Bill Overview
Title: Small Business Establishment Registration Waiver Act
Description: This bill allows the Food and Drug Administration to waive annual establishment registration fees for small businesses for which such fees present a financial hardship.
Sponsors: Rep. Bucshon, Larry [R-IN-8]
Target Audience
Population: Small business owners worldwide facing financial hardship from FDA registration fees
Estimated Size: 2000000
- The bill is related to the Food and Drug Administration (FDA) which primarily affects the health, pharmaceutical, and food sectors.
- The bill specifically targets small businesses, defined by specific revenue or employee thresholds, which can vary by industry and governmental regulations.
- Small businesses contribute significantly to global economy; OECD reports show small businesses represent approximately 99% of all firms.
- According to the SBA, there are over 31 million small businesses in the US; many fall within industries regulated by the FDA.
- Many small businesses globally may also be involved in producing FDA-regulated goods, though they interact less directly unless exporting to the US.
Reasoning
- The policy is expected to most directly affect small business owners in FDA-regulated industries such as food, pharmaceuticals, and cosmetics, who are currently paying registration fees.
- The impact will vary depending on the level of financial hardship that the FDA registration fees present to these businesses.
- It is essential to include people from regions with high concentrations of these businesses, such as California, Texas, and New York.
- Some businesses may experience little to no impact if the fees do not present a financial burden or if they don't qualify under the financial hardship criteria.
- Consideration of business size and industry is essential as the policy specifically targets those facing financial hardship.
Simulated Interviews
Owner of a small organic food company (California)
Age: 45 | Gender: male
Wellbeing Before Policy: 6
Duration of Impact: 10.0 years
Commonness: 8/20
Statement of Opinion:
- The registration fees have been a significant burden on our cash flow.
- Waiving these fees would allow us to invest more in product development and employee benefits.
Wellbeing Over Time (With vs Without Policy)
| Year | With Policy | Without Policy |
|---|---|---|
| Year 1 | 6 | 6 |
| Year 2 | 7 | 6 |
| Year 3 | 7 | 6 |
| Year 5 | 8 | 6 |
| Year 10 | 9 | 6 |
| Year 20 | 9 | 6 |
Co-owner of a small cosmetics business (Texas)
Age: 37 | Gender: female
Wellbeing Before Policy: 5
Duration of Impact: 5.0 years
Commonness: 10/20
Statement of Opinion:
- The waiver would help us survive the first critical years. It's been tight financially.
- It would make us more competitive with larger brands that don't face these margins.
Wellbeing Over Time (With vs Without Policy)
| Year | With Policy | Without Policy |
|---|---|---|
| Year 1 | 6 | 5 |
| Year 2 | 7 | 5 |
| Year 3 | 8 | 5 |
| Year 5 | 8 | 5 |
| Year 10 | 8 | 5 |
| Year 20 | 8 | 5 |
Pharmaceutical consultant (New York)
Age: 50 | Gender: male
Wellbeing Before Policy: 7
Duration of Impact: 5.0 years
Commonness: 5/20
Statement of Opinion:
- My clients have faced increasing costs, and this waiver could allow them to sustain operations longer.
- It could also mean more work for me as more businesses start consulting us to leverage this opportunity.
Wellbeing Over Time (With vs Without Policy)
| Year | With Policy | Without Policy |
|---|---|---|
| Year 1 | 7 | 7 |
| Year 2 | 8 | 7 |
| Year 3 | 8 | 7 |
| Year 5 | 8 | 7 |
| Year 10 | 8 | 7 |
| Year 20 | 8 | 7 |
Owner of a small artisanal cheese company (Ohio)
Age: 29 | Gender: female
Wellbeing Before Policy: 7
Duration of Impact: 10.0 years
Commonness: 9/20
Statement of Opinion:
- We've been heavily burdened by the registration fees.
- This could really help us expand our distribution channels faster.
Wellbeing Over Time (With vs Without Policy)
| Year | With Policy | Without Policy |
|---|---|---|
| Year 1 | 7 | 7 |
| Year 2 | 8 | 7 |
| Year 3 | 8 | 7 |
| Year 5 | 9 | 7 |
| Year 10 | 9 | 7 |
| Year 20 | 9 | 7 |
Vape product manufacturer (Florida)
Age: 39 | Gender: other
Wellbeing Before Policy: 5
Duration of Impact: 3.0 years
Commonness: 3/20
Statement of Opinion:
- These fees hinder smaller players in the industry.
- If waived, it would facilitate more compliance investments.
Wellbeing Over Time (With vs Without Policy)
| Year | With Policy | Without Policy |
|---|---|---|
| Year 1 | 6 | 5 |
| Year 2 | 6 | 5 |
| Year 3 | 6 | 5 |
| Year 5 | 6 | 5 |
| Year 10 | 6 | 5 |
| Year 20 | 6 | 5 |
Owner of a mid-sized baked goods company (Michigan)
Age: 53 | Gender: male
Wellbeing Before Policy: 8
Duration of Impact: 0.0 years
Commonness: 2/20
Statement of Opinion:
- We can absorb these fees given our scale.
- Support is better directed towards startups or smaller businesses.
Wellbeing Over Time (With vs Without Policy)
| Year | With Policy | Without Policy |
|---|---|---|
| Year 1 | 8 | 8 |
| Year 2 | 8 | 8 |
| Year 3 | 8 | 8 |
| Year 5 | 8 | 8 |
| Year 10 | 8 | 8 |
| Year 20 | 8 | 8 |
Supplement company founder (California)
Age: 45 | Gender: female
Wellbeing Before Policy: 5
Duration of Impact: 5.0 years
Commonness: 7/20
Statement of Opinion:
- Every dollar saved helps in product development.
- This allows us to focus on R&D without worrying about fee constraints.
Wellbeing Over Time (With vs Without Policy)
| Year | With Policy | Without Policy |
|---|---|---|
| Year 1 | 6 | 5 |
| Year 2 | 7 | 5 |
| Year 3 | 7 | 5 |
| Year 5 | 7 | 5 |
| Year 10 | 7 | 5 |
| Year 20 | 7 | 5 |
Operator of a small dairy farm/cheese producer (Vermont)
Age: 62 | Gender: male
Wellbeing Before Policy: 6
Duration of Impact: 3.0 years
Commonness: 4/20
Statement of Opinion:
- The waiver would alleviate some of the financial pressure we face seasonally.
- It might allow us to hire more help during peak times.
Wellbeing Over Time (With vs Without Policy)
| Year | With Policy | Without Policy |
|---|---|---|
| Year 1 | 7 | 6 |
| Year 2 | 7 | 6 |
| Year 3 | 7 | 6 |
| Year 5 | 7 | 6 |
| Year 10 | 7 | 6 |
| Year 20 | 7 | 6 |
Lift-off business advisor (Colorado)
Age: 55 | Gender: female
Wellbeing Before Policy: 6
Duration of Impact: 2.0 years
Commonness: 6/20
Statement of Opinion:
- This policy would reduce some barriers to entry for startups, facilitation more innovation.
- It would potentially expand my client base with more small businesses emerging.
Wellbeing Over Time (With vs Without Policy)
| Year | With Policy | Without Policy |
|---|---|---|
| Year 1 | 6 | 6 |
| Year 2 | 6 | 6 |
| Year 3 | 6 | 6 |
| Year 5 | 6 | 6 |
| Year 10 | 6 | 6 |
| Year 20 | 6 | 6 |
Craft beer brewery owner (Oregon)
Age: 34 | Gender: male
Wellbeing Before Policy: 7
Duration of Impact: 1.0 years
Commonness: 5/20
Statement of Opinion:
- While not directly related as heavily to FDA, lowering any potential fees helps our bottom line.
- It might not impact us immediately but it is a step forward.
Wellbeing Over Time (With vs Without Policy)
| Year | With Policy | Without Policy |
|---|---|---|
| Year 1 | 7 | 7 |
| Year 2 | 7 | 7 |
| Year 3 | 7 | 7 |
| Year 5 | 7 | 7 |
| Year 10 | 7 | 7 |
| Year 20 | 7 | 7 |
Cost Estimates
Year 1: $50000000 (Low: $25000000, High: $75000000)
Year 2: $52500000 (Low: $26250000, High: $78750000)
Year 3: $55125000 (Low: $27562500, High: $82687500)
Year 5: $60642937 (Low: $30321469, High: $90964406)
Year 10: $72309333 (Low: $36154666, High: $108464000)
Year 100: $600000000 (Low: $300000000, High: $900000000)
Key Considerations
- Determination of 'financial hardship' is crucial to ascertain which businesses benefit from the waiver.
- Impact on FDA operations and budget since fee collections are part of their funding.
- Balancing the waiver's benefit to small businesses with any potential lost revenue to FDA and its consequences.