Legislative Analysis
Phone: (517) 373-8080
NICOTINE AND TOBACCO ACT
http://www.house.mi.gov/hfa
House Bill 6002 as introduced Analysis available at
Sponsor: Rep. Kristian Grant http://www.legislature.mi.gov
House Bill 6003 as introduced
Sponsor: Rep. Abraham Aiyash
Committee: Families, Children and Seniors
Complete to 11-11-24
SUMMARY:
House Bill 6002 would amend the Youth Tobacco Act to do the following:
• Change the name of the act to the Nicotine and Tobacco Act.
• Require the licensure and regulation of establishments that sell nicotine or tobacco
products.
• Prohibit selling or furnishing nicotine or tobacco products to minors (defined as
individuals under the age of 21) and provide penalties.
• Create the Nicotine Regulation Fund in the state treasury.
• Prohibit persons from selling, giving or furnishing certain vapor products to minors.
Nicotine or tobacco products
For purposes of the bill, the term nicotine or tobacco product would mean any of the following:
• A product that contains, is made of, or is derived from nicotine or tobacco, from any
source; that is intended for human consumption or is likely to be consumed by humans,
by any means, including inhaling, absorbing, or ingesting; and that is not regulated as
a drug or device by the United States Food and Drug Administration (FDA) under 21
USC 351 to 360fff-8.
• An alternative nicotine product.
• A tobacco product.
• A qualified vapor product.
• A component, part, or accessory of a product described above, including filters, rolling
papers, blunt or hemp wraps, flavor enhancers, or pipes, if the component, part, or
accessory is not a product regulated as a drug or device by the FDA under 21 USC 351
to 360fff-8.
Alternative nicotine product means a noncombustible product containing that contains
nicotine and is intended for human consumption, whether chewed, absorbed, dissolved,
or ingested by any other means, but does not include a tobacco product, a vapor
product, food, or a product regulated as a drug or device by the FDA under 21 USC
351 to 360fff-7.360fff-8.
Tobacco product means a product that contains tobacco and is intended for human
consumption, including a cigar, a cigarette, noncigarette smoking tobacco, or
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smokeless tobacco, but does not include a product regulated as a drug or device by the
FDA under 21 USC 351 to 360fff-8.
Qualified vapor product would mean one or both of the following:
• A vapor product for the production of vapor from nicotine or tobacco.
• A vapor product that contains nicotine or tobacco.
Vapor product means a noncombustible product that employs a heating element, power
source, electronic circuit, or other electronic, chemical, or mechanical means,
regardless of shape or size, to produce vapor from nicotine or any other substance, and
the use or inhalation of which simulates smoking. Vapor product includes an electronic
cigarette, electronic cigar, electronic cigarillo, electronic pipe, or similar product or
device and a vapor cartridge or other container of nicotine or other substance in a
solution or other form that is intended to be used with or in an electronic cigarette,
electronic cigar, electronic cigarillo, electronic pipe, or similar product or device.
Vapor product does not include a product regulated as a drug or device by the FDA
under 21 USC 351 to 360fff-8.
Establishment licensure
The bill would require an establishment to hold a valid license to sell a nicotine or tobacco
product at retail, except as described below. The requirement would not take effect earlier than
when the Department of Health and Human Services (DHHS) begins accepting affidavits and
license applications as described below. Itinerant and flash retail establishments would be
ineligible to hold a license.
Establishment would mean a place of business, or area within a place of business,
where a nicotine or tobacco product is sold, or is intended to be sold, at retail.
Flash retail would mean the use of a mobile, pop-up, or temporary structure for retail.
The bill would prohibit a person from selling a nicotine or tobacco product at retail unless the
sale is at, and on behalf of, an establishment that holds a valid license or is temporarily exempt
from licensure as described below. However, this would not apply to a nonmanagerial
employee who is at an establishment and employed by the establishment and who does not
know or have reason to know that the establishment does not hold a valid license or is not
temporarily exempt from licensure.
Nonmanagerial employee means a cashier or clerk that does not have managerial
control at their employer under the terms of their employment.
A person found in violation of the requirement or prohibition above would be subject to an
administrative fine and license ineligibility as follows:
• For a first violation in a period of 36 months, $500 and the person is ineligible to be
granted a license for the 30 days immediately following the violation.
• For a second violation in a period of 36 months, $1,000 and the person is ineligible to
be granted a license for the three years immediately following the violation.
• For a third or subsequent violation in a period of 36 months, $2,000 and the person is
ineligible to be granted a license for the five years immediately following the violation.
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An establishment would be required to do the following:
• If it holds a license, publicly display the applicable certificate of licensure or a copy.
• Prohibit the sale, consumption, and use of marijuana on its premises.
• If the establishment does not hold a valid license and is not temporarily exempt from
licensure, keep its nicotine or tobacco products out of public view and refrain from
advertisement that could lead a reasonable consumer to believe that a nicotine or
tobacco product can be lawfully obtained at the establishment.
An establishment would be prohibited from doing any of the following:
• Delivering, or knowingly participating in a delivery of, a nicotine or tobacco product
to a consumer that is not on the establishment’s premises.
• Knowingly selling a nicotine or tobacco product to a person that intends to deliver the
products to a consumer as part of a commercial transaction.
• Selling a nicotine or tobacco product itinerantly, remotely, or by flash retail.
An establishment found in violation of the requirements or prohibitions above would be subject
to an administrative fine of up to $2,000 (and not less than $250). DHHS would have to suspend
or revoke the establishment’s license, if any, as follows:
• For a first violation in a period of 36 months, suspend the license for 30 days.
• For a second violation in a period of 36 months, suspend the license for 90 days.
• For a third violation in a period of 36 months, suspend the license for one year.
• For a fourth or subsequent violation in a period of 36 months, revoke the license.
DHHS could bring an action to collect a fine described above. A fine collected would have to
be deposited in the Nicotine and Tobacco Regulation Fund.
DHHS responsibilities
DHHS would have to begin accepting license applications and temporary exemption affidavits
no later than 15 months after the bill takes effect. DHHS would set the application fee for a
new license. The new license fee, in conjunction with the renewal fee, would have to cover the
cost to administer and enforce licensure under the bill.
An application for a new license would have to be on a form prescribed by DHHS, and an
applicant would have to include the following information for each establishment requesting a
license:
• The name, address, and phone number of the establishment.
• The name, address, and phone number of each operator of the establishment.
• For the establishment, or each operator, one name and mailing address to receive
communication. An establishment or operator that does not include a name and mailing
address consents to receiving communication at each operator address given above.
• Proof of any required licensure under the Tobacco Products Tax Act, as applicable.
• The establishment’s and each operator’s record, if any, for violations occurring in the
previous five years, with the date and location of each violation.
• An affidavit affirming that the establishment has not sold and will not sell a nicotine or
tobacco product at retail without holding a valid license and that each operator of the
establishment has read the act and has provided training to each employee of the
establishment, if any. This required training would have to include the following:
o That the sale of a nicotine or tobacco product to a minor is prohibited by law.
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o The consequences of selling a nicotine or tobacco product to a minor.
o The types of identification that are permissible under the act for proof of an
individual’s age.
• The signature, under the penalty of perjury, of each operator of the establishment.
• Other information DHHS finds necessary for the administration or enforcement of the
act.
• Payment for the new license fee.
An establishment that has an application pending DHHS approval would have to inform DHHS
of a change in the information submitted with the application no later than 10 business days
after the change occurs.
Not later than 90 days after DHHS receives a complete application for a new license, it would
have to grant a license to each establishment for which the applicant requested a license unless
it finds that one or more of the following bases of denial exist:
• Information included in the application is inaccurate or false.
• The establishment, or an operator of the establishment, is ineligible for licensure.
• The applicant requests a license for an establishment to sell a nicotine or tobacco
product that is prohibited by applicable law.
• Granting a license to the establishment would not be consistent with the public health
and general welfare, as evidenced by the establishment’s or an operator’s history of
noncompliance with the act or any other law that relates to the retail sale of a nicotine
or tobacco product.
• The establishment or an operator has an unpaid fine.
For each license granted and each license renewal, DHHS would have to issue a certificate of
licensure to the establishment that holds the license.
Except as provided in the Administrative Procedures Act, and subject to a license suspension
or revocation, a license and certificate of licensure would be valid for one year.
In addition to the bases of denial described above, DHHS would have to deny, suspend, revoke,
or refuse to renew an establishment’s license for good cause, including all the following:
• An applicant for the establishment submitted a false or fraudulent license application.
• An applicant for the establishment included a false or fraudulent statement in a license
application.
• The establishment possesses a certificate that is false or fraudulent.
• The establishment displays a certificate that is false or fraudulent.
License renewal
To renew a license for a period of one year, an establishment would have to submit an
application for a renewed license as follows:
• If the establishment is not subject to a license suspension period at the expiration of the
license term, no earlier than 60 days, and no later than 30 days, before the end of the
license term.
• If the establishment is subject to a license suspension period at the expiration of the
license term, no earlier than 60 days before the end of the license term, but no later
than the day the license suspension period expires. An application submitted under this
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provision would not be timely for purposes of section 91 of the Administrative
Procedures Act.
If an establishment fails to submit a license renewal application, it would have to submit an
application for a new license.
DHHS would have to set the fee to submit an application for a renewed license. The renewal
fee, in conjunction with the new license fee, would have to be sufficient to cover the cost to
administer and enforce licensure under the bill.
An application for a renewed license would have to be on a form prescribed by DHHS, and an
applicant would have to include the following information for each establishment requesting a
renewed license:
• The name, address, and phone number of the establishment.
• The name, address, and phone number of each operator of the establishment.
• An affidavit that affirms it has not sold and will not sell a nicotine or tobacco product
at retail without holding a valid license and it or an operator is not subject to a license
ineligibility period under the bill.
• The signature, under the penalty of perjury, of each operator of the establishment.
• Other information that DHHS finds necessary for the administration or enforcement of
the act.
• Payment for the renewal fee.
If DHHS receives a complete application for a renewed license, it would have to renew the
license of each establishment for which the applicant requested a renewal as follows:
• For an application from an establishment not subject to a license suspension period at
the expiration of the license term, not later than 60 days after DHHS receives the
application.
• For an application from an establishment that is subject to a license suspension period
at the expiration of the license term, not later than 60 days after the expiration of the
license suspension period.
DHHS could not renew the license of an establishment included in an application if it finds
that one or more of the following bases of denial exist:
• Information included in the application is inaccurate or false.
• The establishment or an operator is ineligible for licensure.
• The applicant requests a renewed license for an establishment to sell a nicotine or
tobacco product that is prohibited by applicable law.
• Renewing the establishment’s license would not be consistent with the public health
and general welfare, as evidenced by the establishment’s or an operator’s history of
noncompliance with the act or any other law that relates to the retail sale of a nicotine
or tobacco product.
• The establishment or an operator has an unpaid fine under the act.
Except as provided in section 91 of the Administrative Procedures Act and subject to a license
suspension or revocation, a license renewal would be valid for one year.
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DHHS would have to monitor each establishment for compliance with the act, and it or its
designee would have to conduct at least two unannounced compliance checks per year at each
establishment. Each compliance check would have to involve the following:
• An individual who is 18, 19, or 20 years old who enters the establishment and attempts
a purchase of a nicotine or tobacco product.
• A visual inspection to ascertain whether the establishment sells or offers to sell a
nicotine or tobacco product that is prohibited under applicable law.
Not later than three months after an establishment fails a compliance check, DHHS or its
designee would have to conduct an additional compliance check at the establishment as
described above.
At least every year, DHHS would have to publish the results of each compliance check
conducted during the applicable time frame.
Nontransferable license
The bill provides that an establishment’s license is not transferable to another establishment.
When all ownership interest in an establishment is transferred, the establishment’s history of
violations under the act, if any, while under the ownership of the transferor is not assumed by