A08443 Summary:

COSPNSRRobinson, Aubry
MLTSPNSRArroyo, Thiele
Amd SS105 & 107-a, ABC L
Directs the state liquor authority to require certain labeling of alcoholic beverages containing caffeine or other stimulants; requires retail licensees for off-premises consumption to sell alcoholic beverages containing stimulants in an area of the licensed premises separate from that where other alcoholic beverages and energy drinks are sold.
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A08443 Actions:

10/09/2015referred to economic development
01/06/2016referred to economic development
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A08443 Memo:

submitted in accordance with Assembly Rule III, Sec 1(f)
  TITLE OF BILL: An act to amend the alcoholic beverage control law, in relation to requiring the segregation of certain alcoholic beverages with a stimulant sold for off-premises consumption and the labeling of containers containing certain alcoholic beverages   PURPOSE: This bill expands the State Liquor Authority's (SLA) ability to review the labels of all caffeinated alcoholic beverage containers (hereinafter CABs). CABs are defined, under this bill, as a beverage with a combination of two percent alcohol by volume and 5 milligrams of caffeine per ounce. These caffeinated alcoholic beverages (CABs) are now being actively marketed to and increasingly used by those who are between the ages of 14 to 25. Enacting more rigorous labeling standards and consumer disclosure warnings should help to ensure that such products cannot be confused with other high energy drinks that do not contain alcohol and which can be legally purchased by minors.   SUMMARY OF PROVISIONS: Section 1: Amends ABC Law section 105 to add a new paragraph (13) to require licenses that sell CABs for off-premise consumption to post a warning notice about the possible adverse health effects of CABs, that they are alcoholic beverages that should be used with caution, and that such beverages cannot be consumed by persons under the age of 21. The SLA is to approve, by regulation, the size and text of such sign to be posted in such CAB section. Section 2: Amends ABC Law section 107-a(2) to enact more stringent label approval standards for CABs. Under current state law, the labels on all containers of beer, malt liquors, and liquors that have been approved by the Federal Alcohol & Tobacco Tax & Trade Bureau (TTB) are deemed approved upon filing with the State Liquor Authority (SLA) 30 days after such label is filed with the SLA. This bill gives the SLA 120 days to review such label applications so that the Authority has sufficient time to review each application for a label for caffeinated alcoholic bever- ages. Under this bill, the SLA can only approve container labels. or beverage containers that have a disclosure warning affixed to such container that states: A) this is a combination caffeinated alcohol beverage and the health effects of such consumption are unknown at this time, B) however, over consumption may cause future cardiovascular or neurological health problems, C) the stimulant in this beverage may mask the impairment qualities of the alcohol that is also in this product, D) the use of motor vehicles and other machinery should be avoided after consuming this product. In addition, the SLA, when reviewing a container label must ensure that such label cannot easily be confused with other energy drinks or bever- ages. Further, such label should not be designed so as to be attractive to or encourage the consumption of such product by persons under the age of 21. The container label may be approved if a disclosure warning statement similar to the statements contained in Paragraph (2) (a)of the bill are affixed to the container. In addition, such disclosure warning statement must indicate that this beverage contains alcohol and cannot be sold to or consumed by persons under the age of 21. Under this bill, a CAB is defined as being a beverage that has over 2 % of alcohol by volume and 5 milligrams per ounce of caffeine or any other stimulant that has a similar effect. As a point of reference with CABs, carbonated sodas range between 3 - 5 mg/oz of caffeine, coffee contains between 9 - 18 mg/oz, and energy drinks commonly range between 9.5 - 175 mg/oz, with the mean average being between 9 - 20 mg/oz, with some outlying beverages containing 500 mg/oz. Frozen desserts such as coffee ice cream have between 7 - 10 mg/oz, and milk chocolate contains about 6 mg/oz. Section 3: Amends ABC Law section 107-a(2)so that labels filed with the SLA are not automatically deemed approved until 120 days after filing with the authority, instead of 30 days as is now the case for all label approvals for beer, malt liquor, or liquor.   JUSTIFICATION: Energy drinks are designed to make individuals "feel" more aware and awake. To do this, such drinks contain stimulants such as caffeine, guarana, or ginseng, and may also contain proteins and vita- mins. Energy drinks are the fastest growing sector in the beverage market. Energy drinks are primarily marketed to and consumed by persons between 14 35 years old. One of the leading brands in this market, Red Bull, was created in Austria and introduced into the U.S. market in 1997. Red Bull and other energy drinks, have become popular mixers at bars and night clubs, with the Vodka Red Bull being one of the more popular drinks that mix alcohol and caffeine. The popularity of mixing energy drinks with alcohol at bars has led to the introduction of energy drinks premixed with alcohol. Many of these beverages are primarily malt based beverages, and therefore, can be sold in the same places as beer and malt liquor, i.e., supermarkets, conven- ience stores, and bodegas. High alcohol CABs such as Joose and Four Loko are examples of this trend. Clinical and field studies conducted in the past few years have found that the over consumption of CABs that combine high amounts of alcohol and stimulants, such as caffeine, raises significant public health and safety concerns for both the consumer and for the public at large. Among the "Top 10" concerns raised by researchers about CABs include: 1) Individuals, particularly those under the age of 30, who combine alcohol with stimulants engage in riskier drinking behaviors and drink a greater amount in each session. The stimulants used in CABs make indi- viduals feel more aware, but this "feeling" of awareness does not actu- ally decrease the levels of impairment or coordination, reflexes, and judgment that result from excessive alcohol consumption. 2) Individuals are less able to judge their actual levels of inebriation when consuming CABs. This can lead individuals to consume more alcohol than they would otherwise consume if just consuming an alcoholic bever- age alone. Normally, with the consumption of alcohol (a depressant), consumption goes down as the drinking event progresses because the subject becomes more tired. Instead, with CABs, the consumer becomes drunk, but more awake, which can lead to the further consumption of alcohol. The Marion Institute stated that this product "brilliantly keeps them alert and wanting to keep drinking the product". Other studies have demonstrated that consumption of such beverages leads to significantly higher levels of episodic drinking and episodes of weekly drunkenness. There have been examples in Westchester County of underage persons getting alcohol poisoning because they drank CABs to excess and did not have the inhibition needed to stop consuming these CABs. 3) Consumption of CABs makes such persons think that they can mistakenly undertake dangerous activities such as driving an automobile. 4) CABs are commonly consumed by underage drinkers and those who are under 25 years of age who are generally less sophisticated about when and how to properly consume alcoholic beverages. This can lead to higher incidences of physical injury, sexual assault, becoming the victim of sexual assault, and alcohol poisoning. In addition, underage consumers tend to already have underdeveloped decision making skills, which the consumption of alcohol clouds further. 5) CAB manufacturers have aggressively geared their product packaging, marketing programs, and the taste of their product to further draw consumers between the ages of 14 - 25. Currently, the existing CAB market is male dominated, however, manufacturers are shifting their attention to obtain a larger female consumer base, by offering CABs that are touted as being "light", "sugar-free" or "low carb". In sum, the trend is for more individuals between the ages of 14 and 35 to consume such products, not less. 6) The long term health effects of consuming high levels of alcohol (a depressant) and caffeine (a stimulant) are not known. However, having two agents in the same beverage that have opposite effects has generally been considered to be detrimental to long term health. The Federal Food and Drug Administration (FDA) is now looking into the safety and legali- ty of these beverages. Those experimental studies that have been conducted have not established the safety of co-ingesting caffeine and alcohol, but there are indications that it may heighten the risk of cardiovascular and neurological damage. 7) Both alcohol and caffeine are diuretics; therefore, the combination of these two substances in one beverage can leave the consumer severely dehydrated. Further, the high sugar levels of CABs does speed up the absorption of alcohol into the blood stream. 8) The prime market for CABs and for all energy drinks is the same, persons between 14 and 25 years of age. In general, CABs are sold at relatively low cost to a demographic group that does not have a lot of money. Further, these beverages are priced much lower than beer to retain and expand market share. While many CABs have alcohol content well above beer and sometimes at the level of wine, its excise tax rate is assigned at the same level as beer, the lowest level of excise taxes levied and collected. This low cost of the product makes them extra attractive to young people, who have been shown to be very price conscious. 9) The labeling of CABs is very similar to that of non-alcoholic energy drinks, and meant to be attractive to young people. Energy drink maker Rockstar, introduced an alcoholic version called Rockstar 21 and the extreme similarity in labeling of the company's alcoholic and non-alco- holic energy drinks lead to an outcry which forced Rockstar 21 from the market. Other alcoholic energy drink makers continue to produce cans that are brightly colored with bold designs meant to project an image of energy common with regular energy drinks and inherently more attractive to younger consumers. With new brands of CABs and energy drinks going on the market all of the time, this lack of clear labeling as to what is alcoholic and not alcoholic can confuse store personnel and police offi- cers as to which products have alcohol or not. This can lead to law enforcement problems in accurately identifying which beverages can be sold to or possessed by minors and which beverages are subject to open container laws. 10) Easy access to CABs by underage drinkers in convenient stores and bodegas can encourage youth to start drinking alcohol earlier in life and can significantly increase alcoholism later in life and the manifes- tation of other addictive behaviors, such as gambling and substance abuse, in the future. The rapid expansion in the market share of CABs has raised questions about how these drinks are formulated, their caffeine levels, and alco- hol content, and whether they are properly classified as malt beverages under federal and state law. In 2007, 28 state Attorney Generals contacted the TTB to inquire about the questions outlined above. Further, the FDA is making similar inquiries about the safety of consum- ing such beverages. The purpose of this bill is three fold. First, it is to tighten the labeling requirements of CABs so that a notice is placed on the beverage container and at the point of sale to warn its users that repeated use of such products may be unhealthy, particularly for those under the age of 25. Second, these beverages tend to be consumed by persons under the age of 30 and those who are not legally able to purchase alcoholic beverages. From the perspective of law enforcement officials and store sales personnel, the look of labels for certain high energy drinks that have alcohol and do not have alcohol are indistinguishable. Therefore, it is difficult for law enforcement to screen underage drinkers or those persons who are violating the open container law. Further, for store personnel, it is also difficult to differentiate between alcoholic and non-alcoholic beverages. This bill ensures that such containers are easily distinguishable so that alcoholic beverages can be clearly iden- tified from non-alcoholic beverages. Third, caffeinated alcohol drinks are overwhelmingly consumed by persons under the age of 30, and many are consumed by underage drinkers. This bill ensures that these beverages should not be packaged to attract underage consumers of alcohol. A similar standard has been instituted for commercials and advertising related to tobacco products, including their packaging, for many decades.   LEGISLATIVE HISTORY: 2011/12: A5169 Held in Economic Development 2013/14: A5873 Referred to Economic Development   FISCAL IMPLICATIONS: None   LOCAL FISCAL IMPLICATIONS: None   EFFECTIVE DATE: This act shall take effect 270 days after it shall have become law, provided however, the State Liquor Authority shall promulgate rules and regulations to implement this act within 120 days of the effective date of this act
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A08443 Text:

                STATE OF NEW YORK
                               2015-2016 Regular Sessions
                   IN ASSEMBLY
                                     October 9, 2015
        Introduced  by  M. of A. ORTIZ, ROBINSON, AUBRY -- Multi-Sponsored by --
          M. of A.  ARROYO, THIELE -- read once and referred to the Committee on
          Economic Development
        AN ACT to amend the alcoholic  beverage  control  law,  in  relation  to
          requiring the segregation of certain alcoholic beverages with a stimu-
          lant  sold for off-premises consumption and the labeling of containers
          containing certain alcoholic beverages
          The People of the State of New York, represented in Senate and  Assem-
        bly, do enact as follows:
     1    Section  1.  Section  105  of  the  alcoholic  beverage control law is
     2  amended by adding a new subdivision 13 to read as follows:
     3    13. (a) Each retail license for off-premises  consumption  that  sells
     4  alcoholic  beverages  that  contain  more than two per centum alcohol by
     5  volume, in combination with more  than  five  milligrams  per  ounce  of
     6  caffeine  or  any other stimulant including, but not limited to guarana,
     7  ginseng or taurine that has an equivalent effect  as  such  quantity  of
     8  caffeine  shall sell such alcoholic beverages in an area of the licensed
     9  premises that is segregated from the area where other beverages, includ-
    10  ing alcoholic beverages, are sold. No such alcoholic beverages  contain-
    11  ing  a  stimulant  shall be commingled with other alcoholic beverages or
    12  energy drinks.
    13    (b) At the front of the segregated area of the licensed premises where
    14  alcoholic beverages containing a stimulant are sold, the licensee  shall
    15  conspicuously  post  a sign containing the notices and warnings provided
    16  for in paragraphs (a), (b) and (c) of subdivision  one  of  section  one
    17  hundred  seven-a  of  this article.   Furthermore, such sign shall state
    18  that these beverages contain  alcohol  and  by  law  cannot  legally  be
    19  consumed  by  persons  under the age of twenty-one years, and that these
    20  beverages should not be confused with energy drinks.  The  state  liquor
    21  authority  shall  be  authorized  to  promulgate  rules  and regulations
    22  providing for the form and content of such notices and warnings.
         EXPLANATION--Matter in italics (underscored) is new; matter in brackets
                              [ ] is old law to be omitted.

        A. 8443                             2
     1    § 2. The closing paragraph of subdivision 1 of section  107-a  of  the
     2  alcoholic beverage control law, as amended by chapter 354 of the laws of
     3  2013, is amended to read as follows:
     4    Such  regulations  shall  be  calculated  to prohibit deception of the
     5  consumer; to afford him or her adequate information as  to  quality  and
     6  identity;  and to achieve national uniformity in so far as possible.  In
     7  addition, for the approval of labels for  containers  of  any  alcoholic
     8  beverage  that  contains  more than two per centum alcohol by volume, in
     9  combination with more than five milligrams per ounce of caffeine or  any
    10  other  stimulant  including,  but  not  limited  to  guarana, ginseng or
    11  taurine that has an equivalent effect as such quantity of caffeine,  the
    12  label or container thereof must:
    13    (a)  have  a disclosure that is either part of the label or affixed to
    14  the container that advises purchasers that this alcoholic  beverage  (i)
    15  contains  a combination of high concentrations of alcohol (a depressant)
    16  and caffeine (a stimulant) or another stimulant,  and  that  the  health
    17  effects of such combination are not completely known; (ii) over consump-
    18  tion  of  this  alcoholic  beverage  may  cause future cardiovascular or
    19  neurological problems, higher risk of accidental physical injury to  the
    20  consumer  or  others,  or alcohol poisoning; (iii) the stimulant in this
    21  alcoholic beverage may mask the level of impairment  and  disorientation
    22  that  can  occur  due to the amount of alcohol that is also contained in
    23  this beverage; and (iv)  the  operation  of  motor  vehicles  and  other
    24  machinery should be avoided after consuming this alcoholic beverage;
    25    (b) be designed so that it cannot be confused with other energy drinks
    26  or beverages that are not alcoholic  beverages and are legally available
    27  for  sale  to persons under the age of twenty-one years. Such design may
    28  be accomplished by a label design that places a stripe or other  indica-
    29  tor  to  show  that  this  beverage  contains alcohol or by affixing the
    30  disclosure required by paragraph  (a)  of  this  subdivision  that  also
    31  clearly  indicates  that  the  beverage  contains alcohol and that it is
    32  illegal to be consumed by any person under the age of twenty-one  years;
    33  and
    34    (c)  be  designed  so  as  not  to  be  attractive to or encourage the
    35  consumption of such alcoholic beverage by persons under the age of twen-
    36  ty-one years. Such design may be accomplished by  a  label  design  that
    37  clearly  indicates  that  this  is  an alcoholic beverage that cannot be
    38  legally consumed by persons under the age of twenty-one years or by  the
    39  prominent  affixing  of the disclosure required by paragraph (a) of this
    40  subdivision.
    41    § 3. Clause (ii) of subparagraph 2 of paragraph (a) of  subdivision  4
    42  of  section  107-a  of the alcoholic beverage control law, as amended by
    43  chapter 354 of the laws of 2013, is amended to read as follows:
    44    (ii) the authority does not deny such application within  thirty  days
    45  after  receipt;  provided,  however,  that with respect to any alcoholic
    46  beverage that contain a combination of alcohol  and  caffeine  or  other
    47  stimulant, as described in subdivision one of this section, the authori-
    48  ty  does  not deny such application within one hundred twenty days after
    49  receipt so that the authority has a sufficient period of time to  review
    50  such label and ensure that the requirements established in such subdivi-
    51  sion are complied with.
    52    §  4.  This  act  shall  take effect on the two hundred seventieth day
    53  after it shall have become a law.    Effective  immediately,  the  state
    54  liquor authority is authorized to add, amend and/or repeal any rules and
    55  regulations necessary to implement the provisions of this act within one
    56  hundred twenty days after it shall have become a law.
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