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HomeMy WebLinkAboutRES 158 Draft 01 2010-2012COUNTY OF HAWAII STATE OF HAWAII RESOLUTION NO. 158 11 A RESOLUTION TO THE HAWAII STATE ASSOCIATION OF COUNTIES URGING IT TO INCLUDE AS PART OF ITS 2012 LEGISLATIVE PACKAGE A REQUEST TO REVISE AND CLARIFY AGRICULTURAL PRODUCT BRANDING AND COUNTRY OR REGION OF ORIGIN LABELING, AS PROVIDED IN CHAPTER 486 OF THE HAWAII REVISED STATUTES. WHEREAS, Hawai`i Revised Statutes (hereinafter "HRS "), Section 486 -1 states in the definition of "misbranded" that such term includes (underscoring provided for emphasis only): False, incomplete, incorrect, or misleading labeling; Misrepresentation as to the identity, quantity, quality, or point of origin; Misrepresentation as to the principal place of business of the manufacturer, packer, or distributor; (4) Misrepresentation by vignette, pictorial display, identifiable geographical location, or by any term, word, or phrase in juxtaposition to any other information associated with, labeled on, or accompanying the consumer commodity which falsely alludes to a specific point of origin, a general locale such as a state, or to historical usage by a people; (5) Misrepresentation as to originality or creativity; (6) Misrepresentation of the consumer commodity as an imitation of another or as an imitation of a generic product; and Misrepresentation in any other manner tending to confuse the prospective purchaser. (7) WHEREAS, HRS, Section 486 -1 provides the following definition for "perishable consumer commodity" (underscoring provided for emphasis only): 'Perishable consumer commodity" means any article, product, good, or agricultural commodity of any kind that is customarily produced or distributed for sale through mercantile or retail sales outlets; is intended for consumption as food or use by individuals for the purposes of personal care or in the performance of services ordinarily rendered in or about the household or in connection with personal possessions; and is intended to have a limited shelf life. "Perishable consumer commodity" includes, but is not limited to, baked goods, dairy products, cut or dried flowers, coffee, candy, cookies, jam, jelly, juices, oils, nuts, or similar products." WHEREAS, HRS, Section 486 -7, Specific powers and duties of the board; rules, states in paragraph (9) of subsection (b) that the Board of Agriculture may adopt rules that include (underscoring provided for emphasis only): "(9) Practices to assure that amounts of commodities or services sold are determined in accordance with good commercial practice and are so determined and represented as to be accurate and informative to all parties at interest." WHEREAS, HRS, Section 486 -110, Method of sale of commodities; general, provides in part that (underscoring provided for emphasis only): "All methods of sale shall provide accurate and adequate quantity information that permits the buyer to make price and quantity comparisons. The board may adopt such reasonable rules as may be necessary to assure that the measure of any commodity for sale reflects accurate information and fair measurement practices to all concerned." WHEREAS, HRS, Section 486 -111 Packages; information required; variations; exemptions, states in part that: "Except as otherwise provided in this chapter, any package introduced or delivered for introduction into or received in intrastate commerce, kept for the purpose of sale, or offered or exposed for sale, shall bear on the outside of the package definite, plain, and conspicuous declarations of: (1) The identity of the commodity in the package, unless the commodity can be identified easily through the wrapper or container; (2) The net quantity of the contents in terms of measure." WHEREAS, HRS, Section 486 -113, Deceptive package, states in part that (underscoring provided for emphasis only): "No commodity shall be so wrapped or labeled, nor shall it be in a container so made, formed, or filled as to mislead the purchaser as to the quantity of the contents of the commodity in the package, and the contents of a container shall not fall below such reasonable standard of fill as has been prescribed for the commodity by rule of the board." WHEREAS, HRS, Section 486 -118, Misbranding, states (underscoring provided for emphasis only): "[ §486 -118] Misbranding. (a) No person shall deliver for introduction, hold for introduction or introduce into the State; or keep, offer, or expose for sale; or sell any consumer commodity which is misrepresented or misbranded in any manner. (b) The board, pursuant to section 486 -7 and chapter 91, shall adopt rules relating to misbranding. The rules may: (1) Require any person involved in the manufacture, processing, production, assembly, fabrication, or importation of a specified consumer commodity to keep and make available for inspection or copying by the administrator adequate records to substantiate the source of the consumer commodity, or 2 in the case of blends, the source of such constituents, as may be required by the board; (2) Establish fanciful names or terms, and in the case of blends, minimum constituent content by weight, to be used in labeling to differentiate a specific consumer commodity from an imitation or look - alike; and Establish requirements to reconcile the respective volumes of specific consumer commodities received versus the total amounts output, either as whole or processed product or as blends. In addition, the board may adopt other rules as it deems necessary for the correct and informative labeling of consumer commodities." (3) WHEREAS, HRS, Section 486 -119, Hawai`i -made products; Hawai`i- processed products, states (underscoring provided for emphasis only): " §486 -119 Hawaii -made products; Hawaii - processed products. (a) No person shall keep, offer, display or expose for sale, or solicit for the sale of any item, product, souvenir, or any other merchandise that is labeled "made in Hawaii" or that by any other means misrepresents the origin of the item as being from any place within the State, or uses the phrase "made in Hawaii" as an advertising or media tool for any craft item that has not been manufactured, assembled, fabricated, or produced within the State and that has not had at least fifty -one per cent of its wholesale value added by manufacture, assembly, fabrication, or production within the State. (b) Subsection (a) notwithstanding, no person shall keep, offer, display, expose for sale, or solicit the sale of any perishable consumer commodity that is labeled "made in Hawaii ", "produced in Hawaii ", or "processed in Hawaii" or that by any other means represents the origin of the perishable consumer commodity as being from any place within the State, or use the phrase "made in Hawaii ", "produced in Hawaii ", or "processed in Hawaii" as an advertising or media tool for any perishable consumer commodity, unless the perishable consumer commodity is wholly or partially manufactured, processed, or produced within the State from raw materials that originate from inside or outside the State and at least fifty -one per cent of the wholesale value of the perishable consumer commodity is added by manufacture, processing, or production within the State." WHEREAS, HRS, Section 486 -120, "Island fresh" milk, states in part that (underscoring provided for emphasis only): "(a) No person shall keep, offer, display, expose for sale, or solicit for the sale of any processed milk or milk product which is labeled with the term "island fresh ", or like terms, or which by any other means misrepresents the origin of the item as being from any place within the State unless the processed milk or milk product has been at least ninety per cent, by weight, produced in the State." WHEREAS, HRS, Section 486 - 120.5, Macadamia nuts; labeling requirements, subsection (b), states in part that (underscoring provided for emphasis only): "If a label on a consumer package contains language that a portion of the raw or processed macadamia nuts 3 contained in the package was grown in Hawaii, the label shall be worded "Hawaii -Grown Macadamia Nuts ", preceded by the per cent by weight of the macadamia nuts contained in the package that were grown in Hawaii, and shall appear on the principal display panel of the package." WHEREAS, HRS, Section 486 - 120.6, Hawai`i -grown roasted or instant coffee; labeling requirements, states in part that (underscoring provided for emphasis only): "(a) In addition to all other labeling requirements, the identity statement used for labeling or advertising roasted or instant coffee produced in whole or in part from Hawaii -grown green coffee beans shall meet the following requirements: (2) For roasted or instant coffee consisting of a blend of one or more Hawaii - grown coffees and coffee not grown in Hawaii, the per cent coffee by weight of one of the Hawaii -grown coffees used in the blend, followed by the geographic origin of the weight - specified coffee and the term "Coffee Blend "; and "(c) "It shall be a violation of this section: (2) To use a geographic origin in labeling or advertising, including in conjunction with a coffee style or in any other manner, if the roasted or instant coffee contains less than ten per cent coffee by weight from that geographic origin." WHEREAS, the practice of protecting milk (90 %) but disadvantaging both macadamia nuts (10 %) and coffee (10 %), as well as many other crops, is discriminatory to the growers of these crops and contradicts several sections of the HRS, such as (underscoring provided for emphasis only): 1. The definition of "misbranding" (HRS 486 -1) for providing incomplete information, misrepresentation as to the identity or point of origin, identifiable geographical location, and the historical usage by a people, misrepresentation of the consumer commodity as an imitation of another or as an imitation of a generic product, or misrepresentation in any other manner tending to confuse the prospective purchaser. If country of origin or the majority percentage of the product is not identified on the front label in large font, then the consumer cannot determine if the product meets his or her needs. Therefore, the consumer needs to be protected from misbranding of any food product by identifying the majority of the product by country or region of origin instead of only ten to fifty percent of the product; and 2. The definition of "practices" (HRS 486 -1) "to assure that amounts of commodities or services sold are determined in accordance with good commercial practice and are so determined and represented as to be accurate and informative to all parties at interest." If the front label is not informative as to country or region of origin for the majority of the product, the consumer may inadvertently purchase a non - Hawaiian commodity product. Therefore, the consumer as a party at interest needs information to determine what he or she is actually buying on the front label; and 3. The Board must require "practices to assure that amounts of commodities or services sold are determined in accordance with good commercial practice and are so determined and represented as to be accurate and informative to all parties at interest" (HRS 486 -7). The parties most interested in the product content are the consumers who should be able to instantly 4 understand from the label what the contents are by percentage for each country or region of origin. 4. The Board must require that "...All methods of sale shall provide accurate and adequate quantity information that permits the buyer to make price and quantity comparisons. The board may adopt such reasonable rules as may be necessary to assure that the measure of any commodity for sale reflects accurate information and fair measurement practices to all concerned" (HRS 486 -110). Therefore, fair measurement without full disclosure on the front label of the point of origin or the percentages from each point of origin is deceptive, and the consumer is disadvantaged by a lack of information as to the origin of the product. 5. HRS, Section 486 -110 also provides that the consumer shall have enough information to allow price and quantity comparisons. Withholding sufficient information as to the country or point of origin disallows such comparisons; and 6. Part of the information that the package shall bear on the outside of the package in its "definite, plain, and conspicuous declarations" is the identity of the commodity in the package which should include all points of origin, and the net quantity of the contents in terms of measure which should include the percentage of each point of origin (HRS 486 -111). The current loophole in the law allows processors to disadvantage the consumer by hiding pertinent information. The net measure should be more than just the weight or measure of the total product. It should include country or region of origin by percentage. Therefore, the consumer is entitled to know the exact composition of the product rather than only ten to fifty percent of the product; and 7. Misleading a consumer is not allowed in Hawai`i, as HRS, Section 486 -113 so states. While this section refers to the fill amount, its protection also extends to protecting the consumer if the labeling is misleading. Providing information about only ten percent of a product is deceptive and misleading. Therefore, the consumer needs to know the weight and percentage of each component of the product by country or region of origin; and 8. If the administrator is provided substantive information as to the content and point of origin of a product, in the case of blends, the source of such constituent parts, should be provided to the consumer to differentiate a specific consumer commodity from an imitation or "look- alike" (HRS 486 -118). Therefore, if the administrator is entitled to complete information, then so is the consumer. When ten percent or even fifty percent of a product is not identified by country or region of origin, the consumer may falsely believe that he or she is purchasing an entirely different product from what the label reads. This imitation or look -alike product may confuse the consumer into buying something he or she did not intend to buy. To correctly, accurately, and thoroughly label consumer products is the very least our consumers deserve; and 9. When 51% of the wholesale value is added by manufacturing, assembling, fabricating, or production outside of the State or Country (HRS 486 -11), a loophole is created that allows foreign products to use the name of "Hawai`i ", "Hawaiian ", or the "Hawaiian country or region of origin" in an effort to deceive the public and promote that foreign product. "Made in Hawai`i" becomes misleading because only 49% of the product may originate in Hawai`i, with the remainder coming from a source outside of the State or Country. This should be remedied by full disclosure of the origins of the all components of the item. 5 This problem also negatively impacts perishable agricultural products. The 51% added by processing disadvantages the Hawai`i grower, reduces the Hawai`i product purchased, confuses the consumer, and limits the revenue to the agricultural industry in Hawai`i. As a result, manufacturers have a loophole in this section. By adding 51% of the wholesale value, manufacturers or processors claim a Hawai`i, Hawaiian, or Hawaiian regional origin. A perishable consumer commodity that is grown in the State of Hawai`i should contain more than 51% of a "Hawai`i ", "Hawaiian ", or "Hawaiian regional product" constituent part. Value -added products or blends should be required to have at least 75% of the perishable consumer product that is grown in Hawai`i; and 10. HRS, Section 486 -120 protects milk products by requiring 90% of the milk to be produce in- state. Other agricultural products should require much more than 10% or even 50% before that product can be labeled with a Hawai`i, Hawaiian, or a Hawaiian regional name; and 11. The current language of HRS, Section 486 -120.5 allows discrimination by product such as, macadamia nuts, which like coffee and other products receives a discriminatory lack of protection, and the farmers growing these products are financially disadvantaged; and 12. As a result of the language in HRS, Section 486 - 120.6, a loophole is created allowing processors to use a minimum of 10% of any Hawai`i -grown product and claim a Hawaiian point of origin. This is deceptive and false advertising to our consumers because a ten percent blend is not distinguishable from the 90% out -of- country portion of the blend, degrades the Hawaiian regional identities by producing a diluted Hawaiian product, and is a poor bargain from a price standpoint since the value of the Hawaiian product is massively greater than an out - of- country product. Additionally, other perishable Hawaiian products use much higher percentages and this minimum ten percent or even fifty percent is discriminatory against specific products which inflates the processors profit to the detriment of the growers; and WHEREAS, the Market Development Branch of the State Department of Business, Economic Development and Tourism has stated that Kona coffee growers and marketers are missing major opportunities for marketing in Asia, with emphasis on Mainland China (PRC) and Taiwan, because consumers in those countries are confused by "blends" and want to be assured that they are buying 100% Kona coffee. This problem impacts every growing region in the state that grows coffee or any other product. Regional identity sells product, which is why the processors want to use our geographic names, but not provide at least 75% of our agricultural products in their final product. They save money and Hawai`i growers lose money; and WHEREAS, other States promote and encourage the geographic identity of their homegrown products (for example, Washington Apples, Florida Oranges, Vidalia Onions, Idaho Potatoes, and Napa Valley Wines). This type of regional and geographic branding is vitally important to growers and ultimately, the State through our tax dollars; and WHEREAS, it is essential that the State of Hawai`i strengthen its statutory requirements to protect the agricultural industry with State legislation serving as a basis for Federal legislation to protect the Hawai`i and Hawaiian geographic names in consumer outlets on the mainland United States and in foreign countries; now, therefore, 6 BE IT RESOLVED BY THE COUNCIL OF THE COUNTY OF HAWAII that it requests the Hawai`i State Associations of Counties to include in its 2012 Legislative Package the resolution attached hereto and labeled as "Exhibit 1" which urges the Hawai`i State Legislature to amend Chapter 486 of the Hawai`i Revised Statutes to revise and clarify agricultural product branding and country or region of origin labeling laws. BE IT FURTHER RESOLVED that the Hawai`i State Association of Counties include with the resolution attached hereto and labeled "Exhibit 1" a draft bill to amend Chapter 486 of the Hawai`i Revised Statutes labeled "Exhibit A" and the justification sheet for this action labeled "Exhibit B." BE IT FINALLY RESOLVED, that the County Clerk shall forward copies of this resolution to the President of the Hawai`i State Association of Counties, and the respective Mayors of the counties of Hawai`i, Kaua`i, Maui, and the City and County of Honolulu. Dated at , Hawai`i, this day of , 2011. INTRODUCED BY: COUNCIL MEMBIKR, COUNTY OF HAWAII • COUNTY COUNCIL County of Hawaii Hilo, Hawai`i I hereby certify that the foregoing RESOLUTION was by the vote indicated to the right hereof adopted by the COUNCIL of the County of Hawai`i on A"I" f 13ST: COUNTY CLERK CHAIRPERSON & PRESIDING OFFICER 7 ROLL CALL VOTE Reference: RESOLUTION NO. C- 370 /Waived GRC 158 11 AYES NOES ABS EX BLAS FORD HOFFMANN IKEDA ONISHI PILAGO SMART YAGONG YOSHIMOTO Reference: RESOLUTION NO. C- 370 /Waived GRC 158 11 BE IT RESOLVED BY THE COUNCIL OF THE COUNTY OF HAWAII that it requests the Hawai`i State Associations of Counties to include in its 2012 Legislative Package the resolution attached hereto and labeled as "Exhibit 1" which urges the Hawai`i State Legislature to amend Chapter 486 of the Hawai`i Revised Statutes to revise and clarify agricultural product branding and country or region of origin labeling laws. BE IT FURTHER RESOLVED that the Hawai` i State Association of Counties include with the resolution attached hereto and labeled "Exhibit 1" a draft bill to amend Chapter 486 of the Hawai`i Revised Statutes labeled "Exhibit A" and the justification sheet for this action labeled "Exhibit B." BE IT FINALLY RESOLVED, that the County Clerk shall forward copies of this resolution to the President of the Hawai`i State Association of Counties, and the respective Mayors of the counties of Hawai`i, Kaua`i, Maui, and the City and County of Honolulu. Dated at , Hawai`i, this day of , 2011. INTRODUCED BY: COUNCIL MEMBER, COUNTY OF HAWAI`I COUNTY COUNCIL County of Hawai`i Hilo, Hawai`i 1 hereby certify that the foregoing RESOLUTION was by the vote indicated to the right hereof adopted by the COUNCIL of the Countv of Hawai`i on COUNTY CLERK CHAIRPERSON & PRESIDING OFFICER 7 ROLL CALL VOTE Reference: C- 370 /Waived GRC RESOLUTION NO. 158 11 AYES NOES ABS EX BLAS FORD HOFFMANN IKEDA ONISHI PILAGO SMART YAGONG YOSHIMOTO Reference: C- 370 /Waived GRC RESOLUTION NO. 158 11 Exhibit 1 Hawaii State Association of Counties (HSAC) Counties of Kauai, Maui, and Hawai`i, and City & County of Honolulu A RESOLUTION TO THE HAWAII STATE LEGISLATURE URGING IT TO REVISE AND CLARIFY AGRICULTURAL PRODUCT BRANDING AND COUNTRY OR REGION OF ORIGIN LABELING, AS PROVIDED IN CHAPTER 486 OF THE HAWAII REVISED STATUTES. WHEREAS, Hawai`i Revised Statutes (hereinafter "HRS "), Section 486 -1 states in the definition of "misbranded" that such term includes (underscoring provided for emphasis only): (1) False, incomplete, incorrect, or misleading labeling; (2) Misrepresentation as to the identity, quantity, quality, or point of origin; (3) Misrepresentation as to the principal place of business of the manufacturer, packer, or distributor; (4) Misrepresentation by vignette, pictorial display, identifiable geographical location, or by any term, word, or phrase in juxtaposition to any other information associated with, labeled on, or accompanying the consumer commodity which falsely alludes to a specific point of origin, a general locale such as a state, or to historical usage by a people; (5) Misrepresentation as to originality or creativity; (6) Misrepresentation of the consumer commodity as an imitation of another or as an imitation of a generic product; and Misrepresentation in any other manner tending to confuse the prospective purchaser. (7) WHEREAS, HRS, Section 486 -1 provides the following definition for "perishable consumer commodity" (underscoring provided for emphasis only): 'Perishable consumer commodity" means any article, product, good, or agricultural commodity of any kind that is customarily produced or distributed for sale through mercantile or retail sales outlets; is intended for consumption as food or use by individuals for the purposes of personal care or in the performance of services ordinarily rendered in or about the household or in connection with personal possessions; and is intended to have a limited shelf life. "Perishable consumer commodity" includes, but is not limited to, baked goods, dairy products, cut or dried flowers, coffee, candy, cookies, jam, jelly, juices, oils, nuts, or similar products." WHEREAS, HRS Section 486 -7, Specific powers and duties of the board; rules, states in paragraph (9) of subsection (b) that the Board of Agriculture may adopt rules that include (underscoring provided for emphasis only): 3371 -A Wilcox Road, Lihu`e, Kaua`i, Hawaii 96766, (808) 241 -4188 "(9) Practices to assure that amounts of commodities or services sold are determined in accordance with good commercial practice and are so determined and represented as to be accurate and informative to all parties at interest." WHEREAS, HRS Section 486 -110, Method of sale of commodities; general, provides in part that (underscoring provided for emphasis only): "All methods of sale shall provide accurate and adequate quantity information that permits the buyer to make price and quantity comparisons. The board may adopt such reasonable rules as may be necessary to assure that the measure of any commodity for sale reflects accurate information and fair measurement practices to all concerned." WHEREAS, HRS Section 486 -111 Packages; information required; variations; exemptions, states in part that: "Except as otherwise provided in this chapter, any package introduced or delivered for introduction into or received in intrastate commerce, kept for the purpose of sale, or offered or exposed for sale, shall bear on the outside of the package definite, plain, and conspicuous declarations of: (1) The identity of the commodity in the package, unless the commodity can be identified easily through the wrapper or container; (2) The net quantity of the contents in terms of measure." WHEREAS, HRS Section 486 -113, Deceptive package, states in part that (underscoring provided for emphasis only): "No commodity shall be so wrapped or labeled, nor shall it be in a container so made, formed, or filled as to mislead the purchaser as to the quantity of the contents of the commodity in the package, and the contents of a container shall not fall below such reasonable standard of fill as has been prescribed for the commodity by rule of the board." WHEREAS, HRS section 486 -118, Misbranding, states (underscoring provided for emphasis only): "[ §486 -118J Misbranding. (a) No person shall deliver for introduction, hold for introduction or introduce into the State; or keep, offer, or expose for sale; or sell any consumer commodity which is misrepresented or misbranded in any manner. (b) The board, pursuant to section 486 -7 and chapter 91, shall adopt rules relating to misbranding. The rules may: (1) Require any person involved in the manufacture, processing, production, assembly, fabrication, or importation of a specified consumer commodity to keep and make available for inspection or copying by the administrator adequate records to substantiate the source of the consumer commodity, or in the case of blends, the source of such constituents, as may be required by the board; 2 (2) Establish fanciful names or terms, and in the case of blends, minimum constituent content by weight, to be used in labeling to differentiate a specific consumer commodity from an imitation or look - alike; and Establish requirements to reconcile the respective volumes of specific consumer commodities received versus the total amounts output, either as whole or processed product or as blends. In addition, the board may adopt other rules as it deems necessary for the correct and informative labeling of consumer commodities." (3) WHEREAS, HRS section 486 -119, Hawai`i -made products; Hawai`i- processed products, states (underscoring provided for emphasis only): " §486 -119 Hawaii -made products; Hawaii - processed products. (a) No person shall keep, offer, display or expose for sale, or solicit for the sale of any item, product, souvenir, or any other merchandise that is labeled "made in Hawaii" or that by any other means misrepresents the origin of the item as being from any place within the State, or uses the phrase "made in Hawaii" as an advertising or media tool for any craft item that has not been manufactured, assembled, fabricated, or produced within the State and that has not had at least fifty -one per cent of its wholesale value added by manufacture, assembly, fabrication, or production within the State. (b) Subsection (a) notwithstanding, no person shall keep, offer, display, expose for sale, or solicit the sale of any perishable consumer commodity that is labeled "made in Hawaii ", "produced in Hawaii ", or "processed in Hawaii" or that by any other means represents the origin of the perishable consumer commodity as being from any place within the State, or use the phrase "made in Hawaii ", "produced in Hawaii ", or "processed in Hawaii" as an advertising or media tool for any perishable consumer commodity, unless the perishable consumer commodity is wholly or partially manufactured, processed, or produced within the State from raw materials that originate from inside or outside the State and at least fifty -one per cent of the wholesale value of the perishable consumer commodity is added by manufacture, processing, or production within the State." WHEREAS, HRS 486 -120, "Island fresh" milk states in part that (underscoring provided for emphasis only): "(a) No person shall keep, offer, display, expose for sale, or solicit for the sale of any processed milk or milk product which is labeled with the term "island fresh ", or like terms, or which by any other means misrepresents the origin of the item as being from any place within the State unless the processed milk or milk product has been at least ninety per cent, by weight, produced in the State." WHEREAS, HRS 486 - 120.5, Macadamia nuts; labeling requirements, subsection (b), states in part that (underscoring provided for emphasis only): "If a label on a consumer package contains language that a portion of the raw or processed macadamia nuts contained in the package was grown in Hawaii, the label shall be worded "Hawaii -Grown Macadamia Nuts ", 3 preceded by the per cent by weight of the macadamia nuts contained in the package that were grown in Hawaii, and shall appear on the principal display panel of the package." WHEREAS, HRS section 486- 120.6, Hawai`i -grown roasted or instant coffee; labeling requirements, states in part that (underscoring provided for emphasis only): "(a) In addition to all other labeling requirements, the identity statement used for labeling or advertising roasted or instant coffee produced in whole or in part from Hawaii -grown green coffee beans shall meet the following requirements: (2) For roasted or instant coffee consisting of a blend of one or more Hawaii - grown coffees and coffee not grown in Hawaii, the per cent coffee by weight of one of the Hawaii -grown coffees used in the blend, followed by the geographic origin of the weight- specified coffee and the term "Coffee Blend "; and "(c) "It shall be a violation of this section: (2) To use a geographic origin in labeling or advertising, including in conjunction with a coffee style or in any other manner, if the roasted or instant coffee contains less than ten per cent coffee by weight from that geographic origin." WHEREAS, the practice of protecting milk (90 %) but disadvantaging both macadamia nuts (10 %) and coffee (10 %), as well as many other crops, is discriminatory to the growers of these crops and contradicts several sections of the HRS, such as (underscoring provided for emphasis only): 1. The definition of "misbranding" (HRS 486 -1) for providing incomplete information, misrepresentation as to the identity or point of origin, identifiable geographical location, and the historical usage by a people, misrepresentation of the consumer commodity as an imitation of another or as an imitation of a generic product, or misrepresentation in any other manner tending to confuse the prospective purchaser. If country of origin or the majority percentage of the product is not identified on the front label in large font, then the consumer cannot determine if the product meets his or her needs. Therefore, the consumer needs to be protected from misbranding of any food product by identifying the majority of the product by country or region of origin instead of only ten to fifty percent of the product; and 2. The definition of "practices" (HRS 486 -1) "to assure that amounts of commodities or services sold are determined in accordance with good commercial practice and are so determined and represented as to be accurate and informative to all parties at interest." If the front label is not informative as to country or region of origin for the majority of the product, the consumer may inadvertently purchase a non - Hawaiian commodity product. Therefore, the consumer as a party at interest needs information to determine what he or she is actually buying on the front label; and 3. The Board must require "practices to assure that amounts of commodities or services sold are determined in accordance with good commercial practice and are so determined and represented as to be accurate and informative to all parties at interest" (HRS 486 -7). The parties most interested in the product content are the consumers who should be able to instantly understand from the label what the contents are by percentage for each country or region of origin. 4 4. The Board must require that "...All methods of sale shall provide accurate and adequate quantity information that permits the buyer to make price and quantity comparisons. The board may adopt such reasonable rules as may be necessary to assure that the measure of any commodity for sale reflects accurate information and fair measurement practices to all concerned" (HRS 486 -110). Therefore, fair measurement without full disclosure on the front label of the point of origin or the percentages from each point of origin is deceptive, and the consumer is disadvantaged by a lack of information as to the origin of the product. 5. HRS 486 -110 also provides that the consumer shall have enough information to allow price and quantity comparisons. Withholding sufficient information as to the country or point of origin disallows such comparisons; and 6. Part of the information that the package shall bear on the outside of the package in its "definite, plain, and conspicuous declarations" is the identity of the commodity in the package which should include all points of origin, and the net quantity of the contents in terms of measure which should include the percentage of each point of origin (HRS 486 -111). The current loophole in the law allows processors to disadvantage the consumer by hiding pertinent information. The net measure should be more than just the weight or measure of the total product. It should include country or region of origin by percentage. Therefore, the consumer is entitled to know the exact composition of the product rather than only ten to fifty percent of the product; and 7. Misleading a consumer is not allowed in Hawai`i, as HRS 486 -113 so states. While this section refers to the fill amount, its protection also extends to protecting the consumer if the labeling is misleading. Providing information about only ten percent of a product is deceptive and misleading. Therefore, the consumer needs to know the weight and percentage of each component of the product by country or region of origin; and 8. If the administrator is provided substantive information as to the content and point of origin of a product, in the case of blends, the source of such constituent parts, should be provided to the consumer to differentiate a specific consumer commodity from an imitation or "look- alike" (HRS 486 -118). Therefore, if the administrator is entitled to complete information, then so is the consumer. When ten percent or even fifty percent of a product is not identified by country or region of origin, the consumer may falsely believe that he or she is purchasing an entirely different product from what the label reads. This imitation or look -alike product may confuse the consumer into buying something he or she did not intend to buy. To correctly, accurately, and thoroughly label consumer products is the very least our consumers deserve; and 9. When 51% of the wholesale value is added by manufacturing, assembling, fabricating, or production outside of the State or Country (HRS 486 -11), a loophole is created that allows foreign products to use the name of "Hawai`i ", "Hawaiian ", or the "Hawaiian country or region of origin" in an effort to deceive the public and promote that foreign product. "Made in Hawai`i" becomes misleading because only 49% of the product may originate in Hawaii, with the remainder coming from a source outside of the State or Country. This should be remedied by full disclosure of the origins of the all components of the item. This problem also negatively impacts perishable agricultural products. The 51% added by processing disadvantages the Hawai`i grower, reduces the Hawai`i product purchased, confuses the consumer, and limits the revenue to the agricultural industry in Hawai`i. As a result, manufacturers have a loophole in this section. By adding 51% of the wholesale value, 5 manufacturers or processors claim a Hawai`i, Hawaiian, or Hawaiian regional origin. A perishable consumer commodity that is grown in the State of Hawai`i should contain more than 51% of a "Hawai`I ", "Hawaiian ", or "Hawaiian regional product" constituent part. Value -added products or blends should be required to have at least 75% of the perishable consumer product that is grown in Hawai`i; and 10. HRS 486 -120 protects milk products by requiring 90% of the milk to be produce in- state. Other agricultural products should require much more than 10% or even 50% before that product can be labeled with a Hawai`i, Hawaiian, or a Hawaiian regional name; and 11. The current language of HRS 486 -120.5 allows discrimination by product such as, macadamia nuts, which like coffee and other products receives a discriminatory lack of protection, and the farmers growing these products are financially disadvantaged; and 12. As a result of the language in HRS 486- 120.6, a loophole is created allowing processors to use a minimum of 10% of any Hawai`i -grown product and claim a Hawaiian point of origin. This is deceptive and false advertising to our consumers because a ten percent blend is not distinguishable from the 90% out -of- country portion of the blend, degrades the Hawaiian regional identities by producing a diluted Hawaiian product, and is a poor bargain from a price standpoint since the value of the Hawaiian product is massively greater than an out -of- country product. Additionally, other perishable Hawaiian products use much higher percentages and this minimum ten percent or even fifty percent is discriminatory against specific products which inflates the processors profit to the detriment of the growers; and WHEREAS, the Market Development Branch of the State Department of Business, Economic Development and Tourism has stated that Kona coffee growers and marketers are missing major opportunities for marketing in Asia, with emphasis on Mainland China (PRC) and Taiwan, because consumers in those countries are confused by "blends" and want to be assured that they are buying 100% Kona coffee. This problem impacts every growing region in the state that grows coffee or any other product. Regional identity sells product, which is why the processors want to use our geographic names, but not provide at least 75% of our agricultural products in their final product. They save money and Hawai`i growers lose money; and WHEREAS, other States promote and encourage the geographic identity of their homegrown products (for example, Washington Apples, Florida Oranges, Vidalia Onions, Idaho Potatoes, and Napa Valley Wines). This type of regional and geographic branding is vitally important to growers and ultimately, the State through our tax dollars; and WHEREAS, it is essential that the State of Hawai`i strengthen its statutory requirements to protect the agricultural industry with State legislation serving as a basis for Federal legislation to protect the Hawai`i and Hawaiian geographic names in consumer outlets on the mainland United States and in foreign countries; and WHEREAS, the attached document labeled "Exhibit A" provides a draft bill for amendments to HRS Chapter 486 to address the deficiencies described herein; now, therefore, 6 BE IT RESOLVED BY THE HAWAII STATE ASSOCIATIONS OF COUNTIES that it shall forward to the State Legislature, a bill attached hereto and labeled as "Exhibit A" that would revise and clarify agricultural product branding and country or region of origin labeling laws as provided in Chapter 486 of the Hawai`i Revised Statutes. BE IT FURTHER RESOLVED that a justification sheet for this action is attached hereto and labeled "Exhibit B." BE IT FINALLY RESOLVED, that the Hawai`i State Association of Counties shall forward certified copies of this resolution to the President of the State Senate, the Speaker of the State House of Representatives, the Honorable Governor Neil Abercrombie, and the respective Mayors of the counties of Hawai`i, Kaua`i, Maui, and the City and County of Honolulu. Mel Raposo, President K. Angle Pilago, Vice President Stanley Chang, Secretary Joseph Pontanilla, Treasurer 7 Page 1 EXHIBIT A .B. NO. A BILL FOR AN ACT RELATING TO AGRICULTURAL PRODUCT BRANDING AND COUNTRY OR REGION OF ORIGIN LABELING. BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF HAWAII: SECTION 1. Hawai`i Revised Statutes, Chapter 486, Measurement Standards, Part V, Measurement Standards, Uniform Packaging and Labeling is amended to add a new section 486 -120.7 to read as follows: "486-120.7 Agricultural product branding and country or region of origin labeling. (a) All agricultural products grown, packaged, or sold in Hawai`i shall conform to the following conditions: Honey, macadamia nuts, coffee, tea, vanilla, and any other plant or animal products for which any information or name indicating "Hawai`i ", "Hawaiian ", or any region of Hawai`i, and where the product is less than 100% grown in Hawaii, shall after the word "Contains:" list on the front label the country or region of origin and the percentage of each country's or region's portion of the product in descending order of percentage and in font size at least equal to one -half the size of the largest font on the front label. (Spices are exempted unless spice is the major portion of the product.) (b) All agricultural products claiming to be 100% grown in Hawai`i shall be labeled to conform to the following condition: (1) A minimum of 100% Hawai`i -grown product shall be included in the package for the front label to say, with or without Hawaiian okinas, in a font size at least equal to one -half the size of the largest font: "100% Hawaii (product)" or "Hawai`i (product)" "100% Hawai`i -Grown (product)" or "Hawai`i -Grown (product) "; "100% Grown in Hawai`i "; "100% Hawaii -Made (product)" or "Hawai`i -Made (product) "; "100% Hawaiian -Made (product)" or "Hawaiian -Made (product) "; "100% Made in Hawai`i "; or "100% Hawaiian (product)" or "Hawaiian (product) ". (2) Spices are exempted unless spice is the major portion of the product. (c) All agricultural products claiming to be 100% grown in a single Hawaiian region shall be labeled to conform to the following conditions: (1) A minimum of 100% of the Hawaiian regionally -grown product shall be included in the package for the front label to say, with or without Hawaiian okinas, in a font size at least equal to one -half the size of the largest font: (A) Regional names: "100% (Region) (product)" or "(Region) (product) "; "100% (Region) -Grown (product)" or "(Region) -Grown (product) "; "100% (Region) -Made (product)" or "(Region) -Made (product) "; or "100% (Region) (product) ". In the case of a blend that contains 100% products from multiple Hawaiian islands: "100% Hawaiian Islands (product) Blend" or "100% Hawai`i Islands (product) Blend ". (2) Spices are exempted unless spice is the major portion of the product. (d) All packaging and labeling for products claiming to contain some but less than 100% Hawai`i -grown product shall conform to the following conditions: (1) A blended plant or animal product labeled with the words "Hawai`i" "Hawaiian" or the name of any Hawaiian region (e.g. "75% Kona Coffee Blend ") shall: (A) Contain a minimum of 75% of that named region's agricultural or animal product, and shall use the word "Blend" in the identification of the product; (B) List the percentage number of the majority portion of the product (e.g. "75% (region) (product) "); and (C) List after the word "Contains:" in descending order, and after the majority content, the remainder of the product by percentage and country or Hawaiian region of origin, with or without okinas, for example: "15% Argentina (product)" and "10% Congo (product) "; "15% Argentina (product)" and "10% Mau`i (product) "; or "25% Maui and Kaua`i (product)" (The bulk listing of percentages shall be allowed for Hawaiian regions only); and (D) The labeling required in (1), (2), and (3) above shall be printed on the front label in a font size at least equal to one -half the size of the largest font on the front label. (2) Any blended product that contains less than 75% of a Hawaiian product shall not use the names "Hawai`i" "Hawaiian" or any Hawaiian regional name on the front label, except in the contents list which shall identify on the front label the countries or geographic regions of origin for the entire product with the percentage for each country's or region's portion of the product in a font size at least equal to one -half the size of the largest font on the front label." 2 SECTION 2. Nothing stated on side or back labels on any product subject to this section shall be inconsistent with statements appearing on the front label. SECTION 3. To the extent the provisions of this section are inconsistent with the labeling requirements of HRS Sections 486 - 120.5, 486 - 120.6, or 486 -119, or any other statutory section, the provisions of this section shall apply. SECTION 4. New material is underscored. In printing this ordinance, the underscoring need not be included. SECTION 5. The effective date of this ACT shall be 18 months from the date the legislation is passed by the State Legislature. The passage of this ACT shall begin the 18 -month time period for the effective date to take effect. INTRODUCED BY: 3 EXHIBIT B JUSTIFICATION SHEET PROPOSER: Hawai`i State Association of Counties TITLE: RELATING TO AGRICULTURAL PRODUCT BRANDING AND COUNTRY OR REGION OF ORIGIN LABELING IN HAWAII REVISED STATUTES, SECTION 486. PURPOSE: MEANS: To amend HRS Chapter 486 on branding agricultural products and labeling with the country or region of origin to protect Hawai`i's regional crops and our growers investment, , provide protection of the consumer, prevent misleading information on labels, be informative to all parties of interest, create an identity for Hawai`i agricultural products, increase the minimum percentage in blends of any product to 75% before a Hawaiian or Hawai`i regional name may be placed on the label, and equalize all agricultural products in the way products are labeled and blended. Amend FIRS Chapter 486 to make all agricultural products fairly and accurately labeled with a minimum percentage of Hawaiian products and country or region of origin so the consumer knows exactly what they are buying from the front label. JUSTIFICATION: Milk products require 90% of the product to be produced in Hawai`i before the name of "Island Fresh" may be allowed on the label. However, other Hawaiian products, coffee, tea, vanilla, and macadamia nuts products are allowed to have as low as 10% Hawaiian product and be labeled with a Hawaiian regional name and the word, "blend ". This is discriminatory, disadvantages the growers, confuses the consumer, degrades our Hawaiian products, and makes a mockery of the regional quality of our products. Additionally, HRS 486 specifically and in numerous sections, prohibits unfair or misleading the consumer, or misrepresents the origin of the product. HRS 486 -110 specifically states "measure of any commodity for sale reflects accurate information and fair measurement practices to all concerned ". Section 486 needs to be amended to protect the growers and consumers.