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The 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) I 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 firstname.lastname@example.org. 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 NCRMA Position: OPPOSE 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 2 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 building. 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 3 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. NCRMA Position: OPPOSE 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 damages. coalition received strong signals in the Senate from both sides of the aisle that contributory negligence Continued on page 5 4 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, members 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 5 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 legislation. – 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 6 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 (http://www.abagslife.com) 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 portal.ncdenr.org/web/wm/sw/electronics 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 email@example.com, to request a copy of program in conjunction with the Preston, firstname.lastname@example.org or this document. American Chemistry Council to 919-832-0811. 7 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 INSURANCE? As a member of NCRMA you can receive a free quote from Hodges Insurance Agency, Inc. They work with insurance companies such as: • Blue Cross/Blue Shield • Cigna • Erie Insurance Group • Metlife Home and Auto • United Healthcare • Conventry/Wellpath Small to medium-size business owners don’t have to do without! Give you and your employees the coverage and benefits you deserve!