Reason Foundation's Guy Bentley Argues for a 'Federally Sanctioned Nicotine Era,' Flags Illicit Market as Top Backbar Threat

The convenience-store backbar is in a policy tug-of-war — states tighten rules, the illicit market grows, and a push toward a federally sanctioned nicotine framework could reset the market, Guy Bentley, director of consumer freedom at the Reason Foundation, told CSP in a new podcast episode.

In this episode of "At Your Convenience," CSP editor Diane Adam speaks with Bentley about the tobacco category and the threats and tailwinds facing products on the backbar. The two spoke on Sept. 16 at CSP's Tobacco Plus Forum, held in Oak Brook, Illinois, and the episode — described in CSP Daily News' published show notes as a short-format discussion of c-store news and trends — also covered what Bentley called an initiative for a "new federally sanctioned nicotine era" and the illicit market that challenges convenience stores.

Bentley's research at the Reason Foundation focuses on the taxation and regulation of nicotine, tobacco, alcohol and food, and his role puts him among the most cited limited-government voices on nicotine policy. In the episode, per CSP's summary, he laid out the category's two-sided exposure: regulatory and market threats to lawful backbar products set against tailwinds that keep demand for alternative nicotine products growing.

For the convenience trade, the conversation lands at a moment when the center of gravity in U.S. nicotine regulation has shifted from the federal government to the states. A wave of state measures — e-cigarette directory laws in at least a dozen states, age-verification mandates at the point of sale, and retail enforcement programs — is building a patchwork in which national chains must manage compliance across hundreds of state and local rule sets. Bentley's framing positions that patchwork as the central cost of the status quo, and argues for replacing a maze of state-by-state prohibitions with a coherent federal licensing regime under which adult consumers could purchase approved nicotine products with documented, age-verified access.

That argument collides head-on with the industry's current strategy of buying time through compliance infrastructure. Convenience retailers and their manufacturers have been pre-empting regulation with digital age verification, POS integration and responsible-retailer programs, while public-health regulators lean on state bans and product restrictions to curb youth access. The illicit market sits between the two: unauthorized and counterfeit vapor products have historically accounted for the majority of U.S. e-cigarette dollar sales, and convenience operators say unregulated goods compete for the same shelf space and customer as authorized products. For a c-store chain, the practical problem is that it cannot police what it does not sell, yet it absorbs the enforcement risk when regulators act against the category as a whole.

Bentley's "federally sanctioned nicotine era" proposal, as described in the episode, would move the licensing question back to Washington: a federal framework that approves adult-facing nicotine products, sets uniform age-verification standards and gives states a baseline rather than a patchwork. Whether regulators will trade that authority remains open, with the FDA's recent guidance signaling a softer posture on enforcement for certain pending premarket applications rather than a move toward a new licensing architecture.

For the retail side, the debate has an immediate operational dimension. Whether the end state is state-by-state directories or a federal license, convenience retailers need predictable rules for stocking, ordering and disposing of backbar inventory. The illicit market complicates every scenario: even with federal or state licensing, unauthorized products circulate outside both systems, and stores that do not control the supply chain continue to face seizure risk for products they did not knowingly carry.

The Reason Foundation's position, in short, is that the category's biggest threat is not the competition between combustible and alternative nicotine products, but a regulatory architecture that punishes lawful commerce while leaving the illicit channel unchecked. For c-store operators listening in, the episode is a reminder that the backbar's rulebook is being rewritten on two fronts at once — and that how the state-versus-federal fight resolves will determine whether age-verified adult commerce, or prohibition, is the default for the next decade.