Gregg wants review of vaping law; Senate leaders already taking look

Democratic gubernatorial candidate John Gregg said, if elected, he would seek to change new laws governing the e-cigarette liquid industry, which some vaping retailers and manufacturers have called monopolistic and corrupt.

Indiana Senate leaders are also looking at the issue and impact of the law, which takes effect July 1.

IBJ reported last week that the state has essentially allowed a single private security company to decide who can manufacture e-cigarette liquids to be sold in Indiana. 

Everyone else will be shut out of the market as of June 30.

Supporters say the law, which also bans e-liquid sales to minors and sets rules for ingredients, is meant to protect consumers. But critics say some parts of the law are so restrictive that even major national players in the vaping industry won’t be able to do business in Indiana.

Gregg said a review of the law “is in order.”

“Recent media reports about this apparent monopoly are more than a little disturbing,” Gregg told IBJ. “While everyone supports oversight and reasonable safeguards on the industry, the Legislature should re-evaluate this law and the system it created to ensure greater fairness, competition and transparency.”

Republican Gov. Mike Pence, who is seeking a second term and signed the changes into law, is staying silent. The vaping rules are currently being challenged in state and federal court.

“Given the pending litigation surrounding this issue, we will not be commenting,” Pence’s spokeswoman Kara Brooks told IBJ in an email.

But Senate President Pro Tem David Long, R-Fort Wayne, said through a spokesman that the chamber’s leaders are “looking into the issue with the intention of getting all the facts surrounding the legislation and its actual impact on the marketplace.”

Long declined to be more specific about the Senate's review.

The law — first passed in 2015 and revised this year — requires manufacturers applying for a state permit to have first entered into a five-year contract with a security firm.

Only one firm, Lafayette-based Mulhaupt’s, appears to meet the security qualifications, which include having employees that are certified by both the Door and Hardware Institute and the International Door Association, and the firms had to be in compliance by July 1, 2015, meaning that no other security firm can ever become eligible.

Founder Doug Mulhaupt told IBJ previously that it’s not his fault that other security firms don’t meet the requirement.

But the law doesn’t sit right with other security firms, including Bill Nelson, an officer for the Electronic Security Association of Indiana, who specifically took issue with the requirement that a security firm needed to have a certified rolling steel fire door technician on staff.

“Almost any legitimate alarm company can do a proper job for an e-vapor facility,” said Nelson said. “A rolling door certification has absolutely nothing to do with installing a security system.”

The law also caught off guard the associations that are in charge of the certifications.

Todd Thomas, managing director of the International Door Association, said he was contacted in January by Mulhaupt about the certification issue, which the company lobbied to “clear up” in the Legislature this year.

But Thomas said he didn’t realize the law had to do with vaping.

Since then, the group’s certifying affiliate—the Institute of Door Dealer Education and Accreditation—has received several calls from companies asking how they can get certified to comply, Thomas said.

“There is nothing we can do that would make them eligible to serve as a security company in light of the retroactive deadline for compliance,” Thomas said.

Thomas said the market works better when there is a “flourishing population” of people who are qualified, not just one.

 “This legislation does nothing to encourage that,” he said. “As such, I am at a loss to explain any benefits to the citizens of Indiana that might result from a law that blocks the many professional door companies and qualified technicians from participating in this.”