This docum ent does not reflect the intent or official position of the bill sponsor or House of Representatives. STORAGE NAME: h0179.RRS DATE: 2/20/2023 HOUSE OF REPRESENTATIVES STAFF ANALYSIS BILL #: HB 179 Florida Kratom Consumer Protection Act SPONSOR(S): Andrade TIED BILLS: IDEN./SIM. BILLS: SB 136 REFERENCE ACTION ANALYST STAFF DIRECTOR or BUDGET/POLICY CHIEF 1) Regulatory Reform & Economic Development Subcommittee Wright Anstead 2) Agriculture & Natural Resources Appropriations Subcommittee 3) Commerce Committee SUMMARY ANALYSIS Kratom, Mitragyna speciosa, is a tropical tree native to Southeast Asia that contains psychoactive ingredients in its leaves, which may be crushed and then smoked, brewed with tea, or placed into gel capsules. Consumption of kratom leaves can produce stimulant and sedative effects, and addiction may lead to psychotic symptoms. Currently, kratom is not listed as a controlled substance under federal law or Florida law, and is generally regulated as a food. However, the FDA considers kratom an adulterating agent. There are no specific state laws related to the regulation of kratom. The bill provides that a kratom processor may not sell, prepare, distribute, or expose for sale, subject to an administrative fine: A kratom product that: o Is adulterated with a dangerous non-kratom substance that affects the quality or strength of the kratom product to such a degree that it may injure a consumer. o Contains a poisonous or otherwise harmful non-kratom ingredient, including, but not limited to, controlled substances. o Contains a level of 7-hydroxymitragynine in the alkaloid fraction which is greater than 2 percent of the alkaloid composition of the product. o Contains any synthetically derived compound of the plant Mitragyna speciosa. o Does not include directions for the safe and effective use of the product on the packaging or label. o Has a label that contains any claim that the product is intended to diagnose, treat, cure, or prevent any medical condition or disease. Kratom extract that contains levels of residual solvents higher than USP-NF standards. The bill prohibits processors from distributing, selling, or exposing a kratom product for sale to an individual under 21 years of age. The bill provides an effective date of July 1, 2023. The bill does not appear to have a fiscal impact on local governments and may have a negative fiscal impact on state government. See Fiscal Analysis and Economic Impact Statement. STORAGE NAME: h0179.RRS PAGE: 2 DATE: 2/20/2023 FULL ANALYSIS I. SUBSTANTIVE ANALYSIS A. EFFECT OF PROPOSED CHANGES: Kratom Kratom, or Mitragyna speciosa, is a tropical tree native to Southeast Asia that contains the alkaloids mitragynine and 7-hydroxymytragynine in its leaves, which are two major psychoactive ingredients. 1 The leaves are crushed and then smoked, brewed with tea, or placed into gel capsules. 2 Some people consumer kratom to treat muscle ache, fatigue, and other conditions. 3 Low doses of kratom are said to produce a stimulant effect, while higher doses may produce an opioid-like effect. 4 Research finds that kratom can be used as a substitute for opiate users to combat withdrawal symptoms, 5 though kratom addiction may lead to psychotic symptoms. 6 The U.S. Food and Drug Administration (FDA) has found that: 7 Kratom is abused for its ability to produce opioid-like effects… Evidence suggests that kratom is abused individually and with other psychoactive substances. Kratom does not have an approved medical use in the United States and has not been studied as a treatment agent in the United States. Kratom has a history of being used as an opium substitute in Southeast Asia. In the United States, kratom is misused to self-treat chronic pain and opioid withdrawal symptoms. Consumption of kratom can lead to a number of health impacts, including, among others, respiratory depression, vomiting, nervousness, weight loss, and constipation. Kratom has been reported to have both narcotic and stimulant-like effects, and withdrawal symptoms may include hostility, aggression, excessive tearing, aching of muscles and bones, and jerky limb movements. A Centers for Disease Control and Prevention study of approximately 27,000 overdoses that occurred between 2016 and 2017 found that kratom was implicated in less than one percent of deaths. 8 The exact incidence of kratom dependency is not known and there is no U.S. reporting system. 9 It is estimated that there are between 10-16 million kratom users in the U.S. 10 Users indicate self- treatment of anxiety, depression, pain, fatigue, and substance use disorder symptoms. 11 1 Drug Enforcement Administration, Kratom (April 2020), available at https://www.dea.gov/sites/default/files/2020-06/Kratom- 2020_0.pdf (last visited Feb. 15, 2023). 2 Id. 3 Id. 4 See Dimy Fluyau and Neelambika Revedigar, Biochemical Benefits, Diagnosis, and Clinical Risks Evaluation of Kratom, Frontiers in Psychiatry Journal Volume 8 (April 24, 2017). 5 Id. 6 Id. 7 86 FR 39038. 8 Emily O’Malley Olsen, PhD; Julie O’Donnell, PhD; Christine L. Mattson, PhD; Joshua G. Schier, MD; Nana Wilson, PhD; Notes from the Field: Unintentional Drug Overdose Deaths with Kratom Detected — 27 States, July 2016–December 2017; CDC Morbidity and Mortality Weekly Report, Apr. 12, 2019; Notes from the Field: Unintentional Drug Overdose Deaths with Kratom Detected — 27 States, July 2016–December 2017 | MMWR (cdc.gov) (last visited Feb. 15, 2023); Maia Szalavitz, The FDA Shouldn’t Support a Ban on Kratom, Scientific American, Aug. 12, 2021, The FDA Shouldn't Support a Ban on Kratom - Scientific American (last visited Jan. 30, 2022). 9 Charles Veltri and Oliver Grundmann, Current Perspectives on the Impact of Kratom Use. Substance Abuse and Rehabilitation Journal Volume 10 23-31 (July 1, 2019). 10 Maia Szalavitz, supra note 8. 11 Jeffrey Rogers, Kirsten Smith, Justin Strickland, and David Epstein, Kratom Use in the US: Both a Regional Phenomenon and a White Middle-Class Phenomenon? Evidence From NSDUH 2019 and an Online Convenience Sample, Frontiers on Pharmacology, https://www.frontiersin.org/articles/10.3389/fphar.2021.789075/full (last visited Feb. 19, 2023). STORAGE NAME: h0179.RRS PAGE: 3 DATE: 2/20/2023 Kratom is a $1.3 billion industry in the U.S. with sales generally occurring online and in smoke shops. 12 Hundreds of businesses around Florida sell the product. 13 Public opinions in the U.S. range on the topic of kratom bans, either citing concerns of addiction or praising perceived health benefits. Some point to kratom’s uses for opioid addicts to cease use and aid in withdrawal symptoms. 14 Other reports indicate that the use of kratom may lead to addiction. 15 State and Federal Prohibitions Currently, kratom is not listed as a controlled substance under federal law or Florida law. In 2016, the U.S. Drug Enforcement Administration (DEA) submitted a notice of intent to place kratom into Schedule I of the Controlled Substances Act (CSA) based on abuse potential and risk to public health. 16 However, the DEA withdrew the notice a few months later based on public comments. 17 In a letter obtained by an industry group, U.S. Health and Human Services appeared to rescind their recommendation to the DEA to place kratom on Schedule I of the CSA in 2018, stating that such action should wait until it is supported by further research on kratom uses, abuse, and risks. 18 The DEA continues to label kratom as a drug of concern. 19 The FDA has stated that there is substantial concern regarding the safety of kratom and the risk it may pose to public health, and indicated that there are currently no FDA-approved uses for kratom. 20 The FDA is actively evaluating all available scientific information on the safety and effects of kratom and continues to warn consumers not to use any kratom products. 21 In 2015, the FDA issued an import alert 22 that labels kratom as an adulterating ingredient. 23 As a result, the FDA seized imports of kratom-containing dietary supplements and bulk dietary ingredients. In May of 2021, the FDA announced the seizure of around 37,500 tons of adulterated kratom in Fort Myers, Florida, worth an estimated $1.3 million. 24 On October 26, 2021, a consent decree of condemnation and destruction against the seized articles by the FDA was entered, which requires the claimants to pay a penal bond and destroy all seized articles. 25 12 Brody Ford, Opiate Alternative Kratom Spurs Investor Interest, Bloomberg News, Dec. 20, 2021, https://www.bloomberg.com/news/newsletters/2021-12-20/kratom-attracts-investor-attention-after-regulatory-win (last visited Jan. 30, 2022). 13 Kirby Wilson, Florida Kratom for customers under 21 to be banned if this bill passes, Tampa Bay Times, Jan. 18, 2022, Florida Kratom for customers under 21 to be banned if this bill passes (tampabay.com) (last visited Jan. 30, 2022). 14 Jennifer Clopton, Regulations Are On Hold as Kratom Debate Rages, WebMD, Feb. 11, 2019, https://www.webmd.com/mental- health/addiction/news/20190211/regulations-are-on-hold-as-kratom-debate-rages (last visited Feb. 15, 2023). 15 Mayo Clinic, Kratom for opioid withdrawal: Does it work?, https://www.mayoclinic.org/diseases-conditions/prescription-drug- abuse/in-depth/kratom-opioid-withdrawal/art-20402170 (last visited Feb. 15, 2023). 16 81 FR 59929. 17 81 FR 70652 18 Josh Long, HHS in 2018 rescinded recommendation to schedule kratom as a drug, Jan. 28, 2021, https://www.naturalproductsinsider.com/regulatory/hhs-2018-rescinded-recommendation-schedule-kratom-drug (last visited Feb. 15, 2023). 19 U.S. Drug Enforcement Administration, Kratom, https://www.dea.gov/factsheets/kratom (last visited Feb. 15, 2023). 20 U.S. Food and Drug Administration, FDA and Kratom, https://www.fda.gov/news-events/public-health-focus/fda-and-kratom (last visited Feb. 15, 2023). 21 Id. 22 U.S. Food and Drug Administration, Import Alert 54-15, Import Alert 54-15 (fda.gov) (last visited Feb. 15, 2023). 23 Id. The FDA labeled kratom as adulterating based on the absence of a history of use or other evidence of safety establishing that kratom will reasonably be expected to be safe as a dietary ingredient, kratom and kratom-containing dietary supplements and bulk dietary ingredients are adulterated because they contain a new dietary ingredient for which there is inadequate information to provide reasonable assurance that such ingredient does not present a significant or unreasonable risk of illness or injury. 24 U.S. Food and Drug Administration, FDA Announces Seizure of Adulterated Dietary Supplements Containing Kratom, May 21, 2021, https://www.fda.gov/news-events/press-announcements/fda-announces-seizure-adulterated-dietary-supplements-containing- kratom (last visited Feb. 15, 2023). 25 Id. STORAGE NAME: h0179.RRS PAGE: 4 DATE: 2/20/2023 In 2014, Sarasota County banned kratom, labeling it as a designer drug. 26 With the exception of Sarasota County, in Florida, all parts of the plant and its extracts are legal to cultivate, buy, possess, and distribute without a license or prescription. Kratom is illegal in Alabama, 27 Arkansas, 28 Indiana, 29 Vermont, 30 and Wisconsin. 31 Other states such as Arizona, 32 Georgia, 33 and Utah 34 regulate kratom under their state’s version of the Kratom Consumer Protection Act. Federal Food, Drug, and Cosmetic Act The Federal Food, Drug, and Cosmetic Act (FDCA) is a federal law which establishes the legal framework within which the FDA operates. 35 The FDA develops regulations under the FDCA for the safety of foods, drugs, and cosmetics based on the laws set forth in the FDCA, including when a food is adulterated. 36 Instances where a food must be determined to be adulterated include when it: 37 Bears or contains any poisonous or deleterious substance which may render it injurious to health; such as consisting in whole or in part of any filthy, putrid, or decomposed substance; Is a dietary supplement or contains a dietary ingredient that presents a significant or unreasonable risk of illness or injury under use pursuant to the label; Is a new dietary ingredient for which there is inadequate information to provide reasonable assurance that such ingredient does not present a significant or unreasonable risk of illness or injury. When a food is determined to be adulterated, the FDA may take the following compliance measures: 38 Warning and untitled letters, Import alerts, Recalls, Debarment, Civil money penalties, Seizure of products, Injunctions, and Criminal prosecution. Florida Department of Agriculture and Consumer Services, Division of Food Safety The Department of Agriculture and Consumer Services (DACS) is the department in charge of regulating agriculture in Florida. 39 As such, DACS promotes Florida agriculture, protects the environment, safeguards consumers, and ensures the safety and wholesomeness of food. 40 26 See Sarasota, FL., Code of Ordinances, Sec. 62-351 (2014). 27 See Alabama Public Health, Controlled Substance List (Jan. 20, 2021), available at https://www.alabamapublichealth.gov/blog/assets/controlledsubstanceslist.pdf (last visited Jan. 22, 2022). 28 See Arkansas Department of Health, List of Controlled Substances, available at http://secureservercdn.net/166.62.109.105/e17.085.myftpupload.com/wp-content/uploads/2016/02/arkansas- controlled_substances_list.pdf (last visited Jan. 22, 2022). 29 See IC 35-31.5-2-321. 30 See Vt. Admin. Code 12-5-23:4.0. 31 See W.S.A. 961.14. 32 See AZ Rev Stat § 36-795.02. 33 See GA Code § 16-13-121. 34 See UT Code § 4-45-101. 35 21 U.S.C. 301. 36 See 21 C.F.R. §§ 1-1299. 37 21 U.S.C. 342. 38 CRS Report R43609, Enforcement of the Food, Drug, and Cosmetic Act: Select Legal Issues, February 9, 2018, https://www.everycrsreport.com/reports/R43609.html#fn96 (last visited Feb. 15, 2023). 39 S. 20.14, F.S. DACS also regulates certain professions, unfair and deceptive business practices and provides consumer information. 40 Florida Department of Agriculture and Consumer Services, About Us, h https://www.fdacs.gov/About-Us (last visited Feb. 15, 2023). STORAGE NAME: h0179.RRS PAGE: 5 DATE: 2/20/2023 The Division of Food Safety (division), under DACS, is responsible for assuring a safe, wholesome, and properly represented food supply in Florida. This is accomplished through the permitting and inspection of food establishments, inspection of food products, and through specialized laboratory analyses on a variety of food products sold or produced in the state. The division monitors food from the farm gate through processing and distribution to the retail point of purchase. 41 The division is charged with administration and enforcement of food, poultry, and egg laws, and also provides support in the enforcement of other food safety laws. In addition to regulatory surveillance and enforcement, the division evaluates consumer complaints related to food. 42 “Food” includes: 43 Articles used for food or drink for human consumption; Chewing gum; Articles used for components of any such article; Articles for which health claims are made, which claims are approved by the Secretary of the United States Department of Health and Human Services and which claims are made in accordance with s. 343(r) of the federal act, and which are not considered drugs solely because their labels or labeling contain health claims; and Certain dietary supplements. “Food establishment” means a factory, food outlet, or other facility manufacturing, processing, packing, holding, or preparing food or selling food at wholesale or retail. A food permit is required of any person who operates a food establishment. 44 “Retail food store” means any establishment or section of an establishment where food and food products are offered to the consumer and intended for off-premises consumption. 45 A food permit from the department is required of any person who operates a food establishment or retail food store, except: 46 Persons operating minor food outlets that sell food that is commercially prepackaged, not potentially hazardous, and not time or temperature controlled for safety, if the shelf space for those items does not exceed 12 total linear feet and no other food is sold by the minor food outlet. Persons subject to continuous, onsite federal or state inspection. Persons selling only legumes in the shell, either parched, roasted, or boiled. Persons selling sugar cane or sorghum syrup that has been boiled and bottled on a premise located within the state. The division or its duly authorized agent has free access at all reasonable hours to any food establishment to ensure food safety laws are followed. The inspectors: 47 secure a sample or a specimen of any food after paying or offering to pay for such sample, see that all sanitary rules are complied with, facilitate tracing of food products in the event of a food-borne illness outbreak or identification of an adulterated or misbranded food item, and enforce the special-occupancy provisions of the Florida Building Code which apply to food establishments. 41 Florida Department of Agriculture and Consumer Services, Division of Food Safety, http://www.freshfromflorida.com/Divisions- Offices/Food-Safety (last visited Feb. 15, 2023). 42 Id. 43 S. 500.003(1)(n), F.S. 44 S. 500.03(1)(r), F.S. 45 S. 500.03(1)(bb), F.S. 46 S. 500.12(1)(a), F.S. 47 S, 500.147, F.S. STORAGE NAME: h0179.RRS PAGE: 6 DATE: 2/20/2023 If a food establishment or retail store violates the FFSA, the division may impose an administrative fine not more than $5,000. The division may also revoke or suspend the permit of any such retail food store or food establishment if the retail food store or food establishment has: 48 Violated the FFSA. Violated or aided or abetted in the violation of any law of this state governing or applicable to retail food stores or food establishments or any lawful rules of DACS. Knowingly committed, or been a party to, any material fraud, misrepresentation, conspiracy, collusion, trick, scheme, or device whereby another person, lawfully relying upon the word, representation, or conduct of a retail food store or food establishment, acts to her or his injury or damage. Committed fraud or dishonest dealing. DACS may determine that a food establishment requires immediate closure when the food establishment fails to comply with the FFSA and presents an imminent threat to the public health, safety, and welfare. DACS may accept inspection results from other state and local building officials and other regulatory agencies as justification for such action. 49 Many FDA regulations have been adopted as rules of the division. 50 Florida Food Safety Act The division is responsible for the administration and enforcement of the Florida Food Safety Act (FFSA). 51 The division regulates food products under the FFSA, which include articles used for food or drink for human consumption, as well as dietary supplements. 52 The FFSA is designed to: Promote public welfare by protecting the consuming public from injury by product use and the purchasing public from injury by merchandizing deceit, flowing from intrastate commerce in food; Provide uniform legislation so far as practical with federal regulations; and Promote uniform administration and enforcement of federal and state food safety laws. 53 Adulterated and Misbranded Foods Under the FFSA, individuals may not sell food that is adulterated, adulterate food, or receive food in commerce that is adulterated or misbranded. 54 These prohibitions are similar to federal law. 55 The following are examples when food is deemed adulterated: 56 Food that bears or contains any poisonous or deleterious substance which may render it injurious to health; Food that bears or contains any added poisonous or added deleterious substance; a food additive; or a color additive, which is unsafe; Food that is or bears or contains any food additive which is unsafe; Food whose container is composed, in whole or in part, of any poisonous or deleterious substance; Food where any substance has been substituted wholly or in part therefor; Food where damage or inferiority has been concealed in any manner; and 48 S. 500.121(1), F.S. 49 S. 500.121(7), F.S. 50 R. 5K-4.002, F.A.C. 51 See ch. 500, F.S. 52 See ch. 500, F.S. 53 S. 500.02, F.S. 54 S. 500.04, F.S. 55 21 U.S.C. 331. 56 S. 500.10, F.S. STORAGE NAME: h0179.RRS PAGE: 7 DATE: 2/20/2023 A dietary supplement or its ingredients that present a significant risk of illness or injury due to certain labeling and ingredient requirements. Misbranded food includes food offered for sale and its label or labeling does not comply with the requirements of 21 U.S.C. s. 343(r) pertaining to nutritional content claims and health claims. Labels for supplements may not claim to diagnose, mitigate, treat, cure, or prevent a specific disease or class of diseases. 57 DACS may inspect food that may be adulterated or misbranded; 58 seize food that is adulterated or misbranded; 59 suspend permits of those who sell food that is adulterated or misbranded, adulterate or misbrand food, or receive food in commerce that is adulterated or misbranded; 60 and impose a fine for adulterated or misbranded food, not to exceed $5,000 61 per violation. 62 Food that contains kratom currently falls within in the definition of “food” 63 in the FFSA, and is subject to all applicable permitting, labeling, sanitation, and other food safety requirements. There are no existing age limits related to the sale of these products. Controlled Substances in Florida Section 893.03, F.S., categorizes various controlled substances in Florida into “schedules.” The schedule on which a controlled substance is placed is generally based on its accepted medical uses, abuse potential, and likelihood of dependence if abused. Currently, kratom is not listed on a schedule of controlled substances. USP-NF The United States Pharmacopeia (USP) and the National Formulary (NF) contains standards for medicines, dosage forms, drug substances, excipients, biologics, compounded preparations, medical devices, dietary supplements, and other therapeutics. The current version of USP-NF standards deemed official by USP are enforceable by the FDA for medicines manufactured and marketed in the United States. Residual solvents in pharmaceuticals are defined as organic volatile chemicals that are used or produced in the manufacture of drug substances or excipients, or in the preparation of drug products. The residual solvents are not completely removed by practical manufacturing techniques. Drug products should contain no higher levels of residual solvents than can be supported by safety data. 64 Regulation of Similar Products Hemp 65 is an agricultural commodity grown and used worldwide to produce a variety of industrial and commercial products, including human food and nutritional supplements. 66 After hemp was removed from Schedule I of the federal CSA, the state hemp program (program) within DACS to regulate the cultivation of hemp in Florida was created in 2019. 67 57 S. 500.11(1)(n), F.S.; 21 U.S.C. s. 343 (r)(6)(C. 58 S. 500.147(1), F.S. 59 S. 500.173, F.S. 60 S. 500.12(4), F.S. 61 S. 570.971(1)(b), F.S. 62 S. 500.121, F.S. 63 S. 500.03(1)(n), F.S. 64 See The United States Pharmacopeia and the National Formulary, ‹467› Residual Solvents, available at https://www.uspnf.com/sites/default/files/usp_pdf/EN/USPNF/generalChapter467Current.pdf (last visited Feb. 15, 2023). 65 Hemp is defined as the plant Cannabis sativa L. and any part of that plant with a delta-9 tetrahydrocannabinol (THC) concentration that does not exceed 0.3 percent on a dry weight basis. 7 U.S.C. s. 5940 (2014); 7 U.S.C. s. 1639o (2018); see also s. 581.217, F.S 66 Congressional Research Service (CRS), Hemp as an Agricultural Commodity, CRS Report 7-5700 (June 22, 2018), available at https://fas.org/sgp/crs/misc/RL32725.pdf (last visited Feb. 15, 2023). 67 Ch. 2019-132, L.O.F.; codified as s. 581.217, F.S. STORAGE NAME: h0179.RRS PAGE: 8 DATE: 2/20/2023 Any person seeking to cultivate hemp must apply for a hemp cultivation license with DACS 68 and any establishment that manufactures, processes, packs, holds, prepares or sells hemp extract intended for human consumption is considered a hemp food establishment and must have a permit from the division to operate in Florida. 69 Violations of the hemp laws and rules 70 may result in the imposition of stop-sale/stop-use orders, an administrative fine of up to $5,000 per violation, permit suspension, permit revocation, or any combination thereof. 71 Hemp extract intended for human consumption distributed or sold in violation of hemp laws and rules are considered adulterated or misbranded. Hemp extract products must be distributed or sold in a container that has certain batch and identifying information 72 Hemp extract products that are intended for inhalation may not be sold to a person who is under 21 years of age. 73 There is no liability shield for retailers based on misrepresentations by a manufacturer. Effect of the Bill The bill may be cited as the "Kratom Consumer Protection Act." The bill provides the following definitions: "Kratom extract" means a food product or dietary ingredient that contains any part of the leaf of the plant Mitragyna speciosa which has been extracted and concentrated to provide more standardized dosing. "Kratom product" means a food product, food ingredient, dietary ingredient, dietary supplement, or beverage intended for human consumption which contains any part of the leaf of the plant Mitragyna speciosa or an extract of such plant and is manufactured as a powder, capsule, pill, beverage, or other edible form. "Processor" means a person who sells, prepares, manufactures, distributes, or maintains kratom products. The bill provides that a processor may not sell, prepare, distribute, or expose for sale: A kratom product that: o Is adulterated with a dangerous non-kratom substance that affects the quality or strength of the kratom product to such a degree that it may injure a consumer. o Contains a poisonous or otherwise harmful non-kratom ingredient, including, but not limited to, controlled substances. o Contains a level of 7-hydroxymitragynine in the alkaloid fraction which is greater than 2 percent of the alkaloid composition of the product. o Contains a synthetic alkaloid, including, but not limited to, synthetic mitragynine, synthetic 7- hydroxymitragynine, or any other synthetically derived compound of the plant Mitragyna speciosa. o Does not include directions for the safe and effective use of the product, including, but not limited to, a suggested serving size, on the product's packaging or label. o Has a label that contains any claim that the product is intended to diagnose, treat, cure, or prevent any medical condition or disease. Kratom extract that contains levels of residual solvents higher than the standards set forth in USP-NF chapter 467. 68 S. 581.217(5), F.S. 69 Department of Agriculture and Consumer Services, Hemp Food Establishment Permit Checklist, https://www.fdacs.gov/content/download/93802/file/hemp-food-establishment-permit-checklist.pdf (last visited Feb. 15, 2023). 70 Id.; R. 5K-4.034, F.A.C. 71 R. 5K-4.034(9)(d)-(e), F.A.C. 72 S. 581.217(7)(a)2., F.S. 73 S. 581.217(7)(c), F.S. STORAGE NAME: h0179.RRS PAGE: 9 DATE: 2/20/2023 The bill establishes fines for violations. A processor who violates these prohibitions is subject to an administrative fine of not more than $500 for the first offense, and not more than $1,000 for the second or subsequent offense. A processor selling kratom products at retail is not in violation of these prohibitions if it is shown by a preponderance of the evidence that the processor relied in good faith upon the representations of a manufacturer, processor, packer, or distributor of the kratom product. The bill prohibits processors from distributing, selling, or exposing a kratom product for sale to an individual under 21 years of age. There is no disciplinary action provided for in the bill for a processor who violates this prohibition. The bill provides an effective date of July 1, 2023. B. SECTION DIRECTORY: Section 1: Creates s. 501.9745, F.S.; providing prohibitions for the sale of certain kratom products. Section 2: Provides an effective date. II. FISCAL ANALYSIS & ECONOMIC IMPACT STATEM ENT A. FISCAL IMPACT ON STATE GOVERNMENT: 1. Revenues: There may be an increase in administrative fines and licensing fees collected by DACS, but the amount is indeterminate. 2. Expenditures: DACS estimates the following fiscal impact on expenditures: 74 The below reflects expenditures for FY23-24: 25 FTE and HR Services: $1,832,536 Standard Expense Package & Travel: $341,275 Equipment and Vehicles: $3,642,812 Lab Renovations: $4,000,000 It is estimated that an additional one-hour of inspection time per visit to each retail food establishment operating as a kratom processor will be required to verify compliance with new labeling, age verification, and product testing requirements. This does not include laboratory time associated with testing. This additional inspection time will require an estimated 13 new retail field inspectors, adding one additional inspector per retail district. Enforcement of violations of the Act will be handled by the division’s enforcement section and will require one additional Regulatory Consultant to draft and process administrative actions. (FY 23-24) Amount/ FTE (FY 24-25) Amount/ FTE (FY 25-26) Amount/ FTE Expenditures Recurring $2,056761 $2,599,761 $2,681,211 Non-Recurring $7,759,862 $0 $0 TOTAL EXPENDITURES $9,816,623 $2,599,761 $2,681,211 B. FISCAL IMPACT ON LOCAL GOVERNMENTS: 74 Florida Department of Agriculture and Consumer Services, Agency Analysis of 2023 Senate Bill 136, pp. 3-4 (Jan. 25, 2023). STORAGE NAME: h0179.RRS PAGE: 10 DATE: 2/20/2023 1. Revenues: None. 2. Expenditures: Unknown. Law enforcement may receive complaints about local businesses selling kratom to underage buyers. C. DIRECT ECONOMIC IMPACT ON PRIVATE SECTOR: Food establishments and kratom processors will need to pay associated costs of complying with new labeling, age verification, and product testing requirements. D. FISCAL COMMENTS: None. III. COMMENTS A. CONSTITUTIONAL ISSUES: 1. Applicability of Municipality/County Mandates Provision: Not applicable. This bill does not appear to require counties or municipalities to spend funds or take action requiring the expenditures of funds; reduce the authority that counties or municipalities have to raise revenues in the aggregate; or reduce the percentage of state tax shared with counties or municipalities. 2. Other: None. B. RULE-MAKING AUTHORITY: No rulemaking authority is granted in the bill. C. DRAFTING ISSUES OR OTHER COMMENTS: The bill does not provide clear enforcement and rulemaking authority for DACS for both regulating kratom products and sales to individuals under age 21. DACS states that: 75 By defining kratom and kratom extract as food, these products will be regulated under the bill and the FFSA, which is in another section of law. New licenses for kratom processors may be needed. The division laboratory is not currently trained or equipped to conduct most testing required by the Act. Some of the testing would need to be performed by law enforcement laboratories. Consideration should be given to enumerating penalties for the sale of kratom to persons under the age of 21 years. IV. AMENDMENTS/COMMITTEE SUBSTITUTE CHANGES 75 Id. at 7-9.