Will FDA’s New Budget Cover Food Safety Costs?

For Fiscal 2015, which begins ­October 1, the FDA is requesting $1.48 billion to support food safety activities, a $263 million (22 percent) boost over current year ­levels. Of this amount, $253 million would be directed to implement provisions the Food Safety Modernization Act (FSMA). But only $24 million of that would be provided by public taxpayer funds with the lion’s share of $229 million coming from industry user fees, including proposed new fees for food import and food facility registration and inspection.

President Obama released his Administration’s Fiscal 2015 budget request on March 4. FDA’s total budget comes to $4.74 billion, a $358 million (8 percent) increase of over Fiscal 2014. Of the total, $2.58 billion would come from public funding and $2.16 billion would be obtained from new and existing user fees, imposed mostly on manufacturers of prescription and generic drugs, medical devices, and tobacco products. New and existing food industry fees constitute a smaller but rapidly growing portion of these assessments. Overall, more than 93 percent of FDA’s $358 million increase comes from industry user fees, which would jump by $335 million or more than 18 percent, while the agency’s public support would increase by only $23 million or less than 1 percent.

The agency’s overall increase “is really quite a positive outcome for FDA in this tight budget environment,” said FDA Commissioner Margaret A. Hamburg, MD, in a statement accompanying the budget release. “I consider the additional funding for the agency to be a tribute to the important work FDA performs on behalf of the American people, the hard work and dedication of FDA employees, and our ability to meaningfully demonstrate the value of our work to stakeholders.”

FDA says the proposed food safety increase will allow it to focus on five main activities: rulemaking and guidance development to support regulatory action; technical support to ensure safety standards are effective and efficient; food safety regulatory training and capacity among stakeholders and partners, including federal, state, local, tribal, and international entities; risk analysis to support priority setting; and research to better understand the impact of antimicrobial resistance on public health.

‘Insufficient Funds’

FDA’s proposed increase “looks trivial compared with the resource needs for FSMA implementation,” says David Acheson MD, president and CEO of the Acheson Group LLC and a former FDA associate commissioner for foods. “And this is not just about more inspections. It is about having the resources to raise awareness around FSMA and training for inspectors so they fully understand FSMA,” Dr. Acheson tells Food Quality & Safety magazine.

Having sufficient funding for FSMA is essential. “Without adequate funding, FDA will be unable to adequately fulfill its oversight responsibilities,” said Michael R. Taylor, FDA deputy commissioner for foods and veterinary medicine, in congressional testimony earlier this year. “This includes implementing the Foreign Supplier Verification Program, which requires new staff and skills to audit and verify the adequacy of the importer’s verification plan; conducting more foreign inspections; working more closely on food safety with foreign government to leverage their efforts; and improving our data and import systems to facilitate prompt entry of foods that meet our safety standards,” Taylor told the House Committee on Energy and Commerce Subcommittee on Health in February.

When FSMA was signed into law in January 2011, the Congressional Budget Office estimated that FDA would need more than $580 million in additional funding to implement the law’s requirements. Last year, the Department of Health and Human Services, FDA’s parent agency, lowered that estimate to $400 million to $450 million based on different assumptions and a commitment to efficiency. To date, FDA has received $78 million for FSMA, an agency spokesperson tells Food Quality & Safety.

Boost in User Fees

The proposed new user fees include a $169 million food import fee and a $60 million food facility registration and inspection fee. The import fee would target activities associated with implementing the Foreign Supplier Verification Program, which includes recruiting and training FDA import staff to assess the adequacy of importer supply chain management and verification programs. The agency says it will also invest in the staff, information technology, and process improvements needed to make timely import entry decisions. “These fees will enhance both the safety protections for imported food and feed and the efficiency and speed of food and feed entry decisions, thus supporting international trade in safe food and feed,” the agency says in its “Justification of Estimates for Appropriations Committees.”