Selling E-cigarettes to Children—Roger Dickinson and AB 1500

There’s a bill in front of the California State Assembly appropriations committee right now that’s aimed at preventing online sales of electronic cigarettes to minors. That’s the official justification for Roger Dickinson’s AB 1500, anyway.

On the face of it, that’s all well and good, right? Nobody wants to sell either tobacco products or e-cigarettes to minors, and the sale of electronic cigarettes to minors in California is already prohibited by Health and Safety Code Section 119405.

So, wait…if it’s already illegal to sell to minors, why do we need another law to prevent sales to minors? Well, see, AB 1500 is designed to make it more difficult to sell to minors. The bill requires proof of age both at the time of purchase and at the time of delivery.

Age Verification at Purchase

Age verification at the time of purchase is the equivalent to showing your ID when you go to buy a pack of cigarettes or a bottle of wine. It’s a logical requirement. But the time has not yet come when you can just wave your driver’s license at your webcam.

Roger Dickinson’s AB 1500, as amended on April 21, 2014, mandates that the seller must verify the name, age, and address of the purchaser by means of “a commercially available database or aggregate of databases, consisting primarily of data from government sources, that are regularly used by government and businesses for the purpose of age and identity verification and authentication.”

Subscription to one of these database services is an expense for the vendor that has to be recouped through increased prices. Some e-cigarette and e-liquid vendors already use this method of age verification. Not all of them, however, because services like LexisNexis Instant Age Verify charge a percentage of each transaction, which takes a considerable bite out of every purchase, coming as it does on top of merchant service fees.

And as with merchant services, there’s usually a minimum monthly charge even if no sales are made. For smaller vendors, that minimum charge, combined with the cost of integrating the service into their shopping carts, acts as a deterrent. For the very smallest vendors, the ones who sell through their Facebook pages, integrating such a service would not even be possible.

So age verification at the time of purchase appears on the surface to be an appropriate requirement, but places a financial burden on small businesses that will inevitably be passed on to the consumer.

How Do Age Verification Services Work?

Another reason vendors may be reluctant to subscribe to services like LexisNexis, IDology, Integrity, and DoubleCheck is the methods they use to verify the age and identity of the consumer. As I mentioned above, the purchaser cannot simply hold her California Driver’s License or State ID card in front of her webcam, and computers are not equipped with bar code or magnetic strip scanners.

Therefore, the databases use the same kinds of questions that credit services do when you ask for an online credit report. In order to establish your identity, you not only have to enter your date of birth but to confirm previous addresses, phone numbers, and credit card or loan accounts. And if you’ve re-financed your mortgage or your credit card company was bought out, you might answer those questions incorrectly even if you are, in fact, the real Jane Doe.

Everyone who knows anything about online sales knows that the more steps you put between “add to cart” and “submit payment,” the more likely the person is to leave the site without buying—a phenomenon known as “shopping cart abandonment.”

This puts the vendor’s requirement not to sell to minors in conflict with the need not to lose sales.

What’s more, despite their marketing, age verification services aren’t foolproof. What about people who have no credit history? Shocking as it seems to most Americans, there are those who don’t use credit. There are recent immigrants who won’t show up in those records, but who are over 18. Just try waving your green card in front of that webcam.

For the purposes of a vendor, however, just having a credit or debit card with a billing address and phone number that can be confirmed with the bank actually makes it pretty likely that the purchaser is over 18. The Visa and Amex gift cards that anyone can buy in the grocery store don’t have billing addresses and phone numbers associated with them—or even cardholder names, for that matter.

No one under the age of 18 can open a bank account in California without having a parent or guardian co-sign for the account. Accounts like Wells Fargo’s Teen Checking notify parents about every purchase. This suggests that unless your teen is stealing your credit card number, age verification via specialized services is redundant.

Age Verification on Delivery

In addition to requiring age verification through a commercially available database (to the profit of those making the database available), AB 1500 also requires that

The delivery seller shall use a method of mailing or shipping that requires all of the following: (A) The consumer placing the delivery sale order, or an adult who is at least 18 years of age at the place of delivery, shall sign to accept delivery of the electronic cigarette at the delivery address.

(B) The person who signs to accept delivery of the electronic cigarette shall provide proof, in the form of a valid, government-issued identification bearing a photograph of the person, that the person is 18 years of age or older.

Because of my migraines, I have a prescription for Vicodin, which is a controlled substance. When the prescription runs out, all I have to do is log into the Kaiser website, request a refill, provide my payment information, and confirm my delivery address. The system double-checks with my doctor to authorize the prescription and the pharmacy sends out the medication. I don’t even have to sign for the package when it arrives, never mind provide proof of identification.

So why make it so much more difficult to obtain electronic cigarettes, which are entirely legal for adults to purchase?

Roger Dickinson’s argument is that age verification on delivery is required for the shipment of tobacco products. In his mind—and in the minds of many politicians around the nation—electronic cigarettes are a tobacco product because the nicotine in e-liquid is derived from tobacco.

The fact that no actual tobacco is used in the devices and they produce no harmful smoke is irrelevant. Many laws have already been passed that equate e-cigarettes with tobacco cigarettes and vaping with smoking. Many more are in the works. I expect to wear a groove in the road between my house and the Capitol building in the next few years because of this.

Smokers can walk into any gas station or convenience store and buy cigarettes, so there isn’t actually much call to buy tobacco products online, except for the interestingly-exempt “premium cigars” so beloved of Congress. The only e-cigarettes available outside of specialty vape shops are “cigalikes”—which tend to provide the least satisfying vaping experience. Vapers are always ordering online. “Vape mail” is a daily routine for some people, as new tanks, mods, batteries, drip-tips, wicks, coils (or wire to make them), and “juice” arrives from across the state, across the country, or indeed overseas.

A law that requires age verification on delivery for electronic cigarette purchases would obviously hit vapers hard. That service costs money—one reason carriers like UPS support AB 1500—and anyone who misses a delivery faces the inconvenience of going to collect the package at the nearest pick-up point. One vaper in the unincorporated community of Piercy reported that she would have to drive to Leggett to pick up any packages, as the Piercy post office had burned, and the post office in Leggett was likely to close, which would result in a trip to Laytonville, more than 100 miles one way.

Most rural residents are in a similar situation, and they have no choice but to order online—there are no local vape shops. In fact, there are hardly any local shops of any kind.

AB 1500 is a bill that disproportionately affects low-income Californians who may not be able to pay the fees for the age-verification service, Californians with mobility and transportation issues who may not be able to pick up packages if they miss a delivery, and Californians who live in rural areas.

The people it won’t make the slightest difference to are teenagers.

Consistency with laws that govern tobacco be damned. The only reasons for Roger Dickinson to write a law demanding age verification on delivery of electronic cigarettes (and AB 1500 was originally intended to ban online sales outright) are political grandstanding and a complete failure to understand the way teenagers actually behave.

Let’s Take a Look at Teenage Smoking, Shall We?

I did not smoke as a teenager. In fact, I was one of those insufferable goody-two-shoes, teacher’s pet kind of kids. I got good grades and stayed out of trouble, and I never smoked, or drank, or experimented with drugs. I read books and was terrible at sports. I was utterly, hopelessly uncool.

But being uncool, I did not have a wide range of choice in the friends department, so I found myself hanging out with other outcasts. And some of them were, in fact, the class delinquents—the ones who started smoking at ten or eleven, who got bad grades, who got into fights, who got into trouble, but who at least didn’t make fun of me for being a nerd who wore the wrong clothes.

And how was it that someone could start smoking in middle school? Even in the Seventies, a four-foot-ten thirteen-year-old girl did not walk into a store and buy cigarettes. I mean, let’s get real, here. It would be years before this girl would be able to pull off a fake ID. No store would sell her cigarettes unless the owner wanted to go out of business.

No store ever had to. Teenagers don’t buy their cigarettes in stores.

They steal them from their parents or grandparents or older siblings. They buy them on the street from older kids. They pay homeless people to go into the cigarette store to make the purchase. This is the same way they get alcohol, and it’s the same way they get electronic cigarettes.

A law aimed at making it harder for minors to buy from stores is pointless. Kids under the age of 18 assume that stores will not sell to them.

As for online purchases, if your kid is using your ID and credit cards to order e-cigs, what the heck are you doing leaving your wallet lying around? Personally, I’d recommend putting it in the gun safe. (You need the gun to shoot the teenagers with, anyway.) And why haven’t you explained that identity theft is a crime? For that matter, hasn’t anyone told you about password-protecting your computer? Your offspring do not need access to any of your login information or financial records.

And don’t you read your statements? Because a purchase at an e-cig vendor ought to stand out, so you really ought to catch on pretty quickly. Is it the state’s job to compensate for poor parenting?

What about Teenage Vaping?

More importantly, however—in spite of the media hype, teens aren’t vaping. The vast majority of e-cigarette users are middle-aged. They are the people who smoked at least a pack a day for ten years or more and couldn’t quit any other way.

Want some research to back that up? Action on Smoking and Health surveyed 2,178 children between the ages of 11 and 18 in 2013. Two-thirds of them had heard of electronic cigarettes. Only 7% of those who knew of their existence had ever tried an electronic cigarette. Of the children who said they had never smoked a tobacco cigarette, 99% had never tried an e-cigarette.

A similar study conducted in the United States in 2011 and published in the Journal of Adolescent Health in 2013 found that of 228 adolescent males between the ages of 11 and 19, only two—less than 1%—had ever used an e-cigarette. Of the 18% of respondents who expressed willingness to try an e-cigarette, 74% were smokers. (One of the most interesting results of this study was the fact that flavorings had no effect on the boys’ interest in trying e-cigarettes.)

And despite the alarmist tone of the MMWR report accompanying the release of the CDC’s National Youth Survey on Tobacco data for 2011 and 2012, the actual figures don’t support anything like the kind of panic we’ve seen in the media. The CDC survey indicates that as of 2012, 2.7% of middle school students and 4.7% of high school students had ever tried an e-cigarette, while only 1.1% of middle school students and 2.8% of high school students had used an e-cigarette within the past month.

The authors of the article are horrified by the fact that 160,000 out of the 1.78 million teens who had tried e-cigarettes had never smoked before. But do the math. More than 91% of the adolescent e-cigarette users surveyed by the CDC were already smoking.

Even among teens, it’s primarily smokers who use e-cigarettes.

Furthermore, a survey of 4444 students from 8 colleges in North Carolina (conducted in 2009 but not published until 2013) found that only 4.9% of them had ever used an e-cigarette. Though numbers have probably increased since then (the e-cigarettes available in 2009 were extremely primitive), the results are still highly suggestive. Young people do not make up the bulk of the vaping population.

In fact, teenagers are much more likely to be smokers than vapers. That same National Youth Tobacco Survey found that 25.9% of adolescents had smoked “analog” cigarettes, and 20.7% who had tried a cigar, cigarillo, or little cigar. Good old-fashioned smoking obviously remains a much bigger threat to young people than electronic cigarettes.

The Real Effects of AB 1500

Roger Dickinson and the proponents of AB 1500 claim that this bill will safeguard the well-being of California’s children, that allowing online sales of electronic cigarettes to continue as they are “poses a serious threat to public health, safety, welfare, and economy of the state.”

But in law, as in crime, it’s important to ask “Who benefits?” What will actually happen to California’s teens, business owners, and consumers if this bill becomes law?

First, and most importantly, AB 1500 will not prevent minors from using e-cigarettes.

AB 1500 is a solution in search of a problem. Very few people under the age of 18 have even experimented with e-cigarettes, and most of those who do already smoke—in spite of the fact that it is illegal for them to purchase tobacco cigarettes. There is no more reason to believe that children are ordering their electronic cigarettes and vaping supplies online than that they buy their tobacco cigarettes online. The minors are not doing the buying, so age verification is not the answer.

The smallest e-liquid vendors will be forced out of business. Services like LexisNexis will make a tidy profit.

Larger and more successful vendors will choose a commercial age verification service like LexisNexis Instant Age Verify and pay the setup and website integration fees, monthly minimums, and per-transaction fees. Their prices will increase accordingly. Those who had a side business selling e-juice on Facebook will close up shop. (That might not be entirely a bad thing.)

LexisNexis, IDology, Integrity, et al. will profit handsomely—makes me wonder whose campaigns they contribute to, or which politicians have a financial interest in them.

Shopping cart abandonment will increase dramatically, especially among older consumers.

It’s no secret that it’s older consumers who find e-commerce the most confusing. Your delinquent teen is more likely to figure out to hack the age verification system than your retired parent, who has finally found a safer alternative to smoking after 40 years, is to understand how to use it honestly. So I hope the age verification database services will still work when Grandpa picks up the phone to provide his credit card number that way.

Customers will order from out of state or overseas

(Section added 5/12/14) Savvy consumers will order from out-of-state vendors, or even from overseas, in order to avoid the inconvenience and higher costs associated with age verification at both purchase and delivery. Many vapers already order hardware from large discount outlets in China, though few trust Chinese-made e-liquid. And many popular manufacturers of e-liquid, such as Mt. Baker Vapor, Virgin Vapors, and The Vapor Chef, are already located outside of California. If AB 1500 passes, California vapers will have no incentive at all to buy from California vendors unless they live in the same city.

The text of AB 1500 claims that online sales of e-cigarettes, without the interference of the bill, pose a threat to California’s economy. But AB 1500 itself poses a much greater threat. According to Forbes, E-cigarette sales have already surpassed $1 billion. Most e-cigarette vendors are small businesses, an estimated 13,000 in the United States.

Those businesses provide jobs to local residents. They pay sales tax. They pay rent or property tax. They pay business license tax. They make positive contributions to state and local economy.

Roger Dickinson wants to send their customers out of state. How will that help the economy? How will that help the unemployment problem?

UPS, USPS, and FedEx will profit, but not as much as they expect to.

Right now USPS offers adult signature required delivery (“adult” in this case meaning someone over 21) for a modest $5.20 along with its Priority Mail service. USPS policy states that shipments of cigarettes and smokeless tobacco, which could be construed to include e-cigarettes, must be presented at a retail counter. That means e-cigarette vendors will have to send someone to the post office with their outgoing packages every day.

UPS also defines “adult signature” as “over 21.” They offer the “adult signature required” service with all of their delivery options, for $5.25. FedEx Adult Signature Required service is available on US Express and US Ground services and costs $4.75 per package. DHL does not appear to offer adult signature services.

Vendors will have to pay these fees, which means they will charge them to their customers. Customers who can will order less frequently, in order to reduce the fees they pay. For some consumers, the fees will mean that purchasing locally, or even driving an hour or more every few months, is more cost-effective than ordering online. Therefore, current online sales of e-cigarettes and related supplies are not a good indication of the fees that couriers can expect to collect.

Because all of these services require the recipient to be over 21 rather than over 18, vapers between the ages of 18 and 21 will be unable to order e-cigarettes or e-liquid online, unless the couriers change their adult signature services or add new over-18 services. It is not therefore possible to implement the law exactly as written.

Enforcement will be nearly impossible.

California does not have a central register of businesses, never mind a central register of business websites. Who is going to go through every city’s roll of business licenses to find the e-cigarette vendors, discover which ones are selling online, and find out whether they have, in fact, signed up with a service like LexisNexis? Who is going to test the purchase process to make sure that the age verification database has been implemented correctly?

Who is going to perform the spot checks at post offices, UPS Stores, and FedEx offices around the state to make sure that e-cigarette packages are correctly declared and the adult signature forms filled out? Who will check to be sure that the IDs of recipients are in fact being checked?

Who will hand out and enforce the fines? Every city’s police department is already overtaxed, often with crimes considerably more urgent than compliance with a law of very dubious utility. Law enforcement officers are needed to protect California’s children from gang violence, drug dealers, and drunk drivers, rather than their own attempts to buy a product that has not been convincingly shown to be harmful.

Consumers for whom age verification on delivery is impractical will go back to smoking.

Perhaps Roger Dickinson and the American Lung Association would like to believe that if you make it difficult for people to vape, they will just quit, and suddenly there will be more non-smokers in the world. But although vapers don’t seem to experience the intense cravings that smokers do, most vapers don’t intend to stop using nicotine altogether.

Dedicated vapers will find ways to stock up on supplies so they can go on vaping, because they feel strongly about vaping rather than smoking. But many people, hearing about proposed barriers to vaping, respond by taking the path of least resistance: “Shit, I’ll just go back to smoking.”

Is that really the outcome Roger Dickinson wants?

And what about the allegation that e-cigarette vendors are marketing to children?

We’ll cover that in Part 2 of this article. Stay tuned…