Business & Economy

‘Just label your products’ Shumlin tells food industry


Thursday’s U.S. House committee hearing on genetically engineered foods.

A food industry trade group has appealed to Gov. Peter Shumlin to limit their members’ liability under Vermont’s GMO labeling law.

The Grocery Manufacturers Association, which is among a number of industry groups challenging the Vermont law in court, said in a letter to Shumlin dated Wednesday that companies could pay as much as $10 million a day in fines when the law takes effect in July 2016.

“A $10 million per day fine to comply with the labeling law of the second smallest state in the Union is hugely problematic for an industry that employs 14 million U.S. workers and represents the largest sector of manufacturing,” GMA President Pamela G. Bailey said in the letter to Shumlin.

Vermont Gov. Peter Shumlin on Thursday signed Vermont’s first-in-the-nation GMO labeling bill into law on the Statehouse steps in Montpelier. Joining him was Brigid Armbrust, 11, of West Hartford (in black), who launched a letter-writing campaign in support of GMO labeling. Photo by John Herrick/VTDigger
Vermont Gov. Peter Shumlin on Thursday signed Vermont’s first-in-the-nation GMO labeling bill into law on the Statehouse steps in Montpelier. Joining him was Brigid Armbrust, 11, of West Hartford (in black), who launched a letter-writing campaign in support of GMO labeling. Photo by John Herrick/VTDigger

The letter says GMA has repeatedly offered to work with the state on its concerns over liability for supply chain errors and other liability issues since the law was passed, but has not received a response. GMA has also said the expense of labeling products specifically for Vermont could cause some manufacturers not to do business here.

Bailey’s letter says that, as the law is written, a manufacturer would be held 100 percent liable if an independent distributor sends an improperly labeled product to a Vermont retailer.

“The problem with holding the manufacturer liable for an item they don’t distribute is especially acute when you consider there is only one major food wholesaler located in Vermont and that wholesaler accounts for only 10% of retail food sales in the State of Vermont. This means that 90% of hundreds of retail grocery and convenience stores located in Vermont are supplied from warehouses and distribution centers located outside Vermont,” Bailey’s letter says.

Shumlin responded to the letter Thursday, saying the industry’s real concern was with Vermont’s law spreading to other states.

“Here’s an idea for the industry: Just label your products. All of them, nationwide. 64 countries already do it. I’m sure the food industry in America could summon the moral imagination to be the 65th,” Shumlin said in a statement. “Plain and simple Vermont’s law is about giving consumers the right to know what is in their food.”

A spokesman for GMA said Thursday that it was impractical for each state to have its own labeling law and said the industry prefers a uniform labeling law on the federal level.

The U.S. House Energy and Commerce Committee heard testimony on such a bill Thursday. HR1599, known as the Safe and Accurate Food Labeling Act of 2015, would establish federal guidelines for the labeling of genetically engineered and natural foods.

Vermont Assistant Attorney General Todd Daloz testified before the committee Thursday, urging lawmakers not to preempt Vermont’s legislation.

“What is important to Vermonters is the ability to have accurate, factual information in front of them in order to make informed decisions about their food purchases,” Daloz testified.

Bailey’s letter to Shumlin detailed ways in which companies might be held liable even if it elected not to sell their product in Vermont.

“Even with the best of intentions, excellent supply chain logistics and herculean efforts, product will be in the wrong place at any given time, resulting in millions upon millions of dollars in potential fines. For example, assume a 90-95% success rate that the properly labeled products are on shelves. This means that 5% to 10% of products will be mislabeled, or have “slipped” through the supply chain (i.e., slippage rate). Vermont’s law imposes a $1,000 daily fine for each item that does not bear the legally designated label. For a company that has 2,500 items that require the Vermont label, that slippage rate of products would translate to a $125,000 to $250,000 daily fine. We estimate that industry wide, there could be over 100,000 items sold in Vermont that would require Vermont-specific labels. That means our industry could be facing fines as much as $10 million per day,” the letter reads.

The Attorney General’s Office downplayed GMA’s cost estimate.

“While the idea that the industry would face $10 million dollars a day in fines based on products that inadvertently slipped through the supply chain is far-fetched, we would expect that sophisticated industry groups could take steps to manage any potential liability for such mistakes through arrangements with their suppliers and retailers,” Assistant Attorney General Megan Shafritz said in an email. “The letter strikes us as a last-ditch lobbying effort that coincides with the industry’s scheme to advance a bill in Congress that would impose federal preemption of all state labeling requirements.”

 


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Tom Brown

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  • David Zuckerman

    The bill before congress is not spelled out here. It would not create a federal system, it would create a Federal, voluntary labeling system. That would not give consumers the necessary information to make their decision.

    This $10 million per day letter and the threat of not selling their food here are more extreme examples to scare Vermonters. I recently read a letter to the editor in the Free Press that also included scare language from the industry. It claimed that Vermonts’ law would cost the average household $400 more per year for their food.

    That is a very miss-leading interpretation of the study that was done. The study actually said that if a family does not change its purchasing then the cost would be negligible. IF a family chose to by all non-GMO or organic then it would cost them approx. $400 more per year. But those decisions can be made individually, day to day as consumers prioritize how they want to spend their money.

    The industry deceptively used that same statistic in millions of dollars of advertizing to kill labeling laws in states with referenda. They wanted to create fear, and they succeeded and won. But here, they could not use that miss-information to “fool the masses” and we passed it.

    Now, they are overstating the scale of the “problem” to try to fool Congress (made up of a majority of Republicans who supposedly believe in States rights), in order to override our state law.

    Our law is clear and the AG office worked with the food industry to write the rules in a way that was clear and the court ruled that it can go forward. This is a responsible law that is being implemented fairly and, chicken little, the sky is not going to fall.

  • sandra bettis

    Funny that they can label their food that they sell to the rest of the world but can’t label the food that they sell here in the USA….

  • Pam Ladds

    “Here’s an idea for the industry: Just label your products. All of them, nationwide. 64 countries already do it. I’m sure the food industry in America could summon the moral imagination to be the 65th,” Shumlin said in a statement. “Plain and simple Vermont’s law is about giving consumers the right to know what is in their food.”

    Right on!

  • Neil Johnson

    It’s too bad we went with this approach. It could have been a profit center for Vermont, instead it’s making it harder to do business. For example.

    As Vermont is known as a green state, we could have come up with some sensible standards for GMO free foods. Then we could have developed a seal of approval. One that could be used world wide, let alone state wide.

    Then we could assume all products without the seal are GMO, which is probably closer to the truth.

    Then we give a license to companies for a small fee and they buy the labels and install.

    We would be providing a great service to consumers, it would be a great revenue stream, user friendly and not restrictive for others to do business.

    We’d have great labeling and less lawsuits.

    Like Shumlin and
    Vermont is going to change all of the labeling industry in the united states?

    Perhaps we could be a bit more humble, swim down stream instead of up and make money.

  • Jeffrey Showell

    Making grocery manufacturers pay fines because of the actions of retailers is a couple inches short of insane. If I were the GMA, I’d contact all grocery retail outlets in Vermont and tell them to make sure their liability insurance was adequate and up-to-date.