Roll-your-own Cigarette Machines Draw Scrutiny

Lawrence Davis has purchased his last pack of Camel Lights.

After smoking cigarettes for 36 years, he has no plans to stop. Instead, the West Nashville man has found an alternative to get the Turkish mellow cigarettes taste for nearly half the price. He gets his fix at Roll With It smoke cigarettes shop, which operates an RYO Filling Station that allows customers to pack tubes and cheap cigarettes into the roll-your-own machines that assemble the cigarettes online and output as many as 25 buy cigarettes per minute.

The do-it-yourself approach saves the smokers the 62 cents per 20-pack state cigarette tax and the $1.01 per pack federal cigarette tax. The new wave of cigarette technology has already prompted a federal court case, but smokers are singing the praises of the RYO machines, which have been under the state government’s radar until recently.

Davis pays $24 for 200 cigarettes, about half price. “It’s a better, milder taste,” he said. “I know it’s bad for me, but I love it. I never thought about quitting, but when prices started going up the roof, I was looking for a cheaper way.”

RYO Machine Rental LLC provides that cheaper option in 38 U.S. states. In only its third year, the company has grown from a handful of machines in Girard, Ohio, to about 1,500 across the country. The machines have been in Tennessee for the past year, and 14 of the state’s 30 RYO machines are operated in Middle Tennessee.

The new technology offers an updated version of the old practice of hand-rolling cigarettes, said Phil Accordino, president of the Ohio-based company. The customers spend about 10 minutes of their time making their own special blend of cigarettes. The roll-your-own technology has been heralded by local cost-conscious smokers, but the federal government is pushing for more regulation on the business owners that operate the machines.

For nearly a year, RYO Machine Rental LLC and the U.S. Department of the Treasury have been in a legal fight over whether those who run the smoke cigarettes shops that feature roll-your-own machines should be considered cigarette manufacturers. The designation would require business owners to obtain a permit with the federal Tax and Trade Bureau, which would require additional taxation and record keeping comparable with commercial cigarette manufacturers. The case is pending in the U.S. Sixth Circuit Court of Appeals.

The idea that RYO machines could be compared to commercially operated manufacturing devices is absurd, Accordino said.

“It’s like comparing a horse and buggy to a Ferrari,” he said. “The commercial devices make 20,000 cheap cigarette online per minutes. Ours make about 20 to 25 per minute. It’s just a small improvement to rolling your own. We’ve only created a Model T.”

Accordino sells his machines for $32,500 to state distributors and discount cigarettes shop owners. He started the business after running a mom-and-pop buy cigarette online shop in Girard for about 10 years. The increasing price of packaged cigarettes for sale prompted Accordino to research the roll-your-own concept, he said. Though there are misconceptions that shop owners are evading federal taxes, those who run the RYOs in Tennessee and across the country are subject to taxes like all business owners, Accordino said.

“It’s about competition,” Accordino said. “People are trying to target our small increases in technology because the perception of the large cigarette manufacturers is that we may be real competition some day. This is no different from brewing your own wine or growing vegetables in your backyard. Naturally, people are seeking cheaper alternatives.”

In Tennessee, those shop owners are required to be licensed to distribute tobacco, purchase from a licensed tobacco wholesaler, and pay the 6.6 percent state tobacco tax in addition to other business permitting and taxing, said Billy Trout, Tennessee Department of Revenue spokesman. The tobacco tax, along with the tobacco, tubes and rental of the RYO machine, is factored into the customer’s purchase price.

The state revenue department currently has no concerns about RYO businesses’ taxation or regulations, Trout said.

No proof it's safer
Smokers are flocking to Roll With It for the menthol, Turkish Mellow and Kentucky Select tobacco flavors, said store owner Robert Corenswet. He runs two RYO Filling Station machines at his store, which opened in February, and soon will add a third. Besides affordable cigarettes, his customers appreciate having a refuge from a culture that bans smokers, he said.

Patrons can light up on the premises. The only rules: Patrons must be 18 and are not allowed to bring in their own tobacco.

“Smokers are so put upon. They’re banned from buildings everywhere you go,” Corenswet said. “We’re offering the customers a place to be free. We’re seeing growth every month because of it.”

Mary Hamilton of Smyrna said she appreciates avoiding what she calls the “sin tax” when she makes her own cigarettes at EZ Roll in Hermitage. The retired nurse has rolled her own cigarettes for the past six months. She’s been a smoker for 10 years.

“The tobacco industry has no one to blame but themselves for the addiction people have, so why shouldn’t we be able to save?” said Hamilton, 60. “People are going to smoke, so for me, it’s nice that I don’t cough as much when I smoke cigarettes these. It’s just smoother.”

Richard Boensch, owner of EZ Roll, said several of his customers have commented that the RYO cigarettes cause fewer symptoms — such as coughing and burning sensations — than brand-name cigarettes do. The cigarettes have fewer additives than typical cigarettes, but he said there’s no proof the cigarettes are healthier for smokers.

Boensch opened his store on Old Hickory Boulevard in October shortly after his son began operating RYO machines in Daytona, Fla.

The attempt by the Treasury Department to hinder the RYO business likely will go nowhere, Boensch said.

“The business has increased since I started, and there’s more stores popping up around town,” Boensch said. “Smokers are just middle-income Americans. The middle- income people of this country deserve a break, and this is it.”