LEGISLATIVE SERVICES AGENCY
OFFICE OF FISCAL AND MANAGEMENT ANALYSIS
200 W. Washington St., Suite 301
Indianapolis, IN 46204
(317) 233-0696
iga.in.gov
FISCAL IMPACT STATEMENT
LS 6741 NOTE PREPARED: Dec 29, 2023
BILL NUMBER: SB 227 BILL AMENDED:
SUBJECT: Directory of Approved Vaping Products.
FIRST AUTHOR: Sen. Gaskill BILL STATUS: As Introduced
FIRST SPONSOR:
FUNDS AFFECTED:XGENERAL IMPACT: State & Local
XDEDICATED
FEDERAL
Summary of Legislation: This bill requires manufacturers of alternative nicotine products and vapor
products to annually certify their products with the Department of State Revenue (department). It requires
the department to establish and maintain a directory on the department's website of all manufacturers of
alternative nicotine products and vapor products. It provides that, if an alternative nicotine product or vapor
product is removed from the directory, each retail dealer, distributor, or wholesaler has 21 days from the day
the product is removed from the directory to remove the product from its inventory and return the product
to the manufacturer for disposal. It provides that, after the 21 day period, the alternative nicotine products
or vapor products of a manufacturer identified in the notice of removal are contraband and are subject to
seizure, forfeiture, and destruction and may not be purchased or sold in Indiana.
The bill provides the department with certain enforcement authority. It provides that all fees and penalties
collected by the department must be used by the department to administer the directory and enforce the
requirements associated with the directory. It provides that any alternative nicotine products or vapor
products offered for sale in violation of the directory requirements are declared to be contraband and may
be seized without a warrant by the department or by any law enforcement agency in Indiana if directed by
the commissioner of the department. It provides that a person may not advertise, distribute, market, offer for
sale, or sell a vapor product by using, in a trademark of the product or in the product's advertising branding,
design, marketing, or packaging, certain terminology that is attractive to minors.
The bill requires the department to submit an annual report to the General Assembly.
The bill also provides that a violation of the directory requirements constitutes a deceptive act that may be
enforced by the Attorney General.
SB 227 1 Effective Date: July 1, 2024.
Explanation of State Expenditures: Vaping Products Directory: The bill will increase the workload and
expenditures of the Department of State Revenue (DOR) to administer the directory, adopt rules, submit an
annual report to the General Assembly, conduct compliance checks, and enforce the bill’s provisions. Any
increase in workload and expenditures for the DOR will be financed through the penalties and fees collected
from the enforcement and administration of the directory.
Deceptive Acts: This bill adds to the list of unfair and deceptive acts that are actionable by the Attorney
General (AG). To the extent the AG enforces provisions of this bill, agency workload would increase to
investigate and potentially prosecute allegations. Increases in AG workload are expected to be accomplished
within existing resource and funding levels.
Agent Appointment: The Secretary of State may see additional workload if any nonresident or foreign
manufacturers fail to appoint an agent as required by the bill and the Secretary of State is appointed. The
bill’s requirements are within the agency’s routine administrative functions and should be able to be
implemented with no additional appropriations, assuming near customary agency staffing and resource levels.
Explanation of State Revenues: Vaping Products Directory: The bill will increase revenue from fees
imposed on manufacturers for registering alternative nicotine products and vapor products and from penalties
imposed on manufacturers, distributors, wholesalers, and retail dealers for violations of the bill’s provisions.
The DOR must use the revenue to administer and enforce the requirements associated with the directory.
The initial fee for certification of an alternative nicotine product or vapor product is $250 with a subsequent
annual fee of $250. The DOR may impose a civil penalty of $500 per day on a manufacturer and $1,000 per
day on a distributor, wholesaler, or retail dealer for selling a product in Indiana that is not listed in the
directory. In addition, the following civil penalties would be imposed on a person for violating the bill’s
provisions regarding marketing to minors: $100 for the first violation, $500 for the second violation, and
$2,500 for the third and subsequent violations. The potential revenue collected from annual certification fees
could be significant and would depend on the number of products listed in the directory. Revenue from civil
penalties would likely be minor.
Deceptive Acts: Unfair and deceptive acts discovered by the AG carry a maximum $5,000 civil penalty for
each violation, which is deposited in the General Fund. If this bill increases the number of unfair and
deceptive acts discovered in the state, revenue to the General Fund will increase from civil penalties paid by
violators. Actual increases in revenue are unknown but expected to be small.
Court Fee Revenue: If additional civil cases occur and court fees are collected, revenue to the state General
Fund will increase. The total revenue per case would range between $100 and $122. The amount deposited
will vary depending on whether the case is filed in a court of record or a municipal court. The following
linked document describes the fees and distribution of the revenue: Court fees imposed in civil, probate, and
small claims cases.
Explanation of Local Expenditures:
Explanation of Local Revenues: Court Fee Revenue: If additional cases occur, revenue will be collected
by certain local units. If the case is filed in a court of record, the county will receive $32 and qualifying
municipalities will receive a share of $3. If the case is filed in a municipal court, the county receives $20,
SB 227 2 and the municipality will receive $37. The following linked document describes the fees and distribution of
the revenue: Court fees imposed in civil, probate, and small claims cases.
State Agencies Affected: Department of State Revenue; Office of the Attorney General; Secretary of State.
Local Agencies Affected: Trial courts, city and town courts.
Information Sources: Indiana Supreme Court, Indiana Trial Court Fee Manual.
Fiscal Analyst: Nate Bodnar, 317-234-9476.
SB 227 3