Will New State Law Kill California’s Vape Industry?

On March 10, the California State Senate voted to raise the legal age to purchase tobacco products from 18 to 21. But the language in the bill,  SBX2-5, extends beyond cigarettes, rolled up cigars, hookah and chewing tobacco to include all electronic cigarettes and vape products (minus the ones that contain medicinal cannabis).

This means that if Gov. Jerry Brown signs SBX2-5, no one under 21 in the state of California will be allowed to work in the vape business. “We found that 30 to 35 percent of employees on the manufacturing and retail sides of the industry are currently employed and under the age of 21,” says Shane Simpson, owner of the C3 Vapors shop in Costa Mesa. “So that means that huge percent of our workforce is going to be unemployed, and a lot of times it’s these kids’ first jobs and exposure to business.”

As Gov. Brown is expected to sign the bill in 90 days, Simpson is being forced to let go of four employees as a result of being under age.  Meanwhile, Simpson says, his and other Vape shops are immediately going to lose a major chunk of their clientele. “35 percent of my customer base is between the ages of 18 and 21,” he says. “Along with having to pay $4,100 in permit fees and potentially having to pay unemployment out of my own pocket for the underage employees that I’m being forced to let go, I’m basically out of business.”

According to Simpson, Orange County is the vape industry’s national epicenter. “Vaping found its first market and really began in Orange County,” he says, estimating that about 60 percent of vape manufacturing is in Southern California. “We’re talking about 60 percent of a $1.5 billion industry,” Simpson says.

SBX2-5 follows California’s Stop Tobacco Access to Kids Enforcement (STAKE) Act, which was passed in 2004 and prohibits a person from selling or otherwise furnishing tobacco products to minors. Although changing the age from 18 to 21 requires California to abide by those laws more strictly, Simpson explains that bordering states that have lenient tobacco laws, like Nevada and Arizona, are expected to absorb companies that are run out of business here.

Perhaps the most fascinating aspect of this issue lies in the grey area of where marijuana falls into the equation. “Here’s the funny thing about his bill,” says Simpson. “Prop 215 (the medicinal use of marijuana) is excluded from any of the verbiage of these bills; so as long as you’re over 18 you can still get a prescription and still use marijuana vaping products,” he says.

It’s unclear where vaporizing marijuana fits into this equation, or if a similar legislation will appear in the world of cannabis in years to come. In the mean time, however, SBX2-5 is set to go into effect as soon as Gov. Brown signs the bill. “There’s a 3 year generation gap between people 18 – 21 years of age, who won’t be able to vape and who will be unemployed in 90 days,” says Simpson. “The retail side of the industry is going to take a major hit.”

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