LEGISLATIVE FISCAL ESTIMATE

ASSEMBLY, No. 2388

STATE OF NEW JERSEY

221st LEGISLATURE

 

DATED: MAY 7, 2024

 

 

SUMMARY

 

Synopsis:

Requires inspections of retail cigarette and vapor product dealers.

Type of Impact:

Annual local expenditure and revenue increases.

Agencies Affected:

Local governments; Department of Health; Department of Law and Public Safety.

 

 

Office of Legislative Services Estimate

Fiscal Impact

Annual

 

Local Expenditure Increase

Indeterminate

 

Local Revenue Increase

Indeterminate

 

 

 

 

·         The Office of Legislative Services (OLS) concludes that this bill will increase expenditures for local governments by an indeterminate amount annually to perform the mandatory inspections of retail cigarette and vapor product dealers.  

·         It is also likely that the bill’s mandatory inspection requirement will lead to the issuance of additional violations by county and municipal enforcement agencies and result in an indeterminate amount of annual revenue for the municipalities in which these violations occur.

 

BILL DESCRIPTION

 

     This bill requires an official authorized by the Office of the Attorney General or the Department of Health, including any county or municipal law enforcement agency, to inspect retail cigarette and vapor product dealers at least twice annually for violations of current State law regarding cigarettes and vapor products that have a characterizing flavor.  The bill also requires the official to perform a follow-up inspection within three months following a violation. 


 

FISCAL ANALYSIS

 

EXECUTIVE BRANCH

 

      None received.

 

 

OFFICE OF LEGISLATIVE SERVICES

 

      The OLS concludes that this bill will increase expenditures for local governments by an indeterminate amount annually to perform the mandatory inspections of retail cigarette and vapor product dealers.  It is also likely that the bill’s mandatory inspection requirements will lead to the issuance of additional violations by county and municipal enforcement agencies and result in an indeterminate amount of annual revenue for the municipalities in which these violations occur.  This estimate assumes that the responsibilities of the Office of the Attorney General and the Department of Health under the bill would not result in any fiscal impact to the State. 

      At present, State law authorizes local public health and law enforcement officials to issue a summons for violations of the State’s existing prohibition against selling: 1) cigarettes that have a characterizing flavor other than tobacco, clove, or menthol; and 2) vapor products that have a characterizing flavor.  Generally, enforcement efforts vary by municipality, with no minimum inspection requirement provided in existing statute.  This bill mandates two inspections annually with a follow up inspection required when violations are found.  Costs incurred under the bill would be due to additional staff and equipment, such as automobiles, needed to meet the bill’s inspection requirements. 

      The cost increase under the bill would not affect all local governments equally.  For example, a large number of retailers requiring inspection in a jurisdiction would result in higher expenditures under the bill for that jurisdiction.  For reference, according to the federal government, there were 12,528 tobacco retailers, which includes retailers of both cigarettes and vapor products, in New Jersey as of 2020.  Conversely, to the extent that a local entity currently complies, even partially, with the provisions of the bill, the cost of the bill to these entities would be reduced.

      Assuming the bill would require local governments to increase the number of inspections of retail cigarette and vapor product dealers, the OLS concludes that municipal revenues will increase by an indeterminate amount from a greater number of violations.  As provided in current law, for violations of the State’s ban on most flavored cigarettes, there is a civil penalty of not less than $250 for the first violation, not less than $500 for the second violation, and $1,000 for the third and each subsequent violation.  These amounts are doubled for violations of the ban on flavored vapor products.  The OLS cannot determine the number of additional violations that will occur or estimate the total additional revenue that will be collected by municipalities.

 

Section:

Human Services

Analyst:

Sarah Schmidt

Lead Research Analyst

Approved:

Thomas Koenig

Legislative Budget and Finance Officer

 

This legislative fiscal estimate has been produced by the Office of Legislative Services due to the failure of the Executive Branch to respond to our request for a fiscal note.

 

This fiscal estimate has been prepared pursuant to P.L.1980, c.67 (C.52:13B-6 et seq.).