As Passed by the House

127th General Assembly Regular Session 2007-2008

Sub. H. B. No. 500

Representative Hughes 

Cosponsors: Representatives Flowers, Yuko, Letson, Stebelton, Stewart, D., Carmichael, Domenick, Bacon, Batchelder, Brown, Chandler, Collier, Combs, Dyer, Evans, Gerberry, Gibbs, Goyal, Harwood, Heard, Hite, Luckie, Lundy, McGregor, J., Raussen, Sayre, Schindel, Schneider, Setzer, Slesnick, Szollosi, Williams, B., Zehringer 

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A BILL

To amend section 5703.21 and to enact sections

1

3739.01 to 3739.18 and 3739.99 of the Revised

2

Code to establish reduced ignition propensity

3

standards for cigarettes, to authorize the State

4

Fire Marshal to monitor and the Attorney General

5

and the State Fire Marshal to enforce such

6

standards, and to establish penalties for

7

violations.

8

BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF OHIO:

Section 1.  That section 5703.21 be amended and sections	9
3739.01, 3739.02, 3739.03, 3739.04, 3739.05, 3739.06, 3739.07,	10
3739.08, 3739.09, 3739.10, 3739.11, 3739.12, 3739.13, 3739.14,	11
3739.15, 3739.16, 3739.17, 3739.18, and 3739.99 of the Revised	12
Code be enacted to read as follows:	13

Sec. 3739.01.  As used in this chapter:

14

(A) "Agent" means any person licensed by a county auditor or	15
the tax commissioner to purchase and affix adhesive or meter	16
stamps on packages of cigarettes pursuant to Chapter 5743. of the	17
Revised Code.	18

(B) "Brand family" means all styles of cigarettes sold under	19
the same trademark and differentiated from one another by means of	20
additional modifiers or descriptors, including, but not limited	21
to, "menthol," "lights," "kings," and "100s." "Brand family"	22
includes cigarettes sold under a brand name, whether that name is	23
used alone or in conjunction with any other word, trademark, logo,	24
symbol, motto, selling message, recognizable pattern of colors, or	25
other indicia of product identification identical or similar to,	26
or identifiable with, a previous brand of cigarettes.	27

(C) "Cigarettes" and "sale" have the same meanings as in	28
section 5743.01 of the Revised Code.	29

(D) "Manufacturer" means either of the following:

30

(1) Any entity or the entity's successor that, in any	31
location, manufactures or otherwise produces cigarettes, or causes	32
cigarettes to be manufactured or produced, that the entity intends	33
to be sold in this state, including, but not limited to,	34
cigarettes intended to be sold in the United States through an	35
importer;	36

(2) Any entity or the entity's successor that meets both of	37
the following criteria:	38

(a) Purchases cigarettes, in any location, from a second	39
entity that manufactures or otherwise produces cigarettes in any	40
location when that second entity does not intend that the	41
cigarettes it manufactures be sold in the United States;	42

(b) Intends to resell the cigarettes described in division	43
(D)(2)(a) of this section in the United States.	44

(E) "Repeatability" means the range of values within which	45
ninety-five per cent of the results of cigarette test trials from	46
a single laboratory will fall.	47

(F) "Retail dealer" has the same meaning as in division	48
(C)(1) of section 5743.01 of the Revised Code.	49

(G) "Quality control and quality assurance program" means the	50
procedures a laboratory implements to ensure both of the	51
following:	52

(1) Operator bias, systematic and nonsystematic	53
methodological errors, and equipment-related problems do not	54
affect cigarette test results.	55

(2) Testing repeatability remains within the required	56
repeatability values for all test trials used by the laboratory to	57
certify cigarettes in accordance with this chapter and is not	58
greater than 0.19.	59

(H) "Wholesale dealer" means either of the following persons:

60

(1) A person, other than a manufacturer, who sells cigarettes	61
to retail dealers or other persons for purposes of resale;	62

(2) A person who owns, operates, or maintains one or more	63
cigarette vending machines upon premises owned or occupied by any	64
other person.	65

Sec. 3739.02.  Except as otherwise permitted in section	66
3739.12 of the Revised Code, no person shall sell or offer to	67
sell cigarettes in this state or sell or offer to sell	68
cigarettes to persons located in this state unless all of the	69
following requirements are met:	70

(A) The manufacturer of the cigarettes has the cigarettes	71
tested in accordance with the testing method specified in section	72
3739.03 of the Revised Code or the testing method approved by the	73
state fire marshal under section 3739.04 of the Revised Code.	74

(B) The cigarettes meet the performance standard specified	75
under division (B) of section 3739.03 of the Revised Code or the	76
performance standard approved by the state fire marshal under	77
section 3739.04 of the Revised Code.	78

(C) The manufacturer has marked the packaging of the	79
cigarettes as required in section 3739.06 of the Revised Code.	80

(D) The manufacturer files a written certification with the	81
state fire marshal as required under section 3739.07 of the	82
Revised Code.	83

Sec. 3739.03.  (A) A manufacturer shall have a laboratory	84
conduct the testing required under division (B) of this section.	85
The laboratory that the manufacturer uses for the testing shall be	86
accredited pursuant to the international organization for	87
standardization and international electrotechnical commission	88
standard 17025 of the international organization for	89
standardization, or another comparable accreditation standard	90
required by the state fire marshal. The laboratory shall implement	91
a quality control and quality assurance program and shall use that	92
program when conducting the testing required under division (B) of	93
this section.	94

(B) A manufacturer shall have the laboratory described in	95
division (A) of this section test the manufacturer's cigarettes in	96
accordance with all of the following requirements:	97

(1) The laboratory shall test the cigarettes in accordance	98
with the American society of testing and materials standard	99
E2187-04, titled "standard test method for measuring ignition	100
strength of cigarettes" or any subsequent standard adopted by the	101
state fire marshal in accordance with division (E) of this	102
section.	103

(2) The laboratory shall test the cigarettes on ten layers of	104
filter paper.	105

(3) Not more than twenty-five per cent of the cigarettes	106
tested in a test trial shall exhibit full-length burns.	107

(C) The performance standard required under division (B)(3)	108
of this section shall apply only to a complete test trial. For	109
purposes of this division and division (B)(3) of this section,	110
"test trial" means forty replicate tests for each type of	111
cigarette tested.	112

(D) The requirements described in division (B) of this	113
section shall not be construed to require additional cigarette	114
testing if a manufacturer tests cigarettes in accordance with the	115
requirements listed in that division for any other purposes other	116
than the purposes specified in that division.	117

(E) The state fire marshal may adopt any American society of	118
testing and materials standard used to measure the ignition	119
strength of cigarettes that takes effect after the effective date	120
of this section if the state fire marshal determines that that	121
subsequent standard does not result in a change in the percentage	122
of full-length burns exhibited by any tested cigarette when	123
compared to the percentage of full-length burns the same cigarette	124
would exhibit when tested using the American society of testing	125
and materials standard E2187-04 referenced in division (B)(1) of	126
this section and the performance standard specified in division	127
(B)(3) of this section.	128

Sec. 3739.04.  (A) If a manufacturer manufactures a cigarette	129
that the state fire marshal determines cannot be tested in	130
accordance with division (B) of section 3739.03 of the Revised	131
Code, the state fire marshal shall require the manufacturer to	132
propose and submit a test method and performance standard for the	133
cigarette to the state fire marshal for approval. If the state	134
fire marshal determines that the test method and performance	135
standard proposed by the manufacturer are equivalent to the test	136
method and performance standard prescribed in division (B) of	137
section 3739.03 of the Revised Code, the state fire marshal shall	138
approve the proposed test method and performance standard, and	139
the manufacturer may use that test method and performance	140
standard to certify the cigarettes pursuant to section 3739.07 of	141
the Revised Code.	142

(B) If the state fire marshal determines that another state	143
has enacted reduced cigarette ignition propensity standards that	144
include a test method and performance standard that are the same	145
as those specified in section 3739.03 of the Revised Code and	146
that the officials responsible for implementing those standards	147
have determined that the alternative test method and performance	148
standard for a particular cigarette proposed by the manufacturer	149
under division (A) of this section satisfies the standards for	150
that state's law or regulation under a statute or regulation that	151
is comparable to this section, the state fire marshal shall	152
authorize the manufacturer to use that alternative test method and	153
performance standard to certify the manufacturer's cigarettes for	154
sale in this state. The state fire marshal is not required to	155
approve an alternative test method and performance standard	156
approved in another state if the state fire marshal demonstrates a	157
reasonable basis for why that alternative test method and	158
performance standard should not be approved under this section.	159

All other applicable requirements of this chapter apply to a	160
manufacturer authorized to use an alternative test method and	161
performance standard under this section.	162

Sec. 3739.05.  (A) Each manufacturer shall maintain copies	163
of the reports of all tests conducted on all cigarettes offered	164
for sale in this state for a period of three years after a test	165
is concluded, and shall make copies of these reports available to	166
the state fire marshal and the attorney general upon receipt of a	167
written request from the state fire marshal or attorney general.	168

(B) No manufacturer shall fail to make these copies available	169
to the state fire marshal or attorney general within sixty days	170
after receiving such a request from the state fire marshal or the	171
attorney general.	172

Sec. 3739.06.  (A) A manufacturer, prior to submitting the	173
written certification required under section 3739.07 of the	174
Revised Code, shall submit a marking that the manufacturer shall	175
place on each package of cigarettes that the manufacturer intends	176
to certify under that section. The marking shall be in eight-point	177
type or larger and include at least one of the following:	178

(1) Modification of the product universal product code to	179
include a visible mark printed at or around the area of the code	180
that consists of an alphanumeric or symbolic character permanently	181
stamped, engraved, embossed, or printed in conjunction with the	182
product's code;	183

(2) Any visible combination of alphanumeric or symbolic	184
characters permanently stamped, engraved, or embossed upon the	185
cigarette package or cellophane wrap;	186

(3) Printed, stamped, engraved, or embossed text that	187
indicates that the cigarettes meet the standards specified in	188
section 3739.03 of the Revised Code or approved under section	189
3739.04 of the Revised Code.	190

(B)(1) The manufacturer shall notify the state fire marshal	191
of the marking that the manufacturer selects and request approval	192
of that marking from the state fire marshal. Upon receipt of the	193
request, the state fire marshal shall approve or disapprove the	194
marking offered by the manufacturer. If a manufacturer elects to	195
submit either of the following markings, the state fire marshal	196
shall automatically approve that marking:	197

(a) Any marking used for cigarettes approved for sale in the	198
state of New York pursuant to the New York fire safety standards	199
for cigarettes;	200

(b) A marking consisting of only the letters "FSC", which	201
shall signify "fire standards compliant."	202

(2) If the state fire marshal fails to act within ten	203
business days after receiving a request for approval, the proposed	204
marking is considered approved. A manufacturer shall not modify	205
the marking approved by the state fire marshal unless the	206
modification has been approved in accordance with this division.	207

(C) A manufacturer shall include the approved mark on each	208
package of cigarettes that is certified under section 3739.07 of	209
the Revised Code to indicate compliance with the requirements of	210
this chapter. A manufacturer shall use only one marking for all of	211
the cigarettes the manufacturer sells and shall apply this marking	212
uniformly to all packages, including, but not limited to, packs,	213
cartons, cases, and brands sold by that manufacturer.	214

Sec. 3739.07.  (A) Each manufacturer shall submit to the	215
state fire marshal a written certification that each type of	216
cigarette listed in the certification has been tested in	217
accordance with division (B) of section 3739.03 or section 3739.04	218
of the Revised Code and each type of cigarette listed in the	219
certification meets the performance standard set forth in division	220
(B) of section 3739.03 of the Revised Code or approved under	221
section 3739.04 of the Revised Code.	222

(B) A manufacturer shall include in the written certification	223
the manufacturer submits under division (A) of this section all of	224
the following information for each type of cigarette listed in the	225
certification:	226

(1) The brand or trade name on the cigarette package;

227

(2) The style of cigarette;

228

(3) The length of the cigarette in millimeters;

229

(4) The circumference of the cigarette in millimeters;

230

(5) The flavor of the cigarette, if applicable;

231

(6) Whether the cigarette is filter or nonfilter;

232

(7) A description of the package;

233

(8) The marking the manufacturer uses that the state fire	234
marshal approved in accordance with section 3739.06 of the Revised	235
Code;	236

(9) The name, address, and telephone number of the	237
laboratory, if different than the manufacturer, that conducted the	238
test of the cigarette;	239

(10) The date that the testing of the cigarette occurred.

240

(C) A manufacturer shall make the written certification	241
required under division (A) of this section available to the	242
attorney general and the tax commissioner for the purposes of	243
ensuring compliance with this chapter.	244

(D) No manufacturer shall submit a false certification to the	245
state fire marshal.	246

Sec. 3739.08.  Each cigarette a manufacturer lists in a	247
certification submitted pursuant to section 3739.07 of the Revised	248
Code for which the manufacturer uses lowered permeability bands in	249
the cigarette paper to comply with the testing requirements	250
described in division (B) of section 3739.03 of the Revised Code	251
shall have either of the following bands surrounding the tobacco	252
column:	253

(A) For cigarettes on which bands are not positioned by	254
design, at least two nominally identical bands, one of which shall	255
be located at least fifteen millimeters from the lighting end of	256
the cigarette;	257

(B) For cigarettes on which bands are positioned by design,	258
at least two bands, one of which is located at least fifteen	259
millimeters from the lighting end of the cigarette and the other	260
of which is located in either of following places:	261

(1) For filtered cigarettes, ten millimeters from the filter	262
end of the tobacco column;	263

(2) For nonfiltered cigarettes, ten millimeters from the	264
labeled end of the tobacco column.	265

Sec. 3739.09.  A manufacturer shall recertify each cigarette	266
the manufacturer certifies pursuant to section 3739.07 of the	267
Revised Code every three years. A manufacturer that certifies a	268
cigarette in accordance with that section and that subsequently	269
makes any change to that cigarette that alters the cigarette in	270
such a way that the manufacturer knows that the cigarette is	271
likely to no longer meet the standard specified in section	272
3739.03 of the Revised Code or the standard approved under	273
section 3739.04 of the Revised Code shall not sell or offer to	274
sell that cigarette in this state until the manufacturer retests	275
the cigarette in accordance with the testing standards specified	276
in section 3739.03 of the Revised Code or approved under section	277
3739.04 of the Revised Code. The manufacturer shall maintain	278
records of that retesting in the same manner as the manufacturer	279
maintains records under section 3739.05 of the Revised Code. A	280
manufacturer shall not sell in this state any altered cigarette	281
that does not meet either the performance standard set forth in	282
division (B)(3) of section 3739.03 of the Revised Code or the	283
performance standard approved under section 3739.04 of the	284
Revised Code.	285

Sec. 3739.10.  A manufacturer that certifies its cigarettes	286
in accordance with section 3739.07 of the Revised Code shall	287
provide a copy of the certifications to each wholesale dealer and	288
agent to which the manufacturer sells cigarettes and shall provide	289
sufficient copies of an illustration of the package marking used	290
by the manufacturer pursuant to section 3739.06 of the Revised	291
Code for each retail dealer to which the wholesale dealer or agent	292
sells cigarettes. Each wholesale dealer and agent who receives a	293
copy of a manufacturer's certification and copies of the	294
manufacturer's illustration shall provide to each retail dealer to	295
which the wholesale dealer and agent sell the manufacturer's	296
cigarettes a copy of the illustration provided to the wholesale	297
dealer or agent by the manufacturer. A wholesale dealer, agent,	298
or retail dealer shall allow the state fire marshal, the tax	299
commissioner, and the attorney general to inspect the markings of	300
cigarette packaging marked in accordance with section 3739.06 of	301
the Revised Code.	302

Sec. 3739.11.  The state fire marshal may conduct testing on	303
cigarettes certified by a manufacturer pursuant to section 3739.07	304
of the Revised Code to determine whether the manufacturer complied	305
with the requirements of this chapter. The state fire marshal	306
shall conduct any such testing in accordance with division (B) of	307
section 3739.03 of the Revised Code.	308

Whenever the state fire marshal or a designee of the state	309
fire marshal discovers any cigarettes that do not include a mark	310
as required under section 3739.06 of the Revised Code, the state	311
fire marshal or the state fire marshal's designee may seize and	312
take possession of such cigarettes and shall give such cigarettes	313
to the tax commissioner, and such cigarettes thereupon shall be	314
forfeited to the state. The tax commissioner shall order the	315
destruction of any cigarettes forfeited pursuant to this section,	316
but prior to the destruction of any cigarette forfeited pursuant	317
to this section, the true holder of the trademark rights in the	318
cigarette brand shall be permitted to inspect the cigarette.	319

Any cigarettes sold or offered for sale that do not comply	320
with the performance standard required under section 3739.03 of	321
the Revised Code or approved under section 3739.04 of the Revised	322
Code are subject to forfeiture pursuant to section 5743.08 of the	323
Revised Code and shall be destroyed in accordance with that	324
section, except that prior to the destruction of any cigarette	325
forfeited pursuant to that section, the true holder of the	326
trademark rights in the cigarette brand shall be permitted to	327
inspect the cigarette.	328

In addition to any other remedy provided by law, if the state	329
fire marshal or attorney general determines that reasonable	330
evidence exists that a violation of this chapter has occurred, the	331
state fire marshal or attorney general may file an action in the	332
court of common pleas in the county where the alleged violation	333
occurred. The action may include a petition for injunctive relief	334
or to recover any costs or damages suffered by the state because	335
a violation of this chapter occurred, including enforcement costs	336
relating to the specific violation and attorney's fees. Each	337
violation of this chapter or the rules adopted pursuant to it	338
constitutes a separate civil violation for which the state fire	339
marshal or attorney general may obtain relief.	340

To enforce the requirements of this chapter, the attorney	341
general and the state fire marshal may examine the books, papers,	342
invoices, and other business records of any person in possession	343
or control of, or occupying any premises where cigarettes are	344
placed, stored, sold, or offered for sale, including the stock of	345
cigarettes on the premises, if the attorney general or state fire	346
marshal reasonably suspects that a violation of this chapter has	347
occurred. Every person in the possession or control of, or	348
occupying any premises where cigarettes are placed, sold, or	349
offered for sale shall give to the attorney general and the state	350
fire marshal the means, facilities, and opportunity for the	351
examinations authorized under this section.	352

The tax commissioner, in the regular course of conducting	353
inspections of wholesale dealers, agents, and retail dealers, as	354
authorized under section 5743.14 of the Revised Code, may inspect	355
any cigarette packaging to determine if the package is marked as	356
required under section 3739.06 of the Revised Code. If a package	357
containing cigarettes is not marked, the tax commissioner shall	358
notify the state fire marshal of this fact.	359

Sec. 3739.12.  (A) Nothing in this chapter shall be construed	360
to prohibit any person or entity from manufacturing or selling	361
cigarettes that do not meet the requirements specified in this	362
chapter if the cigarette's packaging is or will be stamped for	363
sale in another state or is packaged for sale outside of the	364
United States, and that person or entity has taken reasonable	365
steps to ensure that those cigarettes will not be sold or offered	366
for sale to persons located in this state.	367

(B) The requirements of sections 3739.02 to 3739.10 of the	368
Revised Code shall not prohibit a wholesale dealer or retail	369
dealer of cigarettes from selling the dealer's inventory of	370
cigarettes in existence on or after the effective date of this	371
section if the dealer establishes both of the following:	372

(1) That the state tax stamps were affixed to the cigarettes	373
prior to the effective date of this section;	374

(2) That the inventory that was purchased prior to the	375
effective date of this section is comparable in quantity to the	376
inventory purchased during the same period of the prior year.	377

(C) Nothing in this chapter shall be construed to prohibit	378
the sale of cigarettes solely for the purpose of consumer testing.	379
For purposes of this division, "consumer testing" means an	380
assessment of cigarettes that is conducted by a manufacturer or	381
under the control and direction of a manufacturer for the purpose	382
of evaluating consumer acceptance of such cigarettes, utilizing	383
only the quantity of cigarettes that is reasonably necessary for	384
such assessment.	385

Sec. 3739.13.  The implementation and substance of the New	386
York fire safety standards for cigarettes shall be persuasive	387
authority in implementing this chapter. The state fire marshal may	388
adopt rules, pursuant to Chapter 119. of the Revised Code, as	389
necessary to administer this chapter.	390

Sec. 3739.14.  The state fire marshal shall periodically	391
evaluate the effectiveness of this chapter. The state fire marshal	392
shall submit a report that consists of the state fire marshal's	393
findings to the general assembly on the first day of the	394
forty-ninth month after the effective date of this section, and	395
every three years after that date.	396

Sec. 3739.15.  Notwithstanding any provision of law to the	397
contrary, no political subdivision of this state may enact or	398
enforce any ordinance or other local law or regulation that	399
conflicts with or preempts this chapter or any policy of this	400
state expressed in this chapter.	401

Sec. 3739.16.  No person is required to comply with this	402
chapter or the rules adopted pursuant to it if a federal reduced	403
cigarette ignition propensity standard that preempts this chapter	404
or rules adopted under it is adopted and becomes effective.	405

Sec. 3739.17. In addition to any other immunities, defenses,	406
and exclusions provided under the Revised Code, the state, the	407
department of taxation, the department of commerce, the division	408
of the fire marshal within the department of commerce, and any	409
employees of the state, either department, or the division, are	410
immune from liability in any civil action or proceeding arising	411
from the performance or nonperformance of any duties specified in	412
this chapter that the state, either department, the division, or	413
any employees of the state, either department, or division are	414
required to perform. In no event shall the state, either	415
department, division, or any employees of the state, either	416
department, or division be liable to any person for any claims	417
for injury or damages, including, but not limited to, claims for	418
indirect, consequential, incidental, special, or punitive damages	419
or claims for lost profits, arising from the performance or	420
nonperformance of the duties specified in this chapter that the	421
state, either department, division, or employees of the state,	422
either department, or division are required to perform.	423

Sec. 3739.18. (A) A manufacturer shall pay the state fire	424
marshal a fee of one thousand dollars or an adjusted fee pursuant	425
to division (B) of this section for each type of brand family	426
included in a certification required under division (A) of	427
section 3739.07 of the Revised Code. The fee for each type of	428
brand family includes any new cigarette certified under this	429
chapter within that brand family during the three-year	430
certification period described in section 3739.09 of the Revised	431
Code.	432

(B) The state fire marshal may adjust the fee described in	433
division (A) of this section annually to ensure the fee is	434
sufficient to defray the actual costs of processing, testing,	435
enforcing, and overseeing the activities required under this	436
chapter.	437

(C) There is hereby created in the state treasury the reduced	438
cigarette ignition propensity and firefighter protection act	439
enforcement fund. The fund shall consist of all certification fees	440
submitted by manufacturers and any other moneys made available to	441
the state fire marshal specifically to support processing	442
certifications, testing, enforcing, and overseeing activities	443
conducted pursuant to this chapter. The state fire marshal shall	444
use the fund only for the activities specified in this division.	445

(D) There is hereby created in the state treasury the fire	446
prevention and public safety fund. Moneys collected from penalties	447
assessed under divisions (B) to (E) of section 3739.99 of the	448
Revised Code shall be deposited into the fund. The state fire	449
marshal shall use this fund to support fire safety and prevention	450
programs.	451

Sec. 3739.99.  (A) A manufacturer who violates division (B)	452
of section 3739.05 of the Revised Code shall be subject to a civil	453
penalty not to exceed ten thousand dollars for each day after the	454
sixtieth day that the manufacturer fails to comply with that	455
division.	456

(B) A manufacturer, wholesale dealer, agent, or any other	457
person other than a retail dealer who knowingly sells or offers to	458
sell cigarettes in violation of section 3739.02 of the Revised	459
Code is liable for a civil penalty not to exceed one hundred	460
dollars per each pack of such cigarettes sold or offered for sale,	461
provided that in no case shall the penalty against any such	462
person or entity exceed one hundred thousand dollars during any	463
thirty-day period.	464

(C) A retail dealer who knowingly violates section 3739.02 of	465
the Revised Code is liable for a civil penalty not to exceed one	466
hundred dollars per each pack of cigarettes sold or offered for	467
sale, provided that in no case shall the penalty against any	468
retail dealer exceed twenty-five thousand dollars for sales or	469
offers to sell during any thirty-day period.	470

(D) A manufacturer that is a corporation, partnership, sole	471
proprietorship, limited partnership, or association who knowingly	472
violates division (D) of section 3739.07 of the Revised Code is	473
liable for a civil penalty of at least seventy-five thousand	474
dollars, not to exceed two hundred fifty thousand dollars for	475
each such violation, in addition to any other penalty prescribed	476
by law.	477

(E) Any person who violates any provision of this chapter	478
other than section 3739.02, division (B) of section 3739.05, and	479
division (D) of section 3739.07 of the Revised Code, for a first	480
offense is liable for a civil penalty not to exceed one thousand	481
dollars for each violation and for a subsequent offense is	482
liable for a civil penalty not to exceed five thousand dollars	483
for each violation.	484

Sec. 5703.21.  (A) Except as provided in divisions (B) and	485
(C) of this section, no agent of the department of taxation,	486
except in the agent's report to the department or when called on	487
to testify in any court or proceeding, shall divulge any	488
information acquired by the agent as to the transactions,	489
property, or business of any person while acting or claiming to	490
act under orders of the department. Whoever violates this	491
provision shall thereafter be disqualified from acting as an	492
officer or employee or in any other capacity under appointment or	493
employment of the department.	494

(B)(1) For purposes of an audit pursuant to section 117.15 of	495
the Revised Code, or an audit of the department pursuant to	496
Chapter 117. of the Revised Code, or an audit, pursuant to that	497
chapter, the objective of which is to express an opinion on a	498
financial report or statement prepared or issued pursuant to	499
division (A)(7) or (9) of section 126.21 of the Revised Code, the	500
officers and employees of the auditor of state charged with	501
conducting the audit shall have access to and the right to examine	502
any state tax returns and state tax return information in the	503
possession of the department to the extent that the access and	504
examination are necessary for purposes of the audit. Any	505
information acquired as the result of that access and examination	506
shall not be divulged for any purpose other than as required for	507
the audit or unless the officers and employees are required to	508
testify in a court or proceeding under compulsion of legal	509
process. Whoever violates this provision shall thereafter be	510
disqualified from acting as an officer or employee or in any other	511
capacity under appointment or employment of the auditor of state.	512

(2) For purposes of an internal audit pursuant to section	513
126.45 of the Revised Code, the officers and employees of the	514
office of internal auditing in the office of budget and management	515
charged with conducting the internal audit shall have access to	516
and the right to examine any state tax returns and state tax	517
return information in the possession of the department to the	518
extent that the access and examination are necessary for purposes	519
of the internal audit. Any information acquired as the result of	520
that access and examination shall not be divulged for any purpose	521
other than as required for the internal audit or unless the	522
officers and employees are required to testify in a court or	523
proceeding under compulsion of legal process. Whoever violates	524
this provision shall thereafter be disqualified from acting as an	525
officer or employee or in any other capacity under appointment or	526
employment of the office of internal auditing.	527

(3) As provided by section 6103(d)(2) of the Internal Revenue	528
Code, any federal tax returns or federal tax information that the	529
department has acquired from the internal revenue service, through	530
federal and state statutory authority, may be disclosed to the	531
auditor of state or the office of internal auditing solely for	532
purposes of an audit of the department.	533

(4) For purposes of Chapter 3739. of the Revised Code, an	534
agent of the department of taxation may share information with the	535
division of state fire marshal that the agent finds during the	536
course of an investigation.	537

(C) Division (A) of this section does not prohibit any of the	538
following:	539

(1) Divulging information contained in applications,	540
complaints, and related documents filed with the department under	541
section 5715.27 of the Revised Code or in applications filed with	542
the department under section 5715.39 of the Revised Code;	543

(2) Providing information to the office of child support	544
within the department of job and family services pursuant to	545
section 3125.43 of the Revised Code;	546

(3) Disclosing to the board of motor vehicle collision repair	547
registration any information in the possession of the department	548
that is necessary for the board to verify the existence of an	549
applicant's valid vendor's license and current state tax	550
identification number under section 4775.07 of the Revised Code;	551

(4) Providing information to the administrator of workers'	552
compensation pursuant to sections 4123.271 and 4123.591 of the	553
Revised Code;	554

(5) Providing to the attorney general information the	555
department obtains under division (J) of section 1346.01 of the	556
Revised Code;	557

(6) Permitting properly authorized officers, employees, or	558
agents of a municipal corporation from inspecting reports or	559
information pursuant to rules adopted under section 5745.16 of the	560
Revised Code;	561

(7) Providing information regarding the name, account number,	562
or business address of a holder of a vendor's license issued	563
pursuant to section 5739.17 of the Revised Code, a holder of a	564
direct payment permit issued pursuant to section 5739.031 of the	565
Revised Code, or a seller having a use tax account maintained	566
pursuant to section 5741.17 of the Revised Code, or information	567
regarding the active or inactive status of a vendor's license,	568
direct payment permit, or seller's use tax account;	569

(8) Releasing invoices or invoice information furnished under	570
section 4301.433 of the Revised Code pursuant to that section;	571

(9) Providing to a county auditor notices or documents	572
concerning or affecting the taxable value of property in the	573
county auditor's county. Unless authorized by law to disclose	574
documents so provided, the county auditor shall not disclose such	575
documents;	576

(10) Providing to a county auditor sales or use tax return or	577
audit information under section 333.06 of the Revised Code.	578

Section 2.  That existing section 5703.21 of the Revised Code	579
is hereby repealed.	580

Section 3. Division (B) of section 3739.05, division (D) of	581
section 3739.07, and sections 3739.02, 3739.09, 3739.11, 3739.12,	582
and 3739.99 of the Revised Code, as enacted by this act, shall	583
take effect on the first day of the thirteenth month after the	584
effective date of this act.	585