sr-102379-6tCA RLK:5SS:msh
Council Meetir-~ 10-23-79
STAFr^ REPORT
TO: Mayor and City Council
FROM: City Attorney
SUBJECT: Proposed Item Pricing Ordinance
OCT 2 3 1979'
INTRODUCTION
This report transmits a recommendation that the
Council direct the City Attorney to prepare an ordinance
requiring items to be individually priced in retail stores,
and to schedule a public hearing.
BACKGROUND
State law requires retail stores using automatic
check-out systems to use a consumer protection system called
°'item pricing", which requires readable prices in arabic
numbers on packages and cans. This legislation expires in
January, 1980. Senator Roberti has introduced SB 92 in the
legislature, which would extend indefinitely the present
law requiring item pricing. On March 27, 1979, the Council
adopted Resolution Pdo. 5253, which endorsed SB 92.
The Consumer.' Protection Division of this office has
received numerous communications from citizens and consumer
oriented groups expressing concern that a valuable consumer
protection will be lost if SB 92 is not passed by the legislature.
There is apparently a good chance that this will come to pass;
therefore, Santa b4onica consumers will be left without this
protection unless the City adopts its own item pricing ordinance.
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Santa ^"mica, California
Because of the importance of_ item pricing to Santa
A4onica consumers, and because of the need for a speedy decision
on this issue to enable grocery stores and retailers to prepare
for local item pricing, it is recommended that the Council
should set a public hearing as quickly as possible.
ALTERNATIVES
The Council may direct the City Attorney to prepare
an ordinance establishing local item pricing that is identical
in all respects to the current State Item Pricing Bill,
explore alternative means of item pricing, or not prepare any
ordinance at all.
RECON1uENDATION
It is respectfully recommended that the Council direct
the City Attorney to prepare an ordinance providing for
local item pricing in the City of Santa *4onica, as well as
exploring other alternatives, and schedule a public hearing
on the matter for the November 13, 1979 Council meeting.
It is suggested that local grocery chains and consumer groups
be advised of this public hearing so that their comments can
be incorporated in the staff report transmitting the ordinance.
Prepared by: Stephen S. Stark, Assistant City Attorney
Rosalind Smith, Consumer Affairs Specialist
Consumer ~?unodities: pricing
B & P CodE 2/14/79
As Introduced
SENATE COMMITTEE ON
BUSINESS & PROFESSIONS
Staff Analysis of SB 92 (Roberti)
S
HISTORY: This measure. was introduced to permanently B
extend the requirement of item pricing by food
stores, first imposed by the Legislature for the 9
period April 1, 1976 - April 1, 1977 (SB 261, Rober- 2
ti, Chapter 1120, Statutes 1975). Subsequent legis-
lation;including SB 32 (Roberti, Chapter 763 of 1977)
which passed out of this committee, extended the
item pricing requirement tc January 1, 1980.
F
In September 1975, HR 36 (Ralph) was introduced and I
enacted, requiring the Legislative Analyst and the N
Assembly Office of Research to monitor developments A
in the use of computer checkout systems in Calif or- N
pia, and to .report their findings in December 1976, C
E
BACKGROUND: The experimental testing of computerized
c_e~idout ssystems which, from a grocery retailer's Y
view, eliminate the necessity of marking the price E
on most food items, sparked the item pricing contro- S
versy. The systems utilize the Universal Product
Code, to which most manufacturers already subscribe.
The Code permits an .electronic "scanner" at the
checkout stand to identify the item. The price
of the item is programmed into the computer. Thus
the scanner will.°,-ead91 the Universal Product Code,
ring up the price automatically, flash the price
on a screen for the consumer to see, and print out
a detailed receipt to be given to the consumer at
the close of the transaction (e.g., 4 Ivory soap
@ .37 , 1.48T). The market's present need
for a price on each item is to enable the clerk
to know the price and ring it up manually. Comnu-
terized checkout eliminates that need,
To date, approximately 44 California supe?-maricets
have installed optical scanner automated systems,
A11alVSt°S RepOYt
The Legislative Analyst's report indicated, among other
things, that:
SB 32 (Cc ~d)
Page two
(1) Net before-tax savings from automated scanner
systems can range from 1,0 to 1.5 percent of
store sales volu_*res with item price elimination,
and from .75 to 1.15 percent of store sales
volumes without item price elimination.
(2) On a statewide basis, total estimated potential.
employment reductions in retail food stores are
5,900 to 8,650 assuming item price elimination,
Assuming item pricing is retained, total job
reductions are 3,300 to 4,700. This loss of
jobs in retail food employment may be offset,
in part, by induced employment in equipment
and electronics industries.
PROPOSED LEGISLATION: SB 92
termination date, January 1,
grocery stores utilizing aut
are.reguired to item price.
indefinitely the requirement
price consumer connodities.
removes the current
1980, until which
~matic checkout systems
Therefore ~t waul extend
that such stores item
CO.'~ENTS: The existing statutory provision which
exempts certain coamnodities (e.g., fresh produce, sale
items, vending machine items, cigarettes and cigars)
from item pricing requirements would remain in effect.
Additionally current law also exempts con°nodities not
generally item priced on January 1, 1977, as determined
by the State Department of Food and Agriculture. The
Department published its list in April 1478 which
includes: individual containers of beer and soft
drinks, candy bars, cigarettes in cartons, certain
baby Toed, packaged produce and certain dairy products,
POSITIONS: The Committee office has received numerous
letters from individuals, most of wham favor the
enactment of SB 92.
The following have registered support:
Women For:
Los Angeles Caunty Federation of Labor, AFL-CIO
California Teamsters Public Affairs Council
Consumer Federation of California, Los Angeles &
Orange Counties Chapter
Central Labor Council, AFL-CIO, San Bernardino &
Riverside Counties
SB 92 (C -'j) Page three
Central Labor Council, AFL-CIO, Stanislaus &
Tuolumne Counties
Retail Clerks Jnions, Locals 197, 770, 839,1179,
1288, 1442,
3oard of Supervisors, Sacramento County
California Consumer Affairs Association
California Retailers Association and the California
Grocers Association are opposed to this measure.
The California Chamber of Commerce is also opposed,
MWenw