Russell Ruderman wants to make lemonade.

The Big Island state senator is fed up with hundreds of millions of dollars leaving the local economy to import beverages and food products that could be made in Hawaii with a few key investments and support from the public and private sectors.

Softball-sized lemons can be grown year-round in the islands. And water? Hawaii gets more rainfall than virtually any other state. Look no farther than Maui for sugar.

But when it comes to processing plants and bottling facilities, that’s when the notion of making and selling lemonade falls apart — at least on any scale beyond a roadside stand.

pearlridge shopping center farmers market

People shop for local produce at the Pearlridge shopping center farmers market. Lawmakers are looking for ways to reduce Hawaii’s dependence on imported food.

Cory Lum/Civil Beat

It’s not just about lemonade though. Ruderman, a grocer by trade, sees the same potential to increase local production of everything from tea and kombucha to beer and wine.

He and others have been working to identify barriers to boosting Hawaii’s local food supply and find solutions to overcome them. Several legislative fixes were introduced this session as a result of those efforts.

While some of the bills died without so much as a hearing, there are a few on the cusp of clearing a major hurdle this week at the Capitol. Thursday marks the deadline for bills to pass third reading and cross over to the other chamber.

There’s legislation still alive that could dramatically reduce the amount of glass bottles Hawaii imports; grow the cottage food industry, which includes products like jams, mochi and pasta; increase funding for food security by reallocating the barrel tax; help schools serve more locally grown food; and create a local source of livestock feed.

Senator Russell Ruderman during ways and means meeting. 3 march 2015. photograph Cory Lum/Civil Beat

Sen. Russell Ruderman listens to testimony during a hearing last week. He’s working to help Hawaii grow more of its own food.

Cory Lum/Civil Beat

Food resiliency is a priority this session for the Senate, and Majority Leader Kalani English and others have put forward bills targeting the issue — which is as much economic as environmental.

Hawaii ships in roughly 90 percent of its food from the mainland and foreign countries. Dialing this back just 10 percent would keep some $313 million here annually, according to estimates from state planners.

With the right infrastructure in place, Ruderman foresees the ability to cut imported food by 20 percent just in drinks and snacks like bags of chips. He questions why Hawaii is importing an estimated $2 billion a year in food from thousands of miles away, so much of which is predominantly comprised of water and air.

The state’s own laws hinder the ability to reuse recycled glass bottles as containers for beverages that could be produced and sold locally.

Confusion over Department of Health policies, for instance, has caused recycling companies to send glass to the mainland because they believe there are restrictions on stockpiling glass even though the department maintains that’s not the case, according to a December report by the state auditor.

The report made several recommendations to divert the amount of glass going into Hawaii’s waste stream, such as the department updating and finalizing its 2008 policy on glass recycling so that it equally emphasizes down-cycling and recycling.

Ruderman — along with Sens. Will Espero, Breene Harimoto, Gil Keith-Agaran, Gil Riviere and Glenn Wakai — put forward legislation mandating that the department implement the auditor’s recommendations. Senate Bill 1260, which has been unchanged and unopposed since its introduction in January, is set to clear the full Senate on Tuesday.

Trying to ‘Catalyze a Shift’

Efforts to kickstart a processing plant by issuing $1 million in general obligation bonds to design and construct a food innovation center stalled in the Senate and House money committees.

The legislation, which had broad support, would have funded the next phase of Kapiolani Community College’s plan to create a model healthy food production plant.

The first phase, completed with federal funding, involved the installation of a small-scale test kitchen with a team of food scientists, nutritionists and culinarians to create sample healthy bulk-processed food products, according to the legislation.

The second phase, envisioned as a 20,000-square-foot facility, would create an outlet for second-grade and processing-grade farm products that are currently just plowed back into the fields due to the absence of a large-scale food manufacturing industry in Hawaii, according to the legislation.

The food innovation center was intended to buy those products in bulk from farmers and turn them into sauces, stews, chili, packaged fruits and vegetables, bottled dressings and frozen goods. The legislation says the food could then be sold to schools, hospitals, the military and prisons — institutional services that plan their menus a year or two in advance, which helps farmers grow to meet the demand.

Kyle Datta

Kyle Datta of the Ulupono Initiative has been advocating for greater food self-sufficiency as part of the Local Food Coalition. He’s pictured here in April at the Ascent Building a Secure and Sustainable Water and Energy Future for Hawaii Conference at UH Manoa.

PF Bentley/Civil Beat

While that effort died, there is legislation still moving that would increase the amount of locally grown food served to students in public schools.

Senate Bill 376, which is expected to cross over to the House this week, would establish within the Department of Agriculture a farm-to-school program and create a coordinator position to run it.

Supporters of the legislation had also wanted a farm-to-school coordinator in the Department of Education but that position was deleted last month. Still, many consider it a positive step.

The Local Food Coalition — a broad group of farmers, ranchers, livestock producers, investors and others — is pushing to diversify food production in Hawaii and lessen the state’s dependance on imports.

“Our group’s members came together with one common goal: to promote the local production of food in a sustainable and economically sound manner to benefit Hawaii’s people through the revitalization and expansion of our state’s agricultural sector,” the coalition wrote in its testimony last month.

Kyle Datta, a general partner in the Ulupono Initiative, an investment firm that is part of the coalition, said it’s critical to harness the procurement power of the Department of Education. If successful, the effort could be replicated to produce more local food for prisons and hospitals and then transfer into non-governmental markets.

“It can help catalyze a shift,” he said. “You’re creating a lot of common opportunity for farmers.”

Getting Government Out of the Way

Legislation to help grow the cottage food industry is set to clear the full Senate on Tuesday over the objections of the Department of Health.

Senate Bill 379 would simplify the permit process for people who make non-potentially hazardous foods in their home or farm kitchens. Currently, those operators have to get permits every 120 days and can only sell their products 20 of those days.

The bill, which is the result of recommendations completed by a working group the Legislature formed last year to study the issue, would create an annual permit instead that allows operators to sell their products 120 days out of the year.

There’s a long list of products considered cottage foods, including pies, popcorn, dried fruits and andagi. It’s estimated to be a $20 million industry in Hawaii and operators say fewer restrictions could increase their revenues up to 50 percent.

Datta said the legislation would expand an industry that not only helps small farmers bring in additional income but improves food security by investing more in the preservation of food, particularly dried and canned goods.

“Every society has been doing this for millennia,” he said.

The Department of Health is worried that the bill creates confusion because of existing laws that regulate the industry, and that the bill fails to address legal concerns over governmental entry and inspection.

Taxing Petroleum for Food Security

There’s been a battle to devote more state funding to programs that support food sustainability by changing how much of a $1.05-per-barrel tax on petroleum products goes toward food security.

The tax was initially created in 2010 to improve energy and food security through a dedicated funding source. But just 15 cents of every $1.05 per barrel goes to agriculture development and food security, and 60 cents just goes into the general fund to be used for anything.

There were several bills introduced this session to change the allocation, but most have died.

Senate Bill 359 has made it out alive but in a different form. It initially proposed increasing to 40 cents the portion dedicated to agriculture development and food security, but the Ways and Means Committee blanked out the numbers in the version that’s headed to a vote before the full Senate on Tuesday.

There’s legislation still alive that could dramatically reduce the amount of glass bottles Hawaii imports; grow the cottage food industry, which includes products like jams, mochi and pasta; increase funding for food security by reallocating the barrel tax; help schools serve more locally grown food; and create a local source of livestock feed.

Lawmakers expect the numbers to be a detail that gets hammered out toward the end of session, if at all.

State Budget Director Wes Machida has said that increasing the allocation to 40 cents would result in a $12.6 million loss in general fund revenues, money that would have to come out of other programs and services.

Sen. Jill Tokuda, who chairs the Ways and Means Committee, said last week that she is inclined — as part of a broader budget philosophy — to reduce the number of special funds and instead support food and agriculture programs out of the base state budget.

The barrel tax, like the tobacco tax and others that go to special funds, is volatile. Its fluctuations are problematic whether it goes too high or too low, Tokuda said.

But special funds also provide at least some form of guarantee that money will be dedicated to that purpose each year. There’s concern that issues like food sustainability will fall to the wayside because there are far fewer people fighting to fund initiatives that address it.

“My fear is certain programs aren’t going to get funded based on discretion,” said Ruderman, a self-described environmentalist.

Governor David Ige gestures about the fact he recently found out the workers compensation process is not paperless during press conference.  12 feb 2015. photograph Cory Lum/Civil Beat

Gov. David Ige, pictured here at a press conference in February, likens food security to energy sustainability in that both benefit the state economy and are important from a natural resources perspective.

Cory Lum/Civil Beat

Scott Enright, the head of the Department of Agriculture, said changing the barrel tax’s funding ratio “would move the needle” when it comes to increasing food security in Hawaii.

But he has low expectations that much will change this session. The department is not exactly a legislative priority, receiving just 0.4 percent of the overall state budget.

Gov. David Ige has indicated he would support increasing the amount of the barrel tax that goes to the agriculture development and food security special fund by 10 cents, which would give the department 25 cents of every $1.05 per barrel, Enright said.

The department has used the money for a variety of initiatives, he said, ranging from money for the University of Hawaii to work on growing more organic vegetables to creating a slaughterhouse on the Big Island.

Enright said the special fund lets the department work directly with the community on various ideas and not have to go seek legislative approval for each one.

The Legislature was so set on increasing the barrel tax to $1.05 (it was a nickel previously) that lawmakers overrode Gov. Linda Lingle’s veto in April 2010.

The legislation, which became Act 73, recognized that “energy and food security requires a long-term commitment and the investment of substantial resources.” 

Efforts this session to broaden the base of the barrel tax to include other fossil fuels instead of just petroleum have met resistance, particularly from AES Hawaii, which operates Hawaii’s lone coal-fired power plant that powers roughly 20 percent of Oahu.

House Bill 1471 was amended in the Finance and Energy committees to exempt coal and allow the tax to be passed on first to the utilities and then to customers via a surcharge. So the special fund could see increased revenues if it passes but the money would ultimately come from ratepayers.

Increasing Demand and Production

The Senate also expects to pass a bill Tuesday that would direct the Department of Agriculture to establish a strategy and goals to increase food security and self-sufficiency.

Lawmakers are envisioning a plan similar to the Hawaii Clean Energy Initiative, which set benchmarks for how much renewable energy needs to be produced by certain years.

Under the latest draft of Senate Bill 1008, agriculture officials would determine ways to increase demand and production of locally grown foods, moving the state toward greater self-sufficiency.

Enright said he expects a more innovative package of food sustainability bills to be introduced next session, noting the lack of time the new administration has had since Ige took office Dec. 1.

Ige’s spokeswoman, Cindy McMillan, said the governor will be focusing on building partnerships with the increasing numbers of organizations engaged in this policy discussion.

“For him, it is similar to energy sustainability in the sense that both are important issues from a natural resources perspective, and the solutions will have a direct benefit to the state’s economy,” she said.

McMillan said in an email that the governor supports increasing local food production by strengthening agricultural parks via enhanced irrigation and improved distribution systems; supporting farm workforce development through the Agribusiness Incubator Program; continuing state support for detection, prevention and control of pests; identifying agricultural commodities for organic production and increasing use of low-cost, local sources for fertilizer; and supporting agricultural loans to local farmers to upgrade their facilities to prevent livestock disease.

“Regarding specific bills, the administration will be looking at the various proposals after cross-over to see how it can add to the conversation,” she said.

• The Ulupono Initiative was founded by Pierre and Pam Omidyar. Pierre Omidyar is the CEO and publisher of Civil Beat.

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