Strapped by FSMA, FDA seeks authority for new user fees in budget request

By Hank Schultz

- Last updated on GMT

Related tags: Food and drug administration

Strapped by FSMA, FDA seeks authority for new user fees in budget request
The US Food and Drug Administration has requested a $4.7 million dollar budget for fiscal year 2014, an increase of $821 million, or 21%, over FY 2012.  The biggest chunk of that increase is due to the Food Safety Modernization Act and almost all of that would be borne by new user fees.

Of the $821 million increase, the budget calls for 94% to come in the form of new user fees for facility registrations and inspections and new import fees.  FDA commissioner Margaret Hamburg, MD said the budget reflects both FDA’s expanded mission and stark budget realities facing all federal agencies.

“These are tight budget times, and the FDA budget request reflects this reality,”​ Hamburg said. “Our budget increases are targeted to strategic areas that will benefit patients and consumers and overall strengthen our economy.”

More money for FSMA, China

Two items relevant to the food and dietary supplement industries form part of FDA’s expanded responsibilities—the implementation of the Food Safety Modernization Act and an increased need for on-the-ground personnel to conduct food facility inspections in China.

In the FSMA implementation piece, FDA is requesting an additional $295.8 million, of which $252.4 million will come in the form of new user fees to build a strong, reliable food safety system.  FDA is requesting an additional $10 million to hire more inspectors for China.

“We have to acknowledge that FDA is underfunded.  Nobody does what FDA does,”​ Mike Greene, vice president for government relations for the Council for Responsible Nutrition told us.

Greene cautioned about reading too much into the budget numbers in FDA’s request.  The system by which federal agencies set their budget priorities is really more a way for agencies to alert Congress as to what they need to do their jobs, he said.  The purse strings are controlled by the House of Representatives.

“We have to look at it as sort of a signal from FDA to Congress that they need more money, and if they can’t get the money from appropriations, they have to get it from user fees,”​ Greene said.

Strapped by FSMA

And the signal in this budget is that FDA feels itself under a lot of pressure to comply with Congressional mandates in the implementation of FSMA.  In particular, the agency seems to be feeling the burden of the ramped-up inspection cycle.

CRN in general supports a fully funded FDA, Greene said.  He noted that the organization is a member of the Alliance for  a Stronger FDA.  As to the issue of who should bear the costs of a fully-funded FDA, Greene said the implementation of user fees is generally a matter of negotiation.  Certain members of Congress are not fans of the concept, viewing the fees as new taxes, Greene said.

FDA’s budget request does not specify whether the agency is seeking to have the authority to charge a fee for initial inspections in the future.  Nor would such a request typically contain that level of detail, Greene said, as that is the sort of issue that is part of the negotiation process.

“There will always be these issues that come up.  The user fee issues come up every year and typically Congress says no.  There is this middle ground where people think user fees could work, but on both sides of the political spectrum you have a certain amount of antagonism associated with user fees in any type of regulated industry,”​ Greene said.

“If you look at FSMA and the user fees that came about from it (such as the re-inspection fee that is already in place), they it only came about because industry was at the table with Congress and talking about what could be lived with and what couldn’t. And at the time we addressed those areas, in import fees and re-inspection.

“If a new user fee is for (an initial) inspection, I think you getting close to calling it more of a tax as opposed to the technical definition of a user fee. We thought a re-inspection fee makes sense;  we want people to pass inspection,” ​Greene said.

Related topics: Regulation, Food safety and labeling

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