| TO: | Honorable Lois W. Kolkhorst, Chair, House Committee on Public Health |
| FROM: | John S. O'Brien, Director, Legislative Budget Board |
| IN RE: | HB1523 by Alvarado (Relating to a prohibition of foods containing trans fat; providing an administrative penalty.), As Introduced |
| Fiscal Year | Probable Net Positive/(Negative) Impact to General Revenue Related Funds |
|---|---|
| 2010 | $181,000 |
| 2011 | $181,000 |
| 2012 | $181,000 |
| 2013 | $181,000 |
| 2014 | $181,000 |
| Fiscal Year | Probable Savings/(Cost) from Food & Drug Fee Acct 341 |
Probable Revenue Gain/(Loss) from General Revenue Fund 1 |
Change in Number of State Employees from FY 2009 |
|---|---|---|---|
| 2010 | ($247,353) | $181,000 | 1.5 |
| 2011 | ($273,188) | $181,000 | 2.0 |
| 2012 | ($273,420) | $181,000 | 2.0 |
| 2013 | ($273,660) | $181,000 | 2.0 |
| 2014 | ($273,908) | $181,000 | 2.0 |
The bill requires a food service facility to maintain labels for any food or food additive that contains any fat as long as the food is used in the facility. The labels are to be made available during an inspection by the Department of State Health Services (DSHS) or Local Health Departments.
The bill would prohibit a food service facility from using trans fats to prepare, package, store, serve, distribute, or use in food. The bill exempts packaged food served directly to a consumer in the original sealed package of the manufacturer and food with a nutritional facts label or other documentation from the manufacture that indicates the food has .5 grams or less of trans fat. This section would take effect September 1, 2010.
The bill would allow DSHS or a Local Health Department to inspect food service facilities for compliance with this chapter. On an alleged violation the inspector shall send the commissioner of DSHS and the owner of the facility a notice by certified mail of the violation and may assess an administrative penalty not to exceed $1,000 per violation.
The owner of the facility may file for an administrative hearing before the penalty is assessed. If the owner does not request a hearing then the commissioner may assess the administrative penalty
The bill requires DSHS to maintain a list on DSHS website of facilities that are out of compliance with this chapter. A facility may not be removed from the list until the facility is inspected again and determined to be in compliance.
Except as listed above, the bill would take effect September 1, 2009.
Because of the new inspection requirements DSHS estimates it will need two Sanitary I FTEs to maintain the number inspections DSHS performs each year. This analysis assumes the FTEs would not be hired until December 1, 2009. The expected the associated cost for the FTEs is $121,353 in fiscal year 2010 and approximately $147,188 in fiscal year 2011 and beyond would be funded from the Food and Drug Fee Account. These costs include salary, benefits, travel, and other operating expenses.
DSHS expects that 36 facilities will request a hearing to contest an administrative penalty. DSHS estimates that each hearing will cost $3,500 in fees to the State Office of Administrative Hearings for a total cost of $126,000 for each year.
DSHS expects there will be 181 facilities out of compliance each year and assuming each penalty was assessed at $1,000 it is expected DSHS would collect $181,000 per year. Because the revenue collected is not appropriated to DSHS it is expected that the revenue would go to the General Revenue Fund.
DSHS expects any cost associated with maintaining a list of facilities on DSHS website can be absorbed within existing resources.
| Source Agencies: | 537 State Health Services, Department of
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| LBB Staff: | JOB, CL, PP, BM
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