PUBLIC HEARING AND INTRODUCTION OF AN ORDINANCE REGULATING THE SALE OF TOBACCO AND TOBACCO-RELATED PRODUCTS

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1 STAFF REPORT MEETING DATE: January 10, 2017 TO: FROM: City Council Regan M. Candelario, City Manager Jessica Deakyne, Management Analyst II 922 Machin Avenue Novato, CA / FAX 415/ SUBJECT: PUBLIC HEARING AND INTRODUCTION OF AN ORDINANCE REGULATING THE SALE OF TOBACCO AND TOBACCO-RELATED PRODUCTS REQUEST Consider holding a public hearing and introducing an ordinance related to the sale of tobacco and tobacco-related products in the City. RECOMMENDATION Hold the public hearing and introduce the ordinance. DISCUSSION On October 25, 2016, Novato City Council directed staff to conduct outreach and draft potential changes to the smoking ordinance, encouraging a shift toward clearer definitions and stronger restrictions related to smoking in the City. The original smoking ordinance, adopted in 2008, made great strides in providing for the public health, safety, and welfare by discouraging the inherently dangerous behavior of smoking around non-tobacco users by protecting children from exposure to smoking and tobacco; by reducing the potential for children to associate smoking and tobacco with a healthy lifestyle; by protecting the public from nonconsensual exposure to secondhand smoke and tobacco-related litter and pollution, and by affirming the family-friendly atmosphere of the City's public places. One area identified by the Marin County Tobacco Related Disease Control Program was to implement a Tobacco Retail License (TRL) Ordinance that would ultimately restrict youth access to tobacco and tobacco products and create a mechanism for revoking a retailer s ability to sell tobacco products that target youth and for selling to minors. The newly drafted TRL ordinance would take effect on January 1, 2018, allowing ample time to communicate the changes with businesses selling tobacco and tobacco-related products. At this point in time, extensive public outreach has occurred including the establishment of a website to keep affected tobacco retailers, in addition to the general public, abreast of the timeline and relevant documentation ( as staff works with Council and the community to establish a tobacco retail license (TRL) ordinance. Novato s City Attorney drafted the ordinance utilizing best practices established in other cities in Marin and Sonoma Counties. Part of the impetus to implement a TRL ordinance is the American cc17_

2 Lung Association s State of Tobacco Control report which annually assigns grades for jurisdictions based on measures they ve taken to reduce smoking (Attachment 3). The linked report provides reference for what measures our County and other cities have taken during In order achieve an A grade on the ALA report, the City is required to demonstrate strong policies in several areas including: Smokefree Outdoor Air, Smokefree Housing, Reducing Sales of Tobacco Products and Emerging Issues. Though the City will not be included in the calendar year 2016 State of Tobacco Control Report, Council s approval of this ordinance in January 2017 will provide the City with credit via a planned publicity campaign for taking these measures early in the year. A final reading and adoption of this ordinance and the revised smoking ordinance will be required in order to receive said publicity. Below is a table summarizing the major policy changes that would take effect on January 1, 2018: Table of Proposed Policies Related to Tobacco Retail Licensing Affected Entity Current Restriction Proposed Restriction Businesses that sell tobacco and tobacco-related products No Tobacco Retail Licensing A small fee ($50 or less per year) would be charged for businesses who sell tobacco; if the business sells tobacco without a license or violates the ordinance, the City could revoke their license and they would not be able to sell tobacco or tobacco-related products in Businesses selling tobacco and tobacco-related products that also contain a pharmacy element Business selling flavored tobacco products Businesses selling single-pack cigarettes, cigarillos, cigars etc. No restriction No restriction No restriction 2 the City There are currently two (2) retailers in Novato that would be restricted from selling tobacco because of their pharmacy component In an effort to reduce the attractiveness of smoking to youth, flavored tobacco products would not be sold (excluding menthol) Small or single packs would be banned At this time, tobacco retailers must pay a fee to the State of California to sell tobacco in the State. The City believes that 34 businesses in City limits would be required to purchase a TRL license to continue to sell tobacco in Novato as of January 1, The City Council would set the fee for the TRL for businesses wishing to continue to sell tobacco and related products in City limits (a County ordinance already covers County unincorporated areas). Based on several factors, staff is recommending a fee of $50 in order to cover the cost of issuing the license, developing materials related to the license for tobacco retailers to post and staff time in communicating with tobacco retailers. The American Lung Associations Matrix of Strong Local Tobacco Retailer Licensing Ordinances is listed as an attachment to display typical licensing fees throughout the State of California. The $50 fee is modest in comparison to other cities implementing TRLs. The Marin County Tobacco Related Disease Control Program will lead on education efforts with staff assisting in community outreach. In fact, the County s representative has already completed 2

3 in-person outreach to hotel owners, tobacco retailers with pharmacy components and other retailers in the City. After the TRL Ordinance is adopted, staff will work with the Finance Division to ensure inclusion of the TRL in the next iteration of business licenses that will go out at the end of 2017 for the 2018 calendar year and will assist Finance with design of the License or insignia that is required for display per the TRL Ordinance. PUBLIC OUTREACH Public outreach efforts have been targeted toward owners and managers of businesses in Novato that sell tobacco and tobacco-related products. The following has occurred from October-January: Informational item presented to City Council on Tuesday, October 25, 2016; Letter to tobacco retailers in the City on November 23, 2016, inviting them to provide feedback on the potential changes at a public meeting on December 1, 2016 or via phone or ; In-person outreach conducted with retail establishments that have both a pharmacy and tobacco sales component (2 in City limits); A public meeting was held to receive feedback from retailers with zero attendees; Letter to tobacco retailers in the City s on December 20, 2016 inviting them to the public hearing that Council may host tonight and alerting them to the timeline established to receive feedback, revise and adopt the ordinance and changes. City staff established a website to allow members of the public and affected businesses to check in on the timeline and all relevant information related to the Tobacco Retail Licensing Ordinance ( An e-news item was added to the Chamber of Commerce s e-newsletter to business owners in the City the first week of January, prior to the public hearing. FISCAL IMPACT Limited fiscal impact. The Marin County Department of Health & Human Services is slated to provide enforcement and education on ordinance changes. ALTERNATIVES 1. Accept the Tobacco Retail License Ordinance and hold a first reading on January 10, 2017, scheduling a second reading and formal adoption on January 24, Delay the public hearing and provide direction to staff on other interventions and alternatives to proposed ordinances. 3. Take no action; direct staff to not amend portions of the Municipal Code related to smoking and tobacco use at this time. ATTACHMENTS 1. Draft Ordinance of the City of Novato Requiring the Licensure of Tobacco Retailers and Adding Section 7-6 to the City s Municipal Code 2. American Lung Associations Matrix on Strong Local Tobacco Retailer Licensing Ordinances 3. American Lung Associations State of Tobacco Control 2016 Report 3 3

4 CITY COUNCIL OF THE CITY OF NOVATO ORDINANCE NO. AN ORDINANCE OF THE CITY OF NOVATO REQUIRING THE LICENSURE OF TOBACCO RETAILERS AND ADDING SECTION 7-6 TO THE CITY S MUNICIPAL CODE The City Council of the City of Novato does ordain as follows: SECTION I. FINDINGS. The City Council of the City of Novato hereby finds and declares as follows: WHEREAS, based in part on the information contained in this section, the City Council finds that the failure of tobacco retailers to comply with all tobacco control laws, particularly laws prohibiting the sale of tobacco products to minors, presents an imminent threat to the public health, safety, and welfare of the residents of the City of Novato; and WHEREAS, the City Council finds that a local licensing system for tobacco retailers is appropriate to ensure that retailers comply with tobacco control laws and business standards of the City, to protect the health, safety, and welfare of our residents; and WHEREAS, approximately 480,000 people die in the United States from tobacco-related diseases every year, making tobacco use the nation s leading cause of preventable death; and WHEREAS, the World Health Organization (WHO) estimates that by 2030, tobacco will account for 8.3 million deaths per year and will be responsible for 10 percent of all deaths worldwide; and WHEREAS, 5.6 million of today s Americans who are younger than 18 are projected to die prematurely from a smoking-related illness; and WHEREAS, the California Legislature has recognized the danger of tobacco use and has made reducing youth access to tobacco products a high priority, as evidenced by the fact that: The Legislature has declared that smoking is the single most important source of preventable disease and premature death in California (Cal. Health & Safety Code ); State law prohibits the sale or furnishing of cigarettes, tobacco products, and tobacco paraphernalia to minors, as well as the purchase, receipt, or possession of tobacco products by minors (Cal. Pen. Code 308); ord649 4

5 State law requires that tobacco retailers check the identification of tobacco purchasers who reasonably appear to be under 21 years of age (Cal. Bus. & Prof. Code 22956) and provides procedures for using minors to conduct onsite compliance checks of tobacco retailers (Cal. Bus. & Prof. Code 22952); State law prohibits the sale of tobacco products and paraphernalia through self-service displays with limited exceptions for stores licenses to sell alcoholic beverages, but permits local agencies to adopt more restrictive legislation (Cal. Bus. & Prof. Code and 22962); State law prohibits the sale or furnishing of electronic cigarettes to minors (Cal. Health & Safety Code ); State law prohibits the manufacture, distribution, or sale of cigarettes in packages of less than 20 and prohibits the manufacture, distribution, or sale of "roll-your-own" tobacco in packages containing less than 0.60 ounces of tobacco (Cal. Pen. Code 308.3); and WHEREAS, state law requires all tobacco retailers to be licensed by the Board of Equalization primarily to curb the illegal sale and distribution of cigarettes due to tax evasion and counterfeiting (Cal. Bus. & Prof. Code and 22972); and WHEREAS, state law explicitly permits cities and counties to enact local tobacco retail licensing ordinances, and allows for the suspension or revocation of a local license for a violation of any state tobacco control law (Cal. Bus. & Prof. Code ); and WHEREAS, California courts have affirmed the power of the City to regulate business activity to discourage violations of law. See, e.g., Cohen v. Board of Supervisors, 40 Cal. 3d 277 (1985); Bravo Vending v. City of Rancho Mirage, 16 Cal. App. 4th 383 (1993); Prime Gas, Inc. v. City of Sacramento, 184 Cal. App. 4th 697 (2010); and WHEREAS, despite the State s and City's efforts to limit youth access to tobacco, minors are still able to access cigarettes, as evidenced by the fact that: In California, 36.8 percent of high school students have smoked a whole cigarette by 14 years of age; In California, 67.7 percent of adult smokers started by the age of 18; Nearly 34,000 youth start to smoke in California each year; WHEREAS, California retailers continue to sell tobacco to underage consumers, evidenced by the following: 7.6 percent of all tobacco retailers were witnessed unlawfully selling to minors in 2013; E-cigarette use among American youth is now a major public health concern, growing an astounding 900% among high school students from 2011 to 2015; 2 5

6 Among the 14.2 percent of minors nationwide who smoked cigarettes in 2011, 14.0 percent had usually obtained their own cigarettes by buying them in a store or gas station; and WHEREAS, research demonstrates that local tobacco retail ordinances dramatically reduce youth access to cigarettes. For example: A review of 33 California communities with strong tobacco retailer licensing ordinances shows that the youth sales rate declined in 31 of these communities after the ordinances were enacted, with an average decrease of 26 percent in the youth sales rate; and Over 90 percent of enforcement agencies surveyed in 2000 rated license suspension or revocation after repeated violations as an effective strategy to reduce youth access to tobacco; and A study found that odds of daily smoking were reduced by 2% for each 1% increase in merchant compliance with youth access laws; and WHEREAS, cities and counties in California have passed tobacco retailer licensing ordinances in an effort to stop minors from using tobacco; and WHEREAS, a requirement for a tobacco retailer license will not unduly burden legitimate business activities of retailers who sell or distribute cigarettes or other tobacco products to adults. It will, however, allow the City to regulate the operation of lawful businesses to discourage violations of federal, state, and local tobacco-related laws; and WHEREAS, the 2016 Healthy Store Healthy Community public intercept survey for Marin indicates 90% support for Tobacco Retailer Licensing; and WHEREAS, in Marin County 17 out of 29 pharmacies have voluntarily eliminated tobacco from their product mix and the Marin County Pharmacists Association supports eliminating the sale of tobacco in all pharmacies; and WHEREAS, the City has a substantial interest in promoting compliance with federal, state, and local laws intended to regulate tobacco sales and use; in discouraging the illegal purchase of tobacco products by minors; in promoting compliance with laws prohibiting sales of cigarettes and tobacco products to minors; and finally, and most importantly, in protecting children from being lured into illegal activity through the misconduct of adults. NOW THEREFORE, it is the intent of the City Council, in enacting this ordinance, to ensure compliance with the business standards and practices of the City and to encourage responsible tobacco retailing and to discourage violations of tobacco-related laws, especially those which prohibit or discourage the sale or distribution of tobacco and nicotine products to minors, but not 3 6

7 to expand or reduce the degree to which the acts regulated by federal or state law are criminally proscribed or to alter the penalties provided therein. SECTION II. Section 7-6 is added to the Novato Municipal Code to read as follows: Sec TITLE. This section shall be known as Novato s Tobacco Retailers Licensing Law. Sec DEFINITIONS. The following words and phrases, whenever used in this section, shall have the meanings defined in this subsection unless the context clearly requires otherwise: (a) "Arm s Length Transaction" means a sale in good faith and for valuable consideration that reflects the fair market value in the open market between two informed and willing parties, neither of which is under any compulsion to participate in the transaction. A sale between relatives, related companies or partners, or a sale for which a significant purpose is avoiding the effect of the violations of this is not an Arm s Length Transaction. (b) "Cigar" means (i) any roll of tobacco wrapped entirely or in part in tobacco or in any substance containing tobacco; or (ii) any paper or wrapper that contains tobacco and is designed for smoking or ingestion of tobacco products. For the purposes of this subsection, "Cigar" includes, but is not limited to, Tobacco Products known or labeled as "cigar," "cigarillo," "tiparillo," "little cigar," "blunt wrap," or "cigar wrap." (c) "City" means the City of Novato, State of California. (d) "Department" means City Manager, and any agency or Person designated by the Department to enforce or administer the provisions of this section. (e) Electronic Smoking Device means an electronic device which can be used to deliver an inhaled dose of nicotine, or other substances, including any component, part, or accessory of such a device, whether or not sold separately. Electronic Smoking Device includes any such electronic smoking device, whether manufactured, distributed, marketed, or sold as an electronic cigarette, an electronic cigar, an electronic cigarillo, an electronic pipe, an electronic hookah, or any other product name or descriptor. (f) "Person" means any natural person, partnership, cooperative association, corporation, personal representative, receiver, trustee, assignee, or any other legal entity. (g) "Pharmacy" means a retail establishment in which the profession of pharmacy by a pharmacist licensed by the State of California in accordance with the Business and Professions Code is practiced and where prescriptions are offered for sale. A pharmacy may also offer other retail goods in addition to prescription pharmaceuticals. 4 7

8 (h) "Proprietor" means a Person with an ownership or managerial interest in a business. An ownership interest shall be deemed to exist when a Person has a ten percent (10%) or greater interest in the stock, assets, or income of a business other than the sole interest of security for debt. A managerial interest shall be deemed to exist when a Person can or does have or share ultimate control over the day-to-day operations of a business. (i) "Self-Service Display" means the open display or storage of Tobacco Products or Tobacco Paraphernalia in a manner that is physically accessible in any way to the general public without the assistance of the retailer or employee of the retailer and a direct person-to-person transfer between the purchaser and the retailer or employee of the retailer. A vending machine is a form of Self-Service Display. (j) "Smoking" means inhaling, exhaling, burning, or carrying any lighted, heated, or ignited cigar, cigarette, cigarillo, pipe, hookah, Electronic Smoking Device, or any plant product intended for human inhalation. (k) "Tobacco Paraphernalia" means any item designed for the consumption, use, or preparation of Tobacco Products. (l) "Tobacco Product" means: (i) any product containing, made, or derived from tobacco or nicotine that is intended for human consumption, whether smoked, heated, chewed, absorbed, dissolved, inhaled, snorted, sniffed, or ingested by any other means, including but not limited to, cigarettes, cigars, little cigars, chewing tobacco, snuff; (ii) any electronic device that delivers nicotine or other substances to the person inhaling from the device, including but not limited to, an electronic cigarette, cigar, pipe, or hookah; (iii)notwithstanding any provision of subsections (a) and (b) to the contrary, "tobacco product" includes any component, part, or accessory of a tobacco product, whether or not sold separately. "Tobacco product" does not include any product that has been approved by the United States Food and Drug Administration for sale as a tobacco cessation product or for other therapeutic purposes where such product is marketed and sold solely for such an approved purpose. (m) "Tobacco Retailer" or Retailer means any Person who sells, offers for sale, or does or offers to exchange for any form of consideration, tobacco, Tobacco Products or 5 8

9 Tobacco Paraphernalia. "Tobacco Retailing" shall mean the doing of any of these things. This definition is without regard to the quantity of Tobacco Products or Tobacco Paraphernalia sold, offered for sale, exchanged, or offered for exchange. Sec REQUIREMENTS AND PROHIBITIONS (a) TOBACCO RETAILER S LICENSE REQUIRED. It shall be unlawful for any Person to act as a Tobacco Retailer in the City without first obtaining and maintaining a valid Tobacco Retailer s license pursuant to this section for each location at which that activity is to occur. Tobacco Retailing without a valid Tobacco Retailer s license is a nuisance as a matter of law. (b) LAWFUL BUSINESS OPERATION. In the course of Tobacco Retailing or in the operation of the business or maintenance of the location for which a license issued, it shall be a violation of this section for a licensee, or any of the licensee s agents or employees, to violate any local, state, or federal law applicable to Tobacco Products, or Tobacco Retailing. (c) DISPLAY OF LICENSE. Each Tobacco Retailer license shall be prominently displayed in a publicly visible location at the licensed location. (d) POSITIVE IDENTIFICATION REQUIRED. No Person engaged in Tobacco Retailing shall sell or transfer a Tobacco Product to another Person who appears to be under the age of twenty-seven (27) years without first examining the identification of the recipient to confirm that the recipient is at least the minimum age under state law to purchase and possess the Tobacco Product or Tobacco Paraphernalia. (e) MINIMUM AGE FOR PERSONS SELLING TOBACCO. No Person who is younger than the minimum age established by state law for the purchase or possession of Tobacco Products shall engage in Tobacco Retailing. (f) SELF-SERVICE DISPLAYS PROHIBITED. Tobacco Retailing by means of a Self- Service Display is prohibited. (g) FALSE AND MISLEADING ADVERTISING PROHIBITED. A Tobacco Retailer without a valid Tobacco Retailer license or a Proprietor without a valid Tobacco Retailer license, including, for example, a Person whose license has been suspended or revoked: (1) Shall keep all Tobacco Products out of public view. The public display of Tobacco Products in violation of this provision shall constitute Tobacco Retailing without a license under Section ; and 6 9

10 (2) Shall not display any advertisement relating to Tobacco Products that promotes the sale or distribution of such products from the Tobacco Retailer s location or that could lead a reasonable consumer to believe that such products can be obtained at that location. (h) FLAVORED TOBACCO PRODUCTS. No Tobacco Retailer shall sell a Tobacco Product containing, as a constituent or additive, an artificial or natural flavor (other than tobacco or menthol) or an herb or spice, including strawberry, grape, orange, clove, cinnamon, pineapple, vanilla, coconut, licorice, cocoa, chocolate, cherry, or coffee, that is a characterizing flavor of the Tobacco Product or smoke produced by the Tobacco Product unless (1) the Tobacco Product consists of a package of Cigars containing at least five Cigars or more, or (2) the Tobacco Product consists of a single Cigar for which the retail price exceeds five dollars ($5.00), or (3) the Tobacco Product consists of pipe tobacco, or (4) the Tobacco Product consists of a package of chewing tobacco or snuff containing at least five units or more. (i) MINIMUM PACK SIZE FOR CIGARS. Notwithstanding any other provision of this section, it shall be a violation of this section for any licensee or any of the licensee's agents or employees to sell, offer for sale, or exchange for any form of consideration: (1) any single Cigar, whether or not packaged for individual sale; (2) any number of Cigars fewer than the number contained in the manufacturer's original consumer packaging designed for retail sale to a consumer; or (3) any package of Cigars containing fewer than five Cigars. This subsection (i) does not apply to the sale or offer for sale of a single cigar for which the retail price exceeds five dollars ($5.00). (j) PHARMACIES CANNOT SELL TOBACCO PRODUCTS. issued to authorize Tobacco Retailing in a Pharmacy. No license may be Sec APPLICATION PROCEDURE. (a) Application for a Tobacco Retailer s license shall be submitted in the name of each Proprietor proposing to conduct or conducting retail tobacco sales, and shall be signed by each Proprietor or an authorized agent thereof. It is the responsibility of each Proprietor to be informed regarding all laws applicable to Tobacco Retailing, including those laws affecting the issuance of a 7 10

11 Tobacco Retailer s license. No Proprietor may rely on the issuance of a license as a determination by the City that the Proprietor has complied with all laws applicable to Tobacco Retailing. A license issued contrary to this section, contrary to any other law, or on the basis of false or misleading information supplied by a Proprietor shall be revoked pursuant to subsection of this section. Nothing in this section shall be construed to vest in any Person obtaining and maintaining a Tobacco Retailer s license any status or right to act as a Tobacco Retailer in contravention of any provision of law. All applications shall be submitted on a form supplied by the Department and shall contain the following information: (1) The name, address, and telephone number of each Proprietor of the business seeking a license. (2) The business name, address, and telephone number of the single fixed location for which a license is sought. (3) A single name and mailing address authorized by each Proprietor to receive all communications and notices (the "Authorized Person and Address") required by, authorized by, or convenient to the enforcement of this section. If an Authorized Person and Address is not supplied, each Proprietor shall be understood to consent to the provision of notice at the business address specified in subparagraph (2) above. (4) Proof that the location for which a Tobacco Retailer s license is sought has been issued a valid state tobacco retailer s license by the California Board of Equalization. (5) Such other information as the Department deems necessary for the administration or enforcement of this section as specified on the application form required by this section. (b) A licensed Tobacco Retailer shall inform the Department in writing of any change in the information submitted on an application for a Tobacco Retailer s license within ten (10) business days of a change. (c) All information specified in an application pursuant to this section shall be subject to disclosure under the California Public Records Act (California Government Code 6250 et seq.) or any other applicable law, subject to the laws exemptions. 8 11

12 (d) Tobacco Retailers in existence on the effective date of the ordinance codified in this section shall apply for a license within 90 days of the effective date of the ordinance codified in this section. Sec ISSUANCE OF LICENSE. (a) BASES FOR DENIAL. Upon the receipt of a complete application for a Tobacco Retailer s license and the license fee required by this section, the Department shall issue a license unless substantial evidence demonstrates that one or more of the following bases for denial exists: (1) The information presented in the application is inaccurate or false. Intentionally supplying inaccurate or false information shall be a violation of this section. (2) The application seeks authorization for Tobacco Retailing at a location for which this section prohibits issuance of Tobacco Retailer licenses. However, this subparagraph shall not constitute a basis for denial of a license if the applicant provides the City with documentation demonstrating by clear and convincing evidence that the applicant has acquired or is acquiring the location or business in an Arm s Length Transaction. (3) The application seeks authorization for Tobacco Retailing for a Proprietor to whom this section prohibits a license to be issued. (4) The application seeks authorization for Tobacco Retailing at a location, that is unlawful pursuant to this Code, including without limitation, zoning ordinance and building code, or that is unlawful pursuant to any other law. (b) APPEAL OF DENIAL. Subject to Section (c), a decision of the Department to deny a license is appealable to the City Council and any such appeal must be filed in writing with the City Clerk within fifteen (15) days of the Department's denial of the issuance of the license and the applicable appeal fee must be paid. Sec LICENSE RENEWAL AND EXPIRATION. (a) RENEWAL OF LICENSE. A Tobacco Retailer s license is invalid if the appropriate license fee has not been timely paid in full or if the term of the license has expired. The term of a Tobacco Retailer license is one calendar year. Each Tobacco Retailer shall apply for the renewal of his or her Tobacco Retailer s 9 12

13 license and submit the license fee no later than November 30 of each year, commencing November 30, 2017, and annually thereafter; provided, however, that should the effective date of the ordinance codified in this section precede September 1, 2017, the term of the first licenses issued hereunder shall commence on the date the licenses is issued and expire December 31, 2017, and the license fee payable for said first licenses shall be pro-rated based on the term of the license divided by 365. (b) EXPIRATION OF LICENSE. A Tobacco Retailer s license that is not timely renewed shall expire on December 31 of each year. To renew a license not timely renewed pursuant to subparagraph (a), the Proprietor must: (1) Submit the license fee and the renewal form; and (2) Submit a signed affidavit affirming that the Proprietor has not sold and will not sell any Tobacco Product or Tobacco Paraphernalia after the license expiration date and before the license is renewed. Sec TRANSFER RESTRICTIONS. (a) A Tobacco Retailer s license may not be transferred from one location to another. (b) A new Tobacco Retailer s license is required whenever a Tobacco Retailing location has a change in Proprietor(s). (c) Notwithstanding any other provision of this section, prior violations at a location shall continue to be counted against a location and license ineligibility periods shall continue to apply to a location unless: the new Proprietor(s) provide the Department with clear and convincing evidence that the new Proprietor(s) have acquired or are acquiring the location in an Arm s Length Transaction. Sec LICENSE CONVEYS A LIMITED, CONDITIONAL PRIVILEGE. Nothing in this section shall be construed to grant any Person obtaining and maintaining a Tobacco Retailer s license any status or right other than the limited conditional privilege to act as a Tobacco Retailer at the location in the City identified on the face of the license. For example, nothing in this section shall be construed to render inapplicable, supersede, or apply in lieu of, any other provision of applicable law, including but not limited to, any provision of this Code including without limitation, the zoning ordinance and building codes, or any condition or limitation on smoking in an enclosed place of employment pursuant to 10 13

14 California Labor Code section For example, obtaining a Tobacco Retailer s license does not make the retailer a "retail or wholesale tobacco shop" for the purposes of California Labor Code section Sec FEE FOR LICENSE. The fee to issue or to renew a Tobacco Retailer s license shall be established from time to time by resolution of the City Council. The fee shall be calculated so as to recover the cost of administration and enforcement of this section, including, for example, issuing a license, administering the license program, retailer education, retailer inspection and compliance checks, documentation of violations, and prosecution of violators, but shall not exceed the cost of the regulatory program authorized by this section. Fees are nonrefundable except as may be required by law. Sec COMPLIANCE MONITORING. (a) Compliance with this section shall be monitored by the Department. In addition, any peace officer may enforce the penal provisions of this section. The Department may designate any number of additional Persons to monitor compliance with this section. (b) The Department will work with Marin County Tobacco Program to inspect each Tobacco Retailer at least one (1) time per twelve (12) month period. Nothing in this paragraph shall create a right of action in any licensee or other Person against the City or its agents. (c) The Department shall not enforce any law establishing a minimum age for Tobacco purchases or possession against a Person who otherwise might be in violation of such law because of the Person s age (hereinafter "Youth Decoy") if the potential violation occurs when: (1) the Youth Decoy is participating in an inspection supervised by a peace officer, code enforcement official, or the Person designated by the City to monitor compliance with this section; (2) the Youth Decoy is acting as an agent of a Person designated by the City to monitor compliance with this section; or (3) the Youth Decoy is participating in an inspection funded in part, either directly or indirectly through subcontracting, by the County of Marin Department of Health & Human Services or the California Department of Health Services

15 Sec SUSPENSION OR REVOCATION OF LICENSE. (a) SUSPENSION OR REVOCATION OF LICENSE FOR VIOLATION. In addition to any other penalty authorized by law, a Tobacco Retailer s license shall be suspended or revoked if any court of competent jurisdiction determines, or the Department finds based on a preponderance of the evidence, after the licensee is afforded notice and an opportunity to be heard, that the licensee, or any of the licensee s agents or employees, has violated any of the requirements, conditions, or prohibitions of this section or has pleaded guilty, "no contest" or its equivalent, or admitted to a violation of any law designated in Section above. (1) Upon a finding by the Department of a first violation of this section at a location within any sixty (60)-month period, the license shall be suspended for thirty (30) days. (2) Upon a finding by the Department of a second violation of this section at a location within any sixty (60)-month period, the license shall be suspended for ninety (90) days. (3) Upon a finding by the Department of a third violation of this section at a location within any sixty (60)-month period, the license shall be suspended for one (1) year. (4) Upon a finding by the Department of four or more violations of this section at a location within any sixty (60)-month period, the license shall be revoked. (b) APPEAL OF SUSPENSION OR REVOCATION. A decision of the Department to suspend or revoke a license is appealable to the City Council and any appeal must be filed in writing with the City Clerk within fifteen (15) days of mailing of the Department s decision and the applicable appeal fee must be paid. If such an appeal is timely made, it shall stay enforcement of the appealed action. An appeal to the City Council is not available for a revocation made pursuant to subsection (c) below. (c) REVOCATION OF LICENSE WRONGLY ISSUED. A Tobacco Retailer s license shall be revoked if the Department finds, after the licensee is afforded notice and an opportunity to be heard, that one or more of the bases for denial of a license under Section existed at the time application was made or at any time before the license issued. The decision by the Department shall be the final decision of the City. Such a revocation shall be without prejudice to the filing of a new license application

16 (d) JUDICIAL ACTION TO CHALLENGE. Any final administrative action to suspend or revoke a Tobacco Retailer s license under this section shall be subject to judicial review pursuant to Cal. Gov t Code section , which, among other things, requires such a judicial challenge to be brought within 20 days of service of the final decision. Sec TOBACCO RETAILING WITHOUT A VALID LICENSE. (a) In addition to any other penalty authorized by law, if a court of competent jurisdiction determines, or the City Council finds based on a preponderance of evidence, after notice and an opportunity to be heard, that any Person has engaged in Tobacco Retailing at a location without a valid Tobacco Retailer s license, either directly or through the Person s agents or employees, the Person shall be ineligible to apply for, or to be issued, a Tobacco Retailer s license as follows: (1) After a first violation of this section at a location within any sixty (60)-month period, no new license may issue for the location (unless ownership of the business at the location has been transferred in an Arm s Length Transaction), until thirty (30) days have passed from the date of the violation. (2) After a second violation of this section at a location within any sixty (60)-month period, no new license may issue for the location (unless ownership of the business at the location has been transferred in an Arm s Length Transaction), until ninety (90) days have passed from the date of the violation. (3) After of a third or subsequent violation of this section at a location within any sixty (60)-month period, no new license may issue for the location (unless ownership of the business at the location has been transferred in an Arm s Length Transaction), until sixty (60) months have passed from the date of the violation. (b) Tobacco Products and Tobacco Paraphernalia offered for sale or exchange in violation of this section are subject to seizure by the Department or any peace officer and shall be forfeited after the licensee and any other owner of the Tobacco Products and Tobacco Paraphernalia seized is given reasonable notice and an opportunity to demonstrate that the Tobacco Products and Tobacco Paraphernalia were not offered for sale or exchange in violation of this section. The decision by the Department may be appealed pursuant to the procedures set forth in section (b). Forfeited Tobacco Products and Tobacco Paraphernalia shall be destroyed after all internal appeals have been exhausted and the time in which to seek judicial review pursuant to California Code of Civil Procedure section or other applicable law has expired without the filing of a lawsuit or, if such a suit is 13 16

17 filed, after judgment in that suit becomes final. (c) For the purposes of the civil remedies provided in this section, each of the following constitutes a separate violation of this section: (1) each day on which a Tobacco Product or Tobacco Paraphernalia is offered for sale in violation of this section; or (2) each individual retail Tobacco Product and each individual retail item of Tobacco Paraphernalia that is distributed, sold, or offered for sale in violation of this section; Sec ADDITIONAL REMEDIES. (a) The remedies provided by this section are cumulative and in addition to any other remedies available at law or in equity. (b) Whenever evidence of a violation of this section is obtained in any part through the participation of a Person under the age of eighteen (18) years old, such a Person shall not be required to appear or give testimony in any civil or administrative process brought to enforce this section and the alleged violation shall be adjudicated based upon the sufficiency and persuasiveness of the evidence presented. (c) Violations of this section are subject to a civil action brought by the City Attorney, punishable by a civil fine not less than Two Hundred Fifty Dollars ($250.00) and not exceeding One Thousand Dollars ($1,000.00) per violation. (d) Violations of this section may, in the discretion of the City Attorney, may be prosecuted as infractions or misdemeanors when the interests of justice so require. (e) Causing, permitting, aiding, abetting, or concealing a violation of any provision of this section shall also constitute a violation of this section. (f) Violations of this section are hereby declared to be public nuisances. (g) In addition to other remedies provided by this section or by other law, any violation of this section may be remedied by a civil action brought by the City Attorney, including, for example, administrative or judicial nuisance abatement proceedings, civil or criminal code enforcement proceedings, and suits for injunctive relief

18 Sec ENFORCEMENT. This section shall not be enforced by the City until January 1, SECTION III. SEVERABILITY. If any section, subsection, subdivision, paragraph, sentence, clause or phrase of this Ordinance, or its application to any person or circumstance, is for any reason held to be invalid or unenforceable, such invalidity or unenforceability shall not affect the validity or enforceability of the remaining sections, subsections, subdivisions, paragraphs, sentences, clauses or phrases of this Ordinance, or its application to any other person or circumstance. The City Council of the City of Novato hereby declares that it would have adopted each section, subsection, subdivision, paragraph, sentence, clause or phrase hereof, irrespective of the fact that any one or more other sections, subsections, subdivisions, paragraphs, sentences, clauses or phrases hereof be declared invalid or unenforceable. SECTION IV. EFFECTIVE DATE. This Ordinance shall become effective thirty (30) days from and after the date of its passage SECTION V. CEQA FINDINGS. This ordinance is exempt from the California Environmental Quality Act ( CEQA ) under 14 Cal. Code Regs. Section 15061(b)(3) because it can be seen with certainty that there is no possibility that its adoption will have a significant adverse effect on the environment. It is also categorically exempt under 14 Cal. Code Regs. Section because the ordinance constitutes a regulatory activity whose purpose is the protection of the environment and to reduce the adverse health effects of air pollutants caused by smoking. * * * * * * IT IS HEREBY CERTIFIED that the foregoing ordinance was duly introduced at a regular meeting of the Novato City Council held on 10 th day of January, 2016, and thereafter passed and adopted by the Novato City Council on the day of by the following vote, to wit: AYES: NOES: ABSTAIN: ABSENT: Councilmembers Councilmembers Councilmembers Councilmembers 15 18

19 Mayor of the City of Novato Attest: Assistant City Clerk of the City of Novato Approved as to form: City Attorney of the City of Novato 16 19

20 H-5 2. Matrix of Strong Local Tobacco Retailer Licensing Ordinances JANUARY 1, 2016 In order to reduce illegal sales of tobacco products to minors, many cities and counties in California have adopted strong local tobacco retailer licensing ordinances. This document highlights the 124 ordinances that are considered strong, as well as the fee and enforcement provisions. A strong local tobacco licensing law is defined as one that includes the following four components: Requirements that all retailers that sell tobacco products must obtain a license and renew it annually. A fee set high enough to sufficiently fund an effective program including administration of the program and enforcement efforts. An enforcement plan, that includes compliance checks, should be clearly stated. Coordination of tobacco regulations so that a violation of any existing local, state or federal tobacco regulation violates the license. A financial deterrent through fines and penalties including the suspension and revocation of the license. Fines and penalties should be outlined in the ordinance. Below is a list of the 124 local ordinances in California that have met the requirements for a strong local tobacco retailer licensing ordinance along with basic information about the community population, license fee and designated enforcement agencies. The jurisdictions are listed in alphabetical order under each county in order to make it easy to compare fee and enforcement details for similar jurisdictions. For the table below, the agencies that enforce these ordinances have been categorized in the following way: Law Enforcement: Includes Police Departments and Sheriff Departments Health Department: Includes Environmental Health Services, Departments of Public Health, Health Services Department, and Health and Human Services Divisions. City Officials: Includes City Manager, City Attorney, and any authorized city official Other: Includes Community Development Services, Department of Finance, code enforcement agencies/services, Administrative Services, Neighborhood Preservation Division, neighborhood services inspectors, Business License Division, and District Attorneys The Table and other documents on tobacco retailer licensing, including a fact sheet on the effectiveness of these ordinances, are available at Photo Credit: California Department of Public Health 2013 CENTER4TOBACCOPOLICY.ORG LUNG.ORG/CALIFORNIA The Center for Tobacco Policy & Organizing American Lung Association in California 1531 I Street, Suite 201, Sacramento, CA Phone: (916) Fax: (916) California Department of Public Health. Funded under contract #

21 THE CENTER FOR TOBACCO POLICY & ORGANIZING Page 2 of 7 Community Date Passed Population Fee Designated Administration/Enforcement Agencies Law Enforcement Health Department City Officials Other Alameda County Albany February ,565 $250 X Berkeley December ,780 $427* X X Hayward July ,889 $400 X Oakland April ,603 $50** X Union City November ,744 $665 X Butte County Oroville March ,197 $30 X Contra Costa County Concord September ,069 $160 X Contra Costa County January ,323 $287* X El Cerrito October ,549 $485 (initial) $439 (renew) Richmond June ,346 $1,062.44** X X X San Pablo April ,730 $170 X Fresno County Firebaugh August ,779 $190 X Parlier April ,095 $200 X Imperial County Calexico February ,572 X X Kern County California City February ,165 $165 X Delano June ,222 $165 X Kern County November ,050 $165 X McFarland May ,037 $165 X Tehachapi February ,028 $165 X Wasco March ,130 $165 X LUNG.ORG/CALIFORNIA CENTER4TOBACCOPOLICY.ORG 21

22 THE CENTER FOR TOBACCO POLICY & ORGANIZING Page 3 of 7 Community Date Passed Population Fee Designated Administration/Enforcement Agencies Law Enforcement Health Department City Officials Other Los Angeles County Baldwin Park October ,047 $342 X X Beverly Hills August ,833 $204 X Burbank February ,084 $300** X Calabasas June ,212 No Fee Planned* X Carson November ,148 $500 X X Cerritos January ,968 $50* X Compton July ,506 $500 X X Culver City July ,773 $235 X X Duarte May ,839 $100 X El Monte November ,774 $300/Annual X X El Segundo June ,000 $250 X Gardena July ,414 $120 ** X X Glendale September ,182 $255 X Hawaiian Gardens July ,545 $246 X Hawthorne July ,657 $375 X X Huntington Park November ,312 Inglewood October ,333 $350 X X La Canada Flintridge June ,592 $50* X X Lancaster June ,784 $261 X Lawndale October ,403 $150 X Lomita May ,733 $150 X X Long Beach February ,779 $442 X X X Los Angeles (City) September ,957,022 $300 X X X Los Angeles County December ,051,872 $235 X X Lynwood October ,381 TBD X LUNG.ORG/CALIFORNIA CENTER4TOBACCOPOLICY.ORG 22

23 THE CENTER FOR TOBACCO POLICY & ORGANIZING Page 4 of 7 Community Date Passed Population Fee Designated Administration/Enforcement Agencies Law Enforcement Health Department City Officials Other Malibu November ,935 No Fee Planned * X Montebello September ,104 $300 X Monterey Park April ,063 $40* X Palmdale January ,009 $350 X Pasadena February ,510 $225 X X San Fernando October ,558 $250 X San Gabriel March ,517 $300 X Santa Monica November ,283 $ X Sierra Madre November ,133 $30 X South Pasadena February ,174 $150 X Temple City December ,275 Marin County $75 (Initial fee-$320) X Marin County May ,488 $25 X Mill Valley September ,439 $25 X San Rafael August ,214 Mendocino County $10 (Initial fee - $48) X Fort Bragg December ,343 $183 X Mendocino County April ,095 $290 X Ukiah December ,075 $35.45 Annual X X Willits October ,902 $75 X Monterey County Carmel-By-The-Sea June ,413 $286 X X Monterey November ,163 $286 X X Monterey County May ,645 $286 X X Salinas January ,720 $286 X X LUNG.ORG/CALIFORNIA CENTER4TOBACCOPOLICY.ORG 23

24 THE CENTER FOR TOBACCO POLICY & ORGANIZING Page 5 of 7 Community Date Passed Population Fee Designated Administration/Enforcement Agencies Law Enforcement Health Department City Officials Other Nevada County Grass Valley November ,925 $100 X Nevada City November ,194 $100 X Orange County Santa Ana October ,264 $635 X X Riverside County Banning August ,491 $350 X Beaumont December ,481 $350 X Calimesa June ,353 $350 X Canyon Lake June ,901 $350 X Coachella July ,917 $350 X Corona October ,287 $350 X Desert Hot Springs August ,134 $350 X Eastvale October ,633 $350 X Hemet March ,253 $350 X Jurupa Valley September ,885 $350 X Lake Elsinore August ,426 $350 X Menifee December ,385 $350 X Moreno Valley September ,670 $350 X Murrieta May ,279 $350 X Norco March ,891 $350 X Perris August ,908 $350 X Riverside (City) May ,307 $350 X Riverside County January ,823 $350 X San Jacinto June ,895 $350 X LUNG.ORG/CALIFORNIA CENTER4TOBACCOPOLICY.ORG 24

25 THE CENTER FOR TOBACCO POLICY & ORGANIZING Page 6 of 7 Community Date Passed Population Fee Designated Administration/Enforcement Agencies Law Enforcement Health Department City Officials Other Temecula June ,920 No Fee Planned* X Wildomar July ,148 $350 X Sacramento County Elk Grove September ,899 $270 X Rancho Cordova February ,112 $287 X Sacramento (City) March ,105 $300 X X Sacramento County May ,313 $324 X X San Benito County Hollister May ,305 $269 X X San Diego County El Cajon June ,444 $675 X Solana Beach July ,104 $110 ** X Vista May ,413 $250 X San Francisco County San Francisco November ,602 $175 ** X X San Luis Obispo County Arroyo Grande February ,428 $208 X Grover Beach September ,144 $224 X San Luis Obispo (City) August ,802 $278 X San Luis Obispo County October ,233 $342 X San Mateo County Pacifica February ,551 $300 X X LUNG.ORG/CALIFORNIA CENTER4TOBACCOPOLICY.ORG 25

26 THE CENTER FOR TOBACCO POLICY & ORGANIZING Page 7 of 7 Community Date Passed Population Fee Designated Administration/Enforcement Agencies Law Enforcement Health Department City Officials Other Santa Barbara County Carpinteria April ,547 $379 X X Goleta May ,765 $534 X X Santa Barbara County November ,052 $409* X X Santa Clara County Campbell December ,857 $51 X Gilroy November ,000 $100 X Morgan Hill April ,779 $125 Santa Clara County November ,182 $425 X X Saratoga June ,799 $50* X X Santa Cruz County Santa Cruz (City) October ,789 $425 X Santa Cruz County April ,790 $318 X X Scotts Valley December ,715 $150 X Watsonville October ,087 $255-$382 X Sonoma County Healdsburg November ,687 $445 X Sonoma June ,933 $246 X Stanislaus County Riverbank July ,504 $25-$200 X X Ventura County Oxnard February ,148 $51* X Yolo County Davis August ,757 $344 X X Woodland June ,525 $360 X Yolo County May ,885 $344 X X *City or County fee does not fully cover administration and enforcement of the tobacco retailer license. Rather, the fee is supplemented with another stable source of funds, such as Master Settlement Agreement (MSA) funds or general funds. See the Center s Matrix of Strong Local Tobacco Retailer Licensing Ordinances for full details about the administration and enforcement of these ordinances. ** Fees may have additional restrictions, charges or may be combined with another fee. Sources: Population figures are from California Department of Finance, E-1 Population Estimates for Cities, Counties and the State with Annual Percent Change Jan. 1, 2014 and 2015 LUNG.ORG/CALIFORNIA CENTER4TOBACCOPOLICY.ORG 26

27 State of Tobacco Control 2016 California Local Grades MARIN COUNTY Overall Tobacco Control Grade F C C C A C C B A C C A Total Points Smokefree Outdoor Air F A B A A A A A A A B A Dining Entryways Public Events Recreation Areas Service Areas Sidewalks Worksites Total Points Smokefree Housing D B B B A C D A A B A B Nonsmoking Apartments Nonsmoking Condominiums Nonsmoking Common Areas Nonsmoking Housing Authority n/a n/a 0 n/a n/a 0 n/a Total Points Reducing Sales of Tobacco Products n/a F F F A F n/a F A F F A Tobacco Retailer Licensing Total Points Emerging Issues Bonus Points Belvedere Emerging Products Definition - Secondhand Smoke Emerging Products Definition - Licensing Retailer Location Restrictions Sampling of Tobacco Products Sale of Tobacco Products in Pharmacies Flavored Tobacco Products Minimum Pack Size of Cigars Total Points Fairfax Corte Madera Larkspur Mill Valley Novato Ross San Anselmo San Rafael Sausalito Tiburon County Unincorporated Overall Tobacco Control Grade: A (11-12), B (8-10), C (5-7), D (2-4), F (0-1); determined by grades and points from other three categories A (4), B (3), C (2), D (1), F (0) Smokefree Outdoor Air Grade: A (18+), B (13-17), C (8-12), D (3-7), F (0-2) 54 Smokefree Housing Grade: A (11+), B (8-10), C (5-7), D (2-4), F (0-1) Reducing Sales of Tobacco Products Grade: A (4+), B (3), C (2), D (1), F (0) 27