DES MOINES | Light up a cigarette in an Iowa restaurant, office or the Capitol rotunda and you’ll be told to put it out and, maybe, get slapped with a fine. Fire up an electronic cigarette in any of those places, and there’s no problem.

These are heady days in the electronic cigarette business. Manufacturers are being bought up by larger operations, such as the recent deal in which U.S. tobacco giant Lorillard snapped up a United Kingdom e-cig maker for $50 million and the potential of another $50 million if certain benchmarks are met.

Unlike tobacco-stuffed counterparts, e-cigs are not regulated or subject to tobacco taxes in 49 of the 50 states. 

But changes are coming, as evidenced by the letter signed by 41 attorneys general, including Iowa’s Tom Miller and South Dakota’s Marty Jackley, asking the U.S. Food and Drug Administration to "take all available measures" to issue rules for e-cigarette regulation by the end of October.

E-cigarettes exist in a legal limbo of sorts, where government is trying to play catch up to private enterprise.

“There’s no current Iowa Department of Public Health position,” said Jerilyn Oshel, interim director of the department's Division of Tobacco Use Prevention and Control. “We’re waiting for more research to be done, and we’re looking at the (federal Centers for Disease Control and Prevention) and the FDA for guidance.”

Technology meets nicotine

Electronic cigarettes often are metal or plastic and resemble traditional cigarettes. The battery-powered devices heat a nicotine liquid, creating vapor that users inhale. They get nicotine without the chemicals, tar or odor of regular cigarettes.

Flavors like grape, cherry and vanilla are offered, which has raised questions about whether the products are targeted to teens, who can use the devices legally. Nebraska lawmakers are considering banning the sale of the devices to minors. 

Patrick Gill, owner of Revolver Vapor Shop in Sioux City, said he checks identification of everyone under 30 who buys the devices. He said the e-cigarettes are popular with people trying to quit tobacco products. Eighty percent are successful, he said. 

"The different liquids are all going to be mixed with different nicotine strengths," said Gill, who carries liquid cartridges ranging in nicotine concentration from 8 to 24 milligrams. Nicotine-free liquid is also available.

"Business has been very good," he said.

But Gill also said regulation is needed. Some electronic cigarette companies import liquid from other countries that lack the quality control standards of the United States, he said.

"They really don't have any care or concern for the products they're selling or the people they're selling to," he said. "It gives the industry a bad name when you have a shop like that that pops up."

Finding the loophole

For users, the other appeal is that electronic cigarettes don’t violate no-smoking rules.

Iowa’s 2008 Smoke Free Air Act banned cigarette use in most public places, enclosed places of employment and some outdoor areas. Casinos and some hotel rooms are exempt. 

“It’s not surprising that e-cigarettes aren’t covered in Iowa’s law, because the law was written, passed and implemented before (e-cigarettes) were really around,” said Kathy Drea, vice president of advocacy for the American Lung Association of the Upper Midwest. “One of our main concerns with e-cigarettes is with the vapor they give off. We don’t know what the health consequences to that could be, so we’re all waiting for the FDA to make a ruling, and that’s supposed to be sometime this fall.”

Iowa State Rep. Tyler Olson, D-Cedar Rapids, was the floor manager of the Smoke Free Air Act when it was in the Iowa House. Olson, who is seeking the Democratic nomination for governor, said he’s not sure how e-cigarettes should be handled.

“I don’t think they have quite the same public health impact. There is nicotine in some, which is cause for some concern especially when they are marketed to children,” Olson said. “I think the same public conversation would have to take place that did around the time of the Smoke Free Air Act. The main rationale was because of the $300 million in Medicaid expenses related to smoking and second-hand smoke.”

Gov. Terry Branstad, who had cigarette vending machines removed from state buildings in the 1990s, hasn’t given much thought to whether e-cigarette vending machines should be allowed in, spokesman Tim Albrecht said.

“The governor is focused on job creation and visiting all 99 counties and has not made this issue a priority,” Albrecht said.

The executive branch has, however, prohibited state employees from using e-cigarettes on state property, said Caleb Hunter, deputy director at the Iowa Department of Administrative Services.

But visitors to state buildings seem to have an out that state employees don’t.

“Our rules only address tobacco products, which are not permitted by anyone. As I understand, e-cigarettes contain no tobacco,” Hunter wrote in an email. “I don’t know that we’ve contemplated it for the public.”

Iowa House Chief Clerk Carmine Boal said it would be up to lawmakers if they wanted to allow e-cigarettes in the chamber and could do so with a majority vote.

“It’s an interesting question, but it hasn’t come up yet,” said Boal, a former state representative from Ankeny. “We’ll see.”

Only subject to sales tax

While the rules governing where one can use an e-cigarette seem subjective at best, it is clear that Iowa is not making any extra money off the products. E-cigarettes are subject to sales tax, but not the state cigarette tax.

Cigarette smokers are taxed an additional $1.36 per package of 20 and $1.70 per package of 25 in the state. That’s on top of the 6 percent state sales tax.

Minnesota changed its tobacco law to include e-cigarettes. That change went into effect in August 2010.

Drea, the American Lung Association executive, said one issue states run into when trying to tax e-cigarettes is finding the correct language to cover them all.

“There are more than 250 brands of e-cigarettes out there, and not all of them are made the same, because there is no regulation,” she said. “Since there are a wide variety of products, there’s a lot of discussion around how exactly you can do that.”

Asked if he would like to see e-cigarettes taxed like tobacco products, Olson said he wasn’t sure.

“I don’t have an opinion on that right now,” he said. “I think around the same time of the Smoke Free Air Act, we raised the cigarette tax for the reasons related to the health risks with second-hand smoke and the health costs to the state. This is a bit of a different calculation.”