Washington Report: Senate Votes to Regulate Internet Tobacco Sales

Also Pre-paid calling card legislation; ULSD survey; bipartisan financial reform falls apart and Democrats to go ahead without Republican deal; EPA gets pressure from governors.

March 12, 2010

Major Hurdle Cleared in Regulating Tax-Free Internet and Mail-Order Tobacco
On Thursday evening the U.S. Senate passed S. 1147, the Prevent All Cigarette Trafficking (PACT) Act, by unanimous consent. The bill is authored by Sen. Herb Kohl (D-WI) and has 20 cosponsors. The House version, authored by Rep. Anthony Weiner (D-NY), previously passed the House by a vote of 397-11. This legislation would strengthen federal laws on cigarettes sold over the Internet. In addition to preventing the U.S. postal service from delivering cigarettes, the PACT Act will allow states to recover lost excise tax revenue and allow legitimate retailers to recover lost business. Additionally, the PACT Act would prevent sellers from circumventing state laws preventing minors from purchasing cigarettes. Native American lobbyists have been waging a furious battle to de-rail this legislation.

While passing the PACT Act in the Senate is a major hurdle cleared, because of slight differences in the Senate and House bills, the House will need to take a final vote to accept the Senate version of the bill. It will then go to President Obama??s desk for his signature.

"NACS has been working for over 10 years to pass legislation to regulate Internet and mail order tobacco sales," according to NACS Senior Vice President of Government Relations Lyle Beckwith. "Last night??s vote brings us closer to achieving our goal than we have ever been. We shall continue to pressure the House to take the final step necessary for passage and enactment."

Read more about the PACT Act.

NACS Contact: Lyle Beckwith

Pre-paid Calling Card Legislation Could Affect Retailers
The House Energy and Commerce Committee is expected to consider legislation (H.R. 3933) to regulate the marketing of pre-paid calling cards. The legislation was prompted because some manufacturers have created calling cards that contain complicated rules that dramatically reduce the minutes available. These cards are also marketed in deceptive manners. NACS supports policies to ensure that all pre-paid calling cards deliver the value they are advertised to deliver. However, the legislation leaves open the possibility that retailers of these cards, who have no control over the marketing materials attached or the value provided, may be held accountable for cards that do not deliver the value their marketing materials promise.

Last year, NACS submitted testimony recommending three changes to the legislation. NACS is now working to amend the legislation to provide regulatory certainty to protect honest retailers from unreasonable enforcement actions associated with these pre-paid calling cards. Stay tuned to next week's Washington Report for further details on this issue.

NACS Contact: John Eichberger

Diesel Fuel and Tank Corrosion Problems Surface, Survey to Help Identify the Problem
There have been some reports of underground storage tank (UST) system corrosion when storing and dispensing ultra low sulfur diesel (ULSD) fuel. Recently, NACS attended a meeting with the Environmental Protection Agency and the Petroleum Equipment Institute to discuss the issue. At this time it is unclear what is causing the corrosion or why it is not being reported in all UST systems.

NACS is cooperating with other organizations to investigate this issue to determine a cause and identify a solution. To this end, we ask you to complete a brief online survey. If you sell diesel fuel, regardless of any problems you may or may not have experienced, please complete the survey. Your input will accelerate our ability to resolve this issue. The survey will remain open until April 6, 2010.

If you have any questions, let us know.

NACS Contact: John Eichberger

Dodd To Forge Ahead With Financial Reforms, Republican Support Dwindles
According to the Associated Press, Senate Banking Committee Chairman Christopher Dodd (D-CT) said that he would offer "his own version of a sweeping overhaul of financial regulations without Republican support. A month of talks between Dodd and Senator Bob Corker (R-TN) found some common ground but failed to yield agreement on consumer protections and other sticking points."

President Obama has pushed a new Consumer Financial Protection Agency which would have new authority to regulate consumer financial products such as credit and mortgages. The banking industry has opposed this provision, saying that it would add an unnecessary burden of regulation and bypass important analyses that are already in place to scrutinize consumer product offerings.

Dodd plans to bring his bill forward for markup in the Senate Banking Committee the week of March 22. NACS is closely following the potential financial reform and is making sure those on Capitol Hill do not forget the punitive effects interchange fees have on both the consumer and retailer.

NACS Contact: Lyle Beckwith

Pressure Mounts for EPA to Not Issue Greenhouse Gas Regulations
While activities on Capitol Hill continue to generate support for resolutions to stop EPA??s greenhouse gas regulations, another force entered the mix. This week, 20 state governors sent a letter to Congress expressing grave concern about potential regulations, claiming, "EPA is not equipped to consider the very real potential for economic harm when regulating emissions." They urge "Congress to stop harmful EPA regulation of greenhouse gas emissions" and "ask that Congress continue its work to pass comprehensive legislation that balances the role of conservation and climate security with the production of abundant and affordable American energy."

The bipartisan letter, which echoes many of the concerns expressed by NACS in our letters to Congress, was signed by the governors of MS, WV, AK, NE, GA, KY, RI, NV, ND, SD, SC, MN, UT, HI, LA, AL, VA, AZ, Guam and Puerto Rico.

NACS Contact: John Eichberger

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