Criteria for proposed Hawai'i seal of quality debated

By Sean Hao
Advertiser Staff Writer

A new marketing program designed to increase interest in high-quality, locally made foods is bogged down by the definition of "made in Hawai'i."

The effort to create a Hawai'i seal of quality for fresh and processed goods was initiated by the Legislature last year, but has been hampered by disagreement over what constitutes Hawai'i-made processed foods such as candies, jams and juices.

"That's a very difficult issue," said Jerry Linville, executive director of the Hawaii Marketing Alliance, which is developing the label program with the state Department of Agriculture.

Use of the label would be voluntary, and fees for its use would pay for advertising to raise consumer awareness of Hawai'i products.

So far rules have been drafted governing the quality and origin of fresh fruits and vegetables. Now the issue is how to determine if processed products contain enough local ingredients to receive the Hawai'i seal of quality, Linville said. There's also concern about whether the state has the resources to police the program once it is in place.

How these issues are resolved could have significant implications for farmers of local produce such as macadamia nuts and guava, which compete with low-priced foreign imports for use in locally made processed foods, said Doug MacCluer, chairman of a commodity advisory group that is part of the Hawaii Farm Bureau Federation representing growers.

With lettuce from Aloun Farm, it is easy to determine the amount of local content, MacCluer said.

"The problem is when you get to macadamia nut candy, it's difficult as hell to tell," he said.

It's possible that packaging, chocolate and even macadamia nuts used in the final product were imported to Hawai'i, MacCluer said. If those ingredients are assembled into a candy here, does it qualify as a Hawai'i product?

Some of the state's food makers may be prevented from using the new seal if they don't buy enough raw materials from local growers, Linville said.

"Under certain proposals, there would be some manufacturers that won't qualify, even though their products are made in Hawai'i," he said.

A state law already on the books requires that products carrying the "Made in Hawai'i" label be produced in the state. It also mandates that more than half of the raw material used in a product be produced in the state.

Linville said there is debate whether to adopt that standard or possibly a higher standard for the seal of quality program.

In general, farmers want a high threshold for the amount of required local material in products so that Hawai'i manufacturers continue to use local produce. They also hope the requirement will help promising new diversified agricultural products such as cacao, which is used to make chocolate.

But Neal Arakaki, president of the Hawaii Food Manufacturers Association, said his members are concerned that the high costs for local raw materials may not be recouped without an effective marketing program.

Some food processors also are not happy with compliance measures that could be imposed under the program, including audits and additional product testing, Arakaki said.

Regardless of what standard is adopted, enforcement of the new law would fall to the measurement standards office of the state Department of Agriculture. Whether that office could handle the additional responsibility is unclear given its range of duties.

The measurement standards office, which has 11 inspectors statewide and an annual budget of about $626,000 a year, also certifies the accuracy of gas pumps, scales and other measuring devices in the state, and investigates cases of odometer fraud.

William Pierpont, manager of the measurement standards office, said he has no doubt that products currently on store shelves misuse the "Made in Hawai'i" label. But the office's ability to inspect products for compliance is limited by time and money, he said.

Rather than inspect all products using the label, the office investigates products when complaints of fraud are raised.

"A lot of this is resources," Pierpont said. "We just don't have the resources to put our hands on every product on the shelf.

"We don't have the power to knock on a manufacturer's door and look into their records."

That leaves compliance with the law up to the food processors for the most part.

However, the Hawaii Food Manufacturers Association does not have the resources to enforce a new set of quality and content standards, Arakaki said.

"How do you say it's not a high-quality product? Because you don't like the taste?" Arakaki asked. "We are a volunteer organization. We have no funding for this type of thing."

The Hawaii Marketing Alliance, which has received $175,000 to set up the seal of quality program, hopes to have issues resolved soon.

"I don't think we can spend a year looking at this," Linville said. "We need to get that done soon."

Reach Sean Hao at shao@honoluluadvertiser.com or 525-8093.