment still protects speech by tobacco companies, thus acting as a limitation on the FDA’s authority over marketing and advertising restrictions.
  • “Commercial speech” is one category of speech protected by the First Amendment. Commercial speech includes advertising, banners, logos, etc., and can include expressive conduct, such as how products are displayed in a store window.
    • The level of “protection” certain speech is afforded depends on the type of speech at issue, and the limitations the government places on that speech.
    • First Amendment protections are implicated when the government “compels” speech &emdash; e.g., when it requires a warning label on a package.

Future Possible Challenges

  • E-cigarettes are relatively new to the market in comparison to combustible cigarettes. The products and their marketing innovations continue to evolve, as does the phenomenal impact of social media.
  • The federal regulatory landscape of e-cigarettes may change in the future. Policymakers and regulators need to remain alert to all product, marketing, and regulatory actions, craft policies that can accommodate foreseeable changes, and update policies as necessary and appropriate for public health.

Other Regulatory Issues & Concerns

  • Unintended consequences. While any policy regulating e-cigarettes is a step in the right direction to protect the health of youth, unintended consequences can occur. For example, a ban on all flavored e-cigarettes including menthol could push nicotine-addicted youth to transition to menthol-flavored combustible cigarettes or flavored cigarillos or cigars, which are legally sold in most communities.
  • Regulating e-cigarettes as part of comprehensive commercial tobacco regulation will avoid unintended consequences, ease enforcement, and support the community’s overall public health goal.

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