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January 14, 2025 St. Anthony Council Work Session - 2 <br />licenses at zero. The language drafted allows the current number of licenses which is five to continue to <br />renew and reduce the number over time through attrition to zero. <br />Restrict coupon and price promotion – The price of tobacco products directly affects consumption <br />levels, particularly among price-sensitive consumers, including youth, young adults, and those with <br />limited financial means. The commercial tobacco industry uses innovative pricing strategies to entice <br />new customers to purchase their products, to discourage current users from quitting, and to reduce the <br />effectiveness of tobacco tax increases in decreasing tobacco sales and increasing users’ quit attempts. <br />These pricing strategies include “buy-one-get-one” coupons, cents, or dollar-off promotions, and multi- <br />pack offers, which are often marketed and redeemed at the point of sale. Jurisdictions can prohibit the <br />redemption of these price discounts to negate the sophisticated discounting strategies of the <br />commercial tobacco industry. Several jurisdictions in Minnesota have adopted this provision to keep the <br />price of licensed products high to discourage availability to youth. <br />Set a minimum price and package size – Setting a minimum price for tobacco products is an effective <br />public health policy. Establishing a minimum price helps discourage youth smoking and reduces overall <br />tobacco consumption. To complement this, setting standardized package sizes is important. This ensures <br />pricing consistency and prevents manufacturers from circumventing minimum price rules through <br />smaller, more affordable pack sizes. The proposed minimum prices are based on research of current <br />average prices and the minimum price ordinance in neighboring Minneapolis. The additional revenue <br />when setting a minimum price will be held by the retailer. Prohibiting coupons and price discounts <br />further strengthens the impact of minimum pricing. This policy removes incentives for price-sensitive <br />consumers to access tobacco products. Importantly, the policy allows for periodic price adjustments <br />aligned with the consumer price index, maintaining the real-world value of the minimum price over <br />time. Collectively these measures create a comprehensive tobacco pricing policy that discourages use, <br />especially among youth, while accounting for economic and market factors. This multifaceted approach <br />is an evidence-based strategy to improve public health outcomes. <br />Mayor Webster referred to the penalties for non-compliance. She asked Ms. Anderson to explain. <br />Align and increase penalties – Increasing penalties for violations is also an effective enforcement <br />mechanism. Minn. Stat. §461.12 Subd. 2 establishes a minimum fine schedule for underage sales and <br />other ordinance violations of State Law by licensed tobacco retailers as follows: <br />First Violation: $300 fine <br />Second Violation (within 36 months): $600 fine <br />Third or Subsequent Violation (within 36 months): $1,000 fine <br />For a third or subsequent violation within 36 months of the first violation, state law mandates a <br />suspension of at least seven days and permits license revocation. Jurisdictions may impose stronger <br />penalties for licenses violations. <br />If the Council were to look at higher amounts beyond State minimum, neighboring jurisdictions have a <br />violation structure similar to what is listed below. This structure can further enhance these penalties to <br />deter non-compliance: <br />First Violation: $1,000 fine <br />Second Violation (within 36 months): $2,000 fine and a 3-day suspension of the tobacco license. <br />Third Violation (within 36 months): $2,000 fine and a 7-day suspension of the tobacco license. <br />Fourth Violation: Revocation of the tobacco license.