ARTICLE 2. Sale to Distributors

(Article 2 added by Stats. 1961, Ch. 884.)

30166. Payment for stamps and settings; discount. Stamps and meter register settings shall be sold to licensed distributors at their denominated values less a discount of 0.85 percent , which shall be capped at the first one dollar ($1.00) in denominated value. Payment for stamps or meter register settings shall be made at the time of purchase, provided that a licensed distributor, subject to the conditions and provisions of this article, may be permitted to defer payments therefor.
History.—Added by Stats. 1961, p. 2316, operative July 16, 1961. Stats. 1967, p. 2519, operative August 1, 1967, substituted "0.85 percent" for "2 percent." Proposition 56, Section 5.4, approved by voters at the November 8, 2016 election, in effect November 9, 2016, added "to licensed distributors" after "shall be sold" and substituted ",which shall be capped at the first one dollar ($1.00) in denominated value" for "to licensed distributors" after "0.85 percent" in the first sentence.
30166.1. No later than July 1, 2005, the board shall submit a report to the Legislature that evaluates the average actual costs, including labor for applying indicia or impressions, bonding, warehousing, and leasing stamping equipment, including case cutters and packers, associated with applying stamps or meter impressions to cigarette packages. This report shall be updated every two years.
History.—Added by Stats. 2003, Ch. 890 (AB 71), in effect January 1, 2004

30167. A licensed distributor may apply to the board to fix the maximum amount of deferred-payment purchases of stamps and meter register settings which the distributor may have unpaid at any time. Upon receipt of the application and the bond or bonds required pursuant to Section 30142, the board shall fix such amount. The board at any time may designate the sales locations where the distributor may make deferred-payment purchases of stamps and meter register settings and fix the amount of such purchases which the distributor may have unpaid at any one time with respect to purchases made at each of the designated sales locations.
History.—Added by Stats. 1961, p. 2316, operative July 16, 1961. Stats. 1967, p. 2519, operative August 1, 1967, substituted "have unpaid at any time" for "make in any monthly period beginning with the 16th day of a calendar month and ending with the 15th day of the following calendar month" in the first sentence and substituted "have unpaid at any one time with respect to purchases made at each of" for "make within each monthly period at" in the last sentence

30168. (a) Except as provided for in subdivision (c), amounts owing for stamps and meter register settings purchased on the deferred-payment basis shall be due and payable based on the distributor's election to make the payment pursuant to subdivision (b). Payment shall be made by a remittance payable to the board.
(b) A distributor shall elect to make the payment required by subdivision (a) on either a monthly, a twice-monthly, or a weekly basis. An election made pursuant to this subdivision shall remain in effect for at least one year from the date the election is made. If the board finds that good cause exists for a distributor's inability to maintain the election for the full year, the board shall authorize the distributor to make a new election, as otherwise authorized by this subdivision, prior to the expiration of the one-year period following the prior election.
(1) If a distributor elects to make the payment required by subdivision (a) on a monthly basis, the distributor shall remit the payment on or before the 25th day of the month following the month in which the stamps and meter register settings were purchased.
(2) If a distributor elects to make the payment required by subdivision (a) on a twice-monthly basis, the distributor shall make two remittances during the month following the month in which the stamps and meter register settings were purchased. The first monthly remittance shall be made on or before the fifth day of the month and shall be equal to either one-half of the total amount of those purchases of stamps and meter register settings that were made during the preceding month or the total amount of those purchases of stamps and meter register settings that were made between the first day and the 15th day of the preceding month, whichever is greater. The second monthly remittance shall be made on or before the 25th day of the month for the remainder of those purchases of stamps and meter register settings that were made in the preceding month.
(3) If a distributor elects to make the payment required by subdivision (a) on a weekly basis, the distributor shall remit the payment on or before Wednesday following the week in which the stamps and meter register settings were approved and released. Every distributor electing to make payment on a weekly basis shall provide to the board and update, as necessary, an electronic mail address for the purpose of receiving payment information, including but not limited to, amounts owing for stamps and meter register settings purchased.
(c) Amounts owing for stamps and meter register settings purchased on the deferred-payment basis without a security pursuant to subdivision (d) of Section 30142 shall be due and payable on or before Wednesday following the week in which the stamps and meter register settings were purchased. Payment shall be made by a remittance payable to the board.
History.—Added by Stats. 1961, p. 2316, operative July 16, 1961. Stats. 1967, p. 2519, operative August 1, 1967, substituted "any calendar month, beginning with August, 1967," for "a monthly period beginning with the 16th day of a calendar month and ending with the 15th day of the following calendar month" and "20th day of the following" for "28th day of the latter" in the first sentence and added the last sentence. Stats. 1968, p. 1100, in effect November 13, 1968, substituted "25th" for "20th". Stats. 2003, Ch. 867 (AB 1666), in effect January 1, 2004, established the former sole paragraph as subdivision (a), deleted ", beginning with August, 1967," after "in any calendar month", substituted "on a monthly basis … meter register settings were purchased" for "on or before the 25th day of the following calendar month" after "shall be due and payable" in the first sentence, and deleted the last sentence "Amounts owing for purchases made from July 16, 1967, to and including July 31, 1967, shall be due and payable on or before August 31, 1967" of subdivision (a); and added subdivisions (b) and (c). Stats. 2006, Ch. 70 (AB 2001), in effect January 1, 2007, substituted "fifth" for "5th" after "or before the" in the second sentence of subdivision (b)(2); and deleted former subdivision (c) which stated "This section shall remain in effect until January 1, 2007, and as of that date is repealed.". Stats. 2006, Ch. 501 (AB 1749), in effect January 1, 2007, substituted "Except as provided for in subdivision (c), amounts" for "Amounts" before "owing for stamps", deleted "in any calendar month" after "deferred-payment basis", and substituted "based on the distributor's election to make the payment pursuant to subdivision (b)" for "on a monthly basis, in the manner elected pursuant to subdivision (b), during the month following the calendar month in which the stamps and meter register settings were purchased" after "due and payable", in the first sentence of subdivision (a); substituted a comma for "or" after "either a monthly", and added ", or a weekly" after "a twice-monthly", in the first sentence of the first paragraph, substituted "fifth" for "5th" after "or before the" in the second sentence of paragraph (2), and added paragraph (3) to subdivision (b); and substituted subdivision (c) for the former subdivision (c) which stated "this section shall remain in effect until January 1, 2007, and as of that date is repealed".
Note.—SEC. 9. of Stats. 2003. Ch. 867 (AB 1666), effective January 1, 2004, states, The Legislative Analyst, with assistance of, and based on information provided by, the State Board of Equalization, shall, on or before January 1, 2006, prepare a report to the Legislature of the economic impact of this act. The report shall include an evaluation of the State Board of Equalization's ability to collect cigarette tax revenues, additional revenues, if any, generated by the twice-monthly payment program, and the ability of distributors to access security bonds

30169. A distributor shall authorize in writing those persons who may order purchases of stamps or meter register settings for the account of the distributor at a location where stamps or meter register settings are sold. The authorization shall continue in effect until written notice of revocation of the authority is delivered at the sales location in such manner as may be prescribed by the board.
History.—Added by Stats. 1961, p. 2316, operative July 16, 1961

30170. The board may suspend without prior notice a distributor's privilege to purchase stamps or meter register settings on the deferred-payment basis or may reduce the amount of permissible deferred-payment purchases fixed for the distributor, if the distributor fails to promptly pay for stamps or meter register settings when payment is due, if the bond or bonds of the distributor are canceled, become void, impaired, or unenforceable for any reason, or if in the opinion of the board, collection of any amounts unpaid or due from the distributor under this part are jeopardized.
History.—Added by Stats. 1961, p. 2316, operative July 16, 1961. Stats. 1967, p. 2520, operative August 1, 1967, substituted "deferred-payment purchases" for "monthly purchases.

30171. Any distributor who fails to pay any amount owing for the purchase of stamps or meter register settings within the time required, shall pay a penalty of 10 percent of the amount due in addition to the amount plus interest at the modified adjusted rate per month, or fraction thereof, established pursuant to Section 6591.5, from the date on which the amount became due and payable until the date of payment.
History.—Added by Stats. 1961, p. 2316, operative July 16, 1961. Stats, 1975, Ch. 661, operative to interest accruing on or after January 1, 1976, substituted "1 percent" for "one-half of 1 percent." Stats. 1982, Ch. 5, First Extra Session, in effect May 27, 1982, substituted "adjusted … 19269" for "rate … thereof" before "from." Stats. 1984, Ch. 1020, effective January 1, 1985, effective July 1, 1985, substituted "modified … thereof" for "adjusted annual rate," substituted "Section 6591.5" for "Section 19269.

30172. The board for good cause may extend for not to exceed five days the time for paying any amount owning for stamps or meter register settings purchased on the deferred-payment basis provided a request for the extension is filed with the board within or prior to the period for which the extension may be granted.
History.—Added by Stats. 1961, p. 2317, operative July 16, 1961