STAND. COM. REP. NO. 1496

Honolulu, Hawaii

RE:    S.C.R. No. 102

       S.D. 1

Honorable Colleen Hanabusa

President of the Senate

Twenty-Fourth State Legislature

Regular Session of 2007

State of Hawaii

Madam:

     Your Committee on Water, Land, Agriculture, and Hawaiian Affairs, to which was referred S.C.R. No. 102 entitled:

"SENATE CONCURRENT RESOLUTION REQUESTING THE DEPARTMENT OF AGRICULTURE TO STUDY LABELING REQUIREMENTS RELATING TO THE USE OF HAWAII-GROWN COFFEE NAMES,"

begs leave to report as follows:

     The purpose of this measure is to protect and promote the high quality of Hawaii-grown coffee by requesting the Department of Agriculture to study labeling requirements relating to the use of Hawaii-grown coffee names.

     Specifically, this measure requests the Department of Agriculture to:

     (1)  Examine and identify any problems with the existing labeling requirements relating to the use of Hawaii-grown coffee names;

     (2)  Develop stricter labeling requirements under state law and administrative rules for the use of Hawaii-grown coffee names; and

     (3)  Develop ideas for a uniform national labeling standard and requirements for coffee roasters to abide by for the use of Hawaii-grown coffee names.

Furthermore, this measure requests that the Department of Agriculture submit a written report to the Legislature of its findings and recommendations prior to the convening of the 2008 Regular Session.

     Testimony in support of this measure was submitted by the Department of Agriculture; one Council Member, Hawai‘i County Council; the Hawaii Teamsters and Allied Workers, Local 996; the Hawaii Coffee Association; the Kona Coffee Council; the Maui Oma Coffee Roasting Company; Pau Hana Estate; Halama Farms; Watson-Kabei Coffee Estate, LLC; Wailele Estates Kona Coffee; Owl's Nest Farm, LLC; Daily Fix Coffee; Kona Mountain Coffee; the Captain Cook Coffee Company; Dragon's Lair Estate; Pele Plantations; Island Sun Coffee; Greenwell Farms; Maui Wowi Hawaiian; and forty-two individuals.  Testimony in opposition to this measure was submitted by one individual.

     The Kona coffee name only applies to coffee beans grown in North and South Kona, thus, coffee that is grown elsewhere in Hawaii cannot be called "Kona coffee."  Under section 486-120.6, Hawaii Revised Statutes, the Kona coffee name is permitted to be used on a package of blended coffee that contains at least ten per cent by weight from Kona, however, this requirement does not apply to packages of coffee sold from coffee distributors located outside of Hawaii.  Testimony submitted to your Committee indicated that packages of coffee blends are being sold on the mainland with the Kona coffee name on its package label without proof that the coffee contained in the package is actually from Kona or its percentage by weight.  Your Committee finds that by requesting the Department of Agriculture to conduct a study on the existing labeling requirements relating to the use of Hawaii-grown coffee names will allow further protection and promotion of the high quality and assurance of Hawaii-grown coffee.

     Your Committee has amended this measure by:

     (1)  Requesting the Department of Agriculture to:

          (A)  Perform a thorough economic analysis of the probable impact of increasing the minimum content requirement to fifty per cent upon each segment of the Kona coffee industry, and each segment of the coffee industry statewide;

          (B)  Determine the fiscal impact that stricter labeling requirements or a uniform national labeling requirement standard will have on farmers of small coffee bean farms in Hawaii; and

          (C)  Seek input from and collaborate with Hawaii's Congressional Delegation, the United States Department of Agriculture, and the Federal Food and Drug Administration on establishing and enforcing a uniform national labeling standard for the use of Hawaii-grown coffee names;

     (2)  Inserting language that requests the Department of Agriculture to:

          (A)  Examine the effectiveness of the current administrative rules relating to the inspection, certification, and audit requirements of green coffee beans grown in Hawaii and the current statutes relating to the inspection of roasted Hawaii-grown coffee beans;

          (B)  Seek input and collaborate with coffee associations and coffee growers statewide to identify any problems with respect to the current statutes and administrative rules relating to the inspection and quality assurance of Hawaii-grown coffee beans; and

          (C)  Determine the feasibility in establishing and implementing uniform inspection and certification requirements for all Hawaii-grown coffee beans, whether green or roasted, and the fiscal impact the uniform scheme will have on growers of small coffee bean farms; and

     (3)  Making technical, nonsubstantive amendments for the purposes of clarity and style.

     As affirmed by the record of votes of the members of your Committee on Water, Land, Agriculture, and Hawaiian Affairs that is attached to this report, your Committee concurs with the intent and purpose of S.C.R. No. 102, as amended herein, and recommends its adoption in the form attached hereto as S.C.R. No. 102, S.D. 1.

Respectfully submitted on behalf of the members of the Committee on Water, Land, Agriculture, and Hawaiian Affairs,

____________________________

RUSSELL S. KOKUBUN, Chair