Kentucky Health Officials Suggest Revisions To Food Producer Fee Proposal After Blowback

Sep 18, 2020

Rep. Joe Graviss at Thursday's meeting.
Credit KET

Kentucky health officials are suggesting revisions to a proposed regulation that would have dramatically increased food safety inspection fees for some small food producers. 

Department officials said they received hundreds of public comments on the proposal with concerns about fee increases and they now plan to limit fees according to a producer’s income.

Kentucky Cabinet for Health and Family Resources officials spoke to the Interim Joint Committee on Agriculture on Thursday about the planned rule revision, getting feedback from state lawmakers on concerns about the rule’s impact on small farmers.

As the Ohio Valley ReSource previously reported, the cabinet has said it originally proposed the rule to better align state food safety inspection standards to the U.S. Food and Drug Administration. The proposal would have affected producers operating through commercial kitchens who sell wholesale, online, or across state lines. 

The proposed regulation would have changed how food safety permitting fees are assessed, from being based on the size of a facility to being based on the “risk level” of a particular commodity. For Seth Long, who makes maple syrup in Letcher County, Kentucky, the new fee structure would have increased his yearly fee from $120 to $1,350.  

The department said it received more than 400 comments concerned about the rule, with many concerned about potential fee increases. Because of that feedback the department is planning to account for the income of a producer along with the risk level structure. Long’s yearly fee would increase from $120 to $300 under the suggested revision. 

He said he believes producers’ voices were heard with this revision, but wonders what future fee increases could look like with upcoming state budget issues. 

“In my wife’s language, ‘this is doable.’ I think we can do this, and it sure beats the $1200 dollars that was on the table before,” Long said. “What’s the ten-year plan? How does this look moving forward? Is this something we need to brace for? Because the expenses, to be a local food producer really matter.” 

Cabinet officials said during Thursday’s legislative meeting that  the intent of the proposal was to not sharply increase fees for producers, and took the idea for the income tiers from public commentary received on the proposal. Yet some state lawmakers still had concerns about the timing and appropriateness of the fee increases. 

Democrat Rep. Joe Graviss of Versailles said the revised proposal is much improved from the original draft, but that he’s concerned the more modest  fee increases could still clash with state law. Graviss was a co-sponsor of HB 129, a bill signed into law that limited the administrative and operational costs for programs by the Cabinet for Health and Family Services. The costs of said programs can not increase by more than 25% through 2020 and not more than 5% in the following years, according to the bill

“If you’re paying a fee now, and they create this new risk, income-tiered level structure, then whatever fee you pay under that should not be 25% more than what you’re paying now,” Graviss said in a phone interview after the meeting. 

Cabinet officials at the meeting said that a specific Kentucky Revised Statute, KRS 217.125 (2),  separate from HB 129 allowed the cabinet secretary to create a fee schedule that did not exceed the costs of a program. They said the food processor permitting program currently costs $700,000 more than the revenue generated from collection of fees. Graviss said he didn’t believe it was appropriate for the cabinet to use a separate statute that would go against “the spirit” of HB 129. 

Committee Co-Chair Republican Rep. Richard Heath of Mayfield said the committee plans to draft and send a formal letter next week to the cabinet summarizing concerns, including from Graviss, about the revised proposal. 

Cabinet officials said they would submit a revised version of the proposal to the state legislative research commission by October 15.