TITLE 25.HEALTH SERVICES

Part 1. DEPARTMENT OF STATE HEALTH SERVICES

Chapter 229. FOOD AND DRUG

The Executive Commissioner of the Health and Human Services Commission, on behalf of the Department of State Health Services (department), adopts amendments to §229.182 concerning licensure of food manufacturers, food wholesalers, and warehouse operators, and §§229.435, 229.439, 229.441, 229.443, and 229.444, concerning licensing of device distributors and manufacturers without changes to the proposed text as published in the August 18, 2006, issue of the Texas Register (31 TexReg 6458), and the sections will not be republished.

BACKGROUND AND PURPOSE

The Texas Legislature passed the General Appropriations Act, Senate Bill 1, 79th Legislature, Regular Session (2005). Article II, Rider 85, makes a portion of the appropriation contingent upon collection of fees above the Comptroller of Public Accounts' Biennial Revenue estimate. To meet these requirements, a cost recovery fee is included in these amendments.

Programs with regulatory authority over food manufacturers, food wholesalers, and warehouse operators; and device distributors and manufacturers, were evaluated to determine the level of increase in fees based on the following criteria: the date of the last fee increase for the specific program area; the licensee's ability to pay in comparison to average salary of professionals; the percentage of revenue above costs for the specific program; the cost of licenses compared to other similar licenses; and the value added analysis of the license. Additional costs of administration and enforcement of the program, due to a recent legislative increase in pay, longevity pay, and travel reimbursement, were also factored in to determine the direct and indirect costs of each program.

Finally, the sections required updating to be consistent with changes resulting from House Bill 2292, 78th Legislative Session, 2003. The amendments update and clarify the sections to reflect current licensing procedures and license term durations as well as identification of the state agencies responsible for certain licensing, enforcement and advisory committee functions.

SECTION-BY-SECTION SUMMARY

Amendments to §229.182 contain increases in licensing fees for food wholesalers with combination products for initial and renewal applications per location, based upon gross annual sales. Specifically, new §229.182(b)(3)(A) increases the license fee for wholesalers of combination products with gross annual sales of $0.00 - $199,999.99 by $120 for a two-year term; new §229.182(b)(3)(B) increases the license fee for wholesalers of combination products with gross annual sales of $200,000 - $499,999.99 by $180 for a two-year term; new §229.182(b)(3)(C) increases the license fee for wholesalers of combination products with gross annual sales of $500,000 - $999,999.99 by $240 for a two-year term; new §229.182(b)(3)(D) increases the license fee for wholesalers of combination products with gross annual sales of $1 million - $9,999,999.99 by $300 for a two-year term; and new §229.182(b)(3)(E) increases the license fee for wholesalers of combination products with gross annual sales of greater than or equal to $10 million by $450 for a two-year term.

Amendments to §229.435 remove the reference to one-year license fees changing the reference to two years, and correctly identify the responsible licensing agency as the Department of State Health Services.

Amendments to §229.439 contain increases in fees for device distributor licenses and renewal licenses for distributors with combination products. Amendments to §229.439(a)(1)(A)-(C) remove references to two-year fees related to minor changes within the licensure period. Specifically, §229.439(a)(2)(A) increases the license fee for distributors with gross annual sales of $0 - $199,999.99 by $120 for a two-year term; §229.439(a)(2)(B) increases the license fee for distributors with gross annual sales of $200,000 - $499,999.99 by $180 for a two-year term; §229.439(a)(2)(C) increases the license fee for distributors with gross annual sales of $500,000 - $999,999.99 by $240 for a two-year term; §229.439(a)(2)(D) increases the license fee for distributors of combination productions with gross annual sales of $1 million - $9,999,999.99 by $300 for a two-year term; §229.439(a)(2)(E) increases the license fee for distributors of combination products with gross annual sales of greater than or equal to $10 million by $450 for a two-year term. Amendments to §229.439(a)(3) add a statement about late fees and remove references to two-year fees related to minor changes within the licensure period.

Amendments to §229.441 correctly reflect that the device-related policies of the U.S. Food and Drug Administration are also the policies of the Department of State Health Services. In addition, the amendments recognize that the Executive Commissioner of the Health and Human Services Commission is responsible for any modification or rejection of rules relating to device labeling exemptions adopted under the Federal Food, Drug and Cosmetic Act. References to the "Board of Health" were removed and replaced with "Executive Commissioner of the Health and Human Services Commission" due to the abolishment of the board.

Amendments to §229.443 and §229.444 correctly reflect that the agency responsible for certain enforcement actions with respect to adulterated and misbranded devices is the Department of State Health Services and that the Executive Commissioner of the Health and Human Services Commission is responsible for oversight of the functions and duties of the Device Distributors and Manufacturers Advisory Committee. Changes were made due to agency name changes and the abolishment of the Board of Health.

COMMENTS

The department, on behalf of the commission, did not receive any comments regarding the proposed rules during the comment period.

LEGAL CERTIFICATION

The Department of State Health Services General Counsel, Cathy Campbell, certifies that the rules, as adopted, have been reviewed by legal counsel and found to be a valid exercise of the agencies' legal authority.

Subchapter L. LICENSURE OF FOOD MANUFACTURERS, FOOD WHOLESALERS, AND WAREHOUSE OPERATORS

25 TAC §229.182

STATUTORY AUTHORITY

The amendment is adopted under the Health and Safety Code, §§431.204, 431.222, and 431.276, which require the department to charge fees for issuing or renewing a license or permit; and Government Code, §531.0055, and Health and Safety Code, §1001.075, which authorize the Executive Commissioner of the Health and Human Services Commission to adopt rules and policies necessary for the operation and provision of health and human services by the department and for the administration of Health and Safety Code, Chapter 1001.

This agency hereby certifies that the adoption has been reviewed by legal counsel and found to be a valid exercise of the agency's legal authority.

Filed with the Office of the Secretary of State on February 15, 2007.

TRD-200700515

Cathy Campbell

General Counsel

Department of State Health Services

Effective date: March 7, 2007

Proposal publication date: August 18, 2006

For further information, please call: (512) 458-7111 x6972


Subchapter X. LICENSING OF DEVICE DISTRIBUTORS AND MANUFACTURERS

25 TAC §§229.435, 229.439, 229.441, 229.443, 229.444

STATUTORY AUTHORITY

The amendments are adopted under the Health and Safety Code, §§431.204, 431.222, and 431.276, which require the department to charge fees for issuing or renewing a license or permit; and Government Code, §531.0055, and Health and Safety Code, §1001.075, which authorize the Executive Commissioner of the Health and Human Services Commission to adopt rules and policies necessary for the operation and provision of health and human services by the department and for the administration of Health and Safety Code, Chapter 1001.

This agency hereby certifies that the adoption has been reviewed by legal counsel and found to be a valid exercise of the agency's legal authority.

Filed with the Office of the Secretary of State on February 15, 2007.

TRD-200700516

Cathy Campbell

General Counsel

Department of State Health Services

Effective date: March 7, 2007

Proposal publication date: August 18, 2006

For further information, please call: (512) 458-7111 x6972