02.26.2024 Update: Virginia Vape Related Bills

We know its a lot of detail, but we wanted to make sure you have the latest details of the Virginia vape related bills going through the General Assembly. Additionally, we encourage you to support the Virginia Smoke Free Association (VSFA) at www.virginiasmokefree.org. The VSFA has been active since 2016 with very dedicated lobbyists working tirelessly day and night throughout the legislative process. They are well-established and deeply committed to protecting vaping rights and policies in Virginia.

The Good

VSFA’s bill, SB582, has now passed both the Senate (40-0) and the House (85-13). The companion bill, HB790, passed the House 87-12and will come before the Senate Finance and Appropriations Committee (“SFAC”) first thing tomorrow before moving to the Senate floor. When SB582 was before the SFAC a few weeks ago, it amended our bill to remove the provision where we sought to codify the tax on closed systems at $0.066/mL and create a new, different tax for open systems at 20% of wholesale price. We anticipate the SFAC will attempt to do the same to HB790 tomorrow. Because the bill first passed the House with those provisions, the bill will be forced into a committee of conference where the differences will be reconciled behind closed doors. The bills are likely to pass and have been assured by both our House and Senate patrons that we could put the new tax model back into the bill at that time.

The Bad

Altria’s registry bills are SB550and HB1069. The Senate bill has already passed both chambers, but it is important to note that the House put a reenactment clause on the bill at VSFA’s request. (This was our only real way of getting in front of the bill, unfortunately). This reenactment clause language essentially states that the bill shall not become effective unless it is passed a second time by the General Assembly next year. The House bill had the same reenactment clause on it, but the Senate removed that language today. Consequently, these bills will go to conference as well, where we will lobby like hell to make sure the reenactment clause language stays attached to ameliorate the effect of the bill and give us another shot of killing it next year.

Additionally, we have heard that the Governor’s Administration no longer supports the bill and, after our conversations with them, have some concerns with the bill. On the other hand the Attorney General is still very much ta driving force behind the bill. (The AG is running for Governor soon and wants to be able to say he did something about illicit vapes and can go to Altria for some heavy contribution checks.)

We are trying to ensure these bills do not have funding in the budget; however, both patrons, Senator Deeds and Delegate Willett, are both likely to be budget conferees. Our next move will be to inundate the Governor’s policy with opposition to the bill(s). We’ll have more information to you in early March on these, but it will be absolutely critical that we have all hands on deck for this.

The Ugly

Despite there not being a single member-introduced budget amendment to this end, there is an amendment in the Senate budget that would more than double the tax imposed on liquid nicotine. See Budget Amendment 3-5.19 #1s, raising the tax imposed on liquid nicotine to $0.15/mL. We found it researching each chamber’s approved budget amendments at the end of last week and quickly became priority #1. There was no announcement; There was no budget amendment seeking to do this; It even caught Altria, Reynolds, and the c-stores by surprise. We have meetings later this week with the chief budget negotiators to ensure this language does not make it into the General Assembly’s final budget. VTA even hired a lobbyist last week to help fight this language and the registry bills. We’d encourage our members to email allmembers of the Senate Finance and Appropriations Committee. and, later, the budget conferees, to oppose Budget Amendment 3-5.19 #1s. If it makes it into the General Assembly budget, we’ll still have a chance to lobby the Governor’s Administration to take it out of the budget. We believe the Administration will be receptive. After all, they do not want to be known for doubling taxes on an entire industry.

More details to come on this fast-moving situation.