BILL ANALYSIS                                                                                                                                                                                                    Ó




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          |SENATE RULES COMMITTEE            |                         SB 65|
          |Office of Senate Floor Analyses   |                              |
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                                      CONSENT 


          Bill No:  SB 65
          Author:   Wolk (D)
          Amended:  3/9/15  
          Vote:     21  

           SENATE AGRICULTURE COMMITTEE:  5-0, 4/7/15
           AYES:  Galgiani, Cannella, Berryhill, Pan, Wolk

           SENATE HEALTH COMMITTEE:  8-0, 4/22/15
           AYES:  Hernandez, Nguyen, Mitchell, Monning, Nielsen, Pan,  
            Roth, Wolk
           NO VOTE RECORDED:  Hall

           SENATE APPROPRIATIONS COMMITTEE:  Senate Rule 28.8

           SUBJECT:   Food labeling:  olive oil


          SOURCE:    Author
          
          DIGEST:  This bill removes the use of American Viticultural  
          Areas from olive oil labels and instead uses specific regions or  
          estates within California to indicate oil source.  This bill  
          requires that olive oil labeled as originating from a specific  
          region of California contain at least 85% oil made from olives  
          grown in that specified region, and if labeled from a specific  
          estate, 95% from olives grown on the specified estate. 

          ANALYSIS:  American Viticultural Areas (AVAs) were established  
          in 1980 by the federal Alcohol and Tobacco Tax and Trade Bureau  
          to delineate grape-growing regions in the United States based on  
          differences in climate, geology, soil characteristics, and  
          physical features such as topography or watersheds.  In  
          addition, wines may use an AVA label only if 75% of the wine is  
          derived from grapes grown in that region.  The first AVA  








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          established in California was Napa Valley in 1981, and today  
          there are approximately 130 approved AVAs in California.   (29  
          CFR Part 9).

          Existing state law:

          1)Requires the California Department of Public Health to  
            regulate and enforce food labeling laws and regulations and  
            may also determine that a food is misbranded if its label is  
            false or misleading (Health and Safety Code §110660 et seq.).

          2)Requires any olive oil produced, processed, sold, given away,  
            or possessed in California to be derived solely from olives  
            grown in California if the label indicates that it contains  
            California olive oil.  Similarly, olive oil with a label claim  
            indicating a specific region of California (AVA, see below)  
            must contain 75% olive oil made from olives grown in that  
            specified region. 

          3)Creates the Olive Oil Commission of California (OOCC) to  
            engage in olive oil quality and nutritional research and to  
            recommend grading and labeling standards to the California  
            Department of Food and Agriculture (CDFA).  After a successful  
            producer referendum, the OOCC developed California olive oil  
            grading and labeling standards that would apply only to  
            Californians processing over 5,000 gallons of olive oil,  
            refined-olive oil, or olive-pomace oil, per year.  CDFA  
            approved these recommendations, and they became effective on  
            September 26, 2014.

          This bill:
           
           1)Specifies that olive oil labeled "California Olive Oil" must  
            be 100% derived from California-grown olives.

          2)Deletes the use of AVAs for olive oil labeling.

          3)Requires that olive oil labeled as originating from a specific  
            region of California contain at least 85% of oil made from  
            olives grown in that specified region.

          4)Requires that olive oil labeled as originating from a specific  








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            estate in California contain at least 95% of oil made from  
            olives grown on that specified estate.

          Background
          
          California Olive Oil.  California produces 99% of the olives  
          grown within the United States.  According to the California  
          Olive Oil Council, there are over 400 growers on approximately  
          30,000 acres dedicated to the production of olive oil.  With  
          over 75 olive varieties grown in California, it is estimated  
          that the 2013-14 harvest will produce over 3.5 million gallons  
          of extra virgin olive oil.

          Comments

          Conform state law.  The OOCC recommendations approved by CDFA in  
          2014 included Section 11.3.4, which developed labeling  
          requirements in regards to "provenance," or origination of the  
          olive oil.  This bill conforms state law to these new  
          regulations by removing the reference to AVAs and strengthens  
          the standard of olive oil origination, requiring 100% of the  
          olives to be grown in California, 85% within the stated region  
          or 95% from the specific estate, if such provenance label claims  
          are made.  By amending existing law, these labeling requirements  
          will apply to all California producers, not just those affected  
          by OOCC standards.  
           
          Regions vs AVA.  AVAs were created for the wine industry to  
          group wines within a specific region (i.e. Napa Valley).  Given  
          the abundance of microclimates in California, which have an  
          effect on product quality and taste, it is understandable that a  
          different commodity, olive oil, would benefit from the creation  
          of its own provenance areas based on variables affecting olive  
          groves, not vineyards.  However, the specific regions  
          established in this bill are neither described nor detailed,  
          and, therefore, require no delineation from one region to  
          another.  The OOCC may wish to address this issue in future  
          recommendations.

          FISCAL EFFECT:   Appropriation:    No          Fiscal  
          Com.:YesLocal:   Yes









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          SUPPORT:   (Verified5/4/15)


          None received


          OPPOSITION:   (Verified5/4/15)


          None received

          ARGUMENTS IN SUPPORT:  According to the author, "The California  
          Health and Safety Code contains outdated language relating to  
          utilizing California and its regions in the labeling of olive  
          oil by referencing American Viticultural Areas (AVA's)  
          established by the federal Alcohol and Tobacco Tax and Trade  
          Bureau (TTB) which regulates wine.  SB 65 will replace the  
          outdated language with language that incorporates the OOCC  
          standards for 'California' labeling and applies it to all  
          California olive oil producers."


          Prepared by:Anne Megaro / AGRI. / (916) 651-1508
          5/6/15 16:16:13


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