SENATE COMMITTEE ON COMMERCE

 

 

March 03, 2005                                                                                                       Hearing Room C

3:10 P.M.                                                                                                                      Tapes 25 - 27

 

MEMBERS PRESENT:         Sen. Floyd Prozanski, Chair

Sen. Roger Beyer, Vice-Chair

Sen. Ginny Burdick

Sen. Doug Whitsett

 

MEMBER EXCUSED:          Sen. Charlie Ringo

 

STAFF PRESENT:                 Anna Braun, Committee Administrator

Karen Scoffield, Committee Assistant

 

MEASURES/ISSUES HEARD:        

                                                SB 713 – Public Hearing

                                                SB 738 – Public Hearing

                                                SB 931 – Public Hearing

 

These minutes are in compliance with Senate and House Rules.  Only text enclosed in quotation marks reports a speaker’s exact words.  For complete contents, please refer to the tapes.

 

TAPE/#

Speaker

Comments

TAPE 25, A

005

Chair Prozanski

Calls the meeting to order at 3:17 p.m.  Opens public hearing on SB 713.

SB 713 – PUBLIC HEARING

010

Sen. Jeff Kruse

Senate District 1.  Testifies in support of SB 713.  

050

Anna Braun

Committee Administrator.  Provides an overview of SB 713.

060

Sen. Kruse

Comments that the fine and the penalty in the bill were not his idea.  Also remarks that SB 713 is targeted at retail, not wholesale.

070

Chair Prozanski

Comments on sanction in SB 713.

075

Paul Romain

Oregon Petroleum Association.  Testifies in opposition to SB 713.  Comments that the bill deals with non-retail sales.  Discusses problems with displaying prices because of the variety of negotiated prices. 

120

Sen. Whitsett

Asks what type of fiscal impact SB 713 would have on the petroleum providers.

125

Romain

Answers that it very hard to gauge.

135

Sen. Whitsett

Comments on the difficulty of posting pricing. 

140

Romain

Comments that if someone doesn’t like the system they can still purchase where pricing is posted at a retail station.

145

Sen. Beyer

Mentions Sen. Kruse’s comments about using a computerized system to show pricing and asks if Romain feels that it is feasible.

155

Romain

Answers that it would depend on volume. Comments that there are many variables that go into pricing.

165

Sen. Beyer

Discusses personal experience with the non-retail sale of petroleum.

175

Romain

Discusses options to find out pricing when a contract is signed.

176

Sen. Beyer

Comments that it could be an option to show the cost and then each persons discount would be off of that base.

183

Romain

Responds.

187

Chair Prozanski

Closes public hearing on SB 713 and opens public hearing on SB 738 and SB 931.

SB 738, 931 – PUBLIC HEARING

194

Anna Braun

Committee Administrator.  Provides an overview of SB 738 and SB 931.  Introduces proposed -1 amendments to SB 738 (EXHIBIT A).   Remarks that EXHIBIT A will combine SB 738 and SB 931 into one bill.

220

Sen. Beyer

Submits written testimony on behalf of the Korean – American Grocers Association (KAGRO of Oregon) in opposition to SB 738 and SB 931 (EXHIBIT B).

225

Chair Prozanski

Clarifies that EXHIBIT A folds SB 931 into SB 738.

230

Braun

Answers, yes.

235

Tom Whelan

Citizen, Multnomah County, Oregon.  Testifies in support of SB 738 and SB 931.  Provides background on his interest in SB 738 and SB 931. Discusses personal experience as a firefighter and as a former state representative and his interest in the use of fire safe cigarettes.

355

Tim Birr

Citizen, Washington, County, Oregon.  Discusses and submits written testimony (EXHIBIT C), a preliminary report dated January 24, 2005 on “Fire Safer” Cigarettes (EXHIBIT D) and a research paper on fire safe cigarettes (EXHIBIT E) in support of SB 738 and SB 931.  Discusses previous experience as a firefighter and as a public information officer.

TAPE 26, A

015

Birr

Discusses previous attempts in Oregon and throughout the country to pass similar legislation regarding fire safe cigarettes. Summarizes and concludes.

065

Andrew McGuire

Executive Director, Trauma Foundation – San Francisco General Hospital.  Testifies in support of SB 738 and SB 931.  Remarks that New York has a fire safe cigarette law and all cigarette companies were able to change cigarettes to become fire safe for New York.  Remarks that he has testified 3 times in the United States Senate and House of Representatives in 9 state legislatures on this subject.   

120-270

McGuire

Shows video clip regarding fire safe cigarettes.

271

Whelan

Discusses the purpose of SB 738 and SB 931.  Discusses background regarding the need of the bill. Discusses forest fires in Oregon and remarks that fire safe cigarettes will help prevent forest fires.

335-390

Whelan

Shows a second video clip regarding fire safe cigarettes.

391

Whelan

Summarizes and concludes.

410

Rep. Mitch Green

House District 3.  Testifies in support of SB 738 and SB 931.  Discusses previous experience regarding the proposed bills.  Discusses the need of the bills.  States that he had a very similar bill drafted this session in the House of Representatives.

TAPE 25, B

035

Chair Prozanski

Submits written testimony on behalf of Melvin Thornton, District Manager, Douglas Forest Protective Association (EXHIBIT F).

045

Nancy Orr

State Fire Marshall, Oregon Department of State Police. Discusses and submits written testimony in support of SB 738 and SB 931 (EXHIBIT G).

090

Jim Goold

R.J. Reynolds, Lorrilord.  Testifies in opposition to SB 738 and SB 931.  Remarks that no other state has passed legislation adopting fire safe cigarettes other than New York.  Responds to previous testimony. Submits an excerpt of the Overview on the Practicability of Developing a Performance Standard to Reduce Cigarette Ignition Propensity (EXHIBIT H), a Fiscal Note from the Maine Legislature (EXHIBIT I) a report on the Monthly Gross and Net Tax Collections from the New York State Department of Taxation and Finance (EXHIBIT J) and a Fiscal Note from the New Hampshire Legislature (EXHIBIT M).

180

Goold

Discusses the desire to see a report on New York and the effects of their change to fire safe cigarettes.  Continues to testify in opposition to SB 738 and SB 931.

275

Goold

Summarizes and concludes. Remarks that this should be taken care of in Washington as a federal law and not in the states.

295

Sen. Burdick

Inquires regarding Goold’s comments on revenue going down and asks if there is something about fire safe cigarettes that make people smoke less.

300

Goold

Answers that it is too early to tell, but that they do know that people in New York go to other sources to obtain cigarettes that are not fire safe.

310

Sen. Burdick

Clarifies Goold’s response.

312

Goold

Responds.

315

Sen. Burdick

Asks about Goold’s comments regarding some of the cigarettes having increased carbon monoxide.

323

Goold

Responds that a measuring technique was used.

332

Sen. Burdick

Raises concern of Goold’s comments saying a solution should be to make furniture fire proof when there are studies showing fire retardant chemicals in breast milk.

340

Goold

Responds. Discusses fire retardants used on fabrics and furnishings.

360

Sen. Burdick

Inquires if Goold will lead the charge nationwide if he finds that the data from New York indicates that fire safe cigarettes are preventing fires.

363

Goold

Responds.  Answers that he cannot predict what his role would be.

370

Chair Prozanski

Inquires how many states have considered similar legislation since the law was passed in New York.

373

Goold

Estimates ten to fifteen.

375

Chair Prozanski

Comments that New Hampshire appears to be moving forward with the legislation, as it has passed 15-0 out of one of their chambers.  Inquires if there are any others that are currently having similar legislation this year.

390

Goold

Responds.  

405

Chair Prozanski

Inquires if pipe tobacco or cigars have a higher carbon monoxide content than cigarettes, since something causes them to self extinguish.

420

Goold

Answers that he does not know enough to respond.

425

Chair Prozanski

Inquires if there have been any lawsuits filed against tobacco companies not providing fire safe cigarettes when they have the ability.

TAPE 26, B

015

Goold

Answers that he does not know of pending lawsuits. Discusses knowledge of some cases from the past.

030

Chair Prozanski

Inquires if New York has had any type of tobacco cessation programs that would effect the numbers provided by Goold.

040

Goold

Responds that it would be difficult to break out the figures. 

050

Chair Prozanski

Refers to an example in the video where a New York cigarette and a regular cigarette were both lit and placed in a chair and the New York cigarette went out and the other cigarette continued to emblaze the chair.  Asks if Goold knows of a reason why one cigarette caused a fire to develop and one did not.

060

Goold

Comments regarding skepticism of examples on television.  Discusses other studies performed on fabrics.

070

Chair Prozanski

Inquires what would be a significant enough decline in fires for Goold’s companies to change to fire safe cigarettes nationwide. 

075

Goold

Comments that he cannot answer because he is not a statistician. Remarks that they are watching New York carefully to see if the fire safe cigarettes are really working.

080

Sen. Whitsett

Inquires regarding the difference in cost between the regular paper and the paper used on fire safe cigarettes.

082

Goold

Answers that the cost information is proprietary.  Comments that it has been said that there is a significant cost differential.

090

Sen. Whitsett

Inquires if it would still be higher if it was mandated on a national basis and only one type of paper was being used.

095

Goold

Responds that if there was competition he would assume the cost would go down.

100

Sen. Whitsett

Discusses causes of fires from cigarettes.  Inquires if the possibility of fires from people using more matches to relight cigarettes has been considered.

115

Goold

Responds. 

130

David May

President, Rich and Rhine. Testifies in opposition to SB 738 and SB 931. Discusses the potential financial impact to their company and the challenge of carrying two different types of cigarettes because they supply for Washington and Oregon. Discusses a possible decrease in cigarette tax revenue for Oregon.

212

Sen. Whitsett

Inquires what it would cost in May’s line of credit if he had an incremental change in 1% with an interest rate going up.

215

May

Answers that he borrows $6 million on a daily basis at prime plus one and a half.  Responds that this is atypical of the business because of the competition.

220

Chair Prozanski

Asks what the impact has been for overseas brands that serviced New York.

230

May

Answers that JT International has not been able to service New York.

235

Goold

Interjects that they are not aware how enforcement will work in New York regarding people obtaining different cigarettes.

250

Chris Girard

President and CEO, Plaid Pantries, Inc.  Director, Oregon Neighborhood Store Association  Discusses and submits written testimony in opposition to SB 738 and SB 931 (EXHIBIT K)

385

Girard

Continues.  Discusses possible loss of taxes on cigarettes because of people obtaining cigarettes elsewhere. Provides statistics on taxes on cigarettes in Oregon.

TAPE 27, A

020

Dan Floyd

Oregon Grocery Association.  Discusses and submits written testimony in opposition to SB 738 and SB 931 (EXHIBIT L). Discusses desire for a national uniform standard.

060

Sen. Whitsett

Asks Girard about his comment that the timing of the proposed legislation would create a competitive disadvantage.

062

Girard

Responds.  Discusses problems with having legislation in Oregon, but not in Washington or nationally.

065

Chair Prozanski

Comments that there will be an additional public hearing on SB 738 and SB 931.  Closes public hearing on SB 738 and SB 931.  Adjourns the meeting at 5:14 p.m.

 

EXHIBIT SUMMARY

 

  1. SB 738, -1 amendments, staff, 5 pp
  2. SB 738, 931, written testimony of Oregon Korean American Grocers Association, Sen. Roger Beyer, 1 p
  3. SB 738, 931, written testimony, Tim Birr, 2 pp
  4. SB 738, 931, preliminary report, Tim Birr, 40 pp
  5. SB 738, 931, research paper, Tim Birr, 8 pp
  6. SB 738, 931, written testimony of Melvin Thornton, Sen. Floyd Prozanski, 1 p
  7. SB 738, 931, written testimony, Nancy Orr, 2 pp
  8. SB 738, 931, overview, Jim Goold, 2 pp
  9. SB 738, 931, fiscal note, Jim Goold, 1 p
  10. SB 738, 931, report, Jim Goold, 8 pp
  11. SB 738, 931, written testimony, Chris Girard, 4 pp
  12. SB 738, 931, written testimony, Dan Floyd, 1 p

 

The following exhibit is listed out of order in the body of the tape log:

M.  SB 738, 931, fiscal note, Jim Goold, 2 pp