Key Points:

• Arizona lawmakers pass legislation to crack down on retailers selling vaping devices to minors

• Bill restricts packaging and design of vaping products, including bans on cartoon characters and celebrity images

• Legislation does not impose taxes on vaping products despite containing nicotine

Arizona lawmakers have given final approval to what proponents are calling the state’s first ever set of tools to crack down on retailers who sell vapes and other alternative nicotine products to minors.

House Bill 4001 includes restrictions on how these items can be packaged, with specific prohibitions on using visuals like cartoon characters and celebrity images to promote the products, and even how the devices can be designed. There also is first-time-ever requirement for state licensing and new penalties for those who are found to repeatedly sell vapes and tobacco to minors, including $10,000 fines and the suspension of licensing.

Foes, however, said the measure doesn’t go nearly far enough given what they’ve called a lack of resources to actually find offending retailers. And they point out that while the devices contain nicotine, the state is not imposing the same taxes it does on cigarettes, cigars, and other tobacco products with the same chemical.

Brian Hummell, who lobbies for the American Cancer Society Cancer Action Network, said he will urge Gov. Katie Hobbs to veto the measure when it comes to her desk. He said his fear is that lawmakers, thinking they’ve solved the problem of teen vaping, will conclude they’ve done enough and see no need for further revisions.

“Let’s do something next year,” Hummell said, saying no bill is better than this.

But Rep. Jeff Weninger, who guided the package over a host of hurdles and compromises, called the legislation nothing short of “historic.” The Chandler Republican said it was the first time in years that all sides, including tobacco companies, vape manufacturers and dealers, retailers and even the Attorney General’s Office have agreed to sit down and get behind something that they can support.

More significantly, he said that nothing in HB4001 precludes future lawmakers from making other changes.

“That’s how you get things done in the Legislature,” Weninger said, beginning with incremental change that can get the necessary votes for approval. And that, he said, is something that Hummell doesn’t understand.

“He doesn’t negotiate,” Weninger said.

The legislation starts by providing — for the first time ever in Arizona law — a definition of “alternative nicotine products.” That includes anything that contains nicotine, intended for human consumption in any form, but is not combustible.

That, then, becomes the base for new regulations, starting with advertising.

Off limits would be any “cartoon-like fictional character that mimics a character primarily aimed at entertaining.” Also banned would be celebrity images or anything designed to look like products normally marketed to minors.

Vaping products also could not be sold if they are designed to look like something else, like school supplies, smart phones, backpacks, cosmetics, toys, or food or beverage products. The legislation allows offending products to be seized.

“It attacks the illicit vapes coming in from foreign countries that we don’t know what’s in it by providing licensing,” said Weninger.

And then there are the fines.

There already are some penalties for the sale of tobacco products to minors. But these are petty offenses which usually result only in a fine.

HB4001 not only expands the fines to include vaping products but establishes an entirely new penalty structure.

That starts at $500 for selling to minors. But it goes up to $10,000 for four or more violations within 24 months, a criminal conviction, and the loss of the ability to sell both tobacco and vaping products for a year.

Hummell was not impressed.

“There are no additional resources that are put into the enforcement mechanism,” he said.

Hummell said that the Attorney General’s Office reports it currently does about 2,000 checks of retailers right now to ensure they are not selling tobacco to minors. And he said there are anywhere from 5,500 to 8,000 retailers.

What that means, Hummell said, is that on average, there would be just one compliance check every 36 months. And that, he said, makes the ultimate penalty “pretty far-fetched” because no one would get inspected four or more times in that 24-month period.

There’s one more big objection to HB4001. Unlike tobacco products, there would be no such levy on vaping products even though they, too, contain nicotine.

The levy on a pack of cigarettes is now $2 a pack, with similar levies on chewing tobacco and cigars based on either number or weight. The revenues are earmarked for programs that fund early childhood development, health care, research and prevention programs.

Rep. Cesar Aguilar said one benefit of the higher taxes – aside from the programs they fund – is to deter people from smoking in the first place.

“The tax did such a good job that people stopped smoking,” said the Phoenix Democrat.

But now that has made vaping a more affordable option, particularly for children. And Aguilar told colleagues during voting on the measure that he thinks he knows the reason behind opposition to similar levies on vaping.

“Because there is money to be made,” he said. “And ‘Big Vapes’ and alternative nicotine don’t want to deter children from smoking.”

The lack of a new tax also means no new money for the programs that have been funded by the now-diminishing revenues from tobacco taxes.

One impacted program is First Things First, which uses a 2006 voter-approved tax on tobacco to fund programs for early childhood education and development.

In the 2008 budget year, taxes generated $164.8 million. For the 2025 budget year, that was down to $88.6 million.

Weninger, however, said putting a tax hike into the legislation would have just killed the entire package.

“And then we’re just back at the status quo,” he said, with no change at all.

Anyway, Weninger said, if groups want more dollars for their programs they can do what they did in 2006: put the issue to voters. In fact, he suggested, they might even add a new levy on marijuana to raise a lot more money.

“I think it would actually pass,” he said.

That political reality of having to compromise to get the necessary votes – versus ending up with nothing – was brought home by Rep. Kevin Volk.

The Tucson Democrat said he sees the issue from the perspective of a business owner, recognizing that higher prices drive down demand. So he crafted his own regulatory proposal, one that would have imposed a tax on vaping products equal to 50% of the retail price.

Projections from the Seidman Research Institute at Arizona State University said that kind of levy would raise anywhere from $45.5 million to $64.4 million a year

His bill, however, did not get a hearing. But Volk voted for Weninger’s measure, saying he recognized that any advance in regulation was going to take time and compromise.

“This is a piece of the puzzle,” Volk said, with the possibility he said to do “so much more” in the future.