AN ACT to Provide COntinued recognition of the Wake Young Men's Leadership Academy and the Wake Young Women's Leadership Academy as cooperative innovative high schools, to require the state board of EDUCATION to approve the substitution of a new partner institution of higher education for those schools, and to regulate Tobacco products.

The General Assembly of North Carolina enacts:

CONTINUED STATUS AS A COOPERATIVE INNOVATIVE HIGH SCHOOL AND SUBSTITUTION OF HIGHER EDUCATION PARTNER
SECTION 1.(a)  For the purposes of this section, the Wake Young Men's Leadership Academy and the Wake Young Women's Leadership Academy are referred to collectively as Academies and are referred to individually as Academy.
SECTION 1.(b)  Notwithstanding the requirements of Part 9 of Article 16 of Chapter 115C of the General Statutes for an institution of higher education partner and the written agreements entered into as provided in G.S. 115C‑238.53(b) (written agreement), the following shall apply to the Academies for the 2024‑2025 and 2025‑2026 school years:
(1)	The Academies shall continue to be recognized as cooperative innovative high schools.
(2)	The Academies shall continue to receive funds as provided in G.S. 115C‑238.51A(c).
(3)	The Academies shall continue operation as provided in G.S. 115C‑238.53.
(4)	The Academies shall continue to provide opportunities for eligible students to earn postsecondary credit while enrolled in high school.
SECTION 1.(c)  Notwithstanding the requirements of G.S. 115C‑238.51A, the following shall occur:
(1)	The State Board of Education shall approve one or both applications to substitute the partner institution of higher education from the 2023‑2024 school year in the written agreements for one or both of the Academies with a new partner institution of higher education no later than the 2025‑2026 school year if the following occur:
a.	The Wake County Board of Education and the applicable governing board of the local board of trustees of the partner institution of higher education submit applications for substitution to the State Board of Education for one or both of the Academies. The applications shall comply with procedural requirements established by the State Board of Education for the submission of such applications.
b.	The State Board of Education determines that the partner institution of higher education complies with the requirements for a partner institution of higher education under Part 9 of Article 16 of Chapter 115C of the General Statutes.
(2)	If the applications for the substitution of a partner institution of higher education in the written agreement for one or both of the Academies is approved by the State Board of Education in accordance with subdivision (1) of this subsection, beginning with the first fiscal year for which the approval is granted, the following shall apply:
a.	That Academy shall continue to receive the recurring State funds appropriated for that school as provided in G.S. 115C‑238.51A(c).
b.	Subsection (b) of this section shall cease to apply for that Academy.
SECTION 1.(d)  This section is effective when it becomes law.

REGULATE TOBACCO PRODUCTS
SECTION 2.(a)  G.S. 14‑313 reads as rewritten:
"§ 14‑313.  Youth access to tobacco products, alternative nicotine products, vapor products, and cigarette wrapping papers.
(a)	Definitions. – The following definitions apply in this section:
(1)	Alternative nicotine product. – Any noncombustible product that contains nicotine, whether natural or synthetic, but does not contain tobacco and is intended for human consumption whether chewed, absorbed, dissolved, ingested, or by other means. This term does not include a vapor product or any product regulated by the United States Food and Drug Administration under Chapter V of the federal Food, Drug, and Cosmetic Act.
(1a)	Consumable product. – Consumable product shall have the same meaning as provided in G.S. 105‑113.4(1k). For purposes of this section, a consumable product does not contain any tobacco leaf.
(1b)	Distribute. – To sell, furnish, give, or provide tobacco products, including tobacco product samples or cigarette wrapping papers, to the ultimate consumer.
(1c)	FDA. – Food and Drug Administration.
(2)	Proof of age. – A drivers license or other photographic identification that includes the bearer's date of birth that purports to establish that the person is 18 years of age or older.
(3)	Sample. – A tobacco product distributed to members of the general public at no cost for the purpose of promoting the product.
	
(3b)	Secretary. – The Secretary of the Department of Revenue.
(3c)	Timely Filed Premarket Tobacco Product Application. – An application pursuant to 21 U.S.C. § 387j for a vapor product or consumable product containing nicotine derived from tobacco marketed in the United States as of August 8, 2016, that was submitted to the United States Food and Drug Administration on or before September 9, 2020, and accepted for filing.
(4)	Tobacco product. – Any product that contains tobacco and is intended for human consumption. For purposes of this section, the term includes an alternative nicotine product, vapor product, consumable product, or components of a vapor product.
(5)	Vapor product. – Any noncombustible product that employs a mechanical heating element, battery, or electronic circuit regardless of shape or size and that can be used to heat a consumable product. The term includes an electronic cigarette, electronic cigar, electronic cigarillo, and electronic pipe. The term does not include any product regulated by the United States Food and Drug Administration under Chapter V of the federal Food, Drug, and Cosmetic Act.
(b)	Sale or distribution to persons under the age of 18 years. – If any person shall distribute, or aid, assist, or abet any other person in distributing tobacco products or cigarette wrapping papers to any person under the age of 18 years, or if any person shall purchase tobacco products or cigarette wrapping papers on behalf of a person under the age of 18 years, the person shall be guilty of a Class 2 misdemeanor; provided, however, that it shall not be unlawful to distribute tobacco products or cigarette wrapping papers to an employee when required in the performance of the employee's duties. Retail distributors of tobacco products shall prominently display near the point of sale a sign in letters at least five‑eighths of an inch high which states the following:
N.C. LAW STRICTLY PROHIBITS
THE PURCHASE OF TOBACCO PRODUCTS, ALTERNATIVE NICOTINE PRODUCTS, VAPOR PRODUCTS, AND CIGARETTE WRAPPING PAPERS
BY PERSONS UNDER THE AGE OF 18.
PROOF OF AGE REQUIRED.
Failure to post the required sign shall be an infraction punishable by a fine of twenty‑five dollars ($25.00) for the first offense and seventy‑five dollars ($75.00) for each succeeding offense.
A person engaged in the sale of tobacco products or cigarette wrapping papers shall demand proof of age from a prospective purchaser if the person has reasonable grounds to believe that the prospective purchaser is under 18 years of age. Failure to demand proof of age as required by this subsection is a Class 2 misdemeanor if in fact the prospective purchaser is under 18 years of age. Retail distributors of tobacco products or cigarette wrapping papers shall train their sales employees in the requirements of this law. Proof of any of the following shall be a defense to any action brought under this subsection:
(1)	The defendant demanded, was shown, and reasonably relied upon proof of age in the case of a retailer, or any other documentary or written evidence of age in the case of a nonretailer.
(2)	The defendant relied on the electronic system established and operated by the Division of Motor Vehicles pursuant to G.S. 20‑37.02.
(3)	The defendant relied on a biometric identification system that demonstrated (i) the purchaser's age to be at least the required age for the purchase and (ii) the purchaser had previously registered with the seller or seller's agent a drivers license, a special identification card issued under G.S. 20‑37.7, a military identification card, or a passport showing the purchaser's date of birth and bearing a physical description of the person named on the card.
(b1)	Distribution of tobacco products. –  Tobacco products shall not be distributed in vending machines; provided, however, vending machines distributing tobacco products are permitted (i) in any establishment which is open only to persons 18 years of age and older; or (ii) in any establishment if the vending machine is under the continuous control of the owner or licensee of the premises or an employee thereof and can be operated only upon activation by the owner, licensee, or employee prior to each purchase and the vending machine is not accessible to the public when the establishment is closed. The owner, licensee, or employee shall demand proof of age from a prospective purchaser if the person has reasonable grounds to believe that the prospective purchaser is under 18 years of age. Failure to demand proof of age as required by this subsection is a Class 2 misdemeanor if in fact the prospective purchaser is under 18 years of age. Proof that the defendant demanded, was shown, and reasonably relied upon proof of age shall be a defense to any action brought under this subsection. Any person distributing tobacco products through vending machines in violation of this subsection shall be guilty of a Class 2 misdemeanor.
(b2)	Internet distribution of tobacco products. – A person engaged in the distribution of tobacco products through the Internet or other remote sales methods shall perform an age verification through an independent, third‑party age verification service that compares information available from public records to the personal information entered by the individual during the ordering process to establish that the individual ordering the tobacco products is 18 years of age or older.
(c)	Purchase by persons under the age of 18 years. –  If any person under the age of 18 years purchases or accepts receipt, or attempts to purchase or accept receipt, of tobacco products or cigarette wrapping papers, or presents or offers to any person any purported proof of age which is false, fraudulent, or not actually his or her own, for the purpose of purchasing or receiving any tobacco product or cigarette wrapping papers, the person shall be guilty of a Class 2 misdemeanor; provided, however, that it shall not be unlawful for an employee to purchase or accept receipt of tobacco products or cigarette wrapping papers when required in the performance of the employee's duties.
(d)	Sending or assisting a person [less than] 18 years to purchase or receive tobacco products or cigarette wrapping papers. – If any person shall send a person less than 18 years of age to purchase, acquire, receive, or attempt to purchase, acquire, or receive tobacco products or cigarette wrapping papers, or if any person shall aid or abet a person who is less than 18 years of age in purchasing, acquiring, or receiving or attempting to purchase, acquire, or receive tobacco products or cigarette wrapping papers, the person shall be guilty of a Class 2 misdemeanor; provided, however, persons under the age of 18 may be enlisted by police or local sheriffs' departments to test compliance if the testing is under the direct supervision of that law enforcement department and written parental consent is provided; provided further, that the Department of Health and Human Services shall have the authority, pursuant to a written plan prepared by the Secretary of Health and Human Services, to use persons under 18 years of age in annual, random, unannounced inspections, provided that prior written parental consent is given for the involvement of these persons and that the inspections are conducted for the sole purpose of preparing a scientifically and methodologically valid statistical study of the extent of success the State has achieved in reducing the availability of tobacco products to persons under the age of 18, and preparing any report to the extent required by section 1926 of the federal Public Health Service Act (42 USC § 300x‑26).
(e)	Statewide uniformity. – It is the intent of the General Assembly to prescribe this uniform system for the regulation of tobacco products and cigarette wrapping papers to ensure the eligibility for and receipt of any federal funds or grants that the State now receives or may receive relating to the provisions of this section. To ensure uniformity, no political subdivisions, boards, or agencies of the State nor any county, city, municipality, municipal corporation, town, township, village, nor any department or agency thereof, may enact ordinances, rules or regulations concerning the sale, distribution, display or promotion of (i) tobacco products or cigarette wrapping papers on or after September 1, 1995, (ii) alternative nicotine products or vapor products on or after August 1, 2013, or (iii) alternative nicotine products on or after December 1, 2024. This subsection does not apply to the regulation of vending machines, nor does it prohibit the Secretary of Revenue from adopting rules with respect to the administration of the tobacco products taxes levied under Article 2A of Chapter 105 of the General Statutes.
(f)	Deferred Prosecution or Conditional Discharge. – Notwithstanding G.S. 15A‑1341(a1) or G.S. 15A‑1341(a4), any person charged with a misdemeanor under this section shall be qualified for deferred prosecution or a conditional discharge pursuant to Article 82 of Chapter 15A of the General Statutes provided the defendant has not previously been placed on probation for a violation of this section and so states under oath.
(g)	Certification of Vapor Products and Consumable Products. – As required by Part 3 of Article 4 of Chapter 143B of the General Statutes, the Secretary of the Department of Revenue shall certify vapor products and consumable products eligible for retail sale in this State and shall list them on a directory.
(h)	Fines and Civil Penalties. – The following penalties shall apply to violations of the certification requirements for consumable products and vapor products required by Part 3 of Article 4 of Chapter 143B of the General Statutes.
(1)	Retailer, distributor, or wholesaler fines. – A retailer, distributor, or wholesaler who offers for sale a consumable product or vapor product intended for ultimate retail sale in this State that is not included in the directory is subject to a warning with a mandatory reinspection of the retailer within 30 days of the violation of Part 3 of Article 4 of Chapter 143B of the General Statutes:
a.	For a second violation of this type within a 12‑month period, the fine shall be at least five hundred dollars ($500.00) but not more than seven hundred fifty dollars ($750.00) and, if licensed, the licensee's license shall be suspended for 30 days.
b.	For a third or subsequent violation of this type within a 12‑month period, the fine shall be at least one thousand dollars ($1,000) but not more than one thousand five hundred dollars ($1,500) and, if licensed, the licensee's license shall be revoked.
c.	Upon a second or subsequent violation of this type, consumable products or vapor products that are not on the directory as required by G.S. 143B‑245.12, and are possessed by a retailer, distributor, or wholesaler, shall be subject to seizure, forfeiture, and destruction. The cost of such seizure, forfeiture, and destruction shall be borne by the person from whom the products are confiscated, except that no products may be seized from a consumer who has made a bona fide purchase of such product. The Secretary may store and dispose of the seized products as appropriate, in accordance with federal, State, and local laws pertaining to storage and disposal of such products.
(2)	Manufacturer penalties. – A manufacturer whose consumable products or vapor products are not listed in the directory as required by G.S. 143B‑245.12, and who causes the products that are not listed to be sold for retail sale in North Carolina, whether directly or through an importer, distributor, wholesaler, retailer, or similar intermediary or intermediaries, is subject to a civil penalty of ten thousand dollars ($10,000) for each individual product offered for sale in violation of Part 3 of Article 4 of Chapter 143B of the General Statutes until the offending product is removed from the market or until the offending product is properly listed on the directory. In addition, any manufacturer that falsely represents any information required by a certification form shall be guilty of a misdemeanor for each false representation.
(b)	In an action to enforce this section, the state shall be entitled to recover costs, including the costs of investigation, expert witness fees, and reasonable attorney fees.
(c)	A repeated violation of the requirements of Part 3 of Article 4 of Chapter 143B of the General Statutes shall constitute a deceptive trade practice under Chapter 75 of the General Statutes."
SECTION 2.(b)  Article 4 of Chapter 143B of the General Statutes is amended by adding a new Part to read:
"Part 3. Certification and Directory of Vapor Products and Consumable Products.
"§ 143B‑245.10.  Definitions.
The following definitions apply throughout this Part:
(1)	Alternative nicotine product. – As defined in G.S. 14‑313(a)(1).
(2)	Consumable product. – As defined in G.S. 14‑313(a)(1a).
(3)	Distribute. – As defined in G.S. 14‑313(a)(1b).
(4)	FDA. – As defined in G.S. 14‑313(a)(1c).
(5)	Secretary. – The Secretary of the Department of Revenue.
(6)	Timely Filed Premarket Tobacco Product Application. – As defined in G.S. 14‑313(a)(3c).
(7)	Tobacco product. – As defined in G.S. 14‑313(a)(4).
(8)	Vapor product. – As defined in G.S. 14‑313(a)(5).
"§ 143B‑245.11.  Certification process.
(a)	Certification. – Beginning March 1, 2025, and annually thereafter, every manufacturer of vapor products and consumable products sold for retail sale in this State, whether directly or through a distributor, retailer, or similar intermediary or intermediaries, shall execute and deliver on a form prescribed by the Secretary, a certification to the Secretary under penalty of perjury, of the following:
(1)	The manufacturer received an order granted pursuant to 21 U.S.C. § 387j(c) (marketing granted order) for the vapor product or consumable product from the FDA.
(2)	The manufacturer submitted a Timely Filed Premarket Tobacco Product Application as defined in G.S. 14‑313(a)(3c) for the vapor product or consumable product; and the application either remains under review by the FDA or has received a denial order that has been and remains stayed by the FDA or court order, rescinded by the FDA, or vacated by a court.
(3)	The manufacturer is exempt from the requirements of subdivision (1) or (2) of this subsection because the vapor product or consumable product only reflects changes to the name, brand style, or packaging of a vapor product or consumable product.
(b)	Requirements for Manufacturers; Fees. – In addition to the requirements contained in subsection (a) of this section, each manufacturer shall provide to the Secretary the following:
(1)	For each vapor product and consumable product offered by the manufacturer, a copy of (i) the marketing granted order issued by the FDA pursuant to 21 U.S.C. § 387j; (ii) a copy of the acceptance letter issued by the FDA pursuant to 21 U.S.C. § 387j for a Timely Filed Premarket Tobacco Product Application; or (iii) a document issued by the FDA or by a court confirming that the premarket tobacco product application has received a denial order that is not yet in effect; and
(2)	An initial fee of two thousand dollars ($2,000) to offset the costs incurred by the Department of Revenue for processing the certifications and operating the directory and an annual renewal fee of five hundred dollars ($500.00) each year on March 1 to offset the costs associated with maintaining the directory and satisfying the requirements of this section for each consumable product or vapor product to be listed in the directory.
(c)	Certification Form. – The certification form shall separately list each brand name, category (e.g., e‑liquid, power unit, device, e‑liquid cartridge, e‑liquid pod, disposable), product name, and flavor for each consumable product or vapor product that is sold in this State.
(d)	Confidentiality. – The information submitted by the manufacturer pursuant to subsections (a) and (b) of this section shall be considered confidential commercial or financial information for purposes of G.S. 132‑1.2. The manufacturer may redact certain confidential commercial or financial information provided under subsection (a) of this section. The Secretary shall not disclose such information except as required or authorized by law.
(e)	Notification of Material Changes to the Certification. – Any manufacturer submitting a certification pursuant to subsections (a) and (b) of this section shall notify the Secretary as soon as practicable but not later than 30 days of any material change to the certification, including the issuance or denial of a marketing authorization or other order by the FDA pursuant to 21 U.S.C. § 387j, or any other order or action by the FDA or any court that affects the ability of the consumable product or vapor product to be introduced or delivered into interstate commerce for commercial distribution in the United States.
"§ 143B‑245.12.  Public directory.
(a)	Development and Maintenance of Directory. – Beginning on May 1, 2025, the Secretary shall develop, maintain, and make publicly available on the Secretary's public website a directory listing all manufacturers of consumable products or vapor products that have provided certifications that comply with G.S. 143B‑245.11(a) and (b) and all product names, brand names, categories (e.g., e‑liquid, e‑liquid cartridge, e‑liquid pod, disposable), and flavors for which certifications have been submitted and approved by the Secretary. The Secretary shall update the directory at least monthly to ensure accuracy. The Secretary shall establish a process to provide licensed retailers, distributors, and wholesalers notice of the initial publication of the directory and changes made to the directory in the prior month.
(b)	Exclusion from the Directory. – No manufacturer or the manufacturer's consumable products or vapor products shall be included or retained in the directory if the Secretary determines that any of the following apply:
(1)	The manufacturer failed to provide a complete and accurate certification as required by G.S. 143B‑245.11(a) and (b).
(2)	The manufacturer submitted a certification that does not comply with the requirements of G.S. 143B‑245.11(c).
(3)	The manufacturer failed to include with its certification the payment required by G.S. 143B‑245.11(b).
(4)	The manufacturer sold products in North Carolina required to be certified under this Part during a period when either the manufacturer or the product had not been certified and listed on the directory.
(5)	The information provided by the manufacturer in its certification is determined by the Secretary to contain false information or contains material misrepresentations or omissions.
(c)	Removal from the Directory. – The Secretary shall provide the manufacturer notice and an opportunity to cure deficiencies before removing the manufacturer or products from the directory.
(1)	The Secretary may not remove the manufacturer or its products from the directory until at least 30 days after the manufacturer has been given notice of an intended action. Notice shall be sufficient and be deemed immediately received by a manufacturer if the notice is sent either electronically or by facsimile to an electronic mail address or facsimile number, as the case may be, provided by the manufacturer in its most recent certification filed under G.S. 143B‑245.11(a).
(2)	The manufacturer shall have 15 business days from the date of service of the notice of the Secretary's intended action to establish that the manufacturer of consumable products or vapor products should be included in the directory.
(3)	Retailers shall have 30 days following the removal of a manufacturer or its products from the directory to sell such products that were in the retailer's inventory as of the date of removal or remove those products from inventory and return them to the distributor or wholesaler from whom the products were purchased for a refund.
(4)	After 30 days following removal from the directory, the consumable product or vapor product of a manufacturer identified in the notice of removal and intended for retail sale in North Carolina may not be purchased or sold for retail sale in North Carolina.
(5)	A determination by the Secretary to not include or to remove from the directory a manufacturer or a manufacturer's product shall be subject to review by the filing of a civil action for prospective declaratory or injunctive relief.
"§ 143B‑245.13.  Retail sale of consumable products and vapor products.
(a)	Products Prohibited from Retail Sale. – Except as provided in subdivisions (1) and (2) of this subsection, beginning May 1, 2025, or on the date that the Department of Revenue first makes the directory available for public inspection on its public website as provided in G.S. 143B‑245.12(a), whichever is later, consumable products or vapor products not included in the directory may not be sold for retail sale in North Carolina, either directly or through an importer, distributor, wholesaler, retailer, or similar intermediary or intermediaries.
(1)	Each retailer shall have 60 days from the date that the Secretary first makes the directory available for inspection on its public website to sell products that were in its inventory and not included in the directory or remove those products from inventory and return them to the distributor or wholesaler from whom the products were purchased for a refund.
(2)	Each distributor or wholesaler shall have 60 days from the date that the Secretary first makes the directory available for inspection on its public website to remove those products intended for ultimate retail sale in the State from its inventory.
(3)	After 60 calendar days following publication of the directory, consumable products or vapor products not listed in the directory and intended for retail sale in North Carolina may not be purchased or sold for retail sale in North Carolina except as provided in G.S. 143B‑245.12(c).
"§ 143B‑245.14.  Agent for service of process.
(a)	Registered Agent. – The following conditions apply:
(1)	A manufacturer not registered to do business in the State shall, as a condition precedent to having its name or its products listed and retained in the directory, appoint and continually engage without interruption a registered agent in this State for service of process on whom all process and any action or proceeding arising out of the enforcement of this Part or G.S. 14‑313(g) and (h) may be served. The manufacturer shall provide to the Secretary the name, address, and telephone number of its agent for service of process and shall provide any other information relating to its agent as may be requested by the Secretary.
(2)	A manufacturer located outside of the United States shall, as an additional condition precedent to having its products listed or retained in the directory, cause each of its importers of any of its products to be sold in the State to appoint, and continually engage without interruption, the services of an agent in the State in accordance with the provisions of this section. All obligations of a manufacturer imposed by this section with respect to appointment of its agent shall also apply to the importers with respect to appointment of their agents.
(3)	A manufacturer shall provide written notice to the Secretary 30 calendar days prior to the termination of the authority of an agent appointed pursuant to subdivisions (1) and (2) of this subsection. No less than five calendar days prior to the termination of an existing agent appointment, a manufacturer shall provide to the Secretary the name, address, and telephone number of its newly appointed agent for service of process and shall provide any other information relating to the new appointment as may be requested by the Secretary. In the event an agent terminates an agency appointment, the manufacturer shall notify the division of the termination within five calendar days and shall include proof to the satisfaction of the division of the appointment of a new agent.
"§ 143B‑245.15.  Compliance.
(a)	Unannounced Compliance Check. – Each retailer, distributor, and wholesaler that sells or distributes consumable products or vapor products in this State shall be subject to unannounced compliance checks by the Secretary or its designee, which may include State and local law enforcement officials, for purposes of enforcing this Part. Unannounced follow‑up compliance checks of all noncompliant retailers, distributors, and wholesalers shall be conducted within 30 days after any violation of this Part.
(1)	Any person who observes a violation described in G.S. 143B‑245.13 may alert the Secretary of such violation, and the Secretary shall cause an unannounced compliance check to occur with respect to the person alleged to be in violation.
(2)	The Secretary shall publish the results of all compliance checks at least annually and shall make the results available to the public on request.
"§ 143B‑245.16.  Rules; use of fees; report.
(a)	Rules. – The Secretary shall adopt rules for the implementation and enforcement of this Part.
(b)	Use of Fees and Penalties. – The fees received under this Part and the penalties collected under G.S. 14‑313(h) by the Department of Revenue shall be used by the Department of Revenue exclusively for processing the certifications, operating and maintaining the directory, and enforcement of this Part.
(c)	Report. – Beginning on January 31, 2026, and annually thereafter, the Secretary shall provide a report to the legislature regarding the status of the directory, manufacturers and products included in the directory, revenue and expenditures related to administration of this section, and enforcement activities undertaken pursuant to this section, including the number of stores that have been inspected and the results from such inspections."
SECTION 2.(c)  This section becomes effective December 1, 2024.

EFFECTIVE DATE
SECTION 3.  Except as otherwise provided, this act is effective when it becomes law.
In the General Assembly read three times and ratified this the 27th day of June, 2024.

	s/	 Phil Berger
	 President Pro Tempore of the Senate

	s/	 Tim Moore
	 Speaker of the House of Representatives

	_____________________________________
		 Roy Cooper
	 Governor

Approved __________.m. this ______________ day of ___________________, 2024