3rd Reading Unamended
March 14, 2007
Amended 2nd Reading
March 13, 2007
First Regular Session
Sixty-sixth General Assembly
STATE OF COLORADO
This Version Includes All Amendments
Adopted in the House of Introduction
LLS NO. 07-0330.01 Duane Gall HOUSE BILL 07-1108
Health and Human Services
A BILL FOR AN ACT
Concerning implementation of the cigar-tobacco bar exemption under the "Colorado Clean Indoor Air Act", and, in connection therewith, authorizing local governments to adopt procedures for the certification of cigar-tobacco bars, enacting a default procedure under the authority of the department of revenue, specifying that a cigar-tobacco bar must rent humidors, and making an appropriation.
(Note: This summary applies to this bill as introduced and does not necessarily reflect any amendments that may be subsequently adopted.)
Makes legislative findings. Specifies that in order to qualify as a "cigar-tobacco bar" under the exemption provided in the 2006 "Colorado
Clean Indoor Air Act", a bar must have derived part of its 2005 annual gross income from the rental of on-site humidors. Changes the term "tobacco products" to "cigars or cigar tobacco" and specifies that cigarette sales are not included for purposes of meeting the income threshold requirement.
Clarifies the application of the cigar-tobacco bar exemption by requiring the owner of a bar desiring to qualify for the exemption to annually obtain a certificate from a local authority, or from the Colorado department of revenue (department) if the local authority has not adopted a process for issuing such certificates. Requires the department to audit the applicant's books and records and to charge the applicant a fee in an amount sufficient to cover the cost of the audit. If the audit concludes that the threshold requirements have been met, requires the department to issue a certificate to the applicant, who must then prominently display the certificate on the premises.
Makes issuance of the certificate prima facie proof of compliance with the requirements for the cigar-tobacco bar exemption, and makes the lack of a certificate conclusive proof of noncompliance.
Be it enacted by the General Assembly of the State of Colorado:
SECTION 1. Legislative declaration. (1) The general assembly finds, determines, and declares that there is a need for a process to certify establishments seeking to make use of the "cigar-tobacco bar" exemption stated in section 25-14-205 (1) (e), Colorado Revised Statutes. Where local authorities are willing and able to adopt such a certification process they should be authorized to do so. Where no local process exists, the general assembly finds that the department of revenue is the agency best suited to make this determination. In any event, it is in the public interest to provide a method to confirm, clearly and quickly, whether an establishment has met the statutory requirements without the need for protracted litigation.
(2) The general assembly further finds, determines, and declares that:
(a) The intent of the general assembly in enacting part 2 of article 14 of title 25, Colorado Revised Statutes, was to protect nonsmokers from involuntary exposure to second-hand tobacco smoke in indoor areas open to the public, public meetings, food service establishments, and places of employment, subject only to a small number of narrowly defined exemptions;
(b) The definition of a cigar-tobacco bar in section 25-14-203 (4), Colorado Revised Statutes, was intended to apply only to establishments that historically derived a substantial portion of their revenue from the rental of on-site humidors as well as the sale of cigars and cigar tobacco; and
(c) The rental of on-site humidors is an essential element of the type of establishment the general assembly intended to define as a "cigar-tobacco bar".
SECTION 2. 25-14-203 (4), Colorado Revised Statutes, is amended to read:
25-14-203. Definitions. As used in this part 2, unless the context otherwise requires:
(4) (a) "Cigar-tobacco bar" means a bar that, in the calendar year ending December 31, 2005, generated at least five percent or more of its total annual gross income or fifty thousand dollars in annual sales from both the on-site sale of tobacco products cigars or cigar tobacco and the rental of on-site humidors, not including any sales of cigarettes or any sales from vending machines. In any calendar year after December 31, 2005, a bar that fails to generate at least five percent of its total annual gross income or fifty thousand dollars in annual sales from both the on-site sale of tobacco products cigars or cigar tobacco and the rental of on-site humidors shall not be defined as a "cigar-tobacco bar" and shall not thereafter be included in the definition regardless of sales figures.
(b) A bar that did not generate some portion of its annual gross income, greater than zero, from the rental of on-site humidors during the calendar year ending December 31, 2005, and does not continue to do so in each calendar year thereafter, shall not be defined as a "cigar-tobacco bar" and shall not be included in the definition regardless of sales figures.
SECTION 3. 25-14-204 (2), Colorado Revised Statutes, is amended to read:
25-14-204. General smoking restrictions. (2) (a) A cigar-tobacco bar shall not expand its size or change its location from the size and location in which it existed as of December 31, 2005. A cigar-tobacco bar shall display signage in at least one conspicuous place and at least four inches by six inches in size stating: "Smoking allowed. Children under eighteen years of age must be accompanied by a parent or guardian."
(b) (I) Unless a local authority adopts its own certification process pursuant to section 25-14-207 (2) (c) within one hundred twenty days after the effective date of this paragraph (b), the department of revenue shall have the power and duty to certify compliance with the annual gross income threshold requirements set forth in section 25-14-203 (4). The owner of a bar seeking to qualify as a cigar-tobacco bar shall submit to the department its tax returns and other records sufficient to determine whether the requirements have been met. The department shall contract with a certified public accountant to audit the records submitted, and shall charge the bar owner an amount sufficient to defray the department's direct and indirect costs incurred in connection with the audit. If the accountant determines that the requirements of section 25-14-203 (4) have been met, the department shall issue a certificate reflecting this determination. The certificate shall be valid for twelve months after the date of issuance.
(II) The cigar-tobacco bar shall conspicuously display a true copy of the certificate with, or in close proximity to, the signage required by paragraph (a) of this subsection (2).
(III) In any enforcement proceeding under this part 2:
(A) A certified copy of a valid certificate shall be prima facie proof of compliance with the annual gross income threshold requirements set forth in section 25-14-203 (4); and
(B) The lack of a valid certificate shall create a conclusive presumption of noncompliance with the annual gross income threshold requirements set forth in section 25-14-203 (4).
(IV) The department of revenue may adopt reasonable rules as necessary to implement this paragraph (b).
SECTION 4. 25-14-205 (1) (e), Colorado Revised Statutes, is amended to read:
25-14-205. Exceptions to smoking restrictions. (1) This part 2 shall not apply to:
(e) A cigar-tobacco bar that has a valid certificate of exemption issued in accordance with, and displays the certificate and other signage as required by, section 25-14-204;
SECTION 5. 25-14-205, Colorado Revised Statutes, is amended BY THE ADDITION OF A NEW SUBSECTION to read:
25-14-205. Exceptions to smoking restrictions. (2) It shall be an affirmative defense that the smoking occurred in any of the places listed in subsection (1) of this section; except that, with regard to paragraph (e) of said subsection (1), the affirmative defense shall not be available if a valid certificate of exemption and other required signage were not displayed as required by section 25-14-204.
SECTION 6. 25-14-207 (2), Colorado Revised Statutes, is amended BY THE ADDITION OF A NEW PARAGRAPH to read:
25-14-207. Other applicable regulations of smoking - local counterpart regulations authorized. (2) (c) Within one hundred twenty days after the effective date of this paragraph (c), a local authority may, pursuant to article 16 of title 31, C.R.S., a municipal home rule charter, or article 15 of title 30, C.R.S., enact, adopt, and enforce a procedure for certifying those establishments that meet the criteria specified for a "cigar-tobacco bar" in section 25-14-203 (4). The local authority shall issue a certificate to each establishment that meets the criteria. The certificate shall be valid for twelve months after the date of issuance. The local authority may charge a fee for issuance of a certificate, in an amount sufficient to defray the local authority's direct and indirect costs incurred in connection with the certification process, including, without limitation, the cost of any investigation or audit conducted by the local authority's own personnel or by independent contractors.
SECTION 7. Appropriation. In addition to any other appropriation, there is hereby appropriated, to the department of revenue, enforcement business group, for allocation to the tobacco enforcement program, for the fiscal year beginning July 1, 2007, the sum of thirty-nine thousand dollars ($39,000), or so much thereof as may be necessary, for the implementation of this act. Said sum shall be cash funds from charges to tobacco bar owners pursuant to section 25-14-204 (2) (b) (I), Colorado Revised Statutes.
SECTION 8. Effective date - applicability. (1) This act shall take effect upon passage and shall apply to all enforcement actions that are:
(a) Commenced on or after said date; and
(b) Pending, including the pendency of any and all appeals, on or after said date.
SECTION 9. Safety clause. The general assembly hereby finds, determines, and declares that this act is necessary for the immediate preservation of the public peace, health, and safety.