H.F. 98 Section 1. Section 321.216C, Code 2021, is amended to read 1 as follows: 2 321.216C Use of driver’s license or nonoperator’s 3 identification card by underage person to obtain tobacco, tobacco 4 products, alternative nicotine products, vapor products, or 5 cigarettes. 6 A person who is under the age of twenty-one, who alters 7 or displays or has in the person’s possession a fictitious 8 or fraudulently altered driver’s license or nonoperator’s 9 identification card and who uses the license or card to violate 10 or attempt to violate section 453A.2, subsection 2 , commits a 11 simple misdemeanor punishable as a scheduled violation under 12 section 805.8A, subsection 4 . The court shall forward a copy 13 of the conviction to the department. 14 Sec. 2. Section 423.3, subsection 57, paragraph h, Code 15 2021, is amended to read as follows: 16 h. “Tobacco” means cigarettes , cigars, chewing or pipe 17 tobacco, or any other item that contains and tobacco products 18 as defined in section 453A.1 . 19 Sec. 3. Section 453A.1, subsections 1, 23, and 28, Code 20 2021, are amended to read as follows: 21 1. “Alternative nicotine product” means a product, not 22 consisting of or containing tobacco, that provides for the 23 ingestion into the body of nicotine, whether by chewing, 24 absorbing, dissolving, inhaling, snorting, or sniffing, or 25 by any other means. “Alternative nicotine product” does not 26 include cigarettes, tobacco products, or vapor products, or a 27 product that is regulated as a drug or device by the United 28 States food and drug administration under chapter V of the 29 federal Food, Drug, and Cosmetic Act. 30 23. “Retailer” shall mean and include every person in 31 this state who shall sell, distribute, or offer for sale for 32 consumption or possess for the purpose of sale for consumption, 33 cigarettes , alternative nicotine products, or vapor products 34 irrespective of quantity or amount or the number of sales ; and 35 -1- LSB 1515YH (2) 89 pf/jh 1/ 10

H.F. 98 every person within or without the state that conducts delivery 1 sales . 2 28. “Tobacco products” means cigars; little cigars as 3 defined in section 453A.42, subsection 6 ; alternative nicotine 4 products; vapor products; cheroots; stogies; periques; 5 granulated ; , plug cut, crimp cut, ready rubbed, and other 6 smoking tobacco; snuff, snuff flour; cavendish; plug and twist 7 tobacco; fine-cut and other chewing tobaccos; shorts; or refuse 8 scraps, clippings, cuttings and sweepings of tobacco, and other 9 kinds and forms of tobacco, prepared in such manner as to be 10 suitable for chewing or smoking in a pipe or otherwise, or both 11 for chewing and smoking; but does not mean cigarettes. 12 Sec. 4. Section 453A.2, subsections 1, 2, 3, and 8, Code 13 2021, are amended to read as follows: 14 1. A person shall not sell, give, or otherwise supply any 15 tobacco, tobacco products, alternative nicotine products, vapor 16 products, or cigarettes to any person under twenty-one years 17 of age. 18 2. A person under twenty-one years of age shall not 19 smoke, use, possess, purchase, or attempt to purchase any 20 tobacco, tobacco products, alternative nicotine products, vapor 21 products, or cigarettes. 22 3. Possession of tobacco, tobacco products, alternative 23 nicotine products, vapor products, or cigarettes by an 24 individual under twenty-one years of age does not constitute a 25 violation under this section if the individual under twenty-one 26 years of age possesses the tobacco, tobacco products, 27 alternative nicotine products, vapor products, or cigarettes 28 as part of the individual’s employment and the individual 29 is employed by a person who holds a valid permit under this 30 chapter or who lawfully offers for sale or sells cigarettes or 31 tobacco products. 32 8. a. A person shall not be guilty of a violation of this 33 section if conduct that would otherwise constitute a violation 34 is performed to assess compliance with tobacco, tobacco 35 -2- LSB 1515YH (2) 89 pf/jh 2/ 10

H.F. 98 products, alternative nicotine products, vapor products, or 1 cigarette laws if any of the following applies: 2 (1) The compliance effort is conducted by or under the 3 supervision of law enforcement officers. 4 (2) The compliance effort is conducted with the advance 5 knowledge of law enforcement officers and reasonable measures 6 are adopted by those conducting the effort to ensure that use 7 of tobacco, tobacco products, alternative nicotine products, 8 vapor products, or cigarettes by individuals under twenty-one 9 years of age does not result from participation by any 10 individual under twenty-one years of age in the compliance 11 effort. 12 b. For the purposes of this subsection , “law enforcement 13 officer” means a peace officer as defined in section 801.4 and 14 includes persons designated under subsection 4 to enforce this 15 section . 16 Sec. 5. Section 453A.4, subsection 1, Code 2021, is amended 17 to read as follows: 18 1. If a person holding a permit under this chapter or an 19 employee of such a permittee has a reasonable belief based on 20 factual evidence that a driver’s license as defined in section 21 321.1, subsection 20A, or nonoperator’s identification card 22 issued pursuant to section 321.190 offered by a person who 23 wishes to purchase tobacco, tobacco products, alternative 24 nicotine products, vapor products, or cigarettes is altered 25 or falsified or belongs to another person, the permittee or 26 employee may retain the driver’s license or nonoperator’s 27 identification card. Within twenty-four hours, the card shall 28 be delivered to the appropriate city or county law enforcement 29 agency of the jurisdiction in which the permittee’s premises 30 are located, and the permittee shall file a written report of 31 the circumstances under which the card was retained. The local 32 law enforcement agency may investigate whether a violation 33 of section 321.216 , 321.216A , or 321.216C has occurred. If 34 an investigation is not initiated or probable cause is not 35 -3- LSB 1515YH (2) 89 pf/jh 3/ 10

H.F. 98 established by the local law enforcement agency, the driver’s 1 license or nonoperator’s identification card shall be delivered 2 to the person to whom it was issued. The local law enforcement 3 agency may forward the card with the report to the state 4 department of transportation for investigation, in which 5 case, the state department of transportation may investigate 6 whether a violation of section 321.216 , 321.216A , or 321.216C 7 has occurred. The state department of transportation shall 8 return the card to the person to whom it was issued if an 9 investigation is not initiated or probable cause is not 10 established. 11 Sec. 6. Section 453A.5, subsection 1, Code 2021, is amended 12 to read as follows: 13 1. The alcoholic beverages division of the department of 14 commerce shall develop a tobacco compliance employee training 15 program not to exceed two hours in length for employees and 16 prospective employees of retailers, as defined in sections 17 453A.1 and 453A.42 , to inform the employees about state and 18 federal laws and regulations regarding the sale of tobacco, 19 tobacco products, alternative nicotine products, vapor 20 products, and cigarettes to persons under twenty-one years of 21 age and compliance with and the importance of laws regarding 22 the sale of tobacco, tobacco products, alternative nicotine 23 products, vapor products, and cigarettes to persons under 24 twenty-one years of age. 25 Sec. 7. Section 453A.13, subsections 1, 6, 9, and 10, Code 26 2021, are amended to read as follows: 27 1. Permits required. Every distributor, wholesaler, 28 cigarette vendor, and retailer, now engaged or who desires to 29 become engaged in the sale or use of cigarettes, upon which a 30 tax is required to be paid, and every retailer now engaged or 31 who desires to become engaged in selling, offering for sale, or 32 distributing alternative nicotine products or vapor products , 33 including through delivery sales, shall obtain a state or 34 retail permit as a distributor, wholesaler, cigarette vendor, 35 -4- LSB 1515YH (2) 89 pf/jh 4/ 10

H.F. 98 or retailer, as the case may be. 1 6. No sales without permit. A distributor, wholesaler, 2 cigarette vendor, or retailer shall not sell any cigarettes, 3 or sell, offer for sale, or distribute alternative nicotine 4 products , or vapor products through delivery sales, until such 5 application has been filed and the fee prescribed paid for a 6 permit and until such permit is obtained and only while such 7 permit is unrevoked and unexpired. 8 9. Permit —— form and contents. Each permit issued shall 9 describe clearly the place of business for which it is issued, 10 shall be nonassignable, consecutively numbered, designating the 11 kind of permit, and shall authorize the sale of cigarettes, or 12 the selling, offering for sale, or distributing of alternative 13 nicotine products , or vapor products through delivery sales in 14 this state subject to the limitations and restrictions herein 15 contained. The retail permits shall be upon forms furnished by 16 the department or on forms made available or approved by the 17 department. 18 10. Permit displayed. The permit shall, at all times, be 19 publicly displayed by the distributor, wholesaler, or retailer 20 at the place of business so as to be easily seen by the public 21 and the persons authorized to inspect the place of business. 22 The proprietor or keeper of any building or place where 23 cigarettes, alternative nicotine products, vapor products, 24 tobacco, or tobacco products are kept for sale, or with intent 25 to sell, shall upon request of any agent of the department or 26 any peace officer exhibit the permit. A refusal or failure to 27 exhibit the permit is prima facie evidence that the cigarettes, 28 alternative nicotine products, vapor products, tobacco, or 29 tobacco products are kept for sale or with intent to sell in 30 violation of this subchapter . 31 Sec. 8. Section 453A.36, subsection 6, Code 2021, is amended 32 to read as follows: 33 6. Any sales of tobacco, tobacco products, alternative 34 nicotine products, vapor products, or cigarettes made through a 35 -5- LSB 1515YH (2) 89 pf/jh 5/ 10

H.F. 98 cigarette vending machine are subject to rules and penalties 1 relative to retail sales of tobacco, tobacco products, 2 alternative nicotine products, vapor products, and cigarettes 3 provided for in this chapter . Cigarettes shall not be sold 4 through any cigarette vending machine unless the cigarettes 5 have been properly stamped or metered as provided by this 6 subchapter , and in case of violation of this provision, the 7 permit of the dealer authorizing retail sales of cigarettes 8 shall be revoked. Payment of the permit fee as provided 9 in section 453A.13 authorizes a cigarette vendor to sell 10 tobacco, tobacco products, alternative nicotine products, vapor 11 products, and cigarettes through vending machines. However, 12 tobacco, tobacco products, alternative nicotine products, vapor 13 products, and cigarettes shall not be sold through a vending 14 machine unless the vending machine is located in a place where 15 the retailer ensures that no person younger than twenty-one 16 years of age is present or permitted to enter at any time. 17 Tobacco, tobacco products, alternative nicotine products, 18 vapor products, and cigarettes shall not be sold through 19 any cigarette vending machine if such products are placed 20 together with any nontobacco product, other than matches, in 21 the cigarette vending machine. This section does not require 22 a retail permit holder to buy a cigarette vendor’s permit if 23 the retail permit holder is in fact the owner of the cigarette 24 vending machines and the machines are operated in the location 25 described in the retail permit. 26 Sec. 9. Section 453A.36, subsection 7, paragraph a, Code 27 2021, is amended to read as follows: 28 a. It shall be unlawful for a person other than a retailer 29 as defined in section 453A.1 or 453A.42 who holds a valid 30 retail permit, as applicable, to sell tobacco, tobacco 31 products, alternative nicotine products, vapor products, or 32 cigarettes at retail. 33 Sec. 10. Section 453A.36A, subsection 1, Code 2021, is 34 amended to read as follows: 35 -6- LSB 1515YH (2) 89 pf/jh 6/ 10

H.F. 98 1. Except as provided in section 453A.36, subsection 6 , 1 a retailer shall not sell or offer for sale tobacco, tobacco 2 products, alternative nicotine products, vapor products, or 3 cigarettes through the use of a self-service display. 4 Sec. 11. Section 453A.39, Code 2021, is amended to read as 5 follows: 6 453A.39 Tobacco, tobacco products, alternative nicotine 7 products, vapor products, and cigarette samples —— restrictions 8 —— administration. 9 1. A manufacturer, distributor, wholesaler, retailer, or 10 distributing agent, or agent thereof, shall not give away 11 cigarettes or tobacco products at any time in connection with 12 the manufacturer’s, distributor’s, wholesaler’s, retailer’s, or 13 distributing agent’s business or for promotion of the business 14 or product, except as provided in subsection 2 . 15 2. a. All cigarette samples shall be shipped only to a 16 distributor that has a permit to stamp cigarettes or little 17 cigars with Iowa tax. All cigarette samples must have a 18 cigarette stamp. The manufacturer shipping samples under this 19 section shall send an affidavit to the director stating the 20 shipment information, including the date shipped, quantity, and 21 to whom the samples were shipped. The distributor receiving 22 the shipment shall send an affidavit to the director stating 23 the shipment information, including the date shipped, quantity, 24 and from whom the samples were shipped. These affidavits shall 25 be duly notarized and submitted to the director at the time of 26 shipment and receipt of the samples. The distributor shall 27 pay the tax on samples by separate remittance along with the 28 affidavit. 29 b. A manufacturer, distributor, wholesaler, retailer, or 30 distributing agent or agent thereof shall not give away any 31 tobacco, tobacco products, alternative nicotine products, vapor 32 products, or cigarettes to any person under twenty-one years 33 of age, or within five hundred feet of any playground, school, 34 high school, or other facility when such facility is being used 35 -7- LSB 1515YH (2) 89 pf/jh 7/ 10

H.F. 98 primarily by persons under age twenty-one for recreational, 1 educational, or other purposes. 2 c. Proof of age shall be required if a reasonable person 3 could conclude on the basis of outward appearance that a 4 prospective recipient of a sample may be under twenty-one years 5 of age. 6 Sec. 12. Section 453A.42, subsection 3, Code 2021, is 7 amended by striking the subsection and inserting in lieu 8 thereof the following: 9 3. “Delivery sale” means the same as defined in section 10 453A.1. 11 Sec. 13. Section 453A.42, subsections 9 and 11, Code 2021, 12 are amended to read as follows: 13 9. “Place of business” means any place where tobacco 14 products are sold or where tobacco products are manufactured, 15 stored, or kept for the purpose of sale or consumption, 16 including any vessel, vehicle, airplane, train, or vending 17 machine; or for a business within or without the state that 18 conducts delivery sales, any place where alternative nicotine 19 products or vapor products are sold or where alternative 20 nicotine products or vapor products are kept for the purpose of 21 sale , including delivery sales . 22 11. “Retailer” means any person engaged in the business 23 of selling tobacco , or tobacco products , alternative nicotine 24 products, or vapor products to ultimate consumers ; and every 25 person within or without the state that conducts delivery 26 sales . 27 Sec. 14. Section 453A.42, subsection 16, Code 2021, is 28 amended by striking the subsection and inserting in lieu 29 thereof the following: 30 16. “Tobacco products” means the same as defined in section 31 453A.1. 32 Sec. 15. Section 453A.42, Code 2021, is amended by adding 33 the following new subsections: 34 NEW SUBSECTION . 01. “Alternative nicotine product” means 35 -8- LSB 1515YH (2) 89 pf/jh 8/ 10

H.F. 98 the same as defined in section 453A.1. 1 NEW SUBSECTION . 17A. “Vapor product” means the same as 2 defined in section 453A.1. 3 Sec. 16. Section 453A.47A, subsections 1, 2, 4, and 5, Code 4 2021, are amended to read as follows: 5 1. Permits required. A person shall not engage in the 6 business of a retailer of tobacco , or tobacco products , 7 alternative nicotine products, or vapor products at any place 8 of business, or through delivery sales, without first having 9 received a permit as a retailer. 10 2. No sales without permit. A retailer shall not sell any 11 tobacco , or tobacco products , alternative nicotine products, or 12 vapor products until an application has been filed and the fee 13 prescribed paid for a permit and until such permit is obtained 14 and only while such permit is not suspended, unrevoked, or 15 unexpired. 16 4. Retailer —— multiple permits not required —— effect of 17 suspension. A retailer, as defined in section 453A.1 , who holds 18 a permit under subchapter I of this chapter is not required to 19 also obtain a retail permit under this subchapter . However, 20 if a retailer, as defined in section 453A.1 , only holds a 21 permit under subchapter I of this chapter and that permit is 22 suspended, revoked, or expired, the retailer shall not sell any 23 tobacco , or tobacco products , alternative nicotine products, or 24 vapor products during the time which the permit is suspended, 25 revoked, or expired. 26 5. Separate permit. A separate retail permit shall be 27 required of a distributor or subjobber if the distributor or 28 subjobber sells tobacco , or tobacco products , alternative 29 nicotine products, or vapor products at retail. 30 Sec. 17. Section 453A.47A, subsection 10, paragraph b, Code 31 2021, is amended to read as follows: 32 b. Every retailer shall, when requested by the department, 33 make additional reports as the department deems necessary and 34 proper and shall at the request of the department furnish full 35 -9- LSB 1515YH (2) 89 pf/jh 9/ 10

H.F. 98 and complete information pertaining to any transaction of the 1 retailer involving the purchase or sale or use of tobacco , 2 or tobacco products , alternative nicotine products, or vapor 3 products . 4 Sec. 18. CODE EDITOR DIRECTIVE. The Code editor shall do 5 all of the following: 6 1. Modify the title of chapter 453A to read “Cigarettes and 7 Tobacco Taxes and Regulation”. 8 2. Modify the subheading of subchapter I of chapter 453A to 9 read “Cigarettes and Tobacco Products”. 10 3. Modify the subheading of subchapter II of chapter 453A to 11 read “Cigars, Tobacco, and Tobacco Products”. 12 4. Modify the heading of section 805.8C, subsection 3, to 13 read “Violations related to smoking, tobacco, tobacco products, 14 and cigarettes”. 15 EXPLANATION 16 The inclusion of this explanation does not constitute agreement with 17 the explanation’s substance by the members of the general assembly. 18 This bill redefines alternative nicotine and vapor products 19 as tobacco products, thereby making applicable to alternative 20 nicotine and vapor products all provisions applicable to 21 tobacco products including taxation of such products. The bill 22 makes conforming changes throughout the Code to redefine these 23 products. 24 -10- LSB 1515YH (2) 89 pf/jh 10/ 10