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HB 1033 And Its Effects

Update: HB 1033 has passed. This post has been edited to reflect what it means going forward.

What you need to know.

House Bill 1033 was introduced on January 4th, 2019, with the intention to allow local Colorado governments to to impose their own, presumably more strict, laws, as well as higher taxes, on tobacco products. 

It does so by removing the previous restrictions that were in place preventing counties from imposing their own tobacco laws through fiscal penalties. Counties currently have the capability to impose their own taxes, but are not able to access any monies collected by Colorado if they do so, due to the state’s own policy on taxes of tobacco products.

The bill will allow every community to regulate tobacco products differently, as long as they are above Colorado’s state regulations. 

On March 28th, Governor Jared Polis signed an amended version of HB 1033, which still accomplishes the same goals as the initial draft. 

The summary of the bill from Colorado General Assembly is as follows:

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Sections 1, 2, and 4 of the bill authorize a county to enact a resolution or ordinance that prohibits a minor from possessing or purchasing cigarettes, tobacco products, or nicotine products. Sections 1 and 2 also authorize a county to impose regulations on cigarettes, tobacco products, or nicotine products that are more stringent than statewide regulations, including prohibiting sales to a person under 21 years of age, and section 4 expressly authorizes a county to enact a resolution or ordinance regulating the sale of cigarettes, tobacco products, or nicotine products to minors. Section 3 expressly authorizes a statutory or home rule city or town to enact an ordinance regulating the sale of cigarettes, tobacco products, or nicotine products to minors.
From state income tax money, the state currently apportions an amount equal to 27% of state cigarette tax revenues to cities, towns, and counties in proportion to the amount of state sales tax revenues collected within their boundaries. In order to receive their allocation of this money, cities, towns, and counties are prohibited from imposing their own fees, licenses, or taxes on cigarette sales or from attempting to impose a tax on cigarettes. Section 5 removes this prohibition, thus allowing cities, towns, and counties to impose fees, licenses, or taxes on cigarette sales without losing their apportioned state cigarette tax revenues.
Section 6 authorizes a statutory or home rule city or town or a county, if approved by a vote of the people within the statutory or home rule city or town or county, to impose a special sales tax on the sale of cigarettes, tobacco products, or nicotine products and provides a mechanism by which a county's special sales tax applies to a municipality within the boundary of the county unless the municipality, if approved by a vote of the people within the municipality, enacts its own such special sales tax; however, the county and municipality may then enter into an intergovernmental agreement authorizing the county to continue to levy, collect, and enforce its special sales tax within the corporate limits of the municipality.
Section 7 makes a conforming amendment.
(Note: This summary applies to the reengrossed version of this bill as introduced in the second house.)

What Does It Mean For You?

While it may not seem immediately impactful, CASAA sums up the larger picture in relation to HB 1033:

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Today, people who smoke (and now the vaping community) are demonized to the point that the power has shifted to public health organizations that lobby against anything connected to tobacco and nicotine–even if it’s new, safer, smoke-free products that could save millions of lives. Allowing local governments to impose stricter regulations on safer alternatives to combustible tobacco is part of a larger strategy to create a patchwork of regulation that forces the legislature to take action and adopt stricter laws that deny access to these products uniformly across the state.

The passing of 1033, which succeeded despite the opposition and final calls for governor Polis to veto the bill, will lead to local battles throughout the state. The first of these battles is an upcoming tobacco 21 proposal in Denver, which appeared immediately after the ink was dry on 1033. The proposal in Denver is only the first of many local bills we will see regarding tobacco 21, taxes, and outright flavor bans, as communities start to craft their own laws. That is to say: our opposition will only increase as we see more of these bills introduced state-wide. 

Jordan Helsley