VT relying on out-of-state donations to fight its own GMO legal battles

By Bruce Parker | Vermont Watchdog

MONTPELIER, Vt. — Now that Vermont has officially been sued over its GMO labeling law, Gov. Peter Shumlin and Attorney General William Sorrell will be using out-of-state money to help defend the law in court.

According to the Department of Finance and Management, Food Fight Fund Vermont, a special fund created to defend the GMO law in court, has received more than $17,000 in donations since Shumlin signed the GMO bill May 8. Of the more than 400 donors who have contributed to the fund so far, nearly three out of four live outside of the state.

“We put Vermont’s legal system up for bids,” state Sen. Norm McAllister, R-Franklin, said of the state’s legal defense fund. “Whoever comes along with the most money can buy whatever they want.”

McAllister, one of only a few state lawmakers who opposed the GMO bill, said Food Fight Fund Vermont sends a message to national special interest groups that Vermont is open to the highest bidder.

“If you’ve got an advocacy thing you want to go for, we’ll start up a fund and let people donate to it, and we’ll let the state fight it for you, mostly with tax dollars. It’s disgusting,” he said.

State Sen. Kevin Mullin, R-Rutland, was similarly troubled that Vermont would fight its legal battles with out-of-state donations.

“It’s a dangerous policy. What you’re saying to anybody that’s lobbying for any proposal is, ‘You go out and get your people to contribute to a fund and we’ll allow the state to defend it.’… It makes no sense.”

According to the lawsuit filed last Thursday by the Grocery Manufacturers Association and three other trade groups, the GMO labeling law violates food manufacturers’ First Amendment rights by compelling them to “convey an opinion with which they disagree.”

The groups argue the Vermont law is unconstitutional on multiple grounds — namely, states can’t regulate commercial speech without demonstrating a substantial governmental interest; Congress alone has authority to regulate interstate commerce; and the GMO law conflicts with the federal Nutrition Labeling and Education Act, requiring the state law to yield to federal law.

To fight the complaints, the Legislature created Food Fight Fund Vermont with a $1.5 million target. But if the state loses in court, legal costs are expected to rise to between $5 million and $8 million.

The use of special funds for political activism is new in Vermont. According to Sue Zeller, the state’s chief performance officer, Vermont has traditionally used special funds to appropriate money for nonpartisan needs of the state.

“There are literally hundreds of special funds. … . A few funds are set up specifically for donations, such as the Fish and Wildlife Fund,” Zeller told Vermont Watchdog. “After Tropical Storm Irene devastated the state in 2011, there was a specific recovery fund set up which received a lot of donations.”

Since 2012, the special funds that have received the most donations are as follows:

Nongame Wildlife Fund ($862,163)

Youth Conservation Corps ($489,171)

Military Vets Cemetery Contribution ($441,656)

Gates Foundation Grants ($275,000)

Miscellaneous Special Revenue Fund ($246,585)

Children’s Trust Fund ($192,490)

Health Department Special Fund ($157,450)

Vermont Clean Energy Development Fund ($132,102)

Miscellaneous Grants Fund ($110,000)

Vermont Veterans Fund ($108,246)

If Food Fight Fund Vermont attains its goals, it would likely become the No.1 special fund in the state.

While Zeller said she was uncertain about rules governing advocacy with regard to special funds, she nevertheless saw potential for abuses.

“The state has to be careful about donations when you’re talking public (needs) versus advocacy. … . I can imagine it could create an issue. How could you take money from one side and not from the other side?” she said.

McAllister said the fund is just another way the state wastes taxpayer dollars.

“We will lose this lawsuit big time. They’re going to make an example out of Vermont, because we always want to be the first. There will be no end to the expenses they’ll put toward this defense, and the taxpayers will pick up the tab for it,” he said.

Contact Bruce Parker at bparker@watchdog.org