BILL ANALYSIS

C.S.H.B. 5459

By: Wilson

Public Health

Committee Report (Substituted)

BACKGROUND AND PURPOSE

The bill author has informed the committee that farmers and local food producers with a food manufacturer or food retailer permit from the Department of State Health Services can sell their products to consumers in many areas across the state, however if they sell within an area that has a local health department, they typically must obtain an additional permit from the local department and pay additional fees. The bill author has informed the committee that local permit requirements pose barriers for farmers markets in rural or low-income areas, where the farmers and food businesses may not generate enough revenue to cover the permit costs. C.S.H.B. 5459 seeks to address this issue by prohibiting a county, municipality, or public health district from requiring that a small-scale food business obtain a permit or pay a permitting fee under certain circumstances.

CRIMINAL JUSTICE IMPACT

It is the committee's opinion that this bill does not expressly create a criminal offense, increase the punishment for an existing criminal offense or category of offenses, or change the eligibility of a person for community supervision, parole, or mandatory supervision.

RULEMAKING AUTHORITY

It is the committee's opinion that this bill does not expressly grant any additional rulemaking authority to a state officer, department, agency, or institution.

ANALYSIS

C.S.H.B. 5459 amends the Health and Safety Code to prohibit a county, municipality, or a public health district from requiring a small-scale food business to obtain a permit or pay a permitting fee to operate a food service establishment, temporary food service establishment, or retail food store at a location for which the business does the following:

· holds a permit issued by the Department of State Health Services (DSHS) for that purpose; or

· is licensed as a food manufacturer under state law.

This provision preempts a county's, municipality's, or public health district's authority to regulate a small-scale food business in a manner that conflicts with this provision.

C.S.H.B. 5459 defines "small-scale food business" as a legal entity established by a farmer or food producer with less than $1.5 million in annual gross revenue, including a sole proprietorship, organization, association, corporation, partnership, joint venture, limited partnership, limited liability partnership, or limited liability company. The bill defines "food producer" by reference to the definition of that term under statutory provisions regulating food samples at farms and farmers' markets.

EFFECTIVE DATE

September 1, 2025.

COMPARISON OF INTRODUCED AND SUBSTITUTE

While C.S.H.B. 5459 may differ from the introduced in minor or nonsubstantive ways, the following summarizes the substantial differences between the introduced and committee substitute versions of the bill.

Whereas the introduced prohibits DSHS, a county, or a public health district from requiring a small-scale business to take certain actions, the substitute prohibits a county, municipality, or public health district from requiring a small-scale food business to take certain actions. The substitute omits the introduced version's prohibition against such entities requiring a small-scale food business to obtain, or pay a permitting fee for, more than one permit to operate a temporary food service establishment requiring a small-scale business to obtain a permit or pay a permitting fee to operate a food service establishment, temporary food service establishment, or retail food store, upon the business being licensed as a food manufacturer under state law, whereas the substitute makes such a prohibition for an establishment or store as applicable which is at a location for which the business holds a permit issued by the DSHS for that purpose or is licensed as a food manufacturer under state law.

The substitute includes provisions absent from the introduced that do the following:

· establish that the bill's provision preempts a county's, municipality's, or public health district's authority to regulate a small-scale food business in a manner that conflicts with the provision; and

· define "small-scale food business" to include a sole proprietorship, organization, association, corporation, partnership, joint venture, limited partnership, limited liability partnership, or limited liability company.