The U.S. Food and Drug Administration (FDA) will face significant challenges in coming years to implement the Food Safety Modernization Act (FSMA). The new law gives FDA additional authority to regulate food safety laws especially those impacting food product imports. One of the big challenges is how to pay for the stricter regulations?
Consider, about 65% of all FDA inspections of U.S. food manufacturing systems are conducted through cooperative efforts with state and local agencies. But state and local governments continue to operate under significant fiscal constraints.
Specifically, the FY 2012 FDA budget request was $4.36 billion for all programs. Of this total, just over $1.2 billion was allocated for food safety and animal drugs and feed. FDA requested an additional $324 million for the food safety initiative.
Previously, the Congressional Budget Office (CBO) estimated an additional $1.4 billion would be needed over the next five years to implement the FSMA. During FY 2012 appropriations deliberations Congress did increase FDA’s funding (by about 3% over last year) to $3.8 billion. Of the additional funding secured, FDA’s new food safety program received the largest amount of increase of $39 million. The overriding concern that Cansler Consulting mentioned earlier remains. CBO estimated an annual need of $280 million for FDA to implement FSMA. FDA requested an additional $324 million in FY 2012. Given the current budget constraints Congress was only able to muster an additional $39 million for FDA’s administration of the FSMA. See our earlier article: 2012 Appropriations Bills & Food Safety Fight May Be Brewing
The future budget situation for FDA from federal standpoint is not bright (See our earlier article FY 2013 Federal Budget Will Be Leaner). The Obama Administration will unveil their FY 2013 budget on February 13 and it will likely reflect continued budget tightening. On November 9 President Obama issued an Executive Order throughout the federal government directing agencies to reduce their FY 2013 budgets by 20% from FY 2010 levels in five key areas including; travel, unused/underutilized information technology, printing (encouraging electronic form), executive fleet transportation and promotional items. To review the entire Executive Order click on: http://www.whitehouse.gov/the-press-office/2011/11/09/executive-order-promoting-efficient-spending. Earlier, on August 17, then-OMB Director Jack Lew (now White House Chief of Staff) issued a memo to each federal agency directing them to produce two scenarios to cut 5 and 10% from their respective FY 2011 discretionary enacted level and reorder priorities to achieve deficit reduction. Across-the-Board reductions, reductions to mandatory spending in appropriations bills, reclassification of existing discretionary spending to mandatory spending, or enactment of new user fees to offset spending were not allowed as options for reductions.
State Cooperation / Funding
About 65% of all FDA inspections of U.S. food manufacturing systems are conducted through cooperative efforts with state and local agencies. But state and local governments continue to operate under significant fiscal constraints. Twenty-nine states have already projected budget gaps totaling $44 billion for fiscal year 2013 that begins July 1, 2012 according to a recently released report by the Center on Budget and Policy Priorities. This number is almost certain to grow as states release new gap projections along with their proposed budgets in the coming months.
Moreover, the report underscored that while the fiscal conditions of States are improving along with the broader economy, states are coming out of a very deep hole caused by the economic recession. Income from state taxes grew 8.3% in the 12-month period ending in June 2011 – the 2011 fiscal year for most states. Unfortunately, even if revenues continue to grow at last year’s rate, it would take seven years to get them back on a normal track. It is likely that revenues probably won’t come close to what states need to restore the programs that they cut during the recession, much less add new programs.
Cansler Consulting & The Food Safety Modernization Act
As a food and agricultural lobbying firm, Cansler Consulting is well versed in the intricacies of the Food Safety Modernization Act.
- Strategic legislative and regulatory advice
- Act as the conduit between FDA and your organization to ensure regulations meet the realities of the industry
- Compliance advisory
Having two decades of experience working closely with congressional leaders on key Committees and regulatory officials, Tim Cansler, Founder and Chief Strategist of Cansler Consulting, continues to successfully achieve legislative and policy initiatives vital to client interests. Tim’s successful strategies have consistently helped educate Members of Congress leading to federal budget authorization and appropriations sought by clients. He has also been successful in working with regulatory officials to ensure programs beneficial to his clients’ interests are implemented as intended.
If your company needs recommendations on how to comply with FSMA requirements or representation before FDA, please contact us today at (202) 714-2822 for a consultation today to see how we can help you.