Agriculture Economy

Small food producers in Kentucky aired their disapproval during a virtual public hearing  Monday for a proposed rule that could increase permitting fees for some producers by more than 1000%. One Democratic state representative believes the proposed regulation could also clash with a bill signed by Governor Andy Beshear this year to help local public health departments become more sustainable. 

The hearing heard from many small food producers, saying the Kentucky Department for Public Health proposal would cripple their business, especially given the economic downturn caused by the pandemic. Seth Long runs a maple syrup operation in Letcher County and was one of those producers who spoke at the hearing.

“It would kill our ability to sell beyond this community where there’s money,” Long said. “There’s only so many dollars [in Letcher County]. There’s not much of a market here. Really to be successful is to sell away from here and bring that money back home.”

The Ohio Valley Resource previously reported the proposed rule would impact producers operating through commercial kitchens that have permits to sell online, wholesale, or beyond state lines. The proposal would change the fee structure from assessing fees based on the square footage of a facility, to based on a tiered system that assesses fees based on the  “risk level” of a particular commodity. 

Inspection fees would range from $750 for low-risk commodities like grain or cosmetics, to $2,400 annually for high-risk products including peanut butter. For Long, that would mean the yearly fee to inspect the shack where he makes maple syrup would spike from $120 to $1,350. 

“We ask the cabinet to reconsider its proposal and work with us, while at the same time asking them to rescind this regulation,” said Kentucky Agriculture Commissioner Ryan Quarles, who also spoke against the proposal at the hearing. “It’s hurtful to Kentucky Proud members and small businesses across the state.”

Kentucky Agriculture Commissioner Ryan Quarles said more than 330 members of Kentucky Proud, a state program marketing state-made agricultural products, could be impacted by the proposal. 

State Representative Joe Graviss, a Democrat, also commented at the hearing that the proposal could clash with a bill he co-sponsored signed into law by Governor Andy Beshear. The bill primarily dealt with more equitably distributing funding for local health departments, but Graviss said a particular section of the bill limits the administrative and operational costs for programs by the Cabinet for Health and Family Services. The costs of said programs can not increase by more than 25% through 2020 and not more than 5% in the following years, according to the bill.

“I think the cabinet means well, and they’re trying to be proactive to do what they think is in the best interest of Kentucky and Kentuckians,” said Graviss. “They just missed it on this one.”

Cabinet for Health and Family Services spokesperson Susan Dunlap in a statement said the proposed increase is an effort to bring the state in line with Food and Drug Administration regulations and new state legislation. A spokesperson for the FDA said the agency generally conducts food safety inspections by risk level, but declined to comment on the state proposal.

Public comments can be submitted on the proposal through August 31 to CHFSregs@ky.gov.