In the past several months, a growing number of California cities and counties have considered local ordinances that would ban the retail sale of flavored tobacco products, including menthol cigarettes and menthol, mint and wintergreen tobacco products. These California localities include Contra Costa County, Oakland, San Francisco and San Leandro.
There are serious concerns that the National Association of Tobacco Outlets (NATO) is raising with the studies, data and reports relied upon by these local governments and advocates to support the flavor bans. These proposed ordinances often claim that 90 percent of adults began smoking by age 18 and that the majority of middle school and high school students that use tobacco products started with flavored tobacco products.
For the state of California, this data should no longer be relied upon to support additional restrictions and prohibitions on the retail sale of tobacco products because the studies were conducted based on a legal age of 18 to purchase and use tobacco products. With the legal age to purchase now 21 in California, the ability of anyone under the age of 21—and, in particular, anyone under the age of 18—to obtain tobacco products is even more severely curtailed.
In 2016, the U.S. Food and Drug Administration (FDA) issued the initial findings of a major study titled the “Population Assessment of Tobacco and Health (PATH).” The PATH study confirmed that the majority of youth under the age of 18 obtain tobacco products from what are called “social sources.” Social sources are older friends, adult siblings, parents and even strangers who purchase tobacco products legally and then provide them to underage youth.
With the age 21 law now in place, high school students will no longer be able to rely on 18-year-old seniors to legally purchase and then provide them with tobacco products. This reduction in availability of tobacco through social sources is referenced in another study sponsored by the FDA and conducted by the Institute of Medicine, which concluded that raising the minimum legal age to 21 would mean that those who can legally obtain tobacco are less likely to be in the same social networks as high school students.
The point is that because the proposed ordinance has a goal of protecting the health of underage youth, local lawmakers in California need to allow the age 21 law to increase the difficulty for anyone under age 21 to obtain tobacco products instead of banning the sale of legal, flavored tobacco products to everyone who is 21 or older.
The proposed ordinance also cites a recommendation contained in a report by the FDA’s Tobacco Product Scientific Advisory Committee that menthol cigarettes should be removed from the marketplace. Local lawmakers cannot and should not rely on this report to support passage of the flavored tobacco product sales ban.
In July 2014, the United States District Court for the District of Columbia ruled in a lawsuit filed against the FDA and the Tobacco Product Scientific Advisory Committee that members of the committee had conflicts of interest and that the findings and the recommendations of this report are “at a minimum, suspect, and, at worst, untrustworthy.” With this case now on appeal, it would be inappropriate for the city of Oakland to adopt a ban on menthol-flavored cigarettes and to rely on this report, even in part, to support adoption of the ordinance.
According to industry sales data, a complete ban on all flavored tobacco products, including menthol cigarettes, flavored cigars, pipe tobacco, electronic cigarettes and vapor products and flavored moist chewing tobacco, would result in the average convenience store located in Oakland losing $83,626 in annual net income on lost tobacco sales alone. The $83,626 in net income can make up a significant portion of a store’s annual profit because the business model for a convenience store relies on gasoline sales at the outside pumps, plus tobacco sales making up 36 percent of in-store sales.
This significant decline in net income will be exacerbated because of the loss of other product sales, including gasoline, snacks and beverages when adult customers simply drive a short distance to an adjacent city to buy their preferred tobacco products and make other purchases. These supplementary purchases of gasoline, snacks and beverages are very important revenue sources for a retail store to remain profitable. The severe impact on sales means that many family-owned retail stores would no longer remain profitable enough to remain in business.
This potential outcome is why local retailers need to become engaged in the public debate on these kinds of local ordinances to protect their right to sell tobacco products and the right of their legal-age customers to purchase tobacco products.
– Contributed by Thomas A. Briant, executive director
of the National Association of Tobacco Outlets (NATO)
This story first appeared in the July/August 2017 issue of Tobacco Business magazine. Members of the tobacco industry are eligible for a complimentary subscription to our magazine. Click here for details.