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July 19 , 2006

A Newsletter of the National Association of Tobacco Outlets, Inc.

By: Thomas A. Briant, Executive Director

No one could have predicted that NATO and its members would compile a legislative record this year exceeding the 82% success rate achieved in 2005. However, through the end of June, NATO’s 2006 legislative win-loss record stands at 90 wins and only 10 losses with 16 tobacco bills still pending in several states. That’s a 90% success rate that could climb even higher if those bills still pending are also defeated.

Legislative victories on tobacco issues do not come easily and there may be as many as five states with tobacco-related questions for citizens to vote on in the November general elections (see story inside). Below is a legislative box score listing the outcome of tax bills and smoking bans in various states:

Besides tax increases and smoking restrictions, NATO helped defeat flavored tobacco bans in Hawaii, Kansas and West Virginia and was successful in lobbying against legal age increase bills in Nebraska and South Carolina.

Dear NATO Members:

This year, NATO has two accomplishments to celebrate. One accomplishment is the association’s fifth anniversary which was celebrated by 500 NATO members at the NATO Gala Dinner and Awards Banquet this past March. The fact that NATO was formed only five years ago and has become one of the leading trade associations on industry legislative issues is a testament to the hard work of NATO’s staff and board of directors along with the steadfast support of our members.

The second reason to celebrate is NATO’s phenomenal legislative record. Who would have thought that this year we would defeat 90% of all tobacco legislative bills. This is a remarkable success story that is shared by NATO and the entire tobacco industry.

Despite this successful record, NATO’s work is not finished for the year. We will be working diligently on November ballot questions regarding tobacco issues in Arizona (smoking ban and taxes), California (taxes), Missouri (taxes), Ohio (smoking ban) and South Dakota (taxes). As long as there are tobacco issues, NATO will be fighting to protect the industry.

Sincerely,

Velma Hartley, NATO President
& Owner of The Tobacco Place

State Ballot Questions

The anti-tobacco advocates are using a new strategy to try and enact cigarette and tobacco tax increases and smoking bans. Rather than lobbying state legislators to pass a bill, these anti-tobacco groups are gathering signatures on initiative petitions to have a question placed on the upcoming November general election ballot. Almost half of the states allow this kind of procedure to pass a law by having citizens directly vote on the question.

Arizona

One ballot question would ban smoking in all indoor public areas and places and increase the cigarette tax by 2 cents per pack. A competing initiative question (supported by NATO and its Arizona members) would allow smoking in bars, the bar area of restaurants, private clubs and tobacco stores. A third question would increase the cigarette tax by 80 cents per pack and raise the tax on OTP products as well.

California

The ballot question in California would raise the cigarette tax by $2.60 per pack with a proportionate increase in the tax on other tobacco products including cigars, pipe tobacco and smokeless tobacco.

Missouri

Both cigarette taxes and other tobacco products taxes would be higher under
the proposed ballot question for Missouri. The cigarette tax would be raised by $.80 per pack and the OTP tax rate would be increased by another 20%.

Ohio

Two different smoking restriction questions may appear on the ballot. One question supported by anti-tobacco groups would ban smoking in all public places and hospitality establishments. A second question supported by a hospitality coalition, including NATO, would allow smoking in bars, private clubs, bingo halls and tobacco stores.

South Dakota

The ballot question in South Dakota would raise the cigarette tax by $1.00 per pack and also increase the tax on other tobacco products by a proportionate amount.

NATO’s Actions on Ballot Questions

NATO is mapping out a strategy to help its retail store members and their customers defeat these proposed ballot questions. In Arizona and Ohio, NATO joined forces with hospitality coalitions that were circulating competing petitions to allow smoking in certain hospitality establishments (like bars and private clubs) as well as tobacco stores. This means that voters in these two states should have two questions on the same ballot (one banning smoking and the other allowing smoking in various businesses). In addition, NATO will respond to all of these ballot questions with the following efforts:

• Coordinating voter education efforts with major tobacco companies that launch a media campaign in these states.
• Providing retailers with voter alerts to pass out to customers so they understand how to vote on each ballot question.
• Submitting long commentary letters-to-the-editor to the numerous newspapers in each of these states to urge the general public to vote against these unfair tax increase and smoking ban ballot questions.

With the elections set for the November 7 th, NATO’s efforts will begin in earnest right after the Labor Day holiday in September. This September start date is important because laws require that a certain number of valid signatures of voters must be obtained first before the question is certified for the state’s election ballot.

Consider Being a Candidate

How to Lower
Credit Card Fees

One of the best cost saving benefits for belonging to NATO is the low credit card and debit card processing rates offered exclusively to NATO member stores by First Data Merchant Services. Even NATO retail members that operate just one or two stores have found that they can save money by signing up with First Data Merchant Services. To learn more about saving money on processing fees and charges, call First Data Representative Juergen Hinz at 1-800-767-2484, Extension 55768 or on his mobile telephone at 260-341-7929.

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