Vermont GMO Laws Could Lead to Fines of $10M a Day

Vermont's first-in-the-nation law requiring the labeling of foods made with genetically modified organisms could cost the nation's grocers up to $10 million a day in fines, according to a letter from an industry organization that is suing the block the law.

The letter to Gov. Peter Shumlin from the head of the Grocery Manufacturers Association, dated Wednesday, said companies could be fined up to $1,000 a day per unlabeled item - a can of soup or a box of cereal, for instance - that mistakenly ends up on store shelves. The law is due to take effect next year.

"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," said GMA President Pamela G. Bailey.

She estimated more than 100,000 items sold in the state would require Vermont-specific labels, a companies could quickly amass millions in fines if only 5 to 10 percent of products slip through.

Shumlin had a clear response Thursday: "Just label your products. All of them nationwide."

He said labeling foods with genetically modified organisms - which can include food made from seeds that were originally engineered in laboratories to have certain traits, like resistance to herbicides - is already required by 64 countries.

"The industry's real concern is that as goes Vermont so will go America," Shumlin said. "Plain and simple Vermont's law is about giving consumers the right to know what is in their food. For too long consumers in America have been denied that right."

Bailey said members of the association have determined that changing labels to comply with Vermont's law will cost more than they earn selling their products in the state.

"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," she said.

A proposal pending in Congress would block mandatory GMO labeling efforts such as Vermont's and others being considered by a number of states. The bill, introduced by Rep. Mike Pompeo, R-Kan., provides for voluntary certification from the U.S. Department of Agriculture.

Much of the country's corn and soybeans are genetically modified, with much of that going to animal feed. GMO corn and soybeans can also be made into popular processed food ingredients like high-fructose corn syrup and soybean oil.

The Vermont law calls for labeling processed GMO foods and for retailers to post signs on displays of unpackaged genetically engineered foods. It also sets a civil penalty of $1,000 per day per product.

Throughout the legislative and legal debate on GMO labeling, industry groups have argued there is no difference between foods made with GMOs and other foods.

The Grocery Association argues in its federal lawsuit to block the law that the First Amendment gives them broad discretion about what to include on their labels and that there's no compelling state interest to offset that.

The legal case is pending.

Bailey acknowledged in her letter the association is trying to block the law in court, but until that happens it is working to comply.

"We would appreciate the opportunity to work cooperatively with the state to minimize the liability that almost certainly will arise despite the best efforts of the GMA member companies, as well as others in the industry," the letter said.