NATO Speaks Against Limiting Tobacco-Shop Licenses

Retail association calls St. Paul move ‘arbitrary and capricious’
Angel Abcede

ST. PAUL, Minn. -- As the St. Paul (Minn.) City Council moved to limit the number of new tobacco-shop licenses it issues annually, one tobacco retailing association spoke against what it calls an “arbitrary and capricious” move.

The City Council voted June 27 in favor of a proposed ordinance in a follow-up to its previous action of restricting the sale of menthol-, mint- and wintergreen-flavored tobacco products to 21-and-older stores—namely, tobacco shops and liquor stores, according to the Pioneer Press. That ordinance effectively shuts out convenience stores from selling those products, even though they can sell regular cigarettes. The new ordinance, as proposed, would limit the number of licenses allowed to the current amount, 242, which accounts for all existing tobacco-retailing licenses in the city.

Council members expressed concern that if it became more lucrative to sell menthol products because of the recently passed restrictions, then the number of new tobacco shops could expand exponentially, thwarting the original goal of the ordinance, which was to reduce smoking among residents.

In a letter to the seven council members, Tom Briant, executive director of Lakeville, Minn.-based NATO, said the ordinance limiting new tobacco shops runs contrary to the city’s economic development plan and is not based on hard data.

“Setting the number of retail-tobacco licenses is an arbitrary exercise because it assumes that the current number of licenses is optimal without any statistical study or factual support,” said Briant, whose group represents tobacco retailers, in the letter dated June 19. “In addition, other property owners who may have appropriate zoning for retail-store activity would have their rights arbitrarily taken from them without compensation, a matter which may expose the city to litigation. Such policy decisions need careful thought and analysis so as not to stifle economic development in a free market system.”

Considering that stores will probably close due to the menthol-flavor restrictions and other local rules discouraging retail development, setting a maximum number of retail licenses “becomes unnecessary” as the actual number of stores will most likely be less than 242 due to the expected decline in tobacco sales, Briant said.

In the past, city lawmakers elsewhere have used permitting as a way to limit tobacco sales. In Philadelphia, lawmakers passed a rule in 2016 limiting the number of retailers who could sell tobacco based on population counts.

Image credit: Angel Abcede

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