The vape industry finally received good news recently with the announcement of the FDA’s decision to delay implementation of its problematic Deeming Regulations. The agency has additionally committed to reviewing the regulations, which, if left in their current form, would force 95-97% of vape-related businesses to exit the industry because of the implausibility of the application process. Therefore, the fight to radically change the regulatory approach to our industry is more important than ever and will continue with renewed hope on several fronts.
Indeed, in the face of an entire industry’s attempted destruction, it has been incredibly inspiring to witness the outburst of a variety of movements, legal actions and political efforts together dedicated to challenging the FDA regulations from various angles. Through the accumulated sum of its parts, the vape industry is showcasing a multifaceted and aptly strategic plan of action in response to the regulations, the likeness of which opponents may never have expected from a young industry pigeonholed as “unprofessional” and “irresponsible.”
One unique effort worthy of attention is being led by the Electronic Vaping Coalition of America (EVCA) to “Repeal and Replace” the Deeming Regulations through an effort called “coordination.” Centered around the village of Hartland, Wisconsin—the headquarters of Johnson Creek Vapor Company, the coordination effort is already underway and could, through legal recourse, actually force the FDA to halt implementation of the deeming rule altogether.
In order to bring you the whole story, we interviewed: Tom Pangborn, Director of Business Development at Johnson Creek; Mark Block, Founder and Director of the EVCA; Linda J. Hansen, Strategic Consultant and Co-Founder of EVCA; and Fred Kelly Grant, legal advisor to EVCA and coordination expert.
Q: The coordination effort is based upon the requirement by federal law that all levels of government “coordinate” with the relevant local level of government to ensure that any proposed policies, laws, or regulations would not negatively impact the local economy and community. Can you please share about the importance of Johnson Creek’s operations to the local economy and community in Hartland? How did it happen that the coordination effort revolves around JCVC?
Mark Block: Johnson Creek Enterprises is a thriving business and major employer in Hartland. If they closed, the potential impact to Hartland and neighboring communities would be extremely negative economically and socially. I knew the coordination process could be a valuable tool to help save not only Johnson Creek, but the vaping industry as a whole.
Linda J. Hansen: We felt it was important to inform the Village of Hartland about the regulations and how they could impact a major employer in the Village and to let them know the Village could, as allowed by federal statute, request the FDA to coordinate regarding the Deeming Regulations. Many local officials do not realize they have legal recourse when federal policies negatively impact their local communities. Hartland officials were eager to learn and they were proud to step up to the plate to move forward with the coordination process.
Fred Kelly Grant: The coordination process for Hartland Wisconsin, was originally initiated by Mark Block, Founder & Director of the Electronic Vaping Coalition of America. He and colleague and EVCA co-founder, Linda J. Hansen, were very familiar with the coordination process and had worked with me on other coordination efforts. They went to Hartland and described the process to the Village Administrator and President, and later to the Hartland Village Board, who voted unanimously and enthusiastically to enter into the process of coordination after learning how much it could benefit Johnson Creek, Hartland, and the nation. Mark and Linda then initiated the relationship between the Hartland leaders and me, and facilitated the steps and logistics to move forward.
The process centered on Johnson Creek Enterprises because Mark and Linda were aware of their quality of work and self-imposed standards of quality. They were also aware of the importance of the company to the economic and social vibrancy of the Village of Hartland. From my standpoint as Hearing Officer, Johnson Creek is critical to the economic health of Hartland and to the social cohesiveness of Hartland’s community. The first, as to economic health, is based on the high payroll of Johnson Creek, which prepares its people as contributors to the economy of the community. The taxes and fees paid are critical to the revenue flow for Hartland, and the services of Johnson Creek employees as volunteers to schools and churches and service groups improve the quality of life for residents. Johnson Creek is a model citizen of the Village.
Congress mandated coordination by federal agencies for the benefit of state governments, regional governments at a mid level between the feds and states, and local governments of any level. By linking the process to all local governments, Congress sought to make the process expansive enough that it could be applicable from the smallest dust district to the largest city. New York City for example, qualifies as local government and could make use of the coordination concept.
Q: How would you evaluate the response(s) to this effort on the part of the local government and community in Hartland?
Mark Block: The leaders in the Village of Hartland have been incredibly proactive and engaged regarding the Coordination process. They have been eager to learn and to do all they can to not only save a major employer in their town (Johnson Creek Enterprises), but to help to save an entire industry that they believe provides valuable products and services to millions of Americans.
Linda J. Hansen: The Hartland Village leaders and community members are amazing people who realized this was an incredible opportunity for them to not only save a business in their community, but to help an industry, and hopefully to have a positive impact on the way local and federal governments interact.
Fred Kelly Grant: As a Hearing Officer, I have never worked with a more enthused and dedicated group of governors of a small district or town. Mark and Linda had prepared them so well that they were looking forward to the hearing. Then as the hearing progressed, I could spot when each member of the Board slipped into a comfortable position with regard to their authority: their questions were asked more often and with more detail as to what was done and was not done. They did not shy from long hours and hard work—a marvelous board and tremendous advance preparation work by Mark and Linda.
Q: What does the coordination process entail and who will make the final decision? Do you have a rough timeline regarding when a determination can be expected?
Mark Block: The local government called the agency into coordination, as federal law outlines. A coordination hearing was held to set the legal record regarding the issue at hand (the FDA Deeming Regulations), and the official Findings and Conclusions were presented by Hartland Village leaders to appropriate staff at the overseeing federal agencies. Communication is continuing. The final decision(s) are made by the Administration and appropriate federal agencies. The exact timeline is unknown, but we hope for answers very soon.
Fred Kelly Grant: The process involves the local government analyzing the impact – good and bad – of the federal action on the small community; and the analysis focuses (or should focus) on the details of that impact and on the conflicts of emphasis between the federal plan or policy or action and that of the local government. The prime purpose and intent of coordination, as it was created in legislation offered by Senator Bob Packwood of Oregon, was to assure that federal agencies, which Packwood could see were going to grow to enormous size and power, could not steamroll over the local governments which are responsible for direct services to taxpayers.
Linda J. Hansen: We are very encouraged by recent announcements from FDA Commissioner, Dr. Scott Gottlieb. He is clearly well aware of Hartland’s impact, and he seems genuinely interested in providing an appropriate regulatory framework for the vaping industry. We look forward to hearing the official response from the agency to Hartland’s requests for coordination.
Q: Speaking of Dr. Scott Gottlieb, how does the recent decision by the FDA to delay implementation of the PMTA until 2022, as well as review and potentially revise the regulations, affect the coordination effort? Do you still feel coordination is important?
Mark Block: The decision to delay implementation opened the door to coordination. What Commissioner Gottlieb and Mitch Zeller laid out in their announcement goes hand-in-hand with what Hartland demanded, and came one day after Hartland submitted the notice that the FDA either begin coordination proceedings or face a lawsuit. Coordination remains very important because it helps provide the vehicle through which the agency can come to consistency with local governments regarding the regulations. It is also required by law.
Q: How would you gauge the level of support you have received, considering that one village, Hartland, could actually set the precedent for repealing the regulations as a whole? Do you anticipate this process may expand to FDA review of other localities with local economies likewise heavily affected by the regulations?
Mark Block: While we cannot speak for the Village of Hartland or for Johnson Creek Enterprises, the Electronic Vaping Coalition of America has seen both amazingly strong support and opposition, with strong support from people who are concerned about the vaping industry and who understand how powerful coordination can be, and with the opposition coming from those who are unaware of existing law regarding coordination and the powerful tool it is for local governments to impact policy to protect the economic and social stability of their local communities. We do see the potential for additional hearings to help provide added impact.
Linda J. Hansen: We appreciate the support of so many people who have taken the time to truly learn facts about the coordination process, to be involved in the hearing process, and who have shared time and resources to support our educational efforts.
Q: While some advocacy efforts revolve around amending the deeming regulations, and especially changing the predicate date, you are promoting a Repeal and Replace strategy. The coordination tends to the “repeal” aspect of the overall strategy; what would you like to see replace the current rule and will you be involved at that stage as well?
Mark Block: We believe the framework for an effective, long-term, appropriate regulatory environment is provided in H.R. 2194, introduced by Congressman Duncan Hunter. We will be educating people about this legislation and the positive impact it could have on the vaping industry.
Q: Fred Kelly Grant, the lawyer conducting the coordination effort, has an incredible track record, with nearly 80 coordination proceedings against the federal government and not a single loss. How did you recruit Mr. Grant to the vape cause and why is he passionate about this effort?
Mark Block: My colleagues and I have worked with Mr. Grant on several other occasions regarding regulatory over-reach by the federal government. He’s a strategic thinker and one of the smartest men I have ever known. I am always proud to work with Fred.
Linda J. Hansen: Fred is a true patriot. He is often referred to as an “Unsung Hero” and is someone who fully understands the coordination process. He is passionate about helping protect freedom and the liberties granted by our Constitution. I have great respect for Mr. Grant. There is no one in the country as qualified to take on such an important mission, and both Mark and I knew Fred would know exactly how to advance the coordination process for Hartland.
Fred Kelly Grant: The credit for recruiting me all goes to Mark Block. He and I, along with Linda J. Hansen, have been associates in work and in sharing the joy of 24-hour days and long weeks of work, and in a few instances of just fun and good times. We have worked on projects where coordination was key. When they called to ask me how coordination could work to help the vaping industry, I told them it would work just fine as long as there was a local government that would initiate coordination to save its economic and social state and the viability of the local business. They briefly described Johnson Creek and Hartland, and I said it would fit the mold.
Frankly, at 81 years of age I had plenty to do and was not looking for a big coordination project, even though using it with Food and Drug for the first time was intriguing. My wife agreed. But when Mark had made the overtures and found enthusiasm on part of Johnson Creek and Hartland, his enthusiasm which is always present and is infectious was too much for me and I agreed to help. My wife Carol shrugged and said, “Its Mark, so you’re in.” And I was.
My passion runs to the Constitution of the United States and to protecting people from the overreaching and overwhelming power of the federal (and in some instances state) regulatory agencies—agencies not provided for by the Constitution—in effect a fourth estate of government. We face today the same un-caring bureaucrat rule that was faced by the colonists in the 1760s and 70s. If we don’t fight, and fight hard, we will lose the liberty that so many of our families and relatives and friends have fought and died for through the years. I feel that we all owe those who have served in our military defense every ounce of devotion and heart we can give to the fight to protect our national liberty. This nation gave me the opportunity to attend a great college: the College of Idaho, one of the leading liberal arts private schools in the nation; an outstanding university law school, the University of Chicago School of Law, even though my parents were not well-to-do and funds were very narrowly limited. I owe the nation and those who founded it; I owe it to them to do what I can to see that the Constitution prevails over the feeble efforts of man to overcome it. Mark Block and Linda J. Hansen both share my passion and love for this country and that helped to get me into this battle.
Q: Do you feel this coordination effort on behalf of the vape community could impact attitudes toward regulation on a larger scale? If the FDA had a mandate to coordinate with local governments and did not, spurring legal proceedings and potentially a whole new set of regulations, isn’t this reflective of a broken and incredibly wasteful system?
Mark Block: Yes. That is part of the reason why the coordination process is so vital.
Linda J. Hansen: Yes. Coordination is key to effective governance as our Founding Fathers envisioned.
Fred Kelly Grant: It has been my goal for the 28 years since I discovered the coordination process to make it apply broadly to all regulatory agencies. If that can be accomplished, we have a medium for reigning in the regulators, and changing the way the bureaucrats are running our government. If the process is adopted and applied adequately it will open up the relationships between the regulation writers and those that have to implement them and the people subject to them. Literally, it will provide the means for cutting the awful waste of time it takes to write a regulation, read and respond to its draft, then to include comments to the draft, then to prepare the final documents for public review and comment, and finally implementation of the rule and the necessity of having it tested in court. Through coordination, the testing of the process can be completed so much more quickly through the analysis of conflicts between the regulation and local policy, and resolution of those conflicts. An enormous amount of time and money will be saved.
It is not the system that is broken and wasteful; it is the people who operate the system. For example, the coordination process is part of the system, but how many people implementing the system even know it exists or how it works? That is why I say that if we can spread this through NEPA by means of EPA and the FDA we have within our grasp the key to changing the way DC operates—change for the good.
Q: There was a recent amendment to the Cole-Bishop language in the bill released by the House Appropriations Committee on Agriculture, which funds the FDA, relating to product standards for “characterizing flavors” and batteries. How do you feel about this development and does it have any implications for the coordination effort?
Mark Block: We do not believe that Cole-Bishop provides a long-term solution to the overall problem presented by the implementation of the Deeming Regulations. It has no bearing on the coordination effort.
Q: We have been very inspired to see your creative approach to the limits on new products; by offering other e-liquid brands for sale on your website, you are promoting an environment of cooperation and collaboration at a time when the vape industry must unite. What inspired you to take this partnership-oriented course of action?
Tom Pangborn: We’ve met a lot of great people and fellow brand owners over our 9+ years in business – and on the flipside, we have the most loyal and caring customers in the industry. We simply wanted to offer our resources and website infrastructure to other brands that we respect while at the same time listening to our customers’ suggestions of different flavors. As we aren’t allowed to launch new flavors due to regulation, we thought this was a great compromise.
Q: As a well-established and veteran company in the vape industry, do you have any advice for other vape companies in terms of continuing to do business today, when the odds have often felt less than favorable?
Tom Pangborn: We certainly have had our share of success, but we have also experienced hard times, like many in this industry. Our motto from day one has been to build a brand around responsibility and quality – this means to do things right from the beginning even if no one is around to watch us. This was more subjective early on, but if you want to be around for the long haul, doing things right is a must. The other factor is, be ready to fight the good fight. This industry is very fortunate to have passionate people who truly believe in this product, who were and are ready to stand up to the naysayers.
Thank you all for sharing your insights with us!
***The original goal to raise the funds needed to hold the hearings in the Village of Hartland, Wisconsin was accomplished.
All funds raised went to the expenses of the coordination hearings.
An historic hearing was accomplished in Hartland, and ECVA is now executing strategies for additional coordination activity to “Repeal” the FDA Deeming Regulations, and to mobilize grassroots support to get “Replace,” the Hunter legislation, passed in the U.S. House of Representatives.***
Vape Organics e-liquids, the first and only USDA-certified organic vapor products, are now available for sale in select flavors on Johnson Creek’s website. We are honored to have been recognized as an e-liquid company with exemplary manufacturing and product standards.