72nd OREGON LEGISLATIVE ASSEMBLY--2003 Regular Session
SA to A-Eng. HB 2094 (A to RC)
LC 864/HB 2094-A12
SENATE AMENDMENTS TO
A-ENGROSSED HOUSE BILL 2094
(INCLUDING AMENDMENTS TO RESOLVE CONFLICTS)
By COMMITTEE ON JUDICIARY
July 17
On page 1 of the printed A-engrossed bill, line 3, after '
166.715,' insert '293.535, 293.537,'.
In line 4, after the semicolon insert 'appropriating money;'.
On page 4, line 5, delete 'tobacco product' and insert '
nonparticipating'.
In line 12, delete 'tobacco product' and insert '
nonparticipating'.
On page 5, line 19, after 'stamps' insert 'or otherwise paid
the tax due'.
On page 6, line 27, after 'under' insert 'this section or' and
delete 'or 10'.
In line 29, after the period insert 'Moneys recovered under
this subsection shall be deposited into the Tobacco Enforcement
Fund established under section 23 of this 2003 Act.'.
In line 31, after 'under' insert 'this section or' and delete
'or 10'.
In line 33, delete 'General Fund' and insert 'Tobacco
Enforcement Fund established under section 23 of this 2003 Act'.
On page 7, line 8, delete '(b) or (c)'.
In line 18, after '(3)' insert '(a)'.
After line 22, insert:
' (b) Upon a determination that a person has violated section
11 (1)(a) of this 2003 Act, the department may impose a civil
penalty in an amount not to exceed $5,000. Judicial review of an
order imposing a civil penalty shall be as provided in ORS
305.445 and 305.501.'.
On page 13, after line 20, insert:
' { + SECTION 16a. + } { + Notwithstanding sections 16 and
17, chapter 666, Oregon Laws 2001, if property forfeited under
sections 1 to 18, chapter 666, Oregon Laws 2001, consists of
cigarettes forfeited because of a violation of section 11 (2) of
this 2003 Act, the seizing agency shall destroy the
cigarettes. + } ' .
On page 18, after line 27, insert:
' { + SECTION 21. + } ORS 293.535 is amended to read:
' 293.535. Any tobacco product manufacturer selling cigarettes
to consumers within the State of Oregon (whether directly or
through a distributor, retailer or similar intermediary or
intermediaries) after October 23, 1999, shall do one of the
following:
' (1) Become a Participating Manufacturer (as that term is
defined in section II(jj) of the Master Settlement Agreement) and
generally perform its financial obligations under the Master
Settlement Agreement; or
' (2)(a) Place into a qualified escrow fund by April 15 of the
year following the year in question the following amounts (as
such amounts are adjusted for inflation):
' (A) For 1999, $.0094241 per unit sold after October 23, 1999.
' (B) For 2000, $.0104712 per unit sold.
' (C) For each of the years 2001 and 2002, $.0136125 per unit
sold.
' (D) For each of the years 2003 through 2006, $.0167539 per
unit sold.
' (E) For 2007 and each year thereafter, $.0188482 per unit
sold.
' (b) A tobacco product manufacturer that places funds into
escrow pursuant to paragraph (a) of this subsection shall receive
the interest or other appreciation on such funds as earned. Such
funds themselves shall be released from escrow only under the
following circumstances:
' (A) To pay a judgment or settlement on any released claim
brought against such tobacco product manufacturer by the State of
Oregon or any releasing party located or residing in this state.
Funds shall be released from escrow under this subparagraph in
the order in which they were placed into escrow and only to the
extent and at the time necessary to make payments required under
such judgment or settlement;
' (B) To the extent that a tobacco product manufacturer
establishes that the amount it was required to place into escrow
{ - in a particular year was greater than this state's
allocable share of the total payments that such manufacturer
would have been required to make in that year under the Master
Settlement Agreement (as determined pursuant to section IX(i)(2)
of the Master Settlement Agreement, and before any of the
adjustments or offsets described in section IX(i)(3) of that
agreement other than the inflation adjustment) - } { + on
account of units sold in Oregon in a particular year was greater
than the Master Settlement Agreement payments, as determined
pursuant to section IX(i) of that agreement after final
determination of all adjustments, that the manufacturer would
have been required to make on account of such units sold + }had
it been a Participating Manufacturer (as that term is defined in
the Master Settlement Agreement), the excess shall be released
from escrow and revert back to such tobacco product manufacturer;
or
' (C) To the extent not released from escrow under subparagraph
(A) or (B) of this paragraph, funds shall be released from escrow
and revert back to such tobacco product manufacturer 25 years
after the date on which they were placed into escrow.
' (c) Each tobacco product manufacturer that elects to place
funds into escrow pursuant to this subsection shall annually
certify to the Attorney General that it is in compliance with
this subsection. The Attorney General may bring a civil action on
behalf of the State of Oregon against any tobacco product
manufacturer that fails to place into escrow the funds required
under this subsection. Any tobacco product manufacturer that
fails in any year to place into escrow the funds required under
this subsection shall:
' (A) Be required within 15 days to place such funds into
escrow as shall bring such manufacturer into compliance with this
subsection. The court, upon a finding of a violation of this
subsection, may impose a civil penalty to be paid to the General
Fund of this state in an amount not to exceed five percent of the
amount improperly withheld from escrow per day of the violation
and in a total amount not to exceed 100 percent of the original
amount improperly withheld from escrow;
' (B) In the case of a knowing violation, be required within 15
days to place such funds into escrow as shall bring such
manufacturer into compliance with this subsection. The court,
upon a finding of a knowing violation of this subsection, may
impose a civil penalty to be paid to the General Fund of this
state in an amount not to exceed 15 percent of the amount
improperly withheld from escrow per day of the violation and in a
total amount not to exceed 300 percent of the original amount
improperly withheld from escrow; and
' (C) In the case of a second knowing violation, be prohibited
from selling cigarettes to consumers within the State of Oregon
(whether directly or through a distributor, retailer or similar
intermediary or intermediaries) for a period not to exceed two
years. Each failure to make an annual deposit required under this
section shall constitute a separate violation.
' { + SECTION 22. + } ORS 293.535, as amended by section 21
of this 2003 Act, is amended to read:
' 293.535. Any tobacco product manufacturer selling cigarettes
to consumers within the State of Oregon (whether directly or
through a distributor, retailer or similar intermediary or
intermediaries) after October 23, 1999, shall do one of the
following:
' (1) Become a Participating Manufacturer (as that term is
defined in section II(jj) of the Master Settlement Agreement) and
generally perform its financial obligations under the Master
Settlement Agreement; or
' (2)(a) Place into a qualified escrow fund by April 15 of the
year following the year in question the following amounts (as
such amounts are adjusted for inflation):
' (A) For 1999, $.0094241 per unit sold after October 23, 1999.
' (B) For 2000, $.0104712 per unit sold.
' (C) For each of the years 2001 and 2002, $.0136125 per unit
sold.
' (D) For each of the years 2003 through 2006, $.0167539 per
unit sold.
' (E) For 2007 and each year thereafter, $.0188482 per unit
sold.
' (b) A tobacco product manufacturer that places funds into
escrow pursuant to paragraph (a) of this subsection shall receive
the interest or other appreciation on such funds as earned. Such
funds themselves shall be released from escrow only under the
following circumstances:
' (A) To pay a judgment or settlement on any released claim
brought against such tobacco product manufacturer by the State of
Oregon or any releasing party located or residing in this state.
Funds shall be released from escrow under this subparagraph in
the order in which they were placed into escrow and only to the
extent and at the time necessary to make payments required under
such judgment or settlement;
' (B) To the extent that a tobacco product manufacturer
establishes that the amount it was required to place into escrow
{ - on account of units sold in Oregon in a particular year was
greater than the Master Settlement Agreement payments, as
determined pursuant to section IX(i) of that agreement after
final determination of all adjustments, that the manufacturer
would have been required to make on account of such units
sold - } { + in a particular year was greater than this state's
allocable share of the total payments that such manufacturer
would have been required to make in that year under the Master
Settlement Agreement (as determined pursuant to section IX(i)(2)
of the Master Settlement Agreement, and before any of the
adjustments or offsets described in section IX(i)(3) of that
agreement other than the inflation adjustment) + } had it been a
Participating Manufacturer (as that term is defined in the Master
Settlement Agreement), the excess shall be released from escrow
and revert back to such tobacco product manufacturer; or
' (C) To the extent not released from escrow under subparagraph
(A) or (B) of this paragraph, funds shall be released from escrow
and revert back to such tobacco product manufacturer 25 years
after the date on which they were placed into escrow.
' (c) Each tobacco product manufacturer that elects to place
funds into escrow pursuant to this subsection shall annually
certify to the Attorney General that it is in compliance with
this subsection. The Attorney General may bring a civil action on
behalf of the State of Oregon against any tobacco product
manufacturer that fails to place into escrow the funds required
under this subsection. Any tobacco product manufacturer that
fails in any year to place into escrow the funds required under
this subsection shall:
' (A) Be required within 15 days to place such funds into
escrow as shall bring such manufacturer into compliance with this
subsection. The court, upon a finding of a violation of this
subsection, may impose a civil penalty to be paid to the General
Fund of this state in an amount not to exceed five percent of the
amount improperly withheld from escrow per day of the violation
and in a total amount not to exceed 100 percent of the original
amount improperly withheld from escrow;
' (B) In the case of a knowing violation, be required within 15
days to place such funds into escrow as shall bring such
manufacturer into compliance with this subsection. The court,
upon a finding of a knowing violation of this subsection, may
impose a civil penalty to be paid to the General Fund of this
state in an amount not to exceed 15 percent of the amount
improperly withheld from escrow per day of the violation and in a
total amount not to exceed 300 percent of the original amount
improperly withheld from escrow; and
' (C) In the case of a second knowing violation, be prohibited
from selling cigarettes to consumers within the State of Oregon
(whether directly or through a distributor, retailer or similar
intermediary or intermediaries) for a period not to exceed two
years. Each failure to make an annual deposit required under this
section shall constitute a separate violation.
' { + SECTION 23. + } { + (1) The Tobacco Enforcement Fund
is established separate and distinct from the General Fund. The
Tobacco Enforcement Fund shall consist of:
' (a) Moneys deposited into the fund under section 10 of this
2003 Act; and
' (b) Moneys transferred to the fund under ORS 293.537.
' (2) Moneys in the Tobacco Enforcement Fund are continuously
appropriated to the Department of Justice for the purpose of
enforcing the provisions of ORS 293.535 and sections 1 to 14 of
this 2003 Act. Moneys in the fund are not subject to allotment
under ORS 291.234 to 291.260. + }
' { + SECTION 24. + } ORS 293.537, as amended by section 17,
chapter 2, Oregon Laws 2002 (fifth special session), and section
8, chapter 11, Oregon Laws 2003 (Enrolled Senate Bill 856), is
amended to read:
' 293.537. (1) The Tobacco Settlement Funds Account is
established as an account in the General Fund. Except as provided
in section 2 { - of this 2003 Act - } , { + chapter 11, Oregon
Laws 2003 (Enrolled Senate Bill 856), + } the account shall
consist of all moneys paid to this state under the Master
Settlement Agreement of 1998.
' { + (2) On June 1 of each odd-numbered year, the sum of
$700,000 shall be transferred from the Tobacco Settlement Funds
Account to the Tobacco Enforcement Fund established under section
23 of this 2003 Act. + }
' { - (2) - } { + (3) + } { + Except as provided in
subsection (2) of this section, + } all moneys in the Tobacco
Settlement Funds Account are continuously appropriated to the
Oregon Department of Administrative Services to be expended as
directed by the Legislative Assembly.
' { - (3) - } { + (4) + } All moneys in the Tobacco
Settlement Funds Account shall be invested as provided in ORS
293.701 to 293.790.
' { + SECTION 25. + } { + (1) The amendments to ORS 293.535
by section 22 of this 2003 Act become operative 31 days after
entry of a final judgment that invalidates the amendments to ORS
293.535 by section 21 of this 2003 Act.
' (2) If a court enters a final judgment described in
subsection (1) of this section, the Attorney General shall notify
the Legislative Counsel of the judgment and of the date of the
judgment. + } ' .
In line 28, delete '21' and insert '26'.
In line 30, delete '22' and insert '27'.
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