Coffee growers at odds over House bill

By COLIN M. STEWART

Tribune-Herald Staff Writer

Big Isle coffee growers are asking Gov. Neil Abercrombie to veto a bill that aims to do away with the state’s mandatory certifications of their coffee.

House Bill 280 — which was introduced by state Rep. Clift Tsuji, D-South Hilo, Puna — would put an end to the requirement that the state Department of Agriculture inspect and certify all Hawaii-grown coffee.

Currently, only those blends that contain a minimum of 10 percent of Kona coffee beans, or other regions such as Maui or Ka‘u, may be labeled as originating there. The certifications also identify the grade of the coffee beans, with “extra fancy” being the top designation.

The new law would make such certifications purely voluntary on the part of the producers.

Supporters say the change is largely in response to complaints that state budgetary cutbacks have hindered the Agriculture Department’s ability to conduct the inspections in a timely fashion. Currently, there is only one inspector in West Hawaii after a second position was cut during the budget crunch.

Opponents of the bill say that ending the certification process will open the door to counterfeit Kona coffee operations similar to 1996’s “Kona Kai scandal,” in which the public learned that Kona Kai Farms had been taking Central American coffee beans and packaging and marketing them as “100 percent Kona” coffee. The state’s mandatory certifications began a few years after the scandal broke.

Hawaii Coffee Association President Tom Greenwell, whose Greenwell Farms produces coffee and processes beans for more than 300 Kona independent growers, says he supports the bill and hopes Gov. Neil Abercrombie will sign it when it lands on his desk.

“It’s what’s good for the industry,” he said Monday. “The bottom line is, this is not going to create fraud. I can tell you that (the certification process) hasn’t stopped that. … It’s failed.”

He added that with the cuts to the Department of Agriculture’s budget, West Hawaii’s inspector can take weeks to certify coffee, and in his business, time is definitely money.

“I’ll submit, and then have to wait three or four weeks. And sometimes … if it fails, because we’re having a heck of a time with the coffee berry borer, I have to resubmit for re-inspection. And that’ll take another three or four weeks. So it’ll sometimes be a couple months before I can pay a farmer, and (as a processor), we’re spending hundreds and hundreds of thousands of dollars a week purchasing coffee. Sometimes the total sits at over a million a month (owed to farmers). We can’t afford to sit on that. I’m not a bank.”

Other growers, however, how come out strongly in opposition to the legislation, saying that it could irreparably harm their business.

According to Bruce Corker, legislative committee chairman of the Kona Coffee Farmers Association, a veto by the governor will be “absolutely critical” to the future of the Big Island coffee industry.

“The coffee industry will not survive if we lose our reputation as a specialty product,” he said Monday. “The cost of land and production is such that if our reputation is damaged, as it will be by this bill, the economic viability of coffee in Hawaii will be forever damaged.

“We’re going to go the way of pineapple and sugar,” he added.

Cecelia B. Smith, president of the Kona Coffee Farmers Association, agreed, saying that if the problem with certification is that there aren’t enough inspectors, the state should just hire more. Instead, by getting rid of the certification process, “it’s sort of like getting rid of all the stoplights when you don’t have enough policemen,” she said.

She and other members of the association have collected more than 600 signatures on a petition that they plan on sending to the governor asking him to veto the bill, she said.

In a Monday afternoon interview, bill sponsor Tsuji said that he was concerned by the Kona Coffee Farmers Association’s calls for the veto of HB 280.

“I would hope that all coffee farmers would work together collectively,” he said. “I did not just dream up this bill unilaterally. I was asked to introduce this bill by coffee farmers. And not everyone agreed on it, to be sure.

“… But, let’s be frank, the poor service from inspectors because of the lack of funding should not burden these coffee farmers. Let’s make the business for them easier, to transact and to make available their Kona, Ka‘u or other statewide coffees, so they can continue their livelihood. Any delays would disrupt the quantities, and most importantly, the quality of the precious Hawaii-grown coffee.”

Tsuji added that while the bill removes the requirement for mandatory inspection and certification, growers would still be able to independently hire third-party providers of certification.

Additionally, he said, the bill finally adds some teeth to state law concerning the labeling of Hawaii-grown coffees.

“We addressed false labeling,” he said. “If a person commits the offense of false labeling of Hawaii-grown coffee, if the person knowingly transports, distributes, sells or possesses with intent to sell Hawaii-grown coffee that is mislabeled … that would be a Class C felony offense.”

Previously, he said, such offenses would have been treated as misdemeanors.

Email Colin M. Stewart at cstewart@hawaiitribune-herald.com.