L.L. 1998/003

Enactment date: 1/14/1998

Int. No. 951-A

By the Speaker (Council Member Vallone), Council Members Williams, Robles, Fusco, Ognibene, Clarke, DeMarco, Malave-Dilan, Duane, Fields, Fisher, Foster, Freed, Harrison, Henry, Leffler, Linares, McCabe, Povman, Powell IV, Warden, Watkins, White, Stabile and the Public Advocate (Mr. Green); also Council Members Cruz, Lasher, Marshall, Michels, Perez, Pinkett, Robinson and Spigner

A Local Law to amend the administrative code of the city of New York, in relation to prohibiting or restricting the advertisement and promotion of tobacco products to protect children.

Be it enacted by the Council as follows:

Section 1. Declaration of legislative findings and intent. The Council of the City of New York hereby finds that certain tobacco product manufacturers have admitted engaging in strategies designed to advertise and promote tobacco products to minors and that such strategies undermine state and local laws prohibiting the sale or distribution of tobacco products to minors. The Council further finds that the exposure of minors to such tobacco product advertising and promotion may be constitutionally restricted through reasonable targeted limitations on the advertising of such products near schools and other locations where children tend to congregate, and through a prohibition on the offering of promotions to persons under the age of eighteen. Thereby, the Council intends to strengthen compliance with and enforcement of laws prohibiting the sale or distribution of tobacco products to children and to protect children against such illegal sales.

Although the rate of smoking among adults nationwide decreased by 50% between 1971 and 1993, the federal Centers for Disease Control and Prevention have reported that the rate of smoking among all high school students during the years 1991 through 1996 increased by over 26% and now stands at its highest rate since 1981. This dramatic increase in teenage smoking has occurred while all fifty states and the District of Columbia have had prohibitions in effect on the sale or distribution of cigarettes and other tobacco products to minors and while all tobacco product manufacturers were pledged to adhere to a voluntary industry code prohibiting advertisement of tobacco products that appeal to or influence minors. In New York City, under section 17-620 of the Administrative Code of the City of New York, section 1399-cc of the State Public Health Law and section 260.20 of the State Penal Law, it is illegal to sell tobacco products to a minor.

It has also been reported that nearly 90% of all smokers begin to smoke prior to the age of 18 and that the average child smoker starts daily smoking by the age of 14. Between 1991 and 1996 the rate of smoking among Hispanic high school students nationwide reportedly increased by over 34% while, during the same period, the rate of smoking among African-American high school students nationwide increased by over 48%; these rates of increased smoking are the highest in a decade. In New York City, as reported by the Department of Consumer Affairs, 200 children begin to smoke every day.

Similarly, a 1994 report by the United States Surgeon General containing data on the use of smokeless tobacco by minors reported that the market for smokeless tobacco had shifted dramatically toward young people since 1970. That report cited school-based surveys conducted in 1991 which estimated that 19.2% of ninth to twelfth grade boys use smokeless tobacco. Among high school seniors who had ever tried smokeless tobacco, the report said that 73% did so by the ninth grade.

A December 1995 investigative report, prepared for the Speaker of the Council and the Council's Youth Services Committee concerning the availability of beer and cigarettes to New York City minors and entitled Easy Access, found, inter alia, that "cigarettes are widely accessible to minors throughout New York City;" that minors participating in the investigation "successfully purchased cigarettes in 79 percent of all attempted cases;" and that "less than one out of five stores asked minors who purchased cigarettes for proof of age." The Easy Access report cited a 1992 Journal of the American Medical Association (JAMA) article entitled "Brand Logo Recognition by Children Aged 3 to 6 Years" which demonstrated that 30 percent of the three year olds and 91 percent of the six year olds surveyed could correctly match the Joe Camel cartoon trademark with Camel cigarettes. The Easy Access Report also referred to a 1991 JAMA report entitled "RJR Nabisco's Cartoon Camel Promotes Camel Cigarettes to Children" which estimated that illegal sales of Camel cigarettes to minors rose from $6 million per year before the advent of Joe Camel in 1988, to $476 million by the end of 1991. The 1991 JAMA report concluded that one-quarter of all Camel sales in 1991 were to minors.

In May 1996, the City Department of Consumer Affairs, joined by the Chair of the Council's Youth Services Committee, announced the results of a citywide enforcement program against tobacco product retailers who violated the law by selling tobacco products to minors. This citywide enforcement program, denoted Three Puffs and You're Out, was, at least in part, motivated by the Council's Easy Access investigative report discussed above. Two hundred tobacco retailers were targeted by this enforcement program. One-year suspensions of their tobacco retailer licenses were imposed on seventeen retailers who illegally sold tobacco products to minors three times during the preceding two years. Ninety-three of the retailers targeted for enforcement were found to be illegally selling cigarettes to minors, thirty-one of the retailers targeted for enforcement were illegally selling loose cigarettes to minors and thirty-six of the retailers targeted for enforcement had failed to post the required sign indicating that tobacco sales to minors are prohibited by local law.

A 1991 JAMA study concluded that "cigarette advertising encourages youth to smoke and should be banned." In a 1994 report, the National Institute of Medicine stated that "the substantial convergent evidence that advertising and promotion increase tobacco use by youths is impressive and, in the Committee's view, provides a strong basis for legal regulation." Similarly, a 1995 report by the federal Centers for Disease Control and Prevention found that "cigarette marketing practices appeared to be the most likely to account for [the] increase in teen smoking initiation rates."

The federal Department of Health and Human Services' Food and Drug Administration (FDA) recently reported that "[i]n 1993, the tobacco industry spent a total of $6.2 billion on the advertising, promotion and marketing of cigarettes and smokeless tobacco. Of that number, 31 percent ($1.9 billion) was spent on advertising and promotional activities, 26 percent ($1.6 billion) was given to retailers in the form of cash allowances or retailer items to facilitate and enhance the sale of tobacco products, and, finally, 43 percent ($2.6 billion) was in the form of financial incentives (e.g. coupons, cents off, buy one/get one free, free samples) to consumers."

In announcing its final rules on the advertising and promotion of tobacco products, published in the Federal Register on August 28, 1996, the FDA commented upon the nexus between advertising and promotion and smoking among minors. The FDA observed that "the images typically associated with advertising and promotion convey the message that tobacco use is a desirable, socially approved, safe and healthful, and widely practiced behavior among young adults, whom children and youths want to emulate. As a result, tobacco advertising and promotion undoubtedly contribute to the multiple and convergent psychosocial influences that lead children and youths to begin using these products and become addicted to them." In that same announcement on its final rules on advertising and promotion of tobacco products, the FDA discussed the issue of federal preemption of state and local restrictions. The FDA specifically stated that it "believes the requirements it is establishing in this final rule set an appropriate floor for regulation of youth access to tobacco products but do not, as a policy matter, reflect a judgment that more stringent State or local requirements are inappropriate."

On March 20, 1997, as part of a settlement agreement signed by the Attorneys General of 17 states, including New York State, and Liggett & Myers Inc. and the Brooke Group, Ltd., cigarette manufacturers, the following statement was among those made by and on behalf of Liggett & Myers: "Liggett acknowledges that the tobacco industry markets to 'youth', which means those under 18 years of age."

In light of the foregoing evidence that cigarettes are advertised and promoted to minors and that smoking by minors continues to dramatically increase despite laws banning the sale or distribution of tobacco products to minors, the Council of the City of New York finds and declares that affirmative, reasonable and constitutionally permissible restrictions on tobacco product advertising and promotion may and must be enacted.

The purpose of this legislation is to promote enforcement of the aforementioned laws banning the sale or distribution of tobacco products to minors and to thereby protect young people. The Council is cognizant of the necessity of acting within the protections afforded by the First Amendment to the United States Constitution and has, therefore, narrowly tailored the scope and effect of this legislation to impose reasonable time, place and manner restrictions on tobacco advertising aimed at or regularly seen by youth while not directly affecting advertising and promotions directed at adults. Indeed, the extensive testimony taken at various Committee hearings prompted the Council to narrow the scope of the prohibition on tobacco product advertisements to ensure that such advertisements are restricted only in those locations closest to where children congregate, and that tobacco product promotions are not given to children but are otherwise freely available to the adult population.

It is well settled law that the First Amendment protects commercial speech but to a lesser degree than the protection afforded other, "fully protected speech." In analyzing the constitutionality of commercial speech regulation, the United States Supreme Court prescribed a four-prong test in Central Hudson Gas & Electric Corporation v. Public Service Commission of New York, 447 U.S. 557 (1980). The Central Hudson test, which subsequent decisions have ratified and clarified, provides that government restrictions on commercial speech are lawful where: (1) the commercial speech at issue concerns a lawful activity and is not misleading; (2) the asserted governmental interest in restricting the commercial speech is substantial; (3) the restriction directly advances the governmental interest asserted; and (4) the restrictions are not more extensive than necessary to serve that governmental interest. The latter two requirements involve a determination that there is a reasonable fit between the government s ends and the means chosen to accomplish these ends. Board of Trustees of State Univ. of New York v. Fox, 492 U.S. 469, 480 (1989); see also, United States v. Edge Broadcasting Co., 509 U.S. 418 (1993).

The restrictions on commercial speech contained in this Council legislation are permissible under the Central Hudson four-prong test. The commercial speech at issue concerns a lawful activity and is not misleading, at least as it applies to consenting adults. The governmental interest in restricting the commercial speech at issue is one grounded in the pre-existing prohibition on the sale and distribution of tobacco products to minors and is geared directly towards countering the adverse impacts of an industry strategy admittedly directed at younger prospective smokers. By restricting the locations for advertisements that are more likely to be addressed to and most likely to be seen by minors, specifically to 1,000 feet from schools, child day care centers and the like, while still permitting tobacco product sellers to notify their customers that such products are available for purchase with a single tombstone advertisement which may be written in any language, this Council legislation directly advances the governmental interest in enforcing the ban on the sale or distribution of tobacco products to minors. Similarly, by permitting tobacco product promotions to be offered and/or given to anyone of lawful age to purchase cigarettes, this Council legislation restricts only promotions designed to induce children to purchase cigarettes. Finally, as the restrictions in this Council legislation focus on modes and locations of communication that are most likely to have a direct impact upon minors, the restrictions contained in this Council legislation strike a balance between the commercial interest in selling tobacco products to persons of lawful age and the need to limit inducements to children who cannot lawfully purchase such products but are nonetheless doing so. Thus, the Council legislation is not more extensive than necessary to serve the governmental interests asserted herein. Other forms of advertising including newspapers, magazines, audio and video media, that are less likely to have a direct impact on minors, and all promotions directed to adults are not affected by this Council legislation. Moreover, street advertisements not within 1,000 feet of a school, child day care center, youth center, amusement arcade or playground, which can readily reach an adult population, are not affected by this Council legislation.

In Penn Advertising of Baltimore v. Baltimore, 101 F.3d 325 (4th Cir. 1995), the United States Court of Appeals for the Fourth Circuit upheld a Baltimore city ordinance which prohibited advertising cigarettes in a publicly visible location against challenges grounded in the First Amendment to the United States Constitution and federal preemption. The court held that the Baltimore city ordinance is not preempted by the Federal Cigarette Labeling and Advertising Act, which prohibits local enactments based on smoking and health with respect to cigarette advertising and promotion. The court reasoned that the ordinance "limits only the location of signs that advertise cigarettes, but it does not address the content of such advertisements. The ordinance neither imposes a duty nor relieves a burden on cigarette advertisers based on smoking and health. Moreover, the ordinance does not limit the ability of cigarette manufacturers to advertise generally in the media." The court also decided that the Baltimore ordinance is a permissible regulation under the Central Hudson four-prong test. Noting that "the governmental interest asserted in this case is to promote compliance with the state prohibition of the sale of cigarettes to minors," the court concluded that "the City's objective in reducing cigarette consumption by minors constitutes a substantial public interest." The court further concluded that "while the fit between the City's objective and the means selected to achieve them may not be perfect, it nevertheless falls well within the range tolerated by the First Amendment for the regulation of commercial speech."

The Council's legislation likewise only limits the locations where tobacco product advertisements may be placed. It addresses neither the location of advertising directed at adults nor the content thereof. As with the Baltimore cigarette ordinance, the Council's legislation neither imposes a duty on tobacco product manufacturers nor relieves a burden otherwise placed upon them related to smoking and health.

Ruling on another city ordinance that closely parallels this Council s legislation, on November 13, 1996, the United States Court of Appeals for the Fourth Circuit upheld against First Amendment attack legislation enacted in the City of Baltimore prohibiting placement of stationary outdoor advertising of alcoholic beverages in areas where it was likely to be encountered by minors traveling to school or play. The Baltimore ordinance targeted individuals who could not legally purchase alcoholic beverages. This Council's legislation similarly targets minors who may not legally purchase cigarettes. Neither this legislation nor the Baltimore ordinance were directed toward or intended to affect adults who may legally purchase cigarettes and alcoholic beverages respectively. Neither this legislation nor the Baltimore ordinance bans all outdoor advertising of cigarettes and alcoholic beverages respectively. Instead, as did the Baltimore ordinance, this legislation merely restricts the time, place and manner of such advertisements.

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[Consolidated provisions are not included in this Appendix A]

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§ 10. If any clause, sentence, item, paragraph or section added by this local law shall be adjudged by any court of competent jurisdiction to be invalid, such judgment shall not affect, impair or invalidate the remainder thereof, but shall be confined in its operation to the clause, sentence, item, paragraph or section thereof directly involved in the controversy in which such judgment shall have been rendered.

§ 11. This local law shall take effect sixty days after it shall have become a law.