LEGISLATIVE BUDGET BOARD Austin, Texas FISCAL NOTE, 81ST LEGISLATIVE REGULAR SESSION April 20, 2009 TO: Honorable Lois W. Kolkhorst, Chair, House Committee on Public Health FROM: John S. O'Brien, Director, Legislative Budget Board IN RE:HB1845 by Lucio III (Relating to disclosure of calorie content of and nutrition information regarding food served by a chain restaurant; providing an administrative penalty.), As Introduced Estimated Two-year Net Impact to General Revenue Related Funds for HB1845, As Introduced: a positive impact of $158,500 through the biennium ending August 31, 2011. The bill would make no appropriation but could provide the legal basis for an appropriation of funds to implement the provisions of the bill.
LEGISLATIVE BUDGET BOARD
Austin, Texas
FISCAL NOTE, 81ST LEGISLATIVE REGULAR SESSION
April 20, 2009
TO: Honorable Lois W. Kolkhorst, Chair, House Committee on Public Health FROM: John S. O'Brien, Director, Legislative Budget Board IN RE:HB1845 by Lucio III (Relating to disclosure of calorie content of and nutrition information regarding food served by a chain restaurant; providing an administrative penalty.), As Introduced
TO: Honorable Lois W. Kolkhorst, Chair, House Committee on Public Health
FROM: John S. O'Brien, Director, Legislative Budget Board
IN RE: HB1845 by Lucio III (Relating to disclosure of calorie content of and nutrition information regarding food served by a chain restaurant; providing an administrative penalty.), As Introduced
Honorable Lois W. Kolkhorst, Chair, House Committee on Public Health
Honorable Lois W. Kolkhorst, Chair, House Committee on Public Health
John S. O'Brien, Director, Legislative Budget Board
John S. O'Brien, Director, Legislative Budget Board
HB1845 by Lucio III (Relating to disclosure of calorie content of and nutrition information regarding food served by a chain restaurant; providing an administrative penalty.), As Introduced
HB1845 by Lucio III (Relating to disclosure of calorie content of and nutrition information regarding food served by a chain restaurant; providing an administrative penalty.), As Introduced
Estimated Two-year Net Impact to General Revenue Related Funds for HB1845, As Introduced: a positive impact of $158,500 through the biennium ending August 31, 2011. The bill would make no appropriation but could provide the legal basis for an appropriation of funds to implement the provisions of the bill.
Estimated Two-year Net Impact to General Revenue Related Funds for HB1845, As Introduced: a positive impact of $158,500 through the biennium ending August 31, 2011.
The bill would make no appropriation but could provide the legal basis for an appropriation of funds to implement the provisions of the bill.
General Revenue-Related Funds, Five-Year Impact: Fiscal Year Probable Net Positive/(Negative) Impact to General Revenue Related Funds 2010 $68,000 2011 $90,500 2012 $90,500 2013 $90,500 2014 $90,500
2010 $68,000
2011 $90,500
2012 $90,500
2013 $90,500
2014 $90,500
All Funds, Five-Year Impact: Fiscal Year Probable Savings/(Cost) fromFood & Drug Fee Acct341 Probable Revenue Gain/(Loss) fromGeneral Revenue Fund1 2010 ($94,500) $68,000 2011 ($126,000) $90,500 2012 ($126,000) $90,500 2013 ($126,000) $90,500 2014 ($126,000) $90,500
Fiscal Year Probable Savings/(Cost) fromFood & Drug Fee Acct341 Probable Revenue Gain/(Loss) fromGeneral Revenue Fund1 2010 ($94,500) $68,000 2011 ($126,000) $90,500 2012 ($126,000) $90,500 2013 ($126,000) $90,500 2014 ($126,000) $90,500
2010 ($94,500) $68,000
2011 ($126,000) $90,500
2012 ($126,000) $90,500
2013 ($126,000) $90,500
2014 ($126,000) $90,500
Fiscal Analysis
The bill requires a chain restaurant with 20 or more establishments in Texas to post the nutritional information of each item. The information must be visible and available before the consumer purchases the food. There are exemptions for farmers markets, commissaries, grocery stores, licensed health care facilities, school cafeterias, and a mobile support unit. The nutritional information must include calorie content, total fat, saturated fat, cholesterol, sodium, total carbohydrates, complex carbohydrates, sugars, dietary fiber, and total protein. The bill would allow DSHS or a Local Health Department to inspect food service facilities for compliance with this chapter. On an alleged violation the inspector shall send the commissioner of DSHS and the owner of the facility a notice by certified mail of the violation and may assess an administrative penalty not to exceed $500 per violation. The owner of the facility may file for an administrative hearing before the penalty is assessed. If the owner does not request a hearing then the commissioner may assess the administrative penalty. The bill would take effect January 1, 2010.
The bill requires a chain restaurant with 20 or more establishments in Texas to post the nutritional information of each item. The information must be visible and available before the consumer purchases the food. There are exemptions for farmers markets, commissaries, grocery stores, licensed health care facilities, school cafeterias, and a mobile support unit. The nutritional information must include calorie content, total fat, saturated fat, cholesterol, sodium, total carbohydrates, complex carbohydrates, sugars, dietary fiber, and total protein.
The bill would allow DSHS or a Local Health Department to inspect food service facilities for compliance with this chapter. On an alleged violation the inspector shall send the commissioner of DSHS and the owner of the facility a notice by certified mail of the violation and may assess an administrative penalty not to exceed $500 per violation.
The owner of the facility may file for an administrative hearing before the penalty is assessed. If the owner does not request a hearing then the commissioner may assess the administrative penalty.
The bill would take effect January 1, 2010.
Methodology
Due to the fact that this would be a new requirement, it is expected that 136 administrative penalites will be issued in FY 2010 and 181 penalties will be issued in FY 2011 and beyond. Assuming each penalty was assessed at $500 it is expected DSHS would collect $68,000 in fiscal year 2010 and $90,500 in fiscal year 2011 and beyond. Because the administrative penalty revenue collected is not appropriated to DSHS it is expected that the revenue would go to the General Revenue Fund. It is projected that 27 facilities in fiscal year 2010 and 36 facilities in fiscal year 2011 and beyond will request a hearing to contest an administrative penalty. The agency estimates that each hearing will cost $3,500 in fees to the State Office of Administrative Hearings for a total cost of $94,500 in fiscal year 2010 and $126,000 in fiscal year 2011 and beyond. These costs are assumed to be from General Revenue-Dedicated Account 341, Food and Drug Fee Account.
Due to the fact that this would be a new requirement, it is expected that 136 administrative penalites will be issued in FY 2010 and 181 penalties will be issued in FY 2011 and beyond. Assuming each penalty was assessed at $500 it is expected DSHS would collect $68,000 in fiscal year 2010 and $90,500 in fiscal year 2011 and beyond. Because the administrative penalty revenue collected is not appropriated to DSHS it is expected that the revenue would go to the General Revenue Fund.
It is projected that 27 facilities in fiscal year 2010 and 36 facilities in fiscal year 2011 and beyond will request a hearing to contest an administrative penalty. The agency estimates that each hearing will cost $3,500 in fees to the State Office of Administrative Hearings for a total cost of $94,500 in fiscal year 2010 and $126,000 in fiscal year 2011 and beyond. These costs are assumed to be from General Revenue-Dedicated Account 341, Food and Drug Fee Account.
Local Government Impact
No significant fiscal implication to units of local government is anticipated.
Source Agencies: 537 State Health Services, Department of
537 State Health Services, Department of
LBB Staff: JOB, CL, BM, MB
JOB, CL, BM, MB