S T A T E   O F   N E W   Y O R K
 ________________________________________________________________________
 
                                    390
 
                        2017-2018 Regular Sessions
 
                           I N  A S S E M B L Y
 
                              January 9, 2017
                                ___________
 
 Introduced by M. of A. GUNTHER -- Multi-Sponsored by -- M. of A. HOOPER,
   MAGEE -- read once and referred to the Committee on Governmental Oper-
   ations
 
 AN ACT establishing a temporary task force on black market cigarettes
 
   THE  PEOPLE OF THE STATE OF NEW YORK, REPRESENTED IN SENATE AND ASSEM-
 BLY, DO ENACT AS FOLLOWS:

   Section 1. Legislative intent. The sale of black market, untaxed ciga-
 rettes has resulted in the loss of hundreds of millions  of  dollars  in
 revenue to the state, robbing state health care and programs designed to
 help children. According to the Tax Foundation, a Washington D.C., busi-
 ness-oriented  tax  research organization, approximately 60.9 percentage
 of cigarettes sold in New York were smuggled in from  other  states.  In
 addition, a study conducted by John Dunham & Associates on behalf of New
 York  Association  of Convenience Stores found that state taxes were not
 collected on one out of every two packs of cigarettes  consumed  in  New
 York State in 2011.
   The widely available black market cigarettes threaten national securi-
 ty  and public safety of New Yorkers. Investigations conducted on feder-
 al, state and local levels revealed  that  proceeds  from  black  market
 cigarettes are used to fuel organized crime and terrorist organizations,
 such as Hamas and Hezbollah. In addition, this criminal activity creates
 imbalanced  and  unfair business competition for law-abiding mom and pop
 stores and other businesses who do pay taxes. In light of the overwhelm-
 ing growth in black market cigarettes and the inherent dangers  of  this
 unbridled  criminal  activity,  it  is imperative that we make concerted
 efforts to develop enhanced measures and  strategies  to  fully  address
 this issue.
   It  is  the intent of the Legislature to create a temporary task force
 to effectively address the illegal  tobacco  sale  and  distribution  of
 untaxed,  unstamped  and smuggled tobacco products in New York. The Task
 Force will be comprised of departments and agencies involved in tackling

  EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
                       [ ] is old law to be omitted.
              

                                                            LBD00803-01-7

 A. 390                              2
 
 illicit tobacco and will examine and analyze  currently  existing  laws,
 policies  and  programs  to develop measures that can reduce and prevent
 black market tobacco in New York.
   §  2.  1.  A  temporary  task force, to be known as the temporary task
 force on black market cigarettes,  is  hereby  created  to  examine  and
 investigate  such issues related to sale and distribution in New York of
 tobacco products for which required tax has not  been  paid,  including,
 but not limited to, unlawfully manufactured cigarettes, cigarettes smug-
 gled  from  low-tax  jurisdictions,  and  stolen  tobacco  products from
 convenience stores, cargos and truck hijacking. This task force will  be
 comprised of appropriate state agency personnel, law enforcement author-
 ities,  and  an  expert  in the fields of taxation.  The task force will
 facilitate studying the root causes of rising black market cigarettes in
 New York and assess the economic, health, and public  safety  impact  of
 illicit cigarette sales and distribution in this state.
   2. Such temporary task force shall have the powers, including, but not
 limited to, to:
   (a)  conduct  public hearings in furtherance of the performance of its
 duties under this act;
   (b) issue subpoenas for and to compel attendance of witnesses and  the
 production of books, records, documents and other relevant evidence;
   (c) recommend legislation consistent with the purpose of this section;
   (d)  develop  and  support innovative law enforcement models to target
 and disrupt smuggling and distribution networks;
   (e) develop and communicate messages for the general public, informing
 them of the serious consequences of purchasing black market cigarettes;
   (f) educate private sector entities about the dangers of black  market
 cigarettes; and
   (g) develop measures and goals that will enable the task force and its
 partners to better gauge success in decreasing the black market in ciga-
 rettes.
   3. The task force shall consist of 9 members as follows:
   (a)  the attorney general, or his or her designee thereof, shall chair
 the task force;
   (b) commissioner of financial services, or his or her designee;
   (c) commissioner of criminal justice services, or his or her designee;
   (d) commissioner of health, or his or her designee;
   (e) the governor shall appoint one member who shall be  an  expert  in
 tobacco taxation;
   (f)  the  temporary  president  of  the  senate and the speaker of the
 assembly shall each appoint one member to the task force who shall be  a
 member of a state or local law enforcement agency; and
   (g)  the  president of the Small Business Congress, Inc. or his or her
 designee and the commissioner of the New York City department of finance
 or his or her designee shall serve as non-voting members.
   4. Four voting members of the  temporary  task  force  shall,  at  all
 times,  constitute  a  quorum. Members shall receive no compensation for
 their services; members  (including  non-voting  members)  who  are  not
 governmental employees shall be reimbursed for their reasonable expenses
 incurred  during  the  performance of their duties.  Notwithstanding any
 inconsistent provision of any general, special or local law, no  officer
 or  employee  of the state or of any political subdivision thereof shall
 forfeit his or her office or  employment  by  reason  of  acceptance  of
 appointment to the temporary task force.

 A. 390                              3
 
   5.  Within  one year of the effective date of this act, such temporary
 task force shall issue a report containing such findings and recommenda-
 tions.
   § 3. This act shall take effect immediately.