RETAILER by alicejenny



               RETAILER                                            North Carolina Retail Merchants Association
                               September 1, 2010 · Volume 92

  In This Issue                 It’s a Wrap!
NC General
Assembly Year in                  NC General Assembly Year in Review (Part -three)

Review -
Part-three                            n the last issue of                        STORE OPERATIONS
                                      the Retailer, we                       (continued from It’s a Wrap: part -two)
You Decide: What
Should be Done                        summarized the
Now?                                  labor, tax and                      Fire Safe Cigarettes
           Page 3              store operations                           Bill:                 HB 1905
                               legislation that the NCRMA lobbying        NCRMA Position: MONITOR
                               team tackled this past legislative         Outcome:              PASSED
                               session.                                   Effective Date:    JULY 1, 2010

                               Included in this issue are several         During the 2007 session, the North
                               specific bills related to store            Carolina Legislature passed HB 1785,
                               operations (continued), tort reform        the NC Fire Safety Standard and Fire
                               and the environment. If you would          Fighter Protection Act, often referred
                               like detailed information about a          to as the “Fire Safe Cigarette Act”.
                               particular issue or to request a           It became effective January 1, 2010
                               complete legislative report, e-mail        and requires that: 1) all cigarettes sold
                               Fran Preston at           or offered for sale in North Carolina
                                                                                   IT’S A WRAP Continued on page 2

                               NCRMA Launching Voluntary Plastic Bag
                                Education Program
                               D      uring the last two legislative
                                      sessions, the North
                               Carolina General Assembly, at
                                                                          This limited ban impacts the barrier
                                                                               islands of the Outer Banks and was
                                                                                passed despite increased costs and
                               the behest of Senate President                    the fact that a move to paper bags
  Fran E. Preston, President   Pro Tem Marc Basnight (D-                          will not likely improve the
  Christie Burris, Editor      Dare), has passed a limited                        environment in this area. In fact,
                               ban on plastic bags                               current experiences with the Outer
                               distributed by retailers to their               Banks ban have not demonstrated
                               customers. (see page 5)                    any reduction in the use of reusable bags
                                                                          by consumers.
                                                                                   PLASTIC BAG Continued on page 7
                                       spring water” if the bottled water        different menu labeling standards
It’s a Wrap                            is not actually from a natural            for each state. NCRMA continued
Continued from page 1                  spring.                                   to emphasize that now is not the
                                                                                 time to impose additional
meet the criteria for reduced          SB 925 defines “Natural Spring            regulatory burdens on businesses
ignition propensity cigarettes; and    Water” as: water derived from an          that are already struggling to survive
2) packs of cigarettes must be         underground land formation from           in the current economy.
marked with the “FSC” symbol           which the water freely flows without
near the UPC code. Every three         the use of a borehole and without the     NCRMA asked Representative
years, cigarette manufacturers         aid of mechanical means and that is
                                                                                 Glazier to consider a one-year
must submit a certification of         collected at the natural orifice in the
                                       earth's surface that is connected to      delay, giving Congress time to enact
compliance to the Office of the
                                       the underground land formation and        a national standard. He agreed to
State Fire Marshall.
                                       through which this water freely           delay introduction of a state bill
                                       flows.                                    until 2010 since menu labeling was
HB 1905 passed during the 2010
                                                                                 included in the federal health
short session to clarify what is
                                       NCRMA lobbyists and two North             reform bill and agreed that this
meant by a brand style for purposes
                                       Carolina bottlers testified multiple      federal standard satisfied his
of certification and streamlines
                                       times before two committees to            concerns.
the process to allow the cigarette
manufacturer to certify all of their   explain that regulations on bottled
                                       water have been defined and                                     The Legislative
styles of cigarettes.
                                       established by the FDA and that                                 Task Force on
                                       this legislation is pre-empted by                               Childhood
Labeling of Bottled
                                       Federal Law. NCRMA kept in                                      Obesity met
 North Carolina Spring Water
                                       close contact with the House                                    during the 2009-
Bill:                SB 925
                                       Agriculture Chairman to ensure            2010 legislative interim, fueling
                                       that the bill never resurfaced            concern that this issue would
Outcome:             DEAD
                                       during the short session.                 resurface. NCRMA attended these
                                                                                 meetings and met with committee
       Senate Bill 925 remained        Menu Labeling                             chairs to ensure labeling legislation
       eligible in 2010 and aimed      NCRMA Position: OPPOSE                    that was more onerous than the new
       to add to the list of unfair    Outcome:          DEAD                    federal law was not recommended to
       and deceptive trade
                                                                                 the General Assembly.
       practices (punishable by a      Early in the 2009 long session,
       fine of up to $5,000 per        Representative Rick Glazier (D-           With a federal standard now in
day) a retailer who sells water        Cumberland) approached                    place, there is reason to hope that
labeled as “North Carolina natural     NCRMA to discuss a menu                   future introduction of state
                                       labeling bill that he considered          legislation will be derailed on the
                                       co-sponsoring with                        basis of uniformity for multi-state
                                       Representative Martha Alexander           operators. The federal government
                                       (D-Mecklenburg). Glazier                  is now in the process of
                                       wanted caloric information to be          implementing rule-making to
                                       conspicuously available to                clarify the menu labeling law,
                                       customers (sign, brochure, etc.)          particularly as it relates to grocery
                                       posted in the store. Our lobbyists        store delis.
                                       explained concerns of creating

                                                                                                     Continued on page 4

You Decide: What Should be Done Now?

W            orries persist about the
             economy. Although the
             economy is in better shape
than it was a year ago, unemployment
is still high, family budgets are still
                                             and the economy today would be in
                                             another Great Depression.
                                             One of the problems with such
                                             conclusions is that they’re based on
tight and confidence about the future        guesses, albeit educated guesses.
isn’t very good.                             Economists estimate what the
                                             economy would be like without the
Progress is being made in very small         policies, compare those results to what
steps, and some economists openly talk       the economy is with the policies, and       Dr. Mike Walden is a Professor and
about a return to recessionary conditions    then take the difference as being the       North Carolina Cooperative Extension
(the “double dip”) within a year.            impact of the policies.                     economist at NC State University’s
                                                                                         College of Agriculture and Life Sciences.
People want something done, and              The “rub” -- the source of
they’re looking to government --             disagreement -- between economists
particularly the federal government -- to    comes from there being many ways to        that during recessions, businesses aren’t
get the economy moving.                      estimate what the economy would            borrowing and spending, so there’s no
                                             look like without the policies.            business activity for the government to
But what should be done? Here’s the          Specifically, economists disagree over     displace.
problem, increasingly there’s                three aspects of economic model
disagreement among economists about                                                     So while there are certainly political
what policies should be put in place to                                                 fights about what to do next for the
mend the economy. The lack of a clear        First, they disagree over the impact of    economy, there are also clashes between
direction makes it all the more              government spending. Some believe          different economic perspectives. Those
frustrating for folks without jobs or with   each dollar of government spending         economists whose theory and research
depressed incomes.                           results in more than a dollar of impact    suggest government spending boosts the
                                             on the economy. Others think the           economy are now calling for more of it -
Part of the disagreement over new            relationship is one to one -- one dollar   - a second stimulus.
initiatives comes from arguments about       of government spending has one dollar
what existing policies have already                                                     But those economists who worry about
                                             of impact on the economy. And still
accomplished. To date, it is estimated                                                  the impacts of new public spending on
                                             others think a dollar of government
that over $3.5 trillion has been spent by                                               borrowing, debt and future taxes say
                                             spending actually results in less than a
the federal government -- including the                                                 just the opposite is needed -- curtailed
                                             dollar of new economic activity.
Federal Reserve -- to fight the recession.                                              spending and movement toward a
Much of this new spending has been           Economists also disagree over how          balanced budget.
financed by borrowing, which has added       taxes enter the mix. In particular,
                                                                                        So perhaps it’s no surprise policymakers
to the national debt.                        some economists say the impacts of
                                                                                        are divided on what to do if economists
                                             government spending are muted if
And while the $3.5 trillion clearly                                                     can’t agree. However, in their defense
                                             people expect the resulting higher debt
hasn’t brought prosperity, an argument                                                  (after all, I am one), it’s always been a
                                             will lead to higher taxes. People,
has been made that without the                                                          challenge for economists to explain the
                                             therefore, save more in anticipation of
spending, the economy would be in                                                       big (“macro”) economy, simply because
                                             a higher tax bill later, and higher
much worse shape. For example, the                                                      the macroeconomy involves millions of
                                             private saving counters the increased
president’s chief economic adviser                                                      decisions daily affecting trillions of
                                             government spending.
estimated that without the $800 billion                                                 dollars. It’s hard for economists to get
stimulus plan passed last year, there        Last, economists disagree over how         their collective arms around the big
would be between 2.5 and 3.5 million         businesses react to government             economy.
fewer jobs today.                            stimulus plans. On one side are
                                                                                        Maybe one day economists will
                                             economists who say government
Two private economists recently issued                                                  collectively decide what the “truth” is.
                                             borrowing and spending simply
an even bolder assessment. They              displace private business borrowing        But until then, you decide.
estimated that without the $3.5 trillion     and spending, leaving no net effect on
anti-recession effort, job losses would      the economy. Countering this
have been double what they’ve been,          viewpoint are economists who argue

It’s a Wrap                              legislation would pass during the
                                         short session and that the coalition
Continued from page 2
                                         should consider other related
        TORT REFORM                      legislative issues that could be
                                         incorporated into the legislation to
Repeal of Contributory                   maintain a balanced civil
 Negligence                              litigation system in North
Bill:               HB 813               Carolina.
Outcome:             DEAD                The two major issues identified to            Saving Money for
                                         help maintain this balance in North       North Carolina Employers!
North Carolina is                        Carolina’s civil liability system
one of four                              were:
remaining states
(plus the District                        • Repeal of joint and several
of Columbia) that                           liability
                                              North Carolina law currently        FBI is designed specifically for
retains a civil liability system of
                                              imposes joint and several             small and medium-size
contributory negligence.                                                          businesses. We focus on the
Contributory negligence reduces the           liability by which one
                                                                                      needs of employers and
number of lawsuits by prohibiting a           defendant is obligated to pay       employees who are ignored by
plaintiff who is even 1% negligent            the entire amount of awarded          large by large out-of-state
from recovering damages.                      damages if the co-defendants              insurance carriers.
Contributory negligence is based on           are unable to pay their              Call us today and begin
                                              share. NCRMA worked to                     saving money!!
the theory that a person should not
                                              ensure that any consideration            1-888-393-2667
recover damages if he or she
contributed in any way to their               of SB 813 include some
own injuries.                                 protections for a defendant
                                              with “deep pockets,” who
In 2009, the North Carolina                   under current law can be on
Academy for Justice (formerly the             the hook for the bulk of the
Academy of Trial Lawyers)                     damages, whether or not they
introduced House Bill 813 to repeal           shared in a significant
contributory negligence and                   percentage of liability.
replace it with a comparative fault
system. Trial lawyers pushed HB             Joint and Several Liability           customer should be awarded
813 through the House with a                Example: Two customers get            $100,000 in damages and that the
narrow margin but the business and          into a fight in a store and one of    other customer was 90% at fault
                                            the customers is severely injured.    for physically harming the
healthcare community worked                                                       customer and the retailer was
                                            The injured customer sues the
together to stall the legislation in a                                            10% at fault for failure to
                                            other customer who caused the
Senate subcommittee.                        physical injury as well as the        provide a security guard. The
                                            retailer for failure to provide a     retailer is supposed to then pay
Our association lobbyists, working          safe environment to shop. At trial,   $10,000 in damages and the other
with the North Carolina Chamber             the jury determines the injured       customer is supposed to pay
and the North Carolina Hospital                                                   $90,000 in damages. However, if
Association, were the lead                                                        the customer could not pay the
negotiators for the business and                                                  $90,000, current North Carolina
healthcare community in this                                                      law would force the retailer to
important legislative battle. The                                                 pay 100%, or $100,000, in
coalition received strong signals in
the Senate from both sides of the
aisle that contributory negligence                                                               Continued on page 5
                                          actual amount of medical bills     for the remainder of the session. It
                                          paid to the hospital and           appears the auto wreck trial
                                          surgeon is only $200,000.          attorneys were less than satisfied
                                          Under current North                with the “actual medical damages
                                          Carolina, the Trial Lawyer         paid” language included in the bill
                                          submits evidence to the jury       while the medical malpractice
                                          that the injured car wreck         attorneys (who depend on deep
          MESSAGE ON HOLD                 victim has medical expenses        pockets to cover their claims) were
                                          of $750,000 that must be paid.     equally dissatisfied with the change
      One Month’s                         The defendant is prohibited
                                          from submitting evidence that
                                                                             in joint and several liability.

       Free Trial                         the actual amount of medical       Despite the news that House Bill 813
                                          bills that must be paid by the     had been shelved for this session,
       For NCRMA                          injured car wreck victim is        our coalition of 54 organizations,

                                          not $750,000 but is actually       associations and companies
                                          only $200,000.                     continued to lobby Senate members
                                                                             on this issue to ensure that this
                                       Note: the Trial Lawyer currently
   That’s right! Now you can…                                                legislation wouldn’t move for the
                                       receives their 1/3 contingency fee
     ‘Give it a test drive!’           based on the $750,000 amount of
                                                                             remainder of the session.
     Absolutely no obligation!!        medical damages rather than the
                                       $200,000 of actual medical damages           ENVIRONMENT
   Ellis Molton Advertising            paid.
                                                                             Outer Banks Plastic Bag Ban
                                       House Bill 813 shaped up to be the    Bill:                 SB 897:
                                       major legislative battle between       Appropriations Act of 2010,
                                       the business community and the            Page 117, Section 13.10
                                       trial lawyers and was seen as a       NCRMA Position: OPPOSE/
                                       litmus test of the business-                                AMEND
                                       friendliness of each chamber.         Outcome:              PASSED
                                                                             Effective Date: October 1, 2010
It’s a Wrap                            After many negotiations, review
Continued from page 4                  and consideration of multiple draft   Bill:                 SB 1202:
                                       compromise proposals, the ongoing      Budget Technical Corrections,
  • Submitting actual medical          fight between the business and         Page 11, Section 5.2
    damages paid versus billed         healthcare communities and the        NCRMA Position: SUPPORT/
    expenses                           trial lawyers screeched to a halt:                           AMEND
      Under current North              the trial lawyers were engaged in     Outcome:               PASSED
      Carolina law, trial lawyers      disputes and disagreement within      Effective Date: October 1, 2010
      submit evidence to the jury of   their own membership. The trial
      the amount of medical            lawyers pulled the plug on House                      In 2009, Senate
      damages billed and defendants    Bill 813 and the issue was shelved                     President Pro Tem
      are prohibited from submitting                                                          Marc Basnight (D-
      evidence of the actual medical                                                          Dare) successfully
      expenses paid to medical                                                               pushed through
      providers.                                                                            legislation
                                                                             establishing a ban on plastic bags in
    Actual Medicals Example: A                                               specific geographic areas of three
    hospital and surgeon bill a                                              North Carolina counties located on
    patient $750,000 to treat                                                North Carolina’s Outer Banks.
    injuries from a car accident.
    However, after negotiations with
    the hospital and surgeon, the                                                                Continued on page 6
It’s a Wrap                             comply with the 2010 legislation,
                                        effective October 1, 2010.
                                                                                     Electronics Recycling
                                                                                     Bill:                 SB 887
Continued from page 5
                                                                                     NCRMA Position: AMENDED/
Effective September 1, 2009,            In summary, the 2010 provision:                              SUPPORT
retailers were required to provide        1. Applies the plastic bag ban to all      Outcome:             PASSED
paper bags made of 100% recycled            retailers/restaurants in the affected    Effective Date: JULY 1, 2010
                                            area regardless of size or number
material and to reward any
                                            of stores;
customer (by use of a credit, refund      2. Allows all retailers to offer paper
                                                                                                  NCRMA worked
or coupon) who utilized a reusable          bags made of 40% recycled                             successfully for years to
bag for the value of each bag not           material rather than the current                      protect retailers from
distributed. The legislation has            standard of 100% recycled                             Advance Disposal Fees
proven to be very costly to retailers       material;                                             (ADFs) on electronics –
operating in these three counties.        3. Changes the definition of a single                   taxes imposed at the
                                            use plastic bag by removing the          point-of-sale. In 2007, your lobbying
Early in 2010, Senator Basnight             2.25 mil plastic threshold and           team negotiated the first agreement
announced that he wanted to enlarge         going to a higher weight standard        in the United States between
the bag ban statewide, but instead          that is more in-line with a              television manufacturers and the
he expanded segments of the 2009            traditional reusable bag at 80
                                                                                     retail community. After forming a
legislation in the three Outer Banks        grams/sq. meter (impacted
                                            retailers can no longer utilize
                                                                                     coalition with the North Carolina
counties. To accomplish this                                                         Department of Environment and
                                            plastic bags weighing 2.25 mil or
expansion of the existing law, a            greater);                                Natural Resources, the Sierra Club,
more onerous special provision was        4. Limits the manner in which a            Thomson and General Electric,
included in the conference report for       retailer can provide an incentive        NCRMA pushed to design a
the state budget.                           for the customer’s use of a              framework for a North Carolina
                                            reusable bag to cash refunds and         computer and television
Effective October 1, 2010, this             store credits (store coupons or          manufacturing responsibility
budget provision amends the Plastic         rewards points are no longer             recycling program. Subsequently,
Bag Ban in the Barrier Island               acceptable). NCRMA was                   this program has been recognized as
portions (not the mainland) of three        successful in inserting a technical
                                                                                     a National Model for this type of
counties located on the Outer Banks         correction to clarify that a credit
                                            toward the purchase may also be
– Currituck, Dare and Hyde
                                            used in addition to a cash refund.
Counties.                                                                            In 2008, the North Carolina General
                                            For example: If the customer             Assembly passed the Computer and
The impacted towns in this area are:        brings their own reusable bags to        Television Recycling law which
Avon, Buxton, Collington, Corolla,          the store and otherwise the retailer
                                                                                     includes the agreed-upon language
Duck, Frisco, Hatteras, Kill Devil          would have otherwise filled five
                                            paper bags, the retailer will now
                                                                                     which NCRMA negotiated relevant
Hills, Kitty Hawk, Nags Head,                                                        to television recycling as some
                                            be required to compensate the
Ocracoke, Rodanthe, Salvo,                  customer by crediting or paying          retailers are also deemed to be TV
Sanderling, Southern Shores,                out the cost of the unused paper         manufacturers (i.e. they license a TV
Wanchese, and Waves.                        bag times five.                          from a manufacturer and then sell under
                                                                                     their store brand).
NCRMA has worked                          5. Allows previously unaffected
                                            retailers (i.e. less than 5,000 square   In 2009, NCRMA successfully halted
diligently to decipher
                                            feet or less than 5 locations) to        county governments attempt to
this complicated law
                                            distribute plastic bags that they        expand North Carolina’s
and provide our                             had ordered prior to May 1,
members with a                                                                       manufacturer responsibility
                                            2010 until May 1, 2011.
layman’s version to help bring                                                       programs to include at least twenty
                                          6. Implements an effective date of
your store in compliance. An                                                         additional electronics items
                                            October 1, 2010 for the new law.
updated document is available             7. Mandates the Department of
                                                                                     (calculators, video games,
                                            Environment and Natural                  computers, cell phones, etc.). This
electronically or in hard copy for
                                            Resources to study the success of        proposal would have dramatically
the Outer Banks Plastic Bag ban,
complete with assistance in how to          the program.                                                  Continued on page 7
It’s a Wrap
Continued from page 6

impacted products and brands that
can be sold by North Carolina
retailers. The end result was a delay
in implementation of manufacturer                          Not your typical credit card processor!
responsibility programs for televisions
and computers from January 1 until                    We’re here for you 24 hours a day, 7 days a week
July 1, 2010.                                       98% of merchants problems solved in one phone call!

This delay in effective date provided      Credit/Debit Processing    eCommerce Solutions     Online Reports
time for stakeholders to meet between      Check Services             POS Equipment Leasing   ACH Services
the 2009 long session and 2010 short       Gift Cards                 PC-Based POS System     ATM Sales and Placement
session. DENR and NCRMA
participated and agreed on the
necessary clarifying changes prior to
the law taking effect on July 1, 2010.
The result was an effort by the
stakeholders’ group to support SB 887
during the 2010 Short Session which
also delayed a landfill ban on
computers and televisions from
January 1 to July 1, 2011 to provide      Plastic Bag                             better the environment. The program
manufacturer responsibility programs      Continued from Cover
                                                                                  will include a website similar to the
a year to get up and running.             We are also seeing increased activity   one currently being utilized in
SB 887 passed and the                     on this issue throughout the United     Florida (
manufacturer’s responsibility             States with the California and          and will feature a video contest as
Electronics Recycling program in          Oregon legislatures currently           well as a listing by searchable zip
North Carolina became effective           discussing a proposed statewide ban.    code of every retailer that provides
July 1, 2010, impacting computer and                                                       recycling of plastic bags
television manufacturers and              In May, an NCRMA                                   within their store.
retailers. The North Carolina             subcommittee
Department of Environment and             thoroughly                                       In addition to the Bag’s Life
Natural Resources (DENR) has              discussed the                                    website and the NCRMA
launched a website with information       implementation of a                              website, we are in the
for manufacturers, retailers and local    public voluntary                                 process of securing links on
governments regarding registration        consumer education                             the websites of Keep North
and compliance.                           program centered around reducing,       Carolina Beautiful, Carolina
                                          reusing and recycling plastic bags in   Recyclers Association, the North
  NC Department of Environment and        North Carolina. NCRMA’s belief is       Carolina Department of
       Natural Resources (DENR)                                                   Environment and Natural
Electronics Management Website: http://
                                          that changing consumer behavior   is better accomplished through          Resources, North Carolina
                                          education rather than mandates.         Restaurant and Lodging
NCRMA has also worked diligently          Similar programs are currently being    Association and the North Carolina
to decipher this complicated law and      conducted in Florida and are about to   Petroleum Marketers and
provide you a layman’s version to         be unveiled in Texas and Virginia.      Convenience Store Association
help bring your store in compliance.                                              among others.
A “How Do I Comply” document is           NCRMA along with its foundation,
available electronically or in hard       the Retail Consumer Alliance            Stay tuned for more information on
copy for the Electronics Recycling        Foundation, is conducting this          this exciting project. If you would
Law. E-mail Fran Preston,                 voluntary consumer education            like to know more, contact Fran, to request a copy of     program in conjunction with the         Preston, or
this document.                            American Chemistry Council to           919-832-0811.
         Our mission is to create and re-create an industry marketplace in which North Carolina retailers can thrive, by:
                                       Effective legislative and regulatory actions
                                       Targeted member services, and
                                       Hi-tech distribution of information

         We achieve this by our constant focus on fiscal responsibility and our core values of integrity, trust and professional excellence.

                                    WITH RISING COSTS WHO CAN AFFORD
                                                As a member of NCRMA you can
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•   Erie Insurance Group                                                                                   •     Metlife Home and Auto
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