Hatch is the name of a town and valley in southern New Mexico that grows a lot of chilies. It's also a brand name and a kind of shorthand for New Mexican chilies outside the state. In terms of spice they can be mild or hot depending on the growing conditions. That being said this is Aramark we're talking about so I wouldn't worry too much about the spice level since chances are good they'll go with the mild version.
To me it seems they're mainly responding to push-back from customers, advocates, and congresspeople.