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 WASHINGTON, July 28 /PRNewswire/ -- Protesting the burdensome effects on Indiana businesses and Hoosiers with lower incomes, Sen. Dan Coats (R-Ind.) has opposed language in an appropriations bill that would authorize the federal Food and Drug Administration to levy "user fees" on companies it regulates. Coats also noted that a tax to cover the cost of FDA inspections would create a conflict of interest for the agency and erode public confidence in safety of the food supply.
 In floor debate this week, Coats joined with other senators in arguing against "a major change in public policy" that would allow FDA to collect $175 million from the food, medical device and other FDA- regulated industries. More than 60 food processing companies operate in Indiana, and food distribution centers, warehouses and even supermarket deli operations could be affected, depending upon how any final regulations were worded.
 Coats inserted in the July 26 Congressional Record a letter from John R. Cady, president of the National Food Processors Association, spelling out food industry opposition to the proposal. Cady's letter noted: "Both the reality and perception of FDA's integrity are important in maintaining public confidence in the agency. Yet concerns have been raised by leaders from all points on the political spectrum regarding the effect of user fees on public confidence in the independence of the FDA."
 Cady cited language stating one reason Congress in 1948 repealed a user fee on meat and poultry it had enacted only the year before: "The cost of such inspection should be paid out of the general funds of the federal government -- not only because such inspection is a proper charge against the people as a whole, but because it is the only way in which consumers can be assured of effective, uncompromising inspection in which they can repose the fullest confidence."
 Cady pointed out that "imposition of fees on industries because they are regulated by FDA would establish an extremely regressive regulatory tax. Since regulated industries would pass the tax cost on to buyers of their products, low-income Americans who spend the highest proportion of their income on food would be hurt most. And small businesses, which create most new jobs in the private sector, would be least able to pass the costs on to their customers, resulting in restricted growth and fewer jobs."
 Cady noted that the user fee idea has been rejected many times by Congress, and that in appropriating FDA's current operating funds, Congress stipulated that "none of these funds shall be used to develop, establish, or operate any program of user fees."
 -0- 7/28/93
 /CONTACT: Roger Coleman of the National Food Processors Association, 202-639-5935/

CO: National Food Processors Association; Food and Drug Administration ST: Indiana IN: HEA SU: LEG

DC-IH -- DC028 -- 6984 07/28/93 17:39 EDT
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Publication:PR Newswire
Date:Jul 28, 1993

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