Published on January 17th, 2017 | by Jimmy Hafrey
Indiana lawmakers are doing an about face on the vaping legislation that they passed last year after an FBI probe into the law uncovered a monopoly that has halted the industry in the state.
The South Bend Tribune reported today that Republican legislators, who lead the General Assembly, are currently working to undo a law that imposed severe and near-impossible standards on the vape industry. This comes under the scrutiny of an FBI probe, which has not yet been confirmed by the agency, that is investigating a 2016 amendment to the law that gave one security firm in Lafayette sole discretion on which companies would be certified to produce vaping liquids in the state.
Many legislators warned against the amendment, telling their colleagues that it would lead to a monopoly and that strict regulation would harm Indiana’s economy.
“We don’t need that much regulation to ensure safety. We don’t do it for food, we don’t do it for the coffee we all had this morning,” state Sen. Randy Head, R-Logansport, who is sponsoring an overhaul of the law, told the press in an interview last week. “The permitting process should be up to the government. We shouldn’t relegate that to a private business.”
The law, which was first passed in 2015, was originally enacted in order to create state-regulated safety precautions for the vape industry. However, it seems that the 2016 amendment led to changes in regulations that would restrict all safety regulations to Mulhaupt’s, the Lafayette-based security firm that is currently under investigation.
The amendment put into place several requirements for security companies that would help vape companies and businesses meet the regulations provided by the law. Mulhaupt’s was the only security firm to meet the regulations, and as The Indy Channel reports, the firm has only certified six companies to sell vape juice in the state. The security firm shut down all other vape companies, leading to suspicion that a conflict of interest may have been at play.
Mulhaupt’s is currently under investigation by the FBI, and the president of the company, Doug Mulhaupt, is cooperating with law enforcement officials.
WLFI is also reporting that Republican state Sen. Ron Alting, who currently chairs the Senate’s Public Policy committee, is also under investigation. The security firm is located in his district and Alting helped the legislation through the General Assembly. Alting has stated that he has been interviewed by law enforcement officials but maintains his innocence in the matter, pointing to the fact that the law and the amendment had been vetted by Indiana’s Alcohol and Tobacco Commission.
Alting also said, when pressed by members of the media, that: “No attorney — nobody — had any legal evidence that that bill was going to create a monopoly. If there would have been any evidence that it would have done that, we would have obviously changed the language.”
This statement, however, flies in the face that objections were raised by members of his own political party prior to the amendment passing into law.
State Sen. Vaneta Becker, R-Evansville, was the author of the amendment. She sponsored the change to the law after a constituent asked her to help change the vaping regulations. It was only after Sen. Becker did more research that she realized that the amendment would effectively cause a monopoly.
Becker tried unsuccessfully to strip her wording from the amendment. However, the amendment passed unchanged, even though Becker warned her colleagues that it would lead to Mulhaupt’s monopoly on the vape industry in the country.
In an interview with The Associated Press, Becker stated that: “Everybody knew there was only one company that would be able to comply — they all knew it.”
For his part, Alting acknowledged that he was indeed a hindrance to Becker’s actions when trying to remove her wording from the amendment. He maintains that his own actions were based on the legal advice he was offered by both state lawyers and the Alcohol and Tobacco Commission, all of which are also under investigation by the FBI.
While the FBI probe has not yet been officially confirmed, members of the General Assembly have confirmed to the press that they have been interviewed; they did not, however, disclose the contents of the interviews.
The overhaul effort to change the legislation is being led by state Sen. Randy Head but has not been publicly released as of this writing. Still, vape companies can rest easy: the measure is supported by the leadership, including Republican House Speaker Brian Bosma, who hopes that the measure will resolve the issue.
While vapers will find comfort in knowing that the legislation will be changed within this State Assembly legislation, one must wonder what Alting knew about the monopoly prior to enacting the law. As the representative of the district where Mulhaupt’s is located, it would seem that Alting would have prior knowledge of the legislation’s effects, particularly where his constituents are concerned.
Whatever Alting knows, he’s trying to move on. He concluded an interview with the press by stating that: “We need … to try to make sure that we don’t do what we did last year and goof and do anything silly like forming that monopoly.We dropped the ball on this and we have integrity to admit that. So we’ll clean it up. Period.”
This publication will continue to update you as the fight to overhaul the law continues.