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February 18 , 2009

Who Pays? - Health Districts Seek to Increase Food Establishment License Fees

Legislative Hot Topics - Food Fees

Issues & Answers

Making the Change

The seven Idaho public health districts are asking the Legislature to allow them to increase the fees charged to food establishments, in an attempt to bring the fees closer to the actual cost of providing the services. Idaho law requires the health districts to protect the public with annual inspections of the more than 9,000 licensed food establishments in the state. But the current $65 annual fee set by the Legislature six years ago only covers about 23% of the cost of providing the inspections. The districts subsidize the Food Program with taxpayer dollars from the state and counties.

Most other health district fees for services are designed to pay for themselves, but cannot be higher than program costs. Only the fees for the food program, child care, and swimming pool inspections are set by the Legislature.

As taxpayer support of the health districts shrinks with state and county budgets, the food program subsidy is taking a bigger bite out of other public health programs. The seven health districts have been forced to reduce their combined workforce by 54 full time positions, or roughly eight percent. The result has been the curtailment and elimination of some programs and the deferral of critical infrastructure improvements and maintenance.

“The food program is under funded,” explained Russell Duke, Director of Central District Health Department. “The law says we must provide the service, but doesn’t allow us to collect enough money to cover our costs. It doesn’t even come close. It is such a critical disease prevention service, and we want to continue to provide it for our communities.”

When fully implemented, the fee increase would amount to roughly 40-cents a day for a year-round food establishment. Should the districts fail in their attempt to raise food license fees, another 20 positions could be cut statewide and resulting in additional reductions in public health services.

“The health districts use the portion of state and county funds allocated to help supplement preventive health services to low income families and protect the health of the entire community,” said Bruce Krosch, District Director for Southwest District Health. “With the food program consuming a larger share of that allocation, preventive health services will suffer for lack of resources.”

Beginning last spring, the health districts worked with a group of food industry representatives and together crafted a proposal that would increase the food fees to cover roughly 67% of the cost of ensuring the safety of food served to the public at restaurants, grocery stores, school cafeterias, farmers’ markets and hot dog stands. The legislation would create a three-tiered fee structure, with those food establishments presenting the greatest risk to the public paying the highest fee. Most Idaho restaurants fall into the medium risk category. (See Table) The change in fee structure wouldn’t be fully implemented for two years.

“When we were presenting our budget request to the Legislature last year we were told to re-examine our fee structure,’ said Duke. “We did exactly that, and found the biggest gap in the food program. For nearly everything else we do it’s ‘pay as you go,’ but not when it comes to protecting the public from foodborne illness.”

Industry lobbyists are working to defeat the food fee legislation citing many food establishments are closing because of the economy and the increase is too much. However, a review of applications for new restaurant licenses conducted by Idaho’s Public Health Districts indicates there is actually a 2.3% increase in the number of licensed food establishments this year compared to last.

“We partner with restaurants to promote safe food handling and we want them to be successful,” said Krosch. “We know the economy is challenging, but the fee increase is an affordable investment for the safety of our citizens.”

More information about the proposed fees can be found on the Central District Health Department website.