Trust But Verify – The eLiquid Industry and Regulations
Indiana Senate Bill 539 – The Good, the Bad, and the Ugly
My initial reaction to the Indiana’s legislation of Senate Bill 539 was outrage. But that outrage was pretty much limited to the ridiculous amount of the proposed $5000 permit fee that eliquid manufacturers would have to pay in order to sell or resell their eliquids to vape shops and/or retail customers. So, I spent some time pondering whether or not I should write about it.
I wound up writing a ‘stream of consciousness’ piece. (If for no other reason than to get my thoughts on down on virtual paper) I began writing about my proper indignation over the proposed ‘extortion’ fee, but then allowed myself to wander off topic in order to bear witness to where my consciousness would ultimately go.
In the end, the commentary I wrote landed in a very different spot than it started out. As I reread it I discovered that I could not run away from a very basic truth about the eliquid industry as a whole. I sincerely wish I felt differently about all this, but I don’t. Three years in I’ve seen massive changes (mostly for the good) in the industry, but not enough. And so I present my ‘unedited but spell-checked’ commentary. I invite your comments. – John Manzione – February 1st 2015.
Indiana Senate Bill 539
Authored by Indiana Senator Carlin Yoder, a Republican (!) Bill 539 aims to extort $5000 from every person/company that wants to make and sell eliquid in Indiana. The other aspects of the Bill, such as restrictions intended to keep minors away from nicotine, and mandatory use of child safety caps are positions long held by Spinfuel eMagazine.
The way I see it is there is only one of two reasons for this outrageous permit fee; extortion to pad the coffers of the treasury, or to put an end to mom and pop eliquid brands.
Killing Off Mom and Dad
One of the ‘likely’ reasons for this outlandish permit fee could be seen as some politico who thinks he or she could separate the wheat from the chaff by instituting a fee so high that only ‘legitimate’ companies could afford to remain in business. Surely mom and pop eliquid ‘makers’ would have a difficult, or impossible, time coming up with 5 grand to cover the permit, leaving only well funded companies capable of staying in business. This wrong headed thinking would cause some mom and pop brands to shutter their business, but let’s be real here; some of the worst companies are indeed well funded and profitable… many for the wrong reasons, while some mom and pop brands handle their product with the same level of care that the CDC handles viruses.
The other likely scenario is the greedy one. Since this is a booming industry I could imagine these lawmakers thinking the streets in Vapelandia are lined with gold, so why not grab some of it for all the pork barrel spending bills they love so much? If the smaller companies can’t pay the fee and wind up going out of business, well, who cares right? If ‘X-amount of eliquid is sold in the state then it won’t matter how many companies are left, the ones still in business will simply sell more eliquid to make up for the loss of the smaller ones. Either way, the government gets its share, and vapers get their juice. Oh, and by the way, who cares if the cost of a bottle of eliquid goes up? Lunacy at its finest.
The bill in its present form does not only apply to Indiana companies wishing to manufacture and sell eliquid in the state, but to any other company in any other state that wishes to sell ejuice in Indiana. They too would have to pony up the extortion fee of $5000 in order to obtain a permit they will need to sell ejuice anywhere in the state. You can call it a permit or you can call it tax, I choose to call it legal extortion. Now, imagine all 50 states instituting $5000 permit fees; how many companies will shell out two and half million dollars for 50 permits?
The bill is clearly execution by extortion either way. Vape shop owners and eliquid manufacturers should not willingly walk the green mile toward his or her demise by accepting this extortion as the cost of doing business. If there was ever a ‘call to action’ in our industry, this bill is surely one.
Where Politicians Continue To Go Wrong
This whole idea that vaping is smoking has got to stop (but it won’t). Eliquid is not tobacco, vapor isn’t combustible smoke, and people do not develop lung cancer and heart disease by way of vaping. It is insane to continue this charade in 2015. There is plenty of science today that has shown that vaping is infinitely less harmful than burning and inhaling tobacco leaves rolled up in paper… of course, none of this really matters. Safety is just a word bandied about by people with other agendas.
Politicians, medical workers, and especially the anti-smoking organizations should be applauding the efforts of vape community as they work diligently to convince smokers to stop smoking. They should not punish the community by making it too expensive to pursue a business, or regulations that are too severe to allow a business to grow. Again, I’m shouting to the choir, no one else is listening…
So, these arguments get stale don’t they? The vape community is continuously talking or writing about the safety of vaping over smoking and it continues to be ignored. Politicians ignore it because to admit that vaping is not smoking means they cannot, should not, regulate or tax electronic cigarettes and eliquid like tobacco. The medical workers that refuse to accept vaping as a safer alternative, and the anti-smoking groups that continue to spread the lies like fanatical Nazi’s, do so because they do not want to “normalize smoking”, or they have a delusional hatred for anything that visually mimics smoking. Nothing we say or do, and no amount of science will ever settle the issue. The bottom line is that at some point soon, ecigarettes and eliquid will become subject to tobacco-like taxes and regulations, and we will always face the consternation of the anti-smoking crowd.
The majority of the vape community, and by vape community I mean vapers and shop owners, has already taken on the responsibility of keeping minors away from electronic vaporizers. We’ve taken steps to insist on higher quality ingredients in eliquid, and are making progress with safety caps and shrink-wrap bottling practices… but not nearly as much as we can. It’s far from perfect, and, to be blunt, we could use some help in the matter. But help is not provided in the form of excessive permit fees, taxes, and heavy-handed regulations.
Companies that still manufacture ejuice in the spare bedrooms, basements or garages, are slowly being squeezed out by the vape community in favor of companies that have set up clean room lab-like conditions, spotless bottling and labeling rooms, and separate shipping areas, but not fast enough. When a company is found to be wanting, or discovered to be liars, a large part of the vape community shuns them, but not all. Still, there is much that needs to be done, and it is here where the government could be helpful, if only they realized that we are not the enemy.
Far too many eliquid brands are still being made in less than pristine conditions. ELiquid recipes are still sometimes haphazardly thrown together, and some eliquid brands tout having facilities that are just plain imaginary, and we are not making the strides we need to make to rid ourselves of these scourges.
If there is to be regulation, we say keep it minimal, but effective. Don’t chase away those that are practicing sound manufacturing procedures with a punishingly expensive permit fee (that may or may not be a yearly extortion). Set the proper regulations and step back and let the market play out. Given sensible guidelines in the way of sensible regulations, we can do a better job of policing our community. But, we can no longer just accept the words coming from small to medium eliquid manufacturers.
In the 3 years (to the day, February 1st) of Spinfuel eMagazine’s existence I, as the publisher, have come a long way in recognizing the good and the bad in our industry. My first inclination in 2012 was to allow the industry free reign, as my Libertarian worldview dictated. But I was wrong to think that this industry was different from others. We have more than our fair share of corrupt individuals and companies, especially in the eliquid sector. The things I have learned over the years have surprised me, and disgusted me. And the more people I meet in top positions in the industry the more I realize that we cannot do it all ourselves.
To that end, I present Spinfuel’s List of Regulations. We believe these types of regulations should be in place in all 50 states, and once in place then that’s it, no revisiting them every year.
Of course, that is the problem though, isn’t it? Every election cycle these suit wearing buffoons who called themselves politicians, and proudly I might add, suddenly care about the people and so revisit the easy targets to squeeze so it looks like they are looking out for you and me, and the children. Regulations should be “once and done”, the rest of the time should be devoted strictly to enforcement.
Spinfuel eMagazine Eliquid Regulation Proposal
- Forbid the sale of ‘nicotine-infused’ eliquid to minors.
- Treat eLiquid manufactures of every size like ‘food preparation facilities’. Inspection before a license, random spot checks, and yearly mandatory inspections should be a must. Failure to comply means losing the right to make and sell ejuice for a period of one year.
- Standardized ingredients. No caffeine, vitamins, and other nonsensical ingredients that proves inert when vaporized.
- Quality Standards for eliquid ingredients; purity, shelf life, etc.
- Safety caps, shrink wrap, and informed labeling practices.
- Truth in Advertising. Vaporin, et al, we’re looking at you.
- Licensing. Absolutely. At the same fee set for Joe’s Diner, nothing more. Say, $35 a year.
- Taxation. Sales tax, the same rate as food, clothing, etc. No more.
When I shop at Amazon I’m not charged some strange transaction tax, or a tax that is supposed to make up for not buying it in the state of Florida, so there is no need to collect a tax in our industry for interstate online purchasing. Since eliquid is not tobacco it should not be taxed like tobacco.
Protection For The People
The real job of government is to protect the citizenry, not rule over them. Government must be minimal, non-invasive, and most of all fair. Business should be encouraged. Businesses create jobs, not the government. Yes, there must be rules and regulations, but they must be fair, equal, and reassuring. If you invest your lifesavings into a vape shop there shouldn’t be surprises down the road that can throw you into bankruptcy at a moment’s notice.
People that risk their wealth to create a new business should not face taxation, fees, and permits of such sums that force them to cut corners or go bankrupt. Government should not be a burden to the people or businesses.
As a Libertarian, heavy-handed government sickens me. But I’m realistic enough to realize that the need for some regulation in a multi-trillion dollar economy is inevitable, maybe even desirable in some cases. In this industry regulation is needed despite of its small 2+ billion dollars in annual sales.
We, Spinfuel, do not want to use eliquids made in someone’s garage with unclean instruments, low quality ingredients, and eyeballed recipes. We, as in all of us in the vape community, are at the mercy of the eliquid community right now. They provide the juice we use to fill our tanks and our clearomizers. While most try to do a good job, some do not. The number of brands that say one thing and do another is frighteningly high.
You cannot trust a brand by the supposed professionalism of their website or the fancy verbiage of their eliquid flavor descriptions… or testaments to their unseen $50,000+ facility. In truth, some hide behind these illusions and we could be vaporizing anything from someone’s sweat to another’s tears and not even be aware of it. We no longer want to take it on faith alone that the fancy eliquid bottle we just purchased was made and bottled in a sterile environment. It’s time to show us your facilities.
So, while some are doing their best to regulate themselves, snakes are very good at hiding in plain sight. It would be somewhat comforting to know that every eliquid facility is inspected before opening, and spot-checked often enough to ferret out the snakes, but to accomplish this doesn’t require the extortion of $5000 for a permit. There are snakes that can pay that amount 100 times over, and make up that cost at OUR expense.
Sensible, minimal, and effective regulation is needed. Extortion is not.