SB 1603 — America250 specialty plates

(c) The authenticated record was securely linked to biometrics contemporaneously collected from the verified record holder and is stored in a centralized, highly secured, encrypted biometric database.

5.

"Board" means the state liquor board.

6.

"Bona fide guest" means:

(a) An individual who is personally familiar to the member, who is personally sponsored by the member and whose presence as a guest is in response to a specific and personal invitation.

(b) In the case of a club that meets the criteria prescribed in paragraph 8, subdivision (a) of this section, a current member of the armed services of the United States who presents proper military identification and any member of a recognized veterans' organization of the United States and of any country allied with the United States during current or past wars or through treaty arrangements.

7.

"Broken package" means any container of spirituous liquor on which the United States tax seal has been broken or removed or from which the cap, cork or seal placed on the container by the manufacturer has been removed.

8.

"Club" includes any of the following organizations where the sale of spirituous liquor for consumption on the premises is made only to members, spouses of members, families of members, bona fide guests of members and guests at other events authorized in this title:

(a) A post, chapter, camp or other local unit composed solely of veterans and its duly recognized auxiliary that has been chartered by the Congress of the United States for patriotic, fraternal or benevolent purposes and that has, as the owner, lessee or occupant, operated an establishment for that purpose in this state.

(b) A chapter, aerie, parlor, lodge or other local unit of an American national fraternal organization that has, as the owner, lessee or occupant, operated an establishment for fraternal purposes in this state.

An American national fraternal organization as used in this subdivision -2- House Amendments to S.B.

1603 shall actively operate in at least thirty-six states or have been in active continuous existence for at least twenty years.

(c) A hall or building association of a local unit mentioned in subdivisions (a) and (b) of this paragraph of which all of the capital stock is owned by the local unit or the members and that operates the clubroom facilities of the local unit.

(d) A golf club that has more than fifty bona fide members and that owns, maintains or operates a bona fide golf links together with a clubhouse.

(e) A social club that has more than one hundred bona fide members who are actual residents of the county in which it is located, that owns, maintains or operates club quarters, that is authorized and incorporated to operate as a nonprofit club under the laws of this state, and that has been continuously incorporated and operating for a period of at least one year.

The club shall have had, during this one-year period, a bona fide membership with regular meetings conducted at least once each month, and the membership shall be and shall have been actively engaged in carrying out the objects of the club.

The club's membership shall consist of bona fide dues-paying members paying dues of at least $6 per year, payable monthly, quarterly or annually, which have been recorded by the secretary of the club, and the members at the time of application for a club license shall be in good standing having for at least one full year paid dues.

At least fifty-one percent of the members shall have signified their intention to secure a social club license by personally signing a petition, on a form prescribed by the board, which shall also include the correct mailing address of each signer.

The petition shall not have been signed by a member at a date earlier than one hundred eighty days before the filing of the application.

The club shall qualify for exemption from the payment of state income taxes under title 43.

It is the intent of this subdivision that a license shall not be granted to a club that is, or has been, primarily formed or activated to obtain a license to sell liquor, but solely to a bona fide club, where the sale of liquor is incidental to the main purposes of the club.

(f) An airline club operated by or for airlines that are certificated by the United States government and that maintain or operate club quarters located at airports with international status.

9.

"Company" or "association", when used in reference to a corporation, includes successors or assigns.

10.

"Control" means the power to direct or cause the direction of the management and policies of an applicant or licensee, whether through the ownership of voting securities or a partnership interest, by agreement or otherwise.

Control is presumed to exist if a person has the direct or indirect ownership of or power to vote ten percent or more of the outstanding voting securities of the applicant or licensee or to control in any manner the election of one or more of the directors of the applicant or licensee.

In the case of a partnership, control is presumed to mean the general partner or a limited partner who holds ten percent or more of the voting rights of the partnership.

For the purposes of determining the -3- House Amendments to S.B.

1603 percentage of voting securities owned, controlled or held by a person, there shall be aggregated with the voting securities attributed to the person the voting securities of an officer, partner, employee or agent of the person or a spouse, parent or child of the person.

Control is also presumed to exist if a creditor of the applicant or licensee holds a beneficial interest in ten percent or more of the liabilities of the licensee.

The presumptions in this paragraph regarding control are rebuttable.

11.

"Controlling person" means a person directly or indirectly possessing control of an applicant or licensee.

12.

"Craft distiller" means a distiller in the United States or in a territory or possession of the United States that holds a license pursuant to section 4-205.10.

13.

"Craft producer" means a licensed farm winery, a licensed microbrewery or a licensed craft distiller.

14.

"Department" means the department of liquor licenses and control.

15.

"Director" means the director of the department of liquor licenses and control.

16.

"Distilled spirits" includes alcohol, brandy, whiskey, rum, tequila, mescal, gin, absinthe, a compound or mixture of any of them or of any of them with any vegetable or other substance, alcohol bitters, bitters containing alcohol, fruits preserved in ardent spirits, and any alcoholic mixture or preparation, whether patented or otherwise, that may in sufficient quantities produce intoxication.

17.

"Employee":

(a) Means any person who performs any service on licensed premises on a full-time, part-time or contract basis with consent of the licensee, whether or not the person is denominated an employee or independent contractor or otherwise.

Employee (b) Does not include a person who is exclusively on the premises for musical or vocal performances, for repair or maintenance of the premises or for the delivery of goods to the licensee.

18.

"Farm winery" means a winery in the United States or in a territory or possession of the United States that holds a license pursuant to section 4-205.04.

19.

"Government license" means a license to serve and sell spirituous liquor on specified premises available only to a state agency, state board, state commission, county, city, town, community college or state university or the national guard or Arizona coliseum and exposition center on application by the governing body of the state agency, state board, state commission, county, city, town, community college or state university or the national guard or Arizona exposition and state fair board.

20.

"Legal drinking age" means twenty-one years of age or older.

21.

"License" means a license or an interim retail permit issued pursuant to this title.

-4- House Amendments to S.B.

1603 22.

"Licensee" means a person who has been issued a license or an interim retail permit pursuant to this title or a special event licensee.

23.

"License fees" means fees collected for license issuance, license application, license renewal, interim permit issuance and license transfer between persons or locations.

24.

"Manager" means a natural person who meets the standards required of licensees and who has authority to organize, direct, carry on, control or otherwise operate a licensed business on a temporary or full-time basis.

25.

"Menu food item" means a food item from a regular menu, special menu or happy hour menu that is prepared by the licensee or the licensee's employee.

26.

"Microbrewery" means a brewery in the United States or in a territory or possession of the United States that meets the requirements of section 4-205.08.

27.

"Mixed cocktail":

(a) Means any drink combined at the premises of an authorized licensee that contains a spirituous liquor and that is combined with at least one other ingredient, which may include additional spirituous liquors, fruit juice, vegetable juice, mixers, cream, flavored syrup or other ingredients except water, and that when combined contains more than one-half of one percent of alcohol by volume.

(b) Does not include a drink sold in an original manufacturer's packaging or any drink poured from an original manufacturer's package without the addition of all of the cocktail's other ingredients at the premises of the licensed bar, liquor store or restaurant.

28.

"Off-sale retailer" means any person that operates a bona fide regularly established retail liquor store that sells spirituous liquors, wines and beer and any established retail store that sells commodities other than spirituous liquors and that is engaged in the sale of spirituous liquors only in the original unbroken package, to be taken away from the premises of the retailer and to be consumed off the premises.

29.

"On-sale retailer" means any person operating an establishment where spirituous liquors are sold in the original container for consumption on or off the premises or in individual portions for consumption on the premises.

30.

"Permanent occupancy" means the maximum occupancy of the building or facility as set by the office of the state fire marshal for the jurisdiction in which the building or facility is located.

31.

"Person" includes a partnership, limited liability company, association, company or corporation, as well as a natural person.

32.

"Premises" or "licensed premises":

(a) Means the area from which the licensee is authorized to sell, dispense or serve spirituous liquors under the provision of the license.

(b) Includes a patio that is not contiguous to the remainder of the premises or licensed premises if the patio is separated from the remainder of the premises or licensed premises by a public or private walkway or -5- House Amendments to S.B.

1603 driveway not to exceed thirty feet, subject to rules the director may adopt to establish criteria for noncontiguous premises.

33.

"Registered alcohol delivery contractor":

(a) Means a person who delivers spirituous liquor to a consumer on behalf of a bar, beer and wine bar, liquor store, beer and wine store or restaurant.

(b) Does not include:

(i) A motor carrier as defined in section 28-5201.

(ii) An independent contractor, a subcontractor of an independent contractor, an employee of an independent contractor or an employee of a subcontractor as provided in section 4-203, subsection J.

34.

"Registered mail" includes certified mail.

35.

"Registered retail agent" means any person who is authorized pursuant to section 4-222 to purchase spirituous liquors for and on behalf of the person and other retail licensees.

36.

"Repeated acts of violence" means:

(a) For licensed premises with a permanent occupancy of two hundred or fewer persons, two or more acts of violence occurring within seven days or three or more acts of violence occurring within thirty days.

(b) For licensed premises with a permanent occupancy of more than two hundred but not more than four hundred persons, four or more acts of violence within thirty days.

(c) For licensed premises with a permanent occupancy of more than four hundred but not more than six hundred fifty persons, five or more acts of violence within thirty days.

(d) For licensed premises with a permanent occupancy of more than six hundred fifty but not more than one thousand fifty persons, six or more acts of violence within thirty days.

(e) For licensed premises with a permanent occupancy of more than one thousand fifty persons, seven or more acts of violence within thirty days.

37.

"Sell" includes soliciting or receiving an order for, keeping or exposing for sale, directly or indirectly delivering for value, peddling, keeping with intent to sell and trafficking in.

38.

"Spirituous liquor" includes alcohol, brandy, whiskey, rum, tequila, mescal, gin, wine, porter, ale, beer, any malt liquor or malt beverage, absinthe, a compound or mixture of any of them or of any of them with any vegetable or other substance, alcohol bitters, bitters containing alcohol, any liquid mixture or preparation, whether patented or otherwise, that produces intoxication, fruits preserved in ardent spirits, and beverages containing more than one-half of one percent of alcohol by volume.

39.

"Tamperproof sealed" means designed to prevent consumption without the removal of a tamperproof cap, seal, cork or closure that has a device, mechanism or adhesive that clearly shows whether a container has been opened.

40.

"TIMELY FILED PREMARKET TOBACCO PRODUCT APPLICATION" MEANS AN APPLICATION THAT MEETS BOTH OF THE FOLLOWING CRITERIA:

-6- House Amendments to S.B.

1603 (a) WAS FILED PURSUANT TO 21 UNITED STATES CODE SECTION 387j FOR A VAPOR PRODUCT THAT CONTAINS NICOTINE DERIVED FROM TOBACCO AND THAT WAS MARKETED IN THE UNITED STATES AS OF AUGUST 8, 2016.

(b) WAS SUBMITTED TO THE UNITED STATES FOOD AND DRUG ADMINISTRATION ON OR BEFORE SEPTEMBER 9, 2020 AND ACCEPTED FOR FILING.

41.

"VAPOR PRODUCT":

(a) MEANS ANY NONCOMBUSTIBLE PRODUCT THAT CONTAINS NICOTINE AND 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 IN A SOLUTION.

(b) INCLUDES A CONSUMABLE NICOTINE LIQUID SOLUTION SUITABLE FOR USE IN A VAPOR PRODUCT, WHETHER SOLD WITH THE PRODUCT OR SEPARATELY.

(c) DOES NOT INCLUDE ANY PRODUCT REGULATED BY THE UNITED STATES FOOD AND DRUG ADMINISTRATION UNDER SUBCHAPTER V OF THE FEDERAL FOOD, DRUG, AND COSMETIC ACT (52 STAT.

1040;

21 UNITED STATES CODE SECTIONS 351 THROUGH 360fff-8).

40.

42.

"Vehicle" means any means of transportation by land, water or air, and includes everything made use of in any way for such transportation.

41.

43.

"Vending machine" means a machine that dispenses merchandise through the means of coin, token, credit card or other nonpersonal means of accepting payment for merchandise received.

42.

44.

"Veteran" means a person who has served in the United States air force, army, navy, marine corps or coast guard, as an active nurse in the services of the American red cross, in the army and navy nurse corps in time of war, or in any expedition of the armed forces of the United States, and who has received a discharge other than dishonorable.

43.

45.

"Voting security" means any security presently entitling the owner or holder of the security to vote for the election of directors of an applicant or a licensee.

44.

46.

"Wine" means the product obtained by the fermentation of grapes, other agricultural products containing natural or added sugar or cider or any such alcoholic beverage fortified with grape brandy and containing not more than twenty-four percent of alcohol by volume.

3.2.

Section 4-112,28-2403, Arizona Revised Statutes, is amended to read:

4-112.28-2403.

PowersSpecial andplates; duties of board and director of department of liquor licenses and control;

investigations;transfers;

countyviolation; and municipal regulation;

definitionclassification A.

TheExcept boardas shall:otherwise provided in this article, the department shall issue or renew special plates in lieu of the regular license plates pursuant to the following conditions and procedures and only if the requirements prescribed by this article for the requested special plates are met:

GrantExcept as provided in sections 28-2416 and deny28-2416.01, applicationsa inperson accordancewho is the registered owner of a vehicle registered with the provisionsdepartment or who applies for an original or renewal registration of thisa title.vehicle may submit to the department a completed application form as prescribed by the department with the fee prescribed by section 28-2402 for special plates in addition to the registration fee prescribed by section 28-2003.

AdoptExcept rulesfor inplates orderissued pursuant to carrysections out28-2404, the28-2412, provisions28-2413, 28-2414, 28-2416, 28-2416.01, 28-2417 through 28-2470.26 28-2470.27, 28-2472, 28-2473, 28-2474, 28-2475 and 28-2476 and article 14 of this section.chapter, the special plates shall be the same color as and similar to the design of the regular license plates that is determined by the department.

HearExcept appealsas andprovided holdin hearingssection 28-2416, the department shall issue special plates only to the owner or lessee of a vehicle that is currently registered, including any vehicle that has a declared gross weight, as provideddefined in thissection section.28-5431, of twenty-six thousand pounds or less.

COORDINATEExcept ANDas SHAREprovided INFORMATIONin WITHsections THE28-2416 ATTORNEYand GENERAL28-2416.01, REGARDINGthe INVESTIGATIONSdepartment ANDshall VIOLATIONScharge OFthe CHAPTERfee 4prescribed OFby THISsection TITLE.28-2402 for each annual renewal of special plates in addition to the registration fee prescribed by section 28-2003.

Except as provided in subsectionsections A28-2416 ofand this28-2416.01, section,on notification to the directordepartment shalland administeron payment of the provisionstransfer offee thisprescribed title,by includingsection AND28-2402, SHALLa DOperson THEwho FOLLOWING:is issued special plates may transfer the special plates to another vehicle the person owns or leases.

-7-Persons Housewho Amendmentsare issued special plates for hearing impaired persons pursuant to S.B.section 28-2408 and international symbol of access special plates pursuant to section 28-2409 are exempt from the transfer fee.

1603If 1.a person who is issued special plates sells, trades or otherwise releases ownership of the vehicle on which the plates have been displayed, the person shall immediately report the transfer of the plates to the department or the person shall surrender the plates to the department as - 2 - S.B.

Adopting1603 ADOPTprescribed rules:by the director.

(a)It Foris carryingunlawful outfor a person to whom the provisionsplates ofhave thisbeen title.issued to knowingly allow them to be displayed on a vehicle except the vehicle authorized by the department.

(b)C. For the proper conduct of the business to be carried on under each specific type of spirituous liquor license.

(c)The Tospecial enableplates andshall assistbe stateaffixed officialsto andthe politicalvehicle subdivisionsfor towhich collectregistration taxesis leviedsought orin imposedlieu inof connectionthe withregular spirituouslicense liquors.plates.

(d)D. For the issuance and revocation of certificates of registration of retail agents, including provisions governing the shipping, storage and delivery of spirituous liquors by registered retail agents, the keeping of records and the filing of reports by registered retail agents.

(e)A Toperson establishis requirementsguilty forof licenseesa underclass section3 4-209,misdemeanor subsectionwho: B, paragraph 12.

(f)1. TO ESTABLISH AND MAINTAIN A DIRECTORY OF VAPOR PRODUCTS AND MANUFACTURERS OF VAPOR PRODUCTS, CONDUCT INSPECTIONS AND TAKE ENFORCEMENT ACTION PURSUANT TO CHAPTER 4 OF THIS TITLE.

Violates subsection B of this section.

SubjectFraudulently togives titlefalse 41,or chapterfictitious 4,information articlein 4,the employingapplication EMPLOYfor necessaryor personnelrenewal andof fixingspecial FIXplates theiror compensationplacards issued pursuant to sectionthis 38-611.article.

KeepingConceals KEEP an index record that is a publicmaterial recordfact openor tootherwise publiccommits inspectionfraud andin that contains the nameapplication andfor addressor ofrenewal each licensee and the name and address of anyspecial personplates having an interest, either legal or equitable,placards inissued eachpursuant licenseto asthis shownarticle. by any written document that is placed on file in the office of the board.

4.Sec.

Providing3. PROVIDE the board with supplies and personnel as directed by the board.

5.Title 28, chapter 7, article 12, Arizona Revised Statutes, is amended by adding section 28-2470.27, to read:

Responding28-2470.27. RESPOND in writing to any law enforcement agency that submits an investigative report to the department relating to a violation of this title, setting forth what action, if any, the department has taken or intends to take on the report and, if the report lacks sufficient information or is otherwise defective for use by the department, what the agency must do to remedy the report.

6.America250 special plates;

Takingfund TAKEA. steps that are necessary to maintain effective liaison with THE ATTORNEY GENERAL, the department of public safety and all local law enforcement agencies in the enforcement of this title, including the laws of this state against the consumption of spirituous liquor by persons under the legal drinking age.

7.IF, BY DECEMBER 31, 2025, A PERSON PAYS $32,000 TO THE DEPARTMENT FOR THE IMPLEMENTATION OF THIS SECTION, THE DEPARTMENT SHALL ISSUE AMERICA250 SPECIAL PLATES.

ProvidingTHE PROVIDEPERSON trainingTHAT toPROVIDES lawTHE enforcement$32,000 agenciesSHALL inDESIGN theTHE properAMERICA250 investigationSPECIAL andPLATES. reporting of violations of this title.

THE DESIGN AND COLOR OF THE AMERICA250 SPECIAL PLATES ARE SUBJECT TO APPROVAL OF THE DEPARTMENT.

THE DIRECTOR MAY ALLOW A REQUEST FOR AMERICA250 SPECIAL PLATES TO BE COMBINED WITH A REQUEST FOR PERSONALIZED SPECIAL PLATES.

IF THE DIRECTOR ALLOWS SUCH A COMBINATION, THE REQUEST SHALL BE IN A FORM PRESCRIBED BY THE DIRECTOR AND IS SUBJECT TO THE FEES FOR THE PERSONALIZED SPECIAL PLATES IN ADDITION TO THE FEES REQUIRED FOR THE AMERICA250 SPECIAL PLATES.

B.

OF THE $25 FEE REQUIRED BY SECTION 28-2402 FOR THE ORIGINAL SPECIAL PLATES AND FOR THE RENEWAL OF SPECIAL PLATES, $8 IS A SPECIAL PLATE ADMINISTRATION FEE AND $17 IS AN ANNUAL DONATION.

TheTHE directorDEPARTMENT shallSHALL establishDEPOSIT, withinPURSUANT theTO departmentSECTIONS a35-146 separateAND investigations35-147, unitALL thatSPECIAL hasPLATE asADMINISTRATION itsFEES soleIN responsibilityTHE theSTATE investigationHIGHWAY ofFUND complianceESTABLISHED withBY thisSECTION title,28-6991 includingAND theSHALL investigationTRANSMIT ofALL licenseesDONATIONS allegedCOLLECTED toPURSUANT haveTO soldTHIS orSECTION distributedTO spirituousTHE liquorAMERICA250 inSPECIAL anyPLATE formFUND toESTABLISHED personsBY underTHIS theSECTION. legal drinking age.

Investigations conducted by this unit may include covert undercover investigations.

AllTHE employeesAMERICA250 ofSPECIAL thePLATE departmentFUND ofIS liquorESTABLISHED licensesCONSISTING andOF control,MONIES exceptDEPOSITED membersPURSUANT ofTO theTHIS stateSECTION. liquor board and the director of the department, shall be employed by the department in the manner prescribed by the department of administration.

-8-THE HouseDIRECTOR AmendmentsSHALL toADMINISTER S.B.THE FUND.

1603THE E.FIRST $32,000 IN THE FUND SHALL BE REIMBURSED TO THE ENTITY THAT PAID THE IMPLEMENTATION FEE TO THE DEPARTMENT PURSUANT TO SUBSECTION A OF THIS SECTION.

TheNOT directorMORE mayTHAN enterTEN intoPERCENT aOF contractTHE orMONIES agreementDEPOSITED withIN anyTHE publicFUND agencyANNUALLY forSHALL anyBE jointUSED orFOR cooperativeTHE actionCOST asOF providedADMINISTERING forTHE byFUND. title 11, chapter 7, article 3.

MONIES IN THE FUND ARE CONTINUOUSLY APPROPRIATED.

E.

THROUGH DECEMBER 31, 2026, THE DIRECTOR SHALL MONTHLY ALLOCATE MONIES FROM THE AMERICA250 SPECIAL PLATE FUND TO THE ARIZONA AMERICA250 COMMISSION TO PAY COSTS RELATED TO AMERICA250 PROJECTS AND EVENTS.

FROM AND AFTER DECEMBER 31, 2026, THE DIRECTOR SHALL ANNUALLY ALLOCATE MONIES - 3 - S.B.

1603 FROM THE AMERICA250 SPECIAL PLATE FUND TO THE STATE LIBRARY FUND ESTABLISHED BY SECTION 41-151.06.

TheON boardNOTICE orFROM theTHE directorDIRECTOR, mayTHE takeSTATE evidence,TREASURER administerSHALL oathsINVEST orAND affirmations,DIVEST issueMONIES subpoenasIN requiringTHE attendanceFUND andAS testimonyPROVIDED ofBY witnesses,SECTION cause35-313, depositionsAND toMONIES beEARNED takenFROM andINVESTMENT requireSHALL byBE subpoenaCREDITED ducesTO tecumTHE theFUND. production of books, papers and other documents that are necessary for the enforcement of this title.

ProceedingsSec. held during the course of a confidential investigation are exempt from title 38, chapter 3, article 3.1.

If4. a person refuses to obey a subpoena or fails to answer questions as provided by this subsection, the board or the director may apply to the superior court in the manner provided in section 12-2212.

TheSection board28-6501, orArizona directorRevised mayStatutes, serveis subpoenasamended byto personalread: service or certified mail, return receipt requested.

G.28-6501.

TheDefinition directorof may:highway user revenues In this article, unless the context otherwise requires or except as otherwise provided by statute, "highway user revenues" means all monies received in this state from licenses, taxes, penalties, interest and fees authorized by the following:

ExamineChapters books,2, records7, 8 and papers15 of athis licenseetitle, ORexcept Afor: RETAILER, DISTRIBUTOR OR WHOLESALER OF VAPOR PRODUCTS.

(a) The special plate administration fees prescribed in sections 28-2404, 28-2407, 28-2412 through 28-2470.26 28-2470.27 and 28-2514.

(b) The donations prescribed in sections 28-2404, 28-2407, 28-2412 through 28-2415, 28-2417 through 28-2470.26 28-2470.27, 28-2473, 28-2474, 28-2475 and 28-2476.

RequireSection applicants,28-1177. licensees, employees who serve, sell or furnish spirituous liquors to retail customers, managers and managing agents to take training courses approved by the director in spirituous liquor handling and spirituous liquor laws and rules.

The director shall adopt rules that set standards for approving training courses.

The director may suspend or revoke the previous approval of trainers who do not adhere to course administration requirements prescribed by the department or who do not meet course standards.

If the director suspends or revokes the previous approval of a trainer pursuant to this paragraph, the trainer may appeal to the board pursuant to section 4-210.02 as if the suspension or revocation was a sanction against a licensee.

After January 1, 2019, The rules for on-sale retailer basic training and on-sale retailer management training shall include security procedures for security personnel assigned to monitor admission of patrons, interaction with patrons, calls to law enforcement and strategies for use of force and for the use of de-escalation techniques.

If the retailer uses a registered security guard, the retailer shall attempt to verify the validity and status of the security guard's registration certificate.

The department's licensed investigators may participate and receive compensation as lecturers at approved training courses within this state's jurisdiction that are conducted by other entities but shall not participate in in-house training programs for licensees.

DelegateChapters to10 employeesand of11 the department authority to exercise powers of thethis directortitle. in order to administer the department.

RegulateChapter signs16, thatarticles advertise1, a2 spirituousand liquor4 productof atthis licensedtitle, retailexcept premises.as provided in sections 28-5926 and 28-5927.

5.

Cause to be removed from the marketplace spirituous liquor that may be contaminated.

6.

Regulate the age and conduct of erotic entertainers at licensed premises.

The age limitation governing these erotic entertainers may be different from other employees of the licensee.

-9- House Amendments to S.B.

1603 7.

Issue and enforce cease and desist orders against any person or entity that sells beer, wine or spirituous liquor without an appropriate license or permit AND IMPOSE PENALTIES AND TAKE OTHER ACTION AGAINST RETAILERS, DISTRIBUTORS, WHOLESALERS OR MANUFACTURERS OF VAPOR PRODUCTS.

8.

Confiscate wines carrying a label including a reference to Arizona or any Arizona city, town or place unless at least seventy-five percent by volume of the grapes used in making the wine were grown in this state.

9.

Accept and expend private grants of monies, gifts and devises for conducting educational programs for parents and students on the repercussions of underage alcohol consumption.

State general fund monies shall not be expended for the purposes of this paragraph.

If the director does not receive sufficient monies from private sources to carry out the purposes of this paragraph, the director shall not provide the educational programs prescribed in this paragraph.

Grant monies received pursuant to this paragraph are nonlapsing and do not revert to the state general fund at the close of the fiscal year.

10.

Procure fingerprint scanning equipment and provide fingerprint services to license applicants and licensees.

The department may charge a fee for providing these services.

11.

Accept electronic signatures on all department and licensee forms and documents and applications.

The director may adopt requirements that would require facsimile signatures to be followed by original signatures within a specified time period.

12.

For use after January 1, 2019, Adopt a form that is required to be used by all on-sale retailers that hire or designate employees to serve as security personnel.

All security personnel job applicants and employees for on-sale retailers shall complete the form, which shall be notarized, before assignment to a security role.

The form shall require the applicant or other person to disclose whether in the previous five years the person has been a registered sex offender or pled guilty TO, pled no contest TO or been convicted of any offense that constitutes assault, homicide, domestic violence, sexual misconduct, misconduct involving a deadly weapon or a drug violation that constitutes the illegal sale, manufacturing, cultivation or transportation for sale of marijuana, a dangerous drug or a narcotic drug.

A licensee may not hire or assign to a role as security personnel any person who fails to complete the form or if the WHOSE form discloses one of the listed offenses within the previous five years.

The licensee shall maintain on file affidavits of all security personnel hired or designated by the licensee.

The form may not be required for a peace officer who is certified by the Arizona peace officer standards and training board or other security personnel who hold a current security guard registration certificate or armed security guard registration certificate issued pursuant to title 32, chapter 26.

H.

A county or municipality may enact and enforce ordinances regulating the age and conduct of erotic entertainers at licensed premises in a manner at least as restrictive as rules adopted by the director.

-10- House Amendments to S.B.

1603 I.

For the purposes of this section, "security personnel":

1.

Includes individuals whose primary assigned responsibilities include the security and safety of employees and patrons of an on-sale retailer premises.

Security personnel 2.

Does not include a person whose primary responsibilities include checking the identification cards of patrons to determine compliance with age requirements.

4.

Section 4-114, Arizona Revised Statutes, is amended to read:

4-114.

Interest in business prohibited;

forfeiture of office A.

Except for a member designated by the governor to be appointed from the industry, no member of the board or the director or any employee of the department shall be financially interested directly or indirectly in any business THAT IS licensed to deal in spirituous liquors OR THAT MANUFACTURES OR SELLS VAPOR PRODUCTS.

B.

Violation of this section by the director or any member of the board shall be deemed a resignation by such person, and a violation by an employee of the department shall result in his THE EMPLOYEE'S immediate dismissal.

Sec.

Section 4-118,28-6991, Arizona Revised Statutes, is amended to read:

4-118.28-6991.

InspectionState ofhighway premisesfund; The director, the director's agents and any peace officer may, in enforcing the provisions of this title, MAY visit during the hours in which the premises are occupied and inspect the premises of a licensee OR A RETAILER, DISTRIBUTOR OR WHOLESALER OF VAPOR PRODUCTS.

Sec.sources The state highway fund is established that consists of:

6.

Section 4-209, Arizona Revised Statutes, is amended to read:

4-209.

Fees for license, application, issuance, renewal, transfer and certification;

late renewal penalty;

seasonal operation;

surcharges A.

A fee shall accompany an application for an original license or transfer of a license, or in case of renewal, shall be paid in advance.

Every license expires annually, except that a license may be renewed for a two-year period pursuant to subsection M of this section if no compliance penalties have been issued to that location during the year before the renewal.

A licensee who fails to renew the license on or before the due date shall pay a penalty of $150, which the licensee shall pay with the renewal fee.

A license renewal that is deposited, properly addressed and postage prepaid in an official depository of the United States mail on or before the due date shall be deemed filed and received by the department on the date shown by the postmark or other official mark of the United States postal service stamped on the envelope.

If the due date falls on a Saturday, Sunday or other legal holiday, the renewal shall be considered timely if it is received by the department on the next business day.

The director may waive a late renewal penalty if good cause is shown by the licensee.

A licensee who fails to renew the license on or before the due date may not sell, purchase or otherwise deal in spirituous liquor until the license is renewed.

A license that is not renewed within sixty days after the due date is deemed terminated.

The director may renew the terminated license if good cause is shown by the licensee.

Except an -11- House Amendments to S.B.

1603 application fee for a permit pursuant to section 4-203.07 and section 4-205.02, subsection K and leases pursuant to sections 4-203.06 and 4-203.07, an application fee for an original license or the transfer of a license shall be $100, which shall be retained by this state.

B.

Issuance fees for original licenses shall be:

ForMonies andistributed in-statefrom producer'sthe licenseArizona tohighway manufactureuser orrevenue producefund spirituouspursuant liquorto inchapter this18 state,of $1,500.this title.

ExceptMonies asappropriated providedby inthe paragraphlegislature. 15 of this subsection, for an out-of-state producer's, exporter's, importer's or rectifier's license, $200.

ForMonies areceived microbreweryfrom license,donations $300.for the construction, improvement or maintenance of state highways or bridges.

These monies shall be credited to a special account and shall be spent only for the purpose indicated by the donor.

ForMonies areceived wholesaler'sfrom licensecounties toor sellcities spirituousunder liquors,cooperative $1,500.agreements, including proceeds from bond issues.

The state treasurer shall deposit these monies to the credit of the fund in a special account on delivery to the treasurer of a concise written agreement between the department and the county or city stating the purposes for which the monies are surrendered by the county or city, and these monies shall be spent only as stated in the agreement.

ForMonies areceived governmentfrom licensethe issuedUnited inStates under an act of Congress to provide aid for the nameconstruction of arural statepost agency,roads, statebut commission,monies statereceived board,on county,projects city,for town,which communitythe collegemonies ornecessary to be provided by this state universityare orwholly derived from sources mentioned in paragraphs 2 and 3 of this section shall be allotted by the nationaldepartment guard,and $100.deposited by the - 4 - S.B.

1603 state treasurer in the special account within the fund established for each project.

On completion of the project, on the satisfaction and discharge in full of all obligations of any kind created and on request of the department, the treasurer shall transfer the unexpended balance in the special account for the project into the state highway fund, and the unexpended balance and any further federal aid thereafter received on account of the project may be spent under the general provisions of this title.

ForMonies ain barthe license,custody whichof is an on-saleofficer retailer'sor licenseagent toof sellthis allstate spirituousfrom liquorsany primarilysource bythat individualis portionsto andbe inused for the originalconstruction, containers,improvement $1,500.or maintenance of state highways or bridges.

ForMonies adeposited beerin andthe winestate bargeneral license,fund whichand isarising anfrom on-salethe retailer'sdisposal licenseof tostate sellpersonal beerproperty andbelonging wineto primarily by individual portions and in the originaldepartment. containers, $1,500.

ForReceipts afrom conveyance license issued to an operating railroad company, to sell all spirituous liquors in individual portions or in the originalsale containers on all passenger trains operated by the railroad company, or todisposal anof operatingany airline company, to sell or serve spirituous liquors solely in individual portions on all passengerother planesproperty operatedheld by the airlinedepartment company,and orpurchased towith astate boathighway operatingmonies. in the waters of this state, to sell all spirituous liquors in individual portions or in the original containers for consumption on the boat, $1,500.

ForMonies agenerated liquorpursuant store license, which is an off-sale retailer's license to sellsection all28-410. spirituous liquors, $1,500.

ForMonies adistributed beerpursuant andto winesection store28-5808, license,subsection whichB, isparagraph an2, off-salesubdivision retailer's(d). license to sell beer and wine, $1,500.

ForMonies adeposited hotel-motelpursuant licenseto issuedsections as28-1143, such,28-2353 to sell and serve28-3003. spirituous liquors solely for consumption on the licensed premises of the hotel or motel, $1,500.

ForExcept a restaurant license issued as such,provided toin sellsection and28-5101, serve spirituous liquors solely for consumption on the licensedfollowing premisesmonies: of the restaurant, $1,500.

For(a) aMonies permitdeposited issuedpursuant underto section 4-205.02,28-2206 subsectionand Hsection allowing28-5808, forsubsection theB, sale of beer for the consumption off the licensed premises pursuant to section 4-244, paragraph 32,2, subdivision (c),(e). the director may charge a fee.

For(b) an$1 applicationof foreach aregistration permitfee pursuant to section 4-203.07 and section$1 4-205.02,of subsectioneach K,title thefee directorcollected maypursuant chargeto asection fee.28-2003.

The(c) director$2 mayof establisheach andlate chargeregistration feespenalty forcollected leaseby applicationsthe director pursuant to sectionssection 4-203.0628-2162. and 4-203.07.

(d) The air quality compliance fee collected pursuant to section 49-542.

(e) The special plate administration fees collected pursuant to sections 28-2404, 28-2407, 28-2412 through 28-2416, 28-2416.01, 28-2417 through 28-2470.26 28-2470.27 and 28-2514.

(f) Monies collected pursuant to sections 28-372, 28-2155 and 28-2156 if the director is the registering officer.

ForMonies adeposited farmpursuant wineryto license,chapter $100.5, article 5 of this title.

The14. director may charge a licensed farm winery a fee pursuant to section 4-205.04, subsection K.

-12-Donations Housereceived Amendmentspursuant to S.B.section 28-2269.

1603 14.

For a club license issued in the name of a bona fide club qualified under this title to sell all spirituous liquors on-sale, $1,000.

ForDealer anand out-of-stateregistration winerymonies thatcollected sellspursuant notto moresection than28-4304. two hundred forty gallons of wine in this state in a calendar year, $25.

TheAbandoned departmentvehicle mayadministration chargemonies adeposited feepursuant forto asection craft28-4804. distiller license.

TheMonies departmentdeposited maypursuant chargeto asection fee28-710, forsubsection registeringD, anparagraph alcohol2. delivery contractor pursuant to section 4-205.13.

C.18.

TheMonies departmentdeposited maypursuant issue licenses with staggered renewal dates to distributesection the28-2065. renewal workload as uniformly as practicable throughout the twelve months of the calendar year.

If19. a license is issued less than six months before the scheduled renewal date of the license, as provided by the department's staggered license renewal system, one-half of the annual license fee shall be charged.

D.Monies deposited pursuant to section 28-7311.

The- annual5 fees- forS.B. licenses shall be:

1603 20.

Monies deposited pursuant to section 28-7059.

21.

Monies deposited pursuant to section 28-1105.

22.

Monies deposited pursuant to section 28-2448, subsection D.

23.

Monies deposited pursuant to section 28-3415.

24.

Monies deposited pursuant to section 28-3002, subsection A, paragraph 14.

25.

Monies deposited pursuant to section 28-7316.

26.

Monies deposited pursuant to section 28-4302.

27.

Monies deposited pursuant to section 28-3416.

28.

Monies deposited pursuant to section 28-4504.

29.

Monies deposited pursuant to section 28-2098.

30.

Monies deposited pursuant to sections 28-2321, 28-2324, 28-2325, 28-5474, 28-5739, 28-5863 and 28-5864.

Sec.

6.

Section 28-6993, Arizona Revised Statutes, is amended to read:

28-6993.

State highway fund;

authorized uses A.

Except as provided in subsection B of this section and section 28-6538, the state highway fund shall be used for any of the following purposes in strict conformity with and subject to the budget as provided by this section and by sections 28-6997 through 28-7003:

ForTo anpay in-statesalaries, producer'swages, licensenecessary totravel manufactureexpenses orand produceother spirituousexpenses liquorsof inofficers thisand state,employees $350.of the department and the incidental office expenses, including telegraph, telephone, postal and express charges and printing, stationery and advertising expenses.

ExceptTo aspay provided in paragraph 15 of this subsection, for anboth: out-of-state producer's, exporter's, importer's or rectifier's license, $50.

(a) Equipment, supplies, machines, tools, department offices and laboratories established by the department.

(b) The construction and repair of buildings or yards of the department.

ForTo apay microbrewerythe license,cost $300.of both:

(a) Engineering, construction, improvement and maintenance of state highways and parts of highways forming state routes.

(b) Highways under cooperative agreements with the United States that are entered into pursuant to this chapter and an act of Congress providing for the construction of rural post roads.

ForTo apay wholesaler'sland license,damages toincurred sellby spirituousreason liquors,of $250.establishing, opening, altering, relocating, widening or abandoning portions of a state route or state highway.

ForTo areimburse government license issued to a county, city or town, community college or state university or the nationaldepartment guard,revolving $100.account.

ForTo apay barpremiums license,on whichauthorized isindemnity anbonds on-saleand retailer'son licensecompensation toinsurance sellunder all spirituous liquors primarily by individual portions and in the originalworkers' containers,compensation $150.act.

ForTo adefray beerlawful expenses and winecosts barrequired license,to whichadminister isand ancarry on-saleout retailer'sthe licenseintent, purposes and provisions of this title, including repayment of obligations entered into pursuant to sellthis beertitle, andpayment wineof primarilyinterest byon individualobligations portionsentered andinto inpursuant theto originalthis containers,title, $75.repayment of - 6 - S.B.

1603 loans and other financial assistance, including repayment of advances and interest on advances made to the department pursuant to section 28-7677, and payment of all other obligations and expenses of the board and department pursuant to chapter 21 of this title.

ForTo apay conveyancelawful licensebills issuedand tocharges anincurred operating railroad company, to sell all spirituous liquors in individual portions or in the original containers on all passenger trains operated by the railroadstate company,engineer. or to an operating airline company, to sell or serve spirituous liquors solely in individual portions on all passenger planes operated by the airline company, or to a boat operating in the waters of this state, to sell all spirituous liquor in individual portions or in the original containers for consumption on the boat, $225.

ForTo aacquire, liquorconstruct storeor license,improve whichentry isroads anto off-salestate retailer'sparks licenseor toroads sellwithin allstate spirituousparks. liquors, $50.

ForTo aacquire, beerconstruct andor wineimprove storeentry license,roads which is an off-sale retailer's license to sellstate beerprisons. and wine, $50.

ForTo apay hotel-motelthe licensecost issuedof asrelocating such,a toutility sellfacility andpursuant serveto spirituoussection liquors28-7156. solely for consumption on the licensed premises of the hotel or motel, $500.

For athe restaurantpurposes licenseprovided issuedin assubsections such,C, toD sell and serveE spirituous liquors solely for consumption on the licensed premises of thethis restaurant,section $500, and forsections a28-1143, restaurant28-2353 licenseand that28-3003. is allowed to continue operating as a restaurant pursuant to section 4-213, subsection E, an -13- House Amendments to S.B.

1603 additional amount established by the director.

The department shall transfer this amount to the state treasurer for deposit in the state general fund.

The director may establish an annual fee for a permit pursuant to section 4-203.07 and section 4-205.02, subsection K.

The director may charge annual lease amounts pursuant to sections 4-203.06 and 4-203.07.

ForTo apay farmthe winerycost license,of $100.issuing an Arizona centennial special plate pursuant to section 28-2448.

The director may charge a licensed farm winery an annual fee pursuant to section 4-205.04, subsection K.

ForTo apay clubfor licenseall issuedof in the namefollowing: of a bona fide club qualified under this title to sell all spirituous liquors on-sale, $150.

15.(a) The enforcement by the department of public safety and the department of transportation of vehicle safety requirements within twenty-five miles of the border between this state and Mexico.

For(b) anCosts out-of-staterelated wineryto thatprocuring sellselectronic notequipment, moreautomated thansystems twoor hundredimprovements fortyto gallonsexisting electronic equipment or automated systems for relieving vehicle congestion at ports of wineentry inon thisthe stateborder inbetween athis calendarstate year,and $25.Mexico.

16.(c) Constructing, maintaining and upgrading transportation facilities, including roads, streets and highways, approved by the board within twenty-five miles of the border between this state and Mexico.

The(d) directorAs mayapproved chargeby athe feeboard, forconstructing and maintaining transportation facilities in the annualCANAMEX renewalhigh priority corridor as defined in section 332 of athe craftnational distillerhighway license.system designation act of 1995 (P.L.

17.104-59;

The109 departmentStat. may charge a fee for the annual registration renewal of a registered alcohol delivery contractor pursuant to section 4-205.13.

568).

(e) Activities of the department that include collecting transportation and trade data in the United States and Mexico for the purposes of constructing transportation facilities, improving public safety, improving truck processing time and relieving congestion at ports of entry on the border between this state and Mexico.

The department may enter into an agreement with the Arizona-Mexico commission and provide funding to the commission for the purposes of this subdivision.

(f) A commitment or investment necessary for the department or another agency of this state to obtain federal monies that are designated for expenditure pursuant to this section.

B.

For each fiscal year, the department of transportation shall allocate and transfer monies in the state highway fund to the department of public safety for funding a portion of highway patrol costs in eight installments in each of the first eight months of a fiscal year that do not exceed $10,000,000.

- 7 - S.B.

1603 C.

Subject to legislative appropriation, the department may use the monies in the state highway fund as prescribed in section 28-6991, paragraph 12 to carry out the duties imposed by this title for registration or titling of vehicles, to operate joint title, registration and driver licensing offices, to cover the administrative costs of issuing the air quality compliance sticker, modifying the year validating tab and issuing the windshield sticker and to cover expenses and costs in issuing special plates pursuant to sections 28-2404, 28-2407, 28-2412 through 28-2470.26 28-2470.27 and 28-2514.

D.

The department shall use monies deposited in the state highway fund pursuant to chapter 5, article 5 of this title only as prescribed by that article.

WhereMonies thedeposited business of an on-sale retail licensee is seasonal, not extending over periods of more than six months in any calendar year, the licenseestate mayhighway designatefund thepursuant periodsto ofsection operation28-2269 andshall a license may be grantedused foronly thoseas periods only, on payment of one-half of the fee prescribed inby subsectionthat D of this section.

TransferMonies feesdeposited fromin personthe tostate personhighway forfund licenses transferred pursuant to section 4-203,28-710, subsection CD, paragraph 2 shall only be $300.used for state highway work zone traffic control devices.

TransferThe feesdepartment frommay locationexchange monies distributed to location,the asstate providedhighway forfund inpursuant to section 4-203,28-6538, shallsubsection beA, $100.paragraph 1 for local government surface transportation program federal monies suballocated to councils of government and metropolitan planning organizations if the local government scheduled to receive the federal monies concurs.

An exchange of state highway fund monies pursuant to this subsection shall be in an amount that is at least equal to ninety percent of the federal obligation authority that exists in the project for which the exchange is proposed.

AssignmentThe feesdepartment forshall ause changemonies ofdeposited agent, as provided for in sectionthe 4-202,state subsectionhighway A,fund anpursuant acquisitionto of control, as provided for in section 4-203,28-1105, subsection F,A, orparagraph a2, restructuring,subdivision as(a) providedonly for ina sectiontransportation 4-203,facility subsection H, shall be $100, except that whereis alocated licenseewithin holdstwenty multipledrivable licensesmiles andof requests multiple, simultaneous changes, the changeinternational ofport agent, acquisition of controlentry orand restructuring fee for the first license shall bespend $100 and the feemonies forproportionally allbased remainingon licenses shall be $50 each, except that the aggregateamount fees shall not exceed $1,000 for all change of agents,total $1,000monies forcollected allpursuant acquisitionsto ofsection control28-1105, andsubsection $1,000A, forparagraph all2, restructurings.subdivision (a).

I.For the purposes of this subsection, "transportation facility" means a highway or a state route or a county, city or town road that is used by a commercial vehicle or a commercial vehicle combination for which an axle fee is paid pursuant to section 28-5474.

No fee shall be charged by the department for an assignment of a liquor license in probate or an assignment pursuant to the provisions of a will or pursuant to a judicial decree in a domestic relations proceeding that assigns ownership of a business that includes a spirituous liquor license to one of the parties in the proceeding.

In the case of nontransferable licenses, no fee shall be charged by the department for the issuance of a license for a licensed business pursuant to a transfer of the business in probate or pursuant to the provisions of a will or pursuant to a judicial decree in a domestic relations proceeding that assigns ownership of the business to one of the parties in the proceeding.

J.

The director shall assess a surcharge of $30 on all licenses prescribed in subsection D, paragraphs 6, 7 and 12 of this section.

Monies -14- House Amendments to S.B.

1603 from the surcharge shall be used by the department exclusively for the costs of an auditor and support staff to review compliance by applicants and licensees with the requirements of section 4-205.02, subsection E.

The department shall assess the surcharge as part of the annual license renewal fee.

K.

The director shall assess a surcharge of $35 on all licenses prescribed in this section.

Monies from the surcharge shall be used by the department exclusively for the costs of an enforcement program to investigate licensees who have been the subject of multiple complaints to the department.

The enforcement program shall respond to complaints against licensees by neighborhood associations, by neighborhood civic groups and from municipal and county governments.

The department shall assess the surcharge as part of the annual license renewal fee.

L.

The director shall assess a surcharge of $20 on all licenses prescribed in subsection D, paragraphs 11 and 12 of this section and $35 on all other licenses prescribed in this section.

Monies from the surcharge and from surcharges imposed pursuant to subsection K of this section shall be used by the department exclusively for the costs of a neighborhood association interaction and liquor enforcement management unit.

The unit shall respond to complaints from neighborhood associations, neighborhood civic groups and local governing authorities regarding liquor violations.

The director shall report the unit's activities and the use of monies from the surcharge or surcharges imposed pursuant to subsection K of this section to the board at each board meeting or as the board may direct.

M.

Licenses may be renewed every two years with payment of license fees that are twice the amount designated in subsection D of this section and other applicable fees.

Licensees renewing every two years must comply with annual reporting requirements.

The director may adopt reasonable rules to allow licensees to renew every two years.

N.

THE DEPARTMENT SHALL CHARGE A FEE FOR THE CERTIFICATION REQUIRED PURSUANT TO SECTION 4-401.

THE DEPARTMENT SHALL USE ALL MONIES RECEIVED FROM FEES FOR CERTIFICATIONS SUBMITTED PURSUANT TO SECTION 4-401 TO IMPLEMENT AND ENFORCE SECTION 4-401.

N.

O.

The department shall use all monies received from application fees for permits issued pursuant to section 4-205.02, subsection K, leases pursuant to sections 4-203.06 and 4-203.07 and registrations pursuant to section 4-205.13 for administrative costs associated with the permit, registration or lease and enforcement of this chapter.

TitleSection 4,41-151.06, Arizona Revised Statutes, is amended by adding chapter 4, to read:

CHAPTER41-151.06. 4 VAPOR PRODUCTS ARTICLE 1.

GENERALState PROVISIONSlibrary 4-401.administrative agency;

Vaporstate products;library fund A.

certification;The state library is the state library administrative agency, and the director may accept, on behalf of the state, any allocation of monies or materials made by the federal government for state library purposes, any appropriation of state monies for the purposes of this article or any bequest, grant or gift to the state library, and administer - 8 - S.B.

fees;1603 all of them under rules adopted by the director, unless otherwise provided by law.

directory;The administration may not be inconsistent with the conditions of the allocation, appropriation, bequest, grant or gift.

violation;

classification;

civil penalties;

manufacturer's agent;

surety bonds;

annual report A.

ON OR BEFORE OCTOBER 1, 2025 AND ANNUALLY THEREAFTER, EACH MANUFACTURER OF A VAPOR PRODUCT THAT IS SOLD IN THIS STATE FOR RETAIL SALE -15- House Amendments to S.B.

1603 OR TO A CONSUMER IN THIS STATE, WHETHER DIRECTLY OR THROUGH AN IMPORTER, WHOLESALER, DISTRIBUTOR, RETAILER OR SIMILAR INTERMEDIARY OR INTERMEDIARIES, SHALL EXECUTE AND SUBMIT TO THE DIRECTOR A CERTIFICATION ON A FORM AND IN A MANNER PRESCRIBED BY THE DIRECTOR AND UNDER PENALTY OF PERJURY THAT THE MANUFACTURER IS COMPLIANT WITH THIS CHAPTER AND THAT, FOR EACH VAPOR PRODUCT SOLD FOR RETAIL SALE IN THIS STATE OR TO A CONSUMER IN THIS STATE, ONE OF THE FOLLOWING APPLIES:

1.

THE MANUFACTURER RECEIVED A MARKETING GRANTED ORDER FOR THE VAPOR PRODUCT FROM THE UNITED STATES FOOD AND DRUG ADMINISTRATION PURSUANT TO 21 UNITED STATES CODE SECTION 387j.

2.

THE MANUFACTURER SUBMITTED A TIMELY FILED PREMARKET TOBACCO PRODUCT APPLICATION FOR THE VAPOR PRODUCT TO THE UNITED STATES FOOD AND DRUG ADMINISTRATION PURSUANT TO 21 UNITED STATES CODE SECTION 387j AND THE APPLICATION MEETS ONE OF THE FOLLOWING CRITERIA:

(a) REMAINS UNDER REVIEW BY THE UNITED STATES FOOD AND DRUG ADMINISTRATION.

(b) HAS RECEIVED A DENIAL ORDER THAT HAS BEEN AND REMAINS STAYED BY THE UNITED STATES FOOD AND DRUG ADMINISTRATION OR COURT ORDER, RESCINDED BY THE UNITED STATES FOOD AND DRUG ADMINISTRATION OR VACATED BY A COURT.

THEThe MANUFACTURERstate ISlibrary NOTfund REQUIREDis TOestablished. SUBMIT AN ADDITIONAL MARKETING GRANTED ORDER OR PREMARKET TOBACCO PRODUCT APPLICATION FOR THE VAPOR PRODUCT SOLELY BECAUSE OF CHANGES TO THE NAME, BRAND STYLE OR PACKAGING OF A VAPOR PRODUCT THAT IS COVERED UNDER SUBSECTION A, PARAGRAPH 1 OR 2 OF THIS SECTION.

All monies received pursuant to this section and section SECTIONS 28-2470.27 AND 41-151.05, except for federal monies, shall be deposited, pursuant to sections 35-146 and 35-147, in the fund and accounted for separately.

Monies in the accounts are continuously appropriated to the state library for the purposes provided for in the fund sources, and monies in the fund are exempt from the provisions of section 35-190 relating to lapsing of appropriations.

On notice from the director, the state treasurer shall invest and divest monies in the fund as provided by section 35-313, and monies earned from investment shall be credited to the fund.

ANAll ANNUALfederal CERTIFICATIONmonies FILEDreceived PURSUANTas TOprovided SUBSECTIONby Athis OFsection THISshall SECTIONbe SHALLdeposited, COMPLYpursuant WITHto THEsections FOLLOWING35-146 CONDITIONS:and 35-147, in a separate account of the fund and disbursed in the manner prescribed for the disbursement of state funds, but are not subject to section 35-190 relating to lapsing of appropriations.

1.- 9 -

SEPARATELY LIST EACH BRAND NAME, PRODUCT NAME, CATEGORY AND FLAVOR FOR EACH VAPOR PRODUCT THAT IS SOLD IN THIS STATE.

2.

BE ACCOMPANIED BY EITHER OF THE FOLLOWING:

(a) A COPY OF EITHER:

(i) THE MARKETING GRANTED ORDER ISSUED BY THE UNITED STATES FOOD AND DRUG ADMINISTRATION PURSUANT TO 21 UNITED STATES CODE SECTION 387j.

(ii) THE ACCEPTANCE LETTER ISSUED BY THE UNITED STATES FOOD AND DRUG ADMINISTRATION PURSUANT TO 21 UNITED STATES CODE SECTION 387j FOR A TIMELY FILED PREMARKET TOBACCO PRODUCT APPLICATION.

(b) A DOCUMENT ISSUED BY THE UNITED STATES FOOD AND DRUG ADMINISTRATION OR BY A COURT CONFIRMING THAT THE TIMELY FILED PREMARKET TOBACCO PRODUCT APPLICATION HAS RECEIVED A DENIAL ORDER THAT HAS BEEN AND REMAINS STAYED BY THE UNITED STATES FOOD AND DRUG ADMINISTRATION OR COURT ORDER, RESCINDED BY THE UNITED STATES FOOD AND DRUG ADMINISTRATION OR VACATED BY A COURT.

D.

AN ANNUAL CERTIFICATION SUBMITTED PURSUANT TO SUBSECTION A OF THIS SECTION SHALL BE ACCOMPANIED BY A FEE FOR EACH VAPOR PRODUCT THE FIRST TIME A MANUFACTURER SUBMITS A CERTIFICATION FOR THAT VAPOR PRODUCT AND AN ANNUAL FEE FOR EACH VAPOR PRODUCT EACH TIME A MANUFACTURER SUBMITS AN ANNUAL CERTIFICATION FOR THAT VAPOR PRODUCT.

THE FEE SHALL BE PRESCRIBED BY THE DIRECTOR PURSUANT TO SECTION 4-209.

-16- House Amendments to S.B.

1603 E.

INFORMATION SUBMITTED TO THE DEPARTMENT BY THE MANUFACTURER PURSUANT TO SUBSECTION C, PARAGRAPH 2 OF THIS SECTION SHALL BE CONSIDERED CONFIDENTIAL COMMERCIAL OR FINANCIAL INFORMATION AND IS EXEMPT FROM TITLE 39, CHAPTER 1, ARTICLE 2.

THE MANUFACTURER MAY REDACT CERTAIN CONFIDENTIAL COMMERCIAL OR FINANCIAL INFORMATION PROVIDED UNDER SUBSECTION C, PARAGRAPH 2 OF THIS SECTION.

F.

TO THE EXTENT THAT THE REQUIREMENTS OR STANDARDS RELATED TO 21 UNITED STATES CODE SECTION 387j OR SUBSEQUENT REGULATIONS OR OTHER FEDERAL GUIDANCE OR FORMAL POLICY STATEMENTS ARE ISSUED THAT CHANGE COMPLIANCE REQUIREMENTS OR STANDARDS FOR A VAPOR PRODUCT TO BECOME FEDERALLY COMPLIANT, EACH MANUFACTURER OF A VAPOR PRODUCT THAT IS SOLD FOR RETAIL SALE IN THIS STATE OR TO A CONSUMER IN THIS STATE SHALL SUBMIT DOCUMENTATION TO THE DIRECTOR THAT SHOWS COMPLIANCE WITH THAT NEW FEDERAL REQUIREMENT OR STANDARD.

FAILURE TO SHOW COMPLIANCE WITH ANY NEW FEDERAL REQUIREMENTS OR STANDARDS SHALL BE GROUNDS FOR REMOVAL OF THE MANUFACTURER AND THE MANUFACTURER'S VAPOR PRODUCTS FROM THE DIRECTORY ESTABLISHED PURSUANT TO SUBSECTION H OF THIS SECTION.

G.

A MANUFACTURER REQUIRED TO SUBMIT A CERTIFICATION PURSUANT TO SUBSECTION A OF THIS SECTION SHALL NOTIFY THE DIRECTOR WITHIN THIRTY DAYS AFTER ANY MATERIAL CHANGE TO THE CERTIFICATION FORM, INCLUDING THE ISSUANCE OR DENIAL OF A MARKETING AUTHORIZATION OR OTHER ORDER BY THE UNITED STATES FOOD AND DRUG ADMINISTRATION PURSUANT TO 21 UNITED STATES CODE SECTION 387j OR ANY OTHER ORDER OR ACTION BY THE UNITED STATES FOOD AND DRUG ADMINISTRATION OR ANY COURT THAT AFFECTS THE ABILITY OF THE VAPOR PRODUCT TO BE INTRODUCED OR DELIVERED INTO INTERSTATE COMMERCE FOR COMMERCIAL DISTRIBUTION IN THE UNITED STATES.

H.

BEGINNING DECEMBER 1, 2025, THE DIRECTOR SHALL MAINTAIN AND MAKE PUBLICLY AVAILABLE ON THE DEPARTMENT'S OFFICIAL WEBSITE A DIRECTORY THAT LISTS ALL VAPOR PRODUCT MANUFACTURERS AND ALL VAPOR PRODUCTS FOR WHICH CERTIFICATION FORMS HAVE BEEN SUBMITTED AND APPROVED BY THE DIRECTOR.