California Restaurants Await Governor’s Decision on Menu Labeling Bill

by Jamie Hartford, QSR Magazine

California could become the first state to require chains to include calories on menus.

California restaurateurs are anxiously awaiting Governor Arnold
Schwarzenegger’s decision on a controversial bill that would require
chain restaurants in the state, including quick-serves, to post
nutritional information on menuboards and printed menus.

He has a track record of signing legislation that most Republican
governors wouldn’t sign if he perceives the public sees it as

The governor has until October 14 to act on SB 120, which he can veto,
sign, or allow to pass into law without a signature. If the bill
becomes law, chain restaurants with 15 or more locations in the state
will be required to display the number of calories in each food item on
menu boards and include additional information, such as calorie,
saturated fat, trans fat, carbohydrate, and sodium content, on standard

On the Senate and Assembly floors, where the bill passed September 12
and 10 respectively, voting went along party lines for the most part,
with most Democrats in favor and Republicans opposed to the bill. The
Republican governor, however, might not be so predictable.

"He has a track record of signing legislation that most Republican
governors wouldn’t sign if he perceives the public sees it as
fitness-related," says Jon Fleischman, publisher of right-leaning
California political news web site

Even so, the California Restaurant Association (CRA), which opposes the bill, is hopeful.

"The California Restaurant Association has always had a good working
relationship with the [g]overnor," says CRA Senior Legislative Director
Jon Barnato. "We have had discussions with the [g]overnor’s office on
this bill, and we are encouraging our member restaurants to make their
opposition to the bill known to the [g]overnor through letters, phone
calls, and e[-]mails."

Proponents of the bill, including the Consumer Federation of California (CFC), are also weighing in.

"There’s a health epidemic in this country, and people deserve
to know what they are putting in their bodies." says Zack Kaldveer, a
spokesman for the group. "If there’s anything [Schwarzenegger] knows a
lot about, it’s health and fitness, so we are hopeful he will side with
the public interest over the profits of big business."

While Barnato says the CRA agrees that the restaurant industry should
work with the government and public health advocates to address the
obesity problem in the U.S., the organization feels that SB 120 is not
the way to go about achieving that goal.

"This legislation places an onerous and intrusive burden on
restaurateurs that will have no affect on obesity rates and opens the
door for frivolous shakedown lawsuits," CRA CEO Jot Condie said in a

The CFC’s Kaldveer countered.

"It’s expected to get responses like [Condie’s] from big
business interests whose profits might decline from consumers’ right to
know," he says "The idea that [restaurants] are going to be unduly
harmed by giving customers a little bit of information about what
they’re eating, I don’t buy that."

But Barnato says the legislation unfairly singles out chain
restaurants, which he says make up 40 to 50 percent of the food
establishments in California.

This legislation places an onerous and intrusive burden on
restaurateurs that will have no affect on obesity rates and opens the
door for frivolous shakedown lawsuits."

"SB 120 definitely creates an unfair playing field between those chains
covered under the bill and small restaurant chains or independent
locations," he says. "This limit will also create a significant barrier
to growing regional restaurant chains going from 14 to 15 restaurants,
as there would be a significant cost expense to test for nutritional
content and redesign menus, menuboards, and drive[-thru] menus."

That cost, Barnato says, will vary among restaurants, but CRA estimates
put laboratory testing for nutritional information at anywhere from
$600 to $1,500 per menu item and menuboard redesign costs at $10,000 to
$30,000 per site. Even McDonald’s, which led the quick-service industry
in displaying nutritional information on product packaging nearly two
years ago, would be required to take additional steps to come into
compliance with the law, as calories are not currently displayed on the
chain’s menu boards.

There are also fears that SB 120 is only the beginning. Future
legislation could expand the law to include single-location
restaurants, and the passing of the law in California could bolster
menu-labeling efforts in at least nine other states where similar
legislation has been introduced, according the National Restaurant
Association’s web site.

A federal judicial ruling that struck down a similar menu-labeling
regulation slated to take effect in New York City this past July,
however, has encouraged opponents of the bill. U.S. District Judge
Richard J. Holwell ruled on September 11 that a New York City Health
Department regulation that would have required chain restaurants that
voluntarily supply nutritional information via other media to include
calorie counts on menus or menu boards is preempted by the Nutrition
Labeling and Education Act of 1990. The judge ultimately agreed with
the argument set forth in a lawsuit by the New York State Restaurant
Association that the federal law, which gives restaurants that
voluntarily offer nutritional information broad discretion over how
they do so, should take precedence.

If SB 120 becomes law, the CRA and other opposition groups might try a similar course to have it overturned.

"We are taking a detailed look at this option," Barnato says.