Food Safety: Overview of Federal and State Expenditures (Letter Report,
02/20/2001, GAO/GAO-01-177).

The Food and Drug Administration (FDA), Food Safety and Inspection
Service (FSIS), and the state agriculture and health departments
expended about $1.3 billion in fiscal year 1999---FSIS and FDA expended
about $1 billion, and the states reported about $300 million. The
amounts and proportions of food safety expenditures for fiscal year 1998
were similar. Regarding the $1 billion in fiscal year 1999 federal
moneys, FSIS expended about 70 percent, overseeing about 20 percent of
federally regulated foods and FDA expended about 30 percent, overseeing
about 80 percent of federally regulated foods. These expenditures
reflect the regulatory approaches or inspection frequencies contained in
the laws under which each agency operates.

--------------------------- Indexing Terms -----------------------------

 REPORTNUM:  GAO-01-177
     TITLE:  Food Safety: Overview of Federal and State Expenditures
      DATE:  02/20/2001
   SUBJECT:  Food inspection
	     Food industry
	     Safety regulation
	     Consumer protection
	     State governments
	     Budget outlays
	     Contaminated foods
	     Funds management
IDENTIFIER:  USDA Food Safety Inspection Program
	     FSIS Hazard Analysis and Critical Control Point System
	     USDA Agricultural Research Service
	     USDA Animal and Plant Health Inspection Service

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GAO-01-177

Report to Congressional Requesters

United States General Accounting Office

GAO

February 2001 FOOD SAFETY Overview of Federal and State Expenditures

Page i GAO- 01- 177 Food Safety Expenditures Letter 1

Appendix I Objectives, Scope, and Methodology 23

Appendix II The Food Safety and Inspection Service's Fiscal Years 1998 and
1999 Food Safety Expenditures 26

Appendix III The Food and Drug Administration's Fiscal Year 1998 and 1999
Food Safety Expenditures 38

Appendix IV States' Fiscal Years 1998 and 1999 Food Safety Expenditures 52

Appendix V Responses to GAO's Survey of State Agencies Responsible for Food
Safety Activities 61

Appendix VI Comments from the Food Safety and Inspection Service 75

Appendix VII Comments from the Food and Drug Administration 79

Appendix VIII GAO Contacts and Staff Acknowledgements 83

Tables

Table 1: FSIS' Expenditures and Staff Years for Food Safety Activities by
Office, Fiscal Years 1998 and 1999 27 Table 2: Office of Field Operations
Headquarters Activities,

Expenditures, and Staff Years, Fiscal Years 1998 and 1999 28 Contents

Page ii GAO- 01- 177 Food Safety Expenditures

Table 3: Office of Field Operations District Office Expenditures and Staff
Years, Fiscal Years 1998 and 1999 30 Table 4: District Office Inspection
Responsibilities by

Establishment Type, Fiscal Year 2000 31 Table 5: Office of Management
Activities, Expenditures, and Staff

Years, Fiscal Years 1998 and 1999 32 Table 6: Office of Public Health and
Science Activities,

Expenditures, and Staff Years, Fiscal Years 1998 and 1999 33 Table 7: Office
of Policy, Program Development and Evaluation

Activities, Expenditures, and Staff Years, Fiscal Years 1998 and 1999 35
Table 8: Office of the Administrator Activities, Expenditures, and

Staff Years, Fiscal Years 1998 and 1999 36 Table 9: FDA's Expenditures and
Staff Years for Food Safety

Activities by Center, Fiscal Years 1998 and 1999 39 Table 10: Number of FDA
Food Safety Field Inspections,

Examinations, and Samples Analyzed, Fiscal Years 1998 and 1999 41 Table 11:
Food Field Activities Accounting for Over $1 Million in

Expenditures and Staff Years, Fiscal Years 1998 and 1999 42 Table 12: Animal
Drugs and Feeds Field Activities Accounting for

Over $1 Million in Expenditures and Staff Years, Fiscal Years 1998 and 1999
45 Table 13: CFSAN Headquarters Activities, Expenditures, and Staff

Years, Fiscal Years 1998 and 1999 47 Table 14: CVM Headquarters Activities,
Expenditures, and Staff

Years, Fiscal Years 1998 and 1999 49 Table 15: Aggregate Agriculture and
Health Department Food

Safety Expenditures and Staff Years by State, Fiscal Years 1998 and 1999 52
Table 16: State Agriculture and Health Department Expenditures

for Food Safety Activity Categories, Fiscal Years 1998 and 1999 55 Table17:
Number of Food Establishments Under State Inspection

Jurisdiction and Most Common Inspection Frequency, Fiscal Years 1998 and
1999 56 Table 18: State Allocation of Resources to Food Safety Licensing

and Inspection Activities, Fiscal Years 1998 and 1999 57 Table 19: State
Allocation of Expenditures in Response to Food

Safety Problems, Fiscal Years 1998 and 1999 58 Table 20: State Allocation of
Expenditures for Food Safety

Laboratory Analysis, Fiscal Years 1998 and 1999 58 Table 21: State
Allocation of Expenditures for Food Safety Training

and Technical Assistance, Fiscal Years 1998 and 1999 59

Page iii GAO- 01- 177 Food Safety Expenditures Figures

Figure 1: FSIS' and FDA's Food Safety Expenditures and Foods Under Each
Agency's Regulatory Jurisdiction 3 Figure 2: FSIS' Expenditures for Field
and Headquarters Food

Safety Activities, Fiscal Year 1999 10 Figure 3: FDA's Expenditures for
Field and Headquarters Food

Safety Activities, Fiscal Year 1999 14 Figure 4: Aggregate State Agriculture
and Health Department

Expenditures for Food Safety Activities, Fiscal Year 1999 18

Abbreviations

CDC Centers for Disease Control and Prevention CFSANCenter for Food Safety
and Applied Nutrition CVM Center for Veterinary Medicine FDA Food and Drug
Administration FSIS Food Safety and Inspection Service HHS Department of
Health and Human Services NCTR National Center for Toxicological Research
ORA Office of Regulatory Affairs USDA U. S. Department of Agriculture

Page 1 GAO- 01- 177 Food Safety Expenditures

February 20, 2001 The Honorable Richard G. Lugar Chairman The Honorable Tom
Harkin Ranking Member Committee on Agriculture, Nutrition, and Forestry
United States Senate

The Honorable Chuck Hagel United States Senate

Foodborne illness in the United States is an extensive and expensive
problem. The Centers for Disease Control and Prevention (CDC) estimates that
unsafe foods cause as many as 76 million illnesses annually. The U. S.
Department of Agriculture (USDA) estimates that the costs associated with
foodborne illness due to seven pathogens, including salmonella,
campylobacter, and E. coli O157: H7, range up to $37 billion annually.
Federal and state expenditures for activities to help ensure the safety of
the nation's food supply are also significant, with federal efforts alone
exceeding $1 billion annually. While there are 12 federal agencies with food
safety responsibilities, USDA's Food Safety and Inspection Service (FSIS)
and the Department of Health and Human Service's (HHS) Food and Drug
Administration (FDA) are the primary federal regulatory agencies responsible
for food safety. FSIS is responsible for ensuring that meat, poultry, and
processed egg products moving in interstate and foreign commerce are safe,
wholesome, and marked, labeled, and packaged correctly. FDA is responsible
for ensuring that (1) all foods moving in interstate and foreign commerce,
except those under FSIS' jurisdiction, are safe, wholesome, and labeled
properly; and (2) all animal drugs and feeds are safe, properly labeled, and
produce no human health hazards when used in food- producing animals. In
addition, state agencies conduct inspection and regulation activities that
help ensure the safety of foods produced, processed, or sold within their
borders.

To obtain a better understanding of federal and state food safety efforts,
you asked us to determine for fiscal years 1998 and 1999 the amount of
resources that were expended by FSIS, FDA, and the states for food safety
and how the agencies used these resources.

United States General Accounting Office Washington, DC 20548

Page 2 GAO- 01- 177 Food Safety Expenditures

To make this determination for FSIS and FDA, we analyzed their annual
appropriations and financial documentation, which included information on
actual food safety expenditures, activities and accomplishments. For food
safety activities, we obtained and reviewed the associated costs and staff
year levels and supplemented this information with agency programmatic
documents and discussions we had with agency officials.

To determine the amounts that states expended on food safety and how they
used the resources, we surveyed the agriculture and health departments of
all 50 states, 3 territories, the commonwealths of Puerto Rico and North
Mariana Islands, the Federated States of Micronesia, and the District of
Columbia. The survey asked respondents for information on the scope of food
safety activities their departments performed, the costs and staffing levels
of those activities, and the scope and frequency of inspection activities.
We analyzed these data to determine the extent of state food safety
activities and expenditures nationwide. The survey was limited to state
agriculture and health departments and did not include other state agencies
or county and city agencies. Appendix I provides details on our scope and
methodology.

FSIS, FDA, and the state agriculture and health departments expended about
$1.3 billion in fiscal year 1999- FSIS and FDA expended about $1 billion,
and the states reported about $300 million. The amounts and proportions of
food safety expenditures for fiscal year 1998 were similar. Regarding the $1
billion in fiscal year 1999 federal moneys, as shown in figure 1, FSIS
expended about 70 percent, or $712 million, overseeing about 20 percent of
federally regulated foods and FDA expended about 30 percent, or $283
million, overseeing about 80 percent of federally regulated foods. These
expenditures reflect the regulatory approaches or inspection frequencies
contained in the laws under which each agency operates. Results in Brief

Page 3 GAO- 01- 177 Food Safety Expenditures

Figure 1: FSIS' and FDA's Food Safety Expenditures and Foods Under Each
Agency's Regulatory Jurisdiction Food Safety Expenditures Consumer Food
Expenditures by Agency Jurisdiction

Source: Prepared by GAO from fiscal year 1999 FSIS and FDA data and fiscal
year 1997 U. S. Bureau of Labor Statistics data.

FSIS food safety expenditures totaled about $678 million in fiscal year 1998
and $712 million in fiscal year 1999. FSIS expended about 85 percent of its
resources on field activities, including in- plant inspection, compliance,
administration, and supervisory activities associated with overseeing about
6,000 meat, poultry, and egg product establishments, including about 130
import establishments. FSIS' expenditures reflect its legislative mandate
for continuous inspection of meat and poultry slaughter plants- including
the examination of every carcass slaughtered- and of egg processing plants
and its interpretation of federal law as requiring daily inspection of meat
and poultry processing plants

72% FSIS ($ 712)

28% ?

FDA ($ 283)

22% ? FSIS ($ 622)

78% ?

FDA ($ 2,258)

Dollars in millions

FSIS FDA

Page 4 GAO- 01- 177 Food Safety Expenditures

(e. g., deboning and canning operations). 1 About $296 million of fiscal
year 1999 inspection expenditures of $486 million went to carcass- by-
carcass slaughter inspections (inspections that cannot detect microbial
pathogens, which are considered the most significant health risk, associated
with foods) and about $145 million was expended on daily inspections of
processing plants regardless of risk. We previously reported that moving to
a risk- based inspection system would allow for a more effective use of some
of the resources currently expended on carcass- by- carcass and daily
inspection activities. 2

FDA's food safety expenditures in fiscal years 1998 and 1999 totaled about
$253 million and $283 million, respectively. FDA expended about 56 percent
of its food safety resources on field activities, including inspection,
compliance, administration, and supervisory activities. In contrast to FSIS,
FDA has no legislatively mandated inspection frequencies for foods or food
firms under its jurisdiction and generally follows a regulatory approach of
allowing food products to enter the market without prior approval. As such,
FDA inspects the estimated 57,000 food establishments under its jurisdiction
about once every 5 years, on average, and inspected less than 1 percent of
the 3.7 million imported food entries in fiscal year 1999. The other 44
percent of FDA's expenditures were for headquarters- based activities,
including activities associated with the evaluation and approval of certain
foods such as infant formula, ingredients such as colors and additives, and
animal drugs and feed before they are produced for the market, and
activities such as surveillance and research on the safety of food and feed
products after they enter the market.

States (used hereafter to collectively refer to state, territory,
commonwealth, federated state, and the District of Columbia agriculture and
health departments) reported food safety activity expenditures of about $292
million and $301 million in fiscal years 1998 and 1999, respectively. Over
50 percent of states' expenditures, $142 million and $144 million in fiscal
years 1998 and 1999, respectively, were for licensing and inspection
activities for a wide variety of establishments, including

1 The Federal Meat Inspection Act requires a post- mortem examination and
inspection of the carcasses and parts of all livestock prepared at any
slaughtering establishment. The Poultry Products Inspection Act requires a
post- mortem inspection of each bird processed.

2 See Food Safety: Opportunities to Redirect Federal Resources and Funds Can
Enhance Effectiveness (GAO/ RCED- 98- 224, Aug. 6, 1998).

Page 5 GAO- 01- 177 Food Safety Expenditures

continuous and daily inspections at meat and poultry slaughter and
processing plants under the states' jurisdictions. 3 Each year participating
states matched the approximately $40 million in grants FSIS provided to the
states to conduct meat and poultry inspections under federal standards,
including carcass- by- carcass examination. The states reported over 1
million establishments under their inspection jurisdiction, including nearly
700,000 restaurants, groceries, and other retail outlets; 90,000 dairy
farms; 4,800 fish and seafood plants/ farms; over 1,900 shellfish
operations; and about 1,500 meat and poultry slaughter plants. In addition
to state agriculture and health departments, which generally have primary
food safety responsibilities at the state level, a wide variety of other
state and local agencies have food safety responsibilities that were not
covered in the scope of our survey.

We provided a draft of the report to FSIS and FDA for their review and
comment. In commenting on the draft, both agencies generally agreed with the
information contained in the report and provided additional information on
specific issues. We modified the report to reflect this information as
appropriate.

The extent of foodborne illness in the United States and its associated
costs are significant. CDC estimates that unsafe foods cause as many as 76
million illnesses, 325,000 hospitalizations, and 5,000 deaths annually. 4 In
terms of medical costs and productivity losses, foodborne illnesses
associated with seven major pathogens cost the nation between $7 billion and
$37 billion annually, according to USDA's estimates.

According to CDC, almost 12,000 cases of foodborne illness were reported in
1997, the latest year for which data are available. Of the approximately
7,000 cases in which the food source for the illness was known, about 85
percent were associated with food products that are regulated by FDA, such
as fish, shellfish, fruits, vegetables, and salads. The remaining 15 percent
were associated with food products, such as meat and poultry, that fall
under FSIS' jurisdiction. The relative proportion of illness

3 States operate federal equivalent inspection programs for intrastate meat
and poultry plants. 4 CDC uses reported illnesses, among other sources, to
estimate the extent of foodborne illnesses each year. Reported data on
foodborne illnesses and related deaths are incomplete and understate the
extent of the problem. Background

Page 6 GAO- 01- 177 Food Safety Expenditures

associated with foods under each agency's jurisdiction reflects consumer
expenditures for food products under the jurisdiction of each. Nearly 80
percent of consumer expenditures are for foods under FDA's jurisdiction,
while FSIS is responsible for the remaining 20 percent.

While 12 different federal agencies located within six federal departments
conduct food safety activities, FSIS and FDA have primary regulatory
responsibility for ensuring the safety of the nation's food supply. 5 FSIS
has responsibility for ensuring the safety of meat, poultry, and processed
egg products, overseeing about 6,000 meat, poultry, egg product and import
establishments. 6 Under the governing inspection acts, FSIS, in effect,
preapproves products before they are marketed. As such, FSIS operates under
a mandated continuous inspection frequency for meat and poultry slaughter
plants and egg processing plants and inspects meat and poultry processing
plants daily. FSIS marks all inspected and approved meat, poultry, and egg
products with a USDA inspection stamp. Without this marking, the products
cannot be legally marketed.

FSIS also reviews and assesses the effectiveness of state intrastate meat,
poultry, and egg product inspection programs to ensure that their standards
are at least equal to federal standards. In addition, FSIS reviews and
assesses foreign inspection systems and facilities that export FSIS-
regulated products to the United States for equivalency with U. S.
standards. 7 In 1998, FSIS reviewed 7 of the 26 states with intrastate
inspection programs for meat and/ or poultry and reviewed foreign inspection
programs in 22 of the 37 countries that were eligible to export

5 The 12 agencies are USDA's Animal and Plant Health Inspection Service,
Grain Inspection, Packers and Stockyards Administration, Agricultural
Marketing Service, Agricultural Research Service, and FSIS; HHS' Centers for
Disease Control and Prevention and FDA; the Department of the Treasury's U.
S. Customs Service and the Bureau of Alcohol, Tobacco and Firearms; the
Department of Commerce's National Marine Fisheries Service; the
Environmental Protection Agency; and the Federal Trade Commission. See Food
Safety: U. S. Needs a Single Agency to Administer a Unified, Risk- Based,
Inspection System (GAO/ T- RCED- 99- 256, Aug. 4, 1999) for information on
food safety agencies' roles and

responsibilities. 6 The Federal Meat Inspection Act regulates meat from
cattle, swine, goats, sheep, and equines (horses); the Poultry Products
Inspection Act defines poultry as domesticated fowl, which FSIS regulations
define as chickens, turkeys, ducks, geese, and guineas. The Egg Products
Inspection Act defines egg products as eggs removed from their shells for
processing.

7 FSIS also reinspects imported meat, poultry, and egg products at ports of
entry and at destination or other locations.

Page 7 GAO- 01- 177 Food Safety Expenditures

to the United States. In addition to the inspection activities, FSIS
conducts emergency responses, including retention, detention, or voluntary
recall of adulterated foods and epidemiological investigations of foodborne
hazards or disease outbreaks. Furthermore, FSIS engages in developing and
implementing cooperative strategies to prevent health hazards associated
with animal production practices, coordinating U. S. participation in
international sanitary standard- setting activities, and providing safety
information to food handlers and consumers.

FDA is responsible for ensuring the safety of a broad range of products,
including foods, animal drugs and feeds, human medicines and vaccines,
radiation- emitting devices, medical devices, blood and blood products, and
cosmetics. Specifically, under the Federal Food, Drug and Cosmetic Act, FDA
is responsible for ensuring that domestic and imported food products (except
meat, poultry, and processed egg products) are safe, wholesome, and labeled
properly. This includes ensuring the safety of ingredients that make up
foods, such as food additives that change a food's color or taste, and
reviewing and approving new additives unless they are generally recognized
as being safe. In administering the act, which generally follows the
regulatory approach of allowing food products to enter the market without
preapproval, FDA inspects and tests domestic and imported food products. 8
However, the act does not mandate or specify inspection frequencies for
overseeing an estimated 57,000 food establishments under FDA's jurisdiction.
Products under FDA's jurisdiction do not require, and FDA does not place,
any inspection mark on the products before they can be legally marketed. FDA
is also responsible for maintaining surveillance of all animal drugs and
feeds to ensure that they are safe and labeled properly and produce no human
health hazards when used in food- producing animals and for overseeing more
than 9, 000 animal drug and feed establishments. 9

8 Both FDA and FSIS have implemented hazard analysis and critical control
point systems that are designed to identify and control foodborne hazards
that are likely to occur. In December 1997, FDA required seafood
establishments to implement such systems, and in January 1998, FSIS began
requiring implementation at meat and poultry establishments.

9 GAO's recently released report, Food Safety: Controls Can Be Strengthened
to Reduce the Risk of Disease Linked to Unsafe Animal Feed (GAO/ RCED- 00-
255, Sept. 22, 2000) addresses concerns regarding the extent to which unsafe
feed has been linked to human health problems in the United States and the
actions FDA and the Department of Transportation are taking to ensure the
safety of animal feed.

Page 8 GAO- 01- 177 Food Safety Expenditures

States all have departments that are responsible for the regulation and
enforcement of their own food safety laws to ensure the safety of foods
produced, processed, or sold within their borders. These responsibilities
are primarily within the state departments of agriculture and health and may
involve others, such as state environmental protection agencies and county
departments of health. States and territories may also perform inspections
for FSIS or FDA under contract or form partnerships to report their results
to the federal agencies. For example, in fiscal year 1998, FDA contracted
with 38 states to conduct inspections in accordance with the federal
regulations. Under partnership agreements, 29 states shared the results of
inspections conducted under their own standards with FDA.

FSIS was responsible for food safety expenditures of $678 million in fiscal
year 1998 and $712 million in fiscal year 1999, or about 55 percent of the
nearly $1.3 billion fiscal year 1999 federal and state expenditures. In
fiscal years 1998 and 1999, FSIS employed 11,057 and 10,951 staff years,
respectively. FDA food safety activities accounted for about 22 percent of
the total expenditures-$ 253 million in fiscal year 1998 and $283 million in
fiscal year 1999- and employed 2,505 and 2,609 staff years, respectively.
State agriculture and health departments reported food safety expenditures
of about $292 million in fiscal year 1998 and $301 million in fiscal year
1999 and employed 5,617 and 5,717 staff years, respectively. About 85
percent of FSIS' expenditures were for field activities, while FDA's
expenditures were almost evenly divided between field and nonfield
activities. The federal agencies' expenditures reflect the regulatory
approaches or inspection frequencies contained in the laws under which they
operate. FSIS, FDA, and State

Agency Food Safety Expenditures Total Nearly $1.3 Billion

Page 9 GAO- 01- 177 Food Safety Expenditures

FSIS expended $678 million in fiscal year 1998 and $712 million in fiscal
year 1999 on food safety. 10 FSIS' food safety activities can be separated
into two major components- operations conducted in the field by district
offices or in direct support of those district offices and operations
conducted primarily in headquarters offices. As shown in figure 2, about 85
percent of FSIS' fiscal year 1999 expenditures were for field activities and
15 percent were for headquarters office activities. 11 See appendix II for
details on FSIS' activities, expenditures, and staff years for fiscal years
1998 and 1999.

10 FSIS' total expenditures included about $47 million in grants to states
for inspection and other activities annually. These funds were likely
reported as food safety expenditures by the state agriculture and health
departments and thus may be double- counted in the federal and state total
of $1.3 billion. In addition, in commenting on a draft of this report, FSIS
stated that some of its expenditures were for nonfood safety activities more
related to food wholesomeness and quality issues, but provided no specific
examples.

11 The proportion of expenditures for each category of activity varied by
less than 2 percent from fiscal years 1998 to 1999. FSIS' Field Inspection

Activities Account for Most of the Agency's Food Safety Expenditures

Page 10 GAO- 01- 177 Food Safety Expenditures

Figure 2: FSIS' Expenditures for Field and Headquarters Food Safety
Activities, Fiscal Year 1999

Note: Percentages do not add to 100 because of rounding. Source: Prepared by
GAO from FSIS' data.

In aggregate, FSIS' field activities accounted for $614 million in fiscal
year1999. Specifically:

? Inspections at more than 6, 000 slaughter, processing, and import
establishments accounted for $486 million, or 68 percent, of total agency
expenditures. Of the $486 million, FSIS estimates that slaughter inspections
conducted at 262 establishments accounted for about $324

1%

Administrator ($ 6.1)

9%

Management ($ 61.8)

2%

Public Health and Science ($ 11.4) ? 3%

Policy, Program Development and Evaluation ($ 18.9)

11% ? Field Operations/ Headquarters ($ 79.9) ? 5%

Field Operations/ District ($ 34.1)

2%

Laboratory Analysis ($ 13.8)

68% ?

Field Operations/ Plant Inspections ($ 486)

Headquarters Field

?

Dollars in millions

Page 11 GAO- 01- 177 Food Safety Expenditures

million; daily meat and poultry processing inspections at about 4,300
establishments accounted for about $145 million; continuous inspections at
75 egg processor establishments accounted for about $8 million; and
inspections at 129 import/ export establishments accounted for about $7
million. 12 Regarding slaughter inspections, FSIS estimates that carcass-
bycarcass organoleptic (see, touch, smell) inspections accounted for about
$296 million of the total inspection expenditures. FSIS does not track
expenditures specifically related to Hazard Analysis and Critical Control
Point system inspections and thus could not provide that information.

? Field office administration, supervision, and compliance activities, such
as following- up on inspection findings, accounted for $34.1 million, or 5
percent, of total expenditures.

? Field office management by the Office of Field Operations located in
Washington, D. C., accounted for $79.9 million, or 11 percent, of total
expenditures. The largest expenditure was for grants to states for
inspections, field automation, and other activities, accounting for almost
$47 million, or over half, of the office's total expenditures for fiscal
year 1999.

? Field laboratory analysis services provided by the Office of Public Health
and Science accounted for $14 million of field activity expenditures, or 2
percent, of total expenditures.

FSIS' headquarters- based activities accounted for the remaining $98 million
of fiscal year 1999 expenditures, or about 15 percent, of total agency
expenditures. Four program offices- Management; Public Health and Science;
Policy, Program Development, and Evaluation; and the Office of the
Administrator- conduct FSIS' headquarters food safety activities.
Specifically:

? The Office of Management accounted for about $61.8 million, or 9 percent,
of total expenditures. The office is responsible for providing centralized
administrative and support services to all other FSIS program offices,
including functions such as human resource management, strategic planning,
procurement, and financial management.

? The Office of Policy, Program Development, and Evaluation accounted for
about $18.9 million, or 3 percent, of total expenditures. The office is

12 FSIS could only provide estimates because (1) its accounting system does
not track categories of inspection expenditures electronically, and to
determine expenditures manually would be extremely labor- intensive, and (2)
the accuracy of inspection expenditure data is questionable due to a change
in accounting systems and management codes during fiscal year 1999.

Page 12 GAO- 01- 177 Food Safety Expenditures

responsible for, among other things, coordinating activities, such as
developing and recommending domestic and international policies for FSIS;
reviewing product process standards; product labeling; and developing and
evaluating inspection programs.

? The Office of Public Health and Science accounted for about $11.4 million,
or 2 percent, of total expenditures. 13 The office is responsible for
conducting scientific analysis, providing scientific advice and data, and
making recommendations involving all public health and science concerns
relating to products under FSIS' jurisdiction. This includes mission
activities such as epidemiology and risk assessment, surveillance, and
response to food safety emergencies.

? The Office of the Administrator accounted for about $6. 1 million, or 1
percent, of total expenditures. The office is responsible for managing
agency activities such as public affairs, food safety education,
coordinating U. S. involvement in international standard- setting for food
safety, and maintaining liaison with trade organizations.

FSIS' large proportion of expenditures on field and supporting activities
reflects the mandate of the meat and poultry acts. The two acts require that
meat and poultry slaughter plants be under continuous FSIS inspection. 14 If
a federal inspector is not present, the animals cannot be slaughtered. FSIS
inspects animals both before and after slaughter. The acts also require FSIS
inspectors to monitor processing plant operations, such as deboning and
canning, to ensure that plants are sanitary and adhere to approved
procedures and label specifications. The acts do not explicitly set
inspection frequencies for meat- and poultry- processing plants; however,
FSIS has interpreted the acts as requiring the daily inspection of such
plants and has established its regulations accordingly. That is, an FSIS
inspector must visit each meat- and poultry- processing plant for an
unspecified period of time- which may be as little as an hour- each
operating day. As such, the majority of FSIS expenditures are directed to
conducting inspection activities based on frequencies derived from the
regulatory acts, rather than on the food safety risk of a specific plant or
process.

13 This excludes the $14 million expended by this office for field
laboratories. 14 There has been an ongoing debate regarding the
implementation of a system under which plant workers would assume more
responsibility for the carcass inspections now conducted by federal
inspectors. With guidance from recent court rulings, FSIS is working to
establish such a system while still meeting the requirements of the acts.

Page 13 GAO- 01- 177 Food Safety Expenditures

In 1998, we reported that FSIS' funds could be used more effectively if they
were redirected using risk- based criteria. Specifically, the approximate
$296 million in fiscal year 1999 expenditures for organoleptic, carcass- by-
carcass slaughter inspections do not optimize federal resources because
these inspections do not detect the most serious public health threat
associated with meat and poultry- microbial contamination. Rather, some of
these funds and funds used for daily inspections of meatand poultry-
processing plants could be used, for example, to increase testing for
microbial and other types of contamination, risk assessment, and scientific
research, or could be congressionally redirected to other food plants, such
as seafood processors, based on the health risk posed. We continue to hold
this view.

FDA expended $253 million in fiscal year 1998 and $283 million in fiscal
year 1999 on food safety activities. 15 These activities represent the
combined efforts of FDA's three centers with food safety responsibilities:
the Center for Food Safety and Applied Nutrition, the Center for Veterinary
Medicine, and the National Center for Toxicological Research, as well as the
field activities conducted by the Office of Regulatory Affairs in support of
the centers. As with FSIS, FDA's food safety activities can be separated
into two major elements: (1) inspection and enforcement operations conducted
in the field by district offices or at headquarters in direct support of
those district offices, and (2) operations conducted primarily in
headquarters offices. As shown in figure 3, about 56 percent of FDA's fiscal
year 1999 food safety expenditures were for field activities and about 44
percent were for headquarters- based activities of FDA's centers. 16
Appendix III provides detailed information on FDA's fiscal years 1998 and
1999 activities, expenditures, and staff years.

15 FDA's total expenditures included nearly $3 million of contracts to
states for inspection and other activities annually. These funds were likely
reported as food safety expenditures by the state agriculture and health
departments and thus may be double- counted in the federal and state total
of $1.3 billion.

16 Each activity's proportion of total expenditures did not vary by more
than 2 percent between fiscal years 1998 and 1999. FDA's Food Safety

Expenditures Are More Closely Divided Between Field Inspection and
Headquarters Activities

Page 14 GAO- 01- 177 Food Safety Expenditures

Figure 3: FDA's Expenditures for Field and Headquarters Food Safety
Activities, Fiscal Year 1999

Legend: ORA Office of Regulatory Affairs CVM Center for Veterinary Medicine
CFSAN Center for Food Safety and Applied Nutrition Note: Percentages do not
add to 100 because of rounding. Source: Prepared by GAO from FDA's data.

In aggregate, FDA's field activities accounted for about $159 million in
fiscal year 1999, or about 56 percent of the agency's total food safety
expenditures. The Office of Regulatory Affairs (ORA) is responsible for

34% ? Center for Food Safety and Applied Nutrition ($ 95.6)

1%

National Center for Toxicological Research ($ 1.5)

51% ?

Field Operations ORA/ CFSAN ($ 145.2)

?

5%

Field Operations ORA/ CVM ($ 13.5)

?

10%

Center for Veterinary Medicine ($ 27.7) Headquarters Field

Dollars in millions

Page 15 GAO- 01- 177 Food Safety Expenditures

conducting field activities designated by the centers. ORA's compliance,
inspection, and laboratory field staff manage, supervise, and conduct
enforcement, compliance, inspection, sample collection and analysis
activities, as well as criminal investigation, education, and outreach
activities. Specifically:

? The ORA- conducted field activities in support of the Center for Food
Safety and Applied Nutrition accounted for about $145 million in
expenditures for fiscal year 1999. Using these funds, FDA conducted over
14,600 domestic food establishment inspections, including those conducted by
states under contract with FDA, at a cost of about $2 million; and about 765
inspections of food importers. About $27 million, or 19 percent, of the $145
million went to domestic and imported seafood hazard analysis and critical
control point inspection activities. Also included in these total
expenditures is more than $40 million for laboratory analysis of about
25,000 domestic and foreign product samples associated with field inspection
activities.

? The ORA- conducted field activities in support of the Center for
Veterinary Medicine accounted for about $13.5 million in expenditures in
fiscal year 1999. With these funds, FDA conducted nearly 3,500 domestic
animal drug and feed establishment inspections, including those conducted by
states under contract with FDA at a cost of about $600,000. Also included in
these expenditures is about $2 million for laboratory analysis of about
1,800 feed samples associated with field inspection activities.

In aggregate, the headquarters- based activities of FDA's centers accounted
for about $125 million in fiscal year 1999, or 44 percent of the agency's
total food safety expenditures. Specifically:

? The Center for Food Safety and Applied Nutrition's activities accounted
for about $96 million in fiscal year 1999, or 34 percent of total agency
food safety expenditures. The center operates FDA's Foods Program, which is
responsible for ensuring that FDA- regulated food is safe, sanitary,
wholesome, and labeled properly. To attain this goal, the center implements
programs that address specific food safety concerns; premarket review of
food and color additives, infant formula and medical foods accounted for
about $10 million in expenditures, and postmarket monitoring and response
activities accounted for about $17 million in expenditures, and cross-
cutting activities that address both premarket and postmarket concerns, such
as regulatory policy development and education and outreach activities,
accounted for about $61 million in expenditures. Food safety research and
risk assessment accounted for about $32 million, or about half of cross-
cutting activity expenditures.

Page 16 GAO- 01- 177 Food Safety Expenditures

? The Center for Veterinary Medicine's activities accounted for about $28
million in fiscal year 1999, or 10 percent, of total agency food safety
expenditures. The center operates FDA's Animal Drugs and Feeds Program,
which has primary goals of ensuring that only safe and effective animal
drugs, feeds, and feed additives are marketed and that foods from animals
that are administered drugs and food additives are safe for human
consumption. The center maintains surveillance over all animal drugs and
feeds to minimize threats to human health. Premarket application review for
new animal drugs accounted for the center's largest expenditures, about
$12.8 million in fiscal year 1999. In the same year, FDA reviewed 36
original new animal drug applications, approving 17, and reviewed 767
supplemental applications to change the conditions of existing approvals,
approving 421.

? The National Center for Toxicological Research located in Jefferson,
Arkansas, accounted for nearly $1.5 million in fiscal year 1999, or about 1
percent of total agency expenditures. 17 The center's mission is to conduct
peer- reviewed scientific research that provides the basis for FDA to make
sound, science- based regulatory decisions and to protect the public health
through pre- and post- market surveillance. During fiscal year 1999, the
center conducted 10 research projects that contributed to FDA's food safety
mission; due to the center's research focus, it did not engage in field
activities related to food safety.

FDA's relatively small proportion of expenditures on field inspection and
supporting activities in comparison to FSIS' expenditures for those
activities reflects the absence of specified inspection frequencies in the
Federal Food, Drug and Cosmetics Act. The act, which FDA has primary
responsibility for administering, generally follows the regulatory approach
of allowing almost all food products to enter the market without preapproval
by federal agencies. Therefore, FDA is not required to inspect foods or food
firms on a given schedule. As a result, FDA inspects the more than 57,000
food establishments under its jurisdiction about once every 5 years, on
average, and according to FDA officials, inspected less than 1 percent of
the 3.7 million imported food entries in fiscal year 1999.

17 In addition, the center conducted food safety research funded through an
interagency agreement with the National Institute of Environmental Health
and Safety at a total cost of $8.4 million in fiscal years 1998 and 1999.

Page 17 GAO- 01- 177 Food Safety Expenditures

State agriculture and health departments reported expenditures of about $292
million in fiscal year 1998 and $301 million in fiscal year 1999. As shown
in figure 4, nearly half of the expenditures reported by state agencies, or
about $144 million in fiscal year 1999, were for inspection and licensing
activities. 18 Appendix IV provides detailed information on the state
agencies' fiscal years 1998 and 1999 expenditures and staff years for food
safety activities.

18 Each activity's proportion of total expenditures did not vary by more
than 2 percent between fiscal years 1998 and 1999. States were able to
report about 83 percent of expenditures by activity category.
“Uncategorized activities” represent the 17 percent of
expenditures that were reported as a total amount or pooled together for
multiple categories. States Report

Expenditures of About $300 Million Annually for Food Safety

Page 18 GAO- 01- 177 Food Safety Expenditures

Figure 4: Aggregate State Agriculture and Health Department Expenditures for
Food Safety Activities, Fiscal Year 1999

Source: Prepared by GAO from state agriculture and health department data.

State agriculture and health departments reported food safety expenditures
in six categories: licensing and inspection, response to food safety
problems, laboratory analysis, technical assistance and training,
administration and support, and other expenditures. Specifically, for fiscal
year 1999:

? Licensing and inspection activities for a wide variety of establishments,
including meat and poultry slaughter and processing plants, fish and seafood
plants, shellfish operations, dairy product and egg product plants,

48% ? Licensing and inspections ($ 144.1)

11% ?

Laboratory analysis ($ 34.1)

11% ?

Administration ($ 32.9)

?

6%

Technical assistance and training ($ 17.5)

?

5%

Response to food safety problems ($ 15.7)

2%

Other activities ($ 5)

17% ?

Uncategorized activities ($ 51.6)

Dollars in millions

Page 19 GAO- 01- 177 Food Safety Expenditures

as well as groceries, restaurants, and institutions, accounted for about
$144 million, or about 48 percent, of state expenditures.

? Laboratory analysis activities, including analysis for microbial
contamination, pesticides and other chemical residues, filth and/ or
sanitation, and food label accuracy, accounted for about $34 million, or
about 11 percent, of state expenditures.

? Administration and support for food safety activities accounted for about
$33 million, or about 11 percent, of state expenditures.

? Technical assistance and training activities for a wide variety of
recipients, including farmers, producers, processors, consumers, department
staff, and the staff of outside departments, accounted for about $18
million, or about 6 percent, of state expenditures.

? Response to food safety problems, including investigation of outbreaks,
recall activities, natural disasters, and regulatory enforcement activities,
accounted for about $16 million, or about 5 percent, of state expenditures.

? Other activities that did not fit into the above categories, such as
committee or council activities, computer or equipment purchases, and
database development, accounted for about $5 million, or about 2 percent, of
state expenditures.

State agriculture and health departments reported in aggregate over 1
million establishments under their collective inspection jurisdictions and
about 2 million inspections conducted each year, not counting continuous
inspections at meat and poultry slaughter plants and other establishments.
Groceries, other retail outlets, and restaurants were by far the largest
proportion of establishments under state inspection jurisdiction,
representing more than 60 percent of all establishments under state
jurisdiction. Dairy farms were the next largest group of establishments
under state inspection jurisdiction, representing almost 10 percent of the
establishments.

While state agriculture and health departments are generally charged with
primary food safety responsibilities, a wide variety of other state and
local agencies that were not included in our survey also have food safety
responsibilities and associated expenditures. About half of the state
departments of agriculture and health that we surveyed reported that other
state departments or agencies had a role in ensuring food safety, but often
only at a specific type of establishment or for a specific food product.
States also reported that local governments are involved in conducting food
safety inspections at some types of establishments, such as groceries and
other retail outlets, restaurants, and at institutions, but are less
involved in conducting laboratory analysis, responding to food safety
problems, or providing technical assistance and training.

Page 20 GAO- 01- 177 Food Safety Expenditures

We provided FSIS and FDA with a draft of this report for review and comment.
FSIS generally agreed with the information provided but said that the report
should clearly state that FSIS' responsibilities and expenditures also
involve some nonfood safety activities, such as ensuring that products meet
consumer expectations for wholesomeness and quality. We believe that the
report clearly identifies FSIS' responsibilities- i. e., ensuring that meat,
poultry, and processed egg products moving in interstate and foreign
commerce are safe, wholesome, and marked, labeled, and packaged correctly.
Regarding nonfood safety expenditures, throughout our review, FSIS officials
said that the expenditure information provided to us was for food safety or
food safetyrelated activities. As such, we believe that the FSIS
expenditures in this report are appropriately characterized as “food
safety” expenditures.

FSIS also said that it would be useful if we included the size and scope of
the products it regulates. We believe the report adequately describes the
size and scope of FSIS' activities. For example, the report includes
information on the number of meat, poultry, egg product, and import
establishments FSIS oversees; the number of state and foreign programs it
reviewed; and the number and type of inspections it conducted. The level of
detail provided on FSIS' responsibilities and activities is similar to that
provided on FDA's activities.

FSIS also said that the statistics provided in the report regarding the
relative proportions of food purchases and agency food safety expenditures
were misleading due to the high risk of FSIS- regulated products compared
with some of the FDA- regulated products. While the relative risk of FSIS-
regulated products may be greater in some cases than FDA- regulated
products, it was not our intent to analyze or compare the risk of products.
We believe that the data accurately reflect the proportion of each agency's
expenditures and the proportion of consumer expenditures for foods under
each agency's jurisdiction. The report also clearly identifies the food
products for which each agency has responsibility.

Finally, FSIS said that the report should further define its
responsibilities under the Federal Meat Inspection Act and Poultry Products
Inspection Act. FSIS also described court actions related to its efforts to
design new inspection models that would realign roles and responsibilities
of industry and federal inspectors. We modified the report to clearly
identify FSIS' responsibilities under the federal meat and poultry
inspection acts and described its efforts, with guidance from the courts, to
realign the responsibilities and roles of industry and federal inspectors.
Agency Comments

and Our Response

Page 21 GAO- 01- 177 Food Safety Expenditures

FDA agreed with the report and said that it contained valuable information
on the allocation of food safety resources. FDA applauded the report for
including important information on the efforts and resources expended by
states but believed that the report was incomplete because it did not
include information on the expenditures and efforts of other agencies, such
as USDA's Agricultural Research Service and Animal and Plant Health
Inspection Service. We have previously reported on the resources and
staffing of the 12 federal agencies involved in food safety activities. By
design, the scope of this report was limited to FSIS and FDA food safety
activities and expenditures.

FSIS and FDA also provided technical clarifications, which we incorporated
into the report as appropriate. FSIS' comments and our responses are
included in appendix VI; FDA's comments and our responses are included in
appendix VII.

We conducted our review from March through December 2000 in accordance with
generally accepted government auditing standards.

As agreed with your offices, unless you publicly announce its contents
earlier, we plan no further distribution of this report until 30 days from
its issue date. At that time, we will send copies of this report to the
Honorable Ann Veneman, Secretary of Agriculture; the Honorable Bernard
Schwetz, D. V. M., Ph. D., Acting Principal Deputy Commissioner of the Food
and Drug Administration; the Honorable Mitchell Daniels, Jr., Director,
Office of Management and Budget; and other interested parties. We will also
make copies available to others upon request.

Page 22 GAO- 01- 177 Food Safety Expenditures

If you have any questions about this report, please contact me at (202) 512-
3841. Major contributors to this report are listed in appendix VIII.

Lawrence J. Dyckman Director, Natural Resources and Environment

Appendix I: Objectives, Scope, and Methodology

Page 23 GAO- 01- 177 Food Safety Expenditures

To determine for fiscal years 1998 and 1999 the amount of resources that
were expended by the Food Safety and Inspection Service (FSIS), the Food and
Drug Administration (FDA), and the states for food safety and how the
agencies actually used these resources, we conducted work at each of the
federal agencies and mailed surveys to food safety agencies in 50 states, 3
territories, the Commonwealths of Puerto Rico and the North Mariana Islands,
the Federated States of Micronesia, and the District of Columbia (hereafter
referred to as states unless specified otherwise). Regarding FSIS and FDA,
we obtained appropriations documentation showing the amount of funding
provided to each agency. We collected records of expenditures and staff
years for specific activities from each of the agencies as follows:

? FSIS provided expenditure and full- time equivalent staff- year
information from its accounting system for each of its headquarters and
field offices for specific food safety activities within those offices, such
as inspection, education, and laboratory activities. FSIS could not provide
expenditure information from its accounting system for approximately 2 weeks
at the end of fiscal year 1999 because of problems created by the
implementation of a new accounting system. Instead, FSIS determined the
allocation of expenditures for that time period based on other expenditure
records. The Office of Inspector General could not give an opinion on the U.
S. Department of Agriculture's (USDA) financial statements for fiscal years
1998 and 1999 because of weaknesses in evidence and internal controls. 1 We
did not verify FSIS' accounting information, as it was the only information
available, and such an audit was outside of the scope of our review.

? FDA provided records of expenditures and staff years from the agency's
Center for Food Safety and Applied Nutrition (CFSAN), Center for Veterinary
Medicine (CVM), National Center for Toxicological Research (NCTR), and
Office of Regulatory Affairs (ORA). Each center used its own methodology to
identify and provide expenditures and staff years for specific food safety
activities, using a combination of accounting system information, staff
activity time records, and estimations. FDA's Office of Financial Management
reviewed the information provided by the centers for accuracy and
consistency and also provided us with the share of FDA central
administrative costs allocable to each center. We did not verify

1 For the past 8 years, USDA has reported to the President that it is unable
to provide reasonable assurance that its financial systems conform with
certain standards and principles. Appendix I: Objectives, Scope, and

Methodology

Appendix I: Objectives, Scope, and Methodology

Page 24 GAO- 01- 177 Food Safety Expenditures

FDA's accounting information; we relied on an independent auditor's finding
that FDA's accounting records fairly reported its financial position and had
no internal control weaknesses in fiscal years 1998 and 1999.

At each agency, we gathered documentation and interviewed agency officials
to (1) obtain additional information on the specific activities funded by
the expenditures and accomplishments associated with those activities and
(2) discuss the expenditure and staff- year information they provided. We
also collected documentation and the transfer of funds between food safety
and nonfood safety activities at each agency and discussed other financial
concerns, such as FSIS' fiscal years 1997 and 1998 anti- deficiency
violations caused by the over- obligation of as much as $4 million each
year. 2

To determine the amounts that states expended on food safety and how they
actually used the resources, we surveyed the agriculture and health
departments of 50 states, 3 territories, Puerto Rico, and the District of
Columbia; we surveyed the health departments of the Commonwealth of the
North Mariana Islands and the Federated States of Micronesia, which do not
have agriculture departments. In total, we sent out 112 surveys. The survey
requested information on the scope of food safety activities performed by
their departments, the costs and staffing levels of those activities, the
scope and frequency of inspection activities, how the states allocated
expenditures between various activities, and perceptions regarding the
extent of local government involvement in food safety activities. In
developing the survey, we coordinated with staff from FDA's Office of
Regulatory Affairs, Division of Federal/ State Relations, which is also
surveying the states.

We pretested the survey at seven food safety departments in four states-
Colorado, Louisiana, Pennsylvania and Virginia- to ensure that our questions
were clear, unbiased, and precise and that responding to the survey did not
place an undue burden on their agencies. We did not independently verify the
accuracy of the state officials' responses. We also reviewed each response
to identify internal data inconsistencies and other issues needing
clarification, called respondents to resolve questions, and made agreed-
upon changes to their responses as appropriate. We received surveys from 98
of the 100 state health and agriculture departments; 6 of

2 The Congress provided $6 million in the agency's fiscal year 2001
appropriation to pay obligations associated with the 1997 and 1998 anti-
deficiency violations.

Appendix I: Objectives, Scope, and Methodology

Page 25 GAO- 01- 177 Food Safety Expenditures

the 10 food safety agencies in the territories and other entities; and both
the health and agriculture departments in the District of Columbia. Our
overall response rate was 95 percent.

In completing the survey, we asked the states to obtain information from
staff who are most knowledgeable about food safety activities, that they
respond only for their department's activities, and that they submit only
one survey reflecting the entire department's activities. Regarding
expenditures, we asked that states report actual expenditures for each state
fiscal year, but if these were not available, to report budget allocations
and to inform us which of the two data types they provided to us. Of the
responding agencies, 37 reported actual expenditures, 9 reported actual
budget allocations, and 55 reported estimates. The majority of the
respondents did not report all indirect costs for food safety activities or
in- kind contributions, although some did.

We recognize that the total funding amounts reported for food safety
activities, as well as the amounts reported for specific categories of
activities, could be under- or over- reported because of differences in
state department reporting, budgeting, and accounting practices. In some
cases, states did not report expenditures, staff years, or establishments by
the individual categories provided in the survey; rather, they may have
pooled categories together or reported only a total amount. These amounts
are reported as “uncategorized.” A few state departments sent in
several individual responses from various entities, which we consolidated
into a single departmental response. Some states provided a response for
only one of the two departments. The reported expenditures do not reflect
the full cost of food safety activities within each state, because
expenditures and activities of other state agencies, local agencies, and
private industry, by design, are not included in our scope. However, we
believe the information presented in the report reasonably and
conservatively represents the food safety activities and expenditures of the
survey respondents. Appendix V contains the survey results.

We performed our work from March through December 2000 in accordance with
generally accepted government auditing standards.

Appendix II: The Food Safety and Inspection Service's Fiscal Years 1998 and
1999 Food Safety Expenditures

Page 26 GAO- 01- 177 Food Safety Expenditures

USDA's Food Safety and Inspection Service (FSIS) is responsible for ensuring
that meat, poultry, and processed egg products moving in interstate and
foreign commerce are safe, wholesome, and labeled and packaged correctly.
The food safety activities undertaken by FSIS to attain these goals during
fiscal years 1998 and 1999, the costs and staff years associated with each
activity, and outcomes associated with selected activities are presented in
the following sections.

FSIS accomplishes its mission to ensure that the nation's meat, poultry, and
egg products moving interstate and into foreign commerce are safe,
wholesome, and labeled and packaged correctly through five program offices
located in Washington, D. C. The offices include the Office of the
Administrator; Office of Public Health and Science; Office of Policy,
Program Development and Evaluation; Office of Field Operations (headquarters
and district offices); and Office of Management. In addition, FSIS operates
a Technical Service Center in Omaha, Nebraska; three field laboratories
located in Alameda, California; St. Louis, Missouri, and Athens, Georgia;
and 17 district offices located throughout the United States. 1

FSIS' food safety activities are funded through annual congressional
appropriations, industry reimbursements, and trust funds for meat and
poultry inspection. In fiscal years 1998 and 1999, funds available to FSIS
totaled about $678 million and $714 million, respectively.

For fiscal years 1998 and 1999, FSIS expended about $678 million and $712
million, respectively, for its food safety activities. 2 As shown in table
1, about 84 percent of the expenditures were for the Office of Field
Operations to conduct headquarters and district office food safety
activities. The other four offices accounted for about 16 percent of
expenditures in aggregate.

1 During fiscal year 1999, FSIS closed its Boston District Office, which
changed the number of district offices from 18 to 17. 2 FSIS officials
explained that the difference between fiscal year 1999 appropriations of
$714 million and expenditures of $712 million was due to the specific
planning of a $2 million carryover. This action was taken to prevent any
further anti- deficiency violations. Appendix II: The Food Safety and
Inspection

Service's Fiscal Years 1998 and 1999 Food Safety Expenditures

Mission, Organization, and Funding

Food Safety Activities, Expenditures, and Staffing

Appendix II: The Food Safety and Inspection Service's Fiscal Years 1998 and
1999 Food Safety Expenditures

Page 27 GAO- 01- 177 Food Safety Expenditures

Table 1: FSIS' Expenditures and Staff Years for Food Safety Activities by
Office, Fiscal Years 1998 and 1999

Dollars in millions

Expenditures (percent of total)

Staff years (percent of total) Office 1998 1999 1998 1999

Field Operations- Plant Inspections $463.4

(68) $486

(68) 9,441

(85) 9,330

(85) Field Operations- District Compliance, Supervision, and Administration

35.4 (5)

34.1 (5)

521 (5)

517 (5)

Field OperationsHeadquarters 69.1

(10) 79.9

(11) 222

(2) 211

(2)

Field Operations –

Subtotal 567.9

(83) 600

(84) 10,184

(92) 10,058

(92)

Management 62.7 (9)

61.8 (9)

406 (4)

382 (3) Public Health and Science 23.9

(4) 25.2

(4) 254

(2) 281

(3) Policy, Program Development, and Evaluation

18 (3)

18.9 (3)

149 (1)

162 (1)

Administrator 5. 3 (1)

6.1 (1)

64 (1)

68 (1)

Headquarters Operations

– Subtotal 109.9 (17)

112 (16)

873 (8)

893 (8) Total $677.8

(100) $712

(100) 11,057

(100) 10,951

(100)

Source: FSIS.

The Office of Field Operations is responsible for managing a program of
regulatory oversight and inspection for the meat, poultry, and egg product
laws enforced by FSIS. As such, the office was responsible for the largest
proportion of agency expenditures-$ 568 million and $600 million in fiscal
years 1998 and 1999, respectively, or about 84 percent of agency
expenditures and over 90 percent of staff years. The office is divided into
two components- headquarters operations and field district operations. The
headquarters unit located in Washington, D. C., sets policy and manages
field operations. As shown in table 2, the headquarters unit accounted for
about $69 million and $79 million in fiscal years 1998 and 1999,
respectively, or about 10 percent of total FSIS expenditures. Included
within this unit is the Technical Service Center, which serves as the
agency's center for technical assistance and guidance for field Office of
Field Operations

Appendix II: The Food Safety and Inspection Service's Fiscal Years 1998 and
1999 Food Safety Expenditures

Page 28 GAO- 01- 177 Food Safety Expenditures

operations personnel and industry. The center also reviews domestic and
foreign inspection programs.

Table 2: Office of Field Operations Headquarters Activities, Expenditures,
and Staff Years, Fiscal Years 1998 and 1999

Dollars in thousands

Expenditures Staff years Office of Field Operations Headquarters 1998 1999
1998 1999

Grants to states – inspection and other activities $40,552 $44,359 0 0
Grants to states – field automation 0 2,514 0 0 Technical Service
Center – review 9,549 9,474 113 113 Field automation 8, 023 13,804 0 0
Resource management 3,246 1,781 46 14 Office of Deputy 2,378 1,231 7 5
District enforcement 2,350 2,294 27 29 District inspection 1,300 1,584 15 15
Technical Service Center – training 727 2,484 4 31 Federal/ state
relations 507 357 5 5 Emergency programs a 424 0 5 0

Total b $69,057 $79,881 222 212

a In fiscal year 1999, the Emergency Planning Program was reassigned from
the Office of Field Operations to the Office of Management, Planning staff.
b Totals may not add because of rounding.

Source: FSIS.

Three activities- grants provided to states, the Field Automation and
Information Management initiative, and reviews conducted by the Technical
Service Center- accounted for $70 million, or about 88 percent, of the total
office expenditures in fiscal year 1999.

? Grants to states accounted for almost 60 percent of total office
expenditures. Most of the grants, about $40 million, funded up to 50 percent
of state costs to operate inspection programs for meat and poultry plants
that are “equivalent to” federal programs. In fiscal year 1999,
26 states received funding through grants.

? The Field Automation and Information Management initiative accounted for
about 17 percent of the Office of Field Operations headquarters expenditures
for fiscal year 1999. This initiative provides for uniform automation of
FSIS' inspection functions at plants inspected by FSIS and state inspectors.
Expenditures were for the purchase and installation of the equipment, as
well as training inspectors. For example, during fiscal

Appendix II: The Food Safety and Inspection Service's Fiscal Years 1998 and
1999 Food Safety Expenditures

Page 29 GAO- 01- 177 Food Safety Expenditures

year 1999, over 750 federal inspectors were trained and 700 computers
delivered to FSIS field locations. In addition, over 550 state inspectors
were trained, and states received over 500 computers.

? The Technical Service Center conducted review activities that accounted
for about 12 percent of field operation's headquarters expenditures for
fiscal year 1999. The center is responsible for designing and implementing
guidelines and procedures for review of foreign, state, and federal domestic
inspection programs. The center also conducts special inquiries and reviews,
such as reviews of state inspection programs, to ensure they are equivalent
to the federal programs. In fiscal year 1999, the center reviewed the
program documentation of 36 countries exporting to the United States to
determine if they had implemented Hazard Analysis and Critical Control Point
systems and Salmonella testing programs equivalent to U. S. requirements. In
that same year, the center's review staff reviewed 96 state- inspected
establishments in 11 states to determine their effectiveness and whether or
not they were equivalent to the federal inspection programs.

The Office of Field Operation's field district offices conduct compliance
and inspection activities for meat, poultry, and egg products. As shown in
table 3, the field district offices accounted for expenditures of about $499
million and $520 million in fiscal years 1998 and 1999, respectively, or
about 73 percent, of agency expenditures and about 90 percent of staff
years. Within the district offices, 93 percent of their expenditures were
for in- plant inspections and 7 percent for the administration of those
activities and compliance activities.

Appendix II: The Food Safety and Inspection Service's Fiscal Years 1998 and
1999 Food Safety Expenditures

Page 30 GAO- 01- 177 Food Safety Expenditures

Table 3: Office of Field Operations District Office Expenditures and Staff
Years, Fiscal Years 1998 and 1999

Dollars in thousands

Expenditures Staff years Office of Field Operations –

District Office 1998 1999 1998 1999

Jackson, MS $48,857 $51,464 1, 078 1,063 Springdale, AR 47,607 52,420 992
982 Des Moines, IA 39,698 40,766 805 801 Atlanta, GA 39,301 41,782 828 866
Dallas, TX 32,432 34,057 660 641 Lawrence, KS 31,715 33,232 650 643 Alameda,
CA 30,988 32,104 583 565 Raleigh, NC 29,973 31,585 637 635 Beltsville, MD
26,572 28,166 569 556 Philadelphia, PA 22,960 24,268 442 436 Albany, NY
22,002 22,239 384 383 Minneapolis, MN 20,943 21,560 390 379 Chicago, IL
20,916 21,525 400 398 Madison, WI 19,382 19,226 366 329 Pickerington, OH
19,314 19,851 364 370 Salem, OR 17,506 18,905 309 326 Boulder, CO 16,180
16,230 296 295 Boston, MA 12,426 10,751 212 180

Total a $498,771 $520,133 9,961 9,847

a Totals may not add because of rounding. Source: FSIS.

Under the guidance and direction of the Office of Field Operation's
headquarters District Inspection and District Enforcement offices, the
districts manage and direct both inspection and compliance activities. As
shown in table 4, the district offices direct inspections of meat and
poultry slaughter plants, processing plants, and plants that have combined
slaughter and processing operations, and other establishments such as egg
product plants. In addition, the offices inspect these products at import
points. For example, in fiscal year 1999, they inspected over 99 billion
pounds of meat and poultry and 3 billion pounds of egg products at about
6,000 domestic plants and inspected 3.2 billion pounds of imported meat and
poultry from 34 countries. The district offices also direct compliance
reviews that are designed to (1) monitor businesses engaged in the
production, distribution, and marketing of food products and (2) prevent the
violation of laws and regulations. As a result of these reviews, in fiscal
year 1999, the district offices detained approximately 20 million pounds of

Appendix II: The Food Safety and Inspection Service's Fiscal Years 1998 and
1999 Food Safety Expenditures

Page 31 GAO- 01- 177 Food Safety Expenditures

adulterated meat and poultry products and initiated 118 enforcement actions
to stop inspection operations in federally inspected plants.

Table 4: District Office Inspection Responsibilities by Establishment Type,
Fiscal Year 2000

Type of establishment District Offices Meat and poultry

slaughter Meat and

poultry processing

Meat and poultry combination

slaughter and processing Other a Total b

Jackson, MS 38 142 44 30 254 Springdale, AR 7 143 70 30 250 Des Moines, IA 4
135 61 60 260 Atlanta, GA 29 336 45 49 459 Dallas, TX 10 188 48 60 306
Lawrence, KS 7 157 80 24 268 Alameda, CA 3 563 55 104 725 Raleigh, NC 14 77
27 19 137 Beltsville, MD 14 123 41 27 205 Philadelphia, PA 38 291 101 25 455
Albany, NY 46 817 74 51 988 Minneapolis, MN 6 148 75 39 268 Chicago, IL 4
314 39 32 389 Madison, WI 1 262 50 36 349 Pickerington, OH 6 217 49 20 292
Salem, OR 12 258 57 62 389 Boulder, CO 8 169 44 20 241

Total 247 4,340 960 688 6,235

a Other includes egg product, import, and other establishments not included
in the other categories. b Excludes 244 Talmadge- Aiken establishments that
are staffed and inspected by state employees with FSIS oversight. Source:
FSIS.

The Office of Management is responsible for providing centralized
administrative and support services to all other FSIS program offices,
including human resource management, strategic planning, procurement, and
financial management. As shown in table 5, the office accounted for
expenditures of about $63 million and $62 million in fiscal years 1998 and
1999, respectively, or about 9 percent, of agency expenditures and 4 percent
of staff years. About 46 percent of the office's expenditures were for
“central charges” attributed to the entire agency. Almost one-
half of Office of Management

Appendix II: The Food Safety and Inspection Service's Fiscal Years 1998 and
1999 Food Safety Expenditures

Page 32 GAO- 01- 177 Food Safety Expenditures

these charges were expenditures for benefits such as worker's compensation
and unemployment. Other charges included “other services” such
as contractual and consulting services, communications, utilities, and rent.

Table 5: Office of Management Activities, Expenditures, and Staff Years,
Fiscal Years 1998 and 1999

Dollars in thousands

Expenditures Staff years Office of Management 1998 1999 1998 1999

Central charges $29,563 $27,684 0 0 Administrative services 9,824 11,304 56
49 Human resources 8, 830 8,259 151 134 Budget a 5,092 1,569 103 23
Automated information services 3,738 3,673 38 29 Civil rights 1,478 1,806 16
18 Labor- management relations 997 1,345 11 18 Planning 984 1,218 14 18
Field automation and information management staff b 690 0 8 0 Reorganization
548 0 0 0 Office of Deputy 518 711 5 7 Internal control 459 496 6 6
Financial management 0 3, 720 0 79

Total c $62,722 $61,784 406 382

a During fiscal years 1998 and 1999, the Budget and Financial Management
Divisions were separated. b After fiscal year 1998, Field Automation and
Information Management staff expenditures were charged to the Office of
Field Operations rather than the Office of Management. c Totals may not add
because of rounding.

Source: FSIS.

The Office of Public Health and Science is responsible for conducting
scientific analysis, providing advice, collecting data, and making
recommendations involving all public health and science concerns relating to
products under FSIS' jurisdiction. This includes mission activities such as
epidemiology and risk assessment, surveillance, response to food safety
emergencies, and laboratory analysis by the agency's three field
laboratories. As shown in table 6, the office accounted for expenditures of
about $24 million and $25 million in fiscal years 1998 and 1999,
respectively, or about 4 percent, of agency expenditures and 2 to 3 percent
of staff years. Office of Public Health and

Science

Appendix II: The Food Safety and Inspection Service's Fiscal Years 1998 and
1999 Food Safety Expenditures

Page 33 GAO- 01- 177 Food Safety Expenditures

Table 6: Office of Public Health and Science Activities, Expenditures, and
Staff Years, Fiscal Years 1998 and 1999

Dollars in thousands

Expenditures Staff years Office of Public Health and Science 1998 1999 1998
1999

Laboratories $13,325 $13,785 175 190 Office of Deputy 4,868 5,531 10 15
Microbiology 1, 689 1,876 22 23 Chemistry and toxicology 910 1,011 11 12
Food hazard surveillance 910 1,019 13 12 Emerging pathogens 853 955 10 9
Emergency response 566 621 6 8 Epidemiology & risk assessment 413 432 4 13
Research oversight a 374 0 4 0

Total b $23,907 $25,231 254 281

a In fiscal year 1999, expenditures for Research oversight were charged to
the Office of Public Health and Science's Office of Deputy. b Totals may not
add due to rounding.

Source: FSIS.

The combined expenditures for the three field laboratories and the Office of
Public Health and Science's Office of Deputy accounted for 77 percent of all
expenditures for that program office in fiscal year 1999.

? Three field laboratories located in Alameda, California; Athens, Georgia;
and St. Louis, Missouri, accounted for more than 50 percent of the office
expenditures and almost 70 percent of the staff years. These laboratories
coordinate and conduct analyses in microbiology, chemistry, and pathology
for food safety in meat, poultry, and egg products. Among other things, they
conduct these services to (1) support both domestic and import inspections
done by FSIS, (2) support the agency's Hazard Analysis and Critical Control
Point initiative, and (3) identify emerging pathogens in the food supply. In
addition, the laboratories provide technical assistance to FSIS field staff.

? The Office of Deputy accounted for about 22 percent of office
expenditures, with the majority of these being for charges attributed
specifically to the Office of Public Health and Science. Most of these
charges are for “other services” such as facilities renovations,
equipment, or payments to other agencies for studies. For example, in fiscal
year 1999, the Office of Deputy expended $1.2 million to repair its Eastern
Laboratory in Athens, Georgia, and provided the Centers for Disease Control
and Prevention (CDC) with $1.5 million for Food Net surveys.

Appendix II: The Food Safety and Inspection Service's Fiscal Years 1998 and
1999 Food Safety Expenditures

Page 34 GAO- 01- 177 Food Safety Expenditures

The Office of Policy, Program Development and Evaluation is responsible for,
among other things, coordinating activities such as developing and
recommending domestic and international policies for FSIS; reviewing product
processes, standards, and labeling; and developing and evaluating inspection
programs. As shown in table 7, the office accounted for expenditures of
about $18 million and $19 million in fiscal years 1998 and 1999,
respectively, or about 3 percent, of agency expenditures and 1 percent of
staff years. Office of Policy, Program

Development and Evaluation

Appendix II: The Food Safety and Inspection Service's Fiscal Years 1998 and
1999 Food Safety Expenditures

Page 35 GAO- 01- 177 Food Safety Expenditures

Table 7: Office of Policy, Program Development and Evaluation Activities,
Expenditures, and Staff Years, Fiscal Years 1998 and 1999

Dollars in thousands

Expenditures Staff years Office of Policy, Program Development and
Evaluation 1998 1999 1998 1999

Inspection development $4,562 $4,584 30 34 Office of Deputy 2,883 3,614 22
16 Hazard analysis and critical control point initiative a 2,322 0 2 0
Labeling and standards 2,317 2,101 32 26 International policy 1, 436 1,697
14 18 Animal production 1, 112 2,029 6 6 Regulatory development 1,070 1,563
16 18 Evaluation and analysis 940 1,279 11 12 Compounds review b 719 0 12 0
Codex c 654 40 5 <1 Label review b 0 1, 542 0 24 Management support staff d
0 500 0 7

Total e $18,014 $18,949 149 162

a In fiscal year 1999, the hazard analysis and critical control point
initiative activity no longer existed. b In fiscal year 1999, FSIS
eliminated the Compounds Review Office because the agency no longer does
those reviews, and FSIS reorganized its former labeling and compounds review
function. c The Codex Office manages and coordinates U. S. involvement and
participation in the Codex

Alimentarius Commission, a United Nations' international standard- setting
organization for food safety and public health. d At the end of fiscal year
1998, expenditures by the management support staff were not separately

tracked by FSIS' accounting system. e Totals may not add because of
rounding.

Source: FSIS.

The combined expenditures of two offices in the Office of Policy, Program
Development and Evaluation- the Inspection Development Division and the
Office of Deputy- accounted for over 40 percent of all expenditures for that
office in fiscal year 1999.

? The Inspection Systems Development Division designs, develops, and tests
new or modified inspection systems for food safety. This division works on
developing specific changes to FSIS' inspection procedures, including work
related to hazard analysis and critical control point procedures. For
example, this division has contracted for the collection of microbiological
and organoleptic data in poultry and hog plants to support the proposed

Appendix II: The Food Safety and Inspection Service's Fiscal Years 1998 and
1999 Food Safety Expenditures

Page 36 GAO- 01- 177 Food Safety Expenditures

Hazard Analysis and Critical Control Point- based Inspection Models Project.

? The Office of Deputy accounted for about 20 percent of total office
expenditures. Other than personnel expenditures, the majority of these were
for “centrally administered” charges. According to FSIS
officials, these are charges associated with the entire Office of Policy,
Program Development and Evaluation office, rather than a specific division
within that office. Most of these charges are for “other
services,” such as production of food safety educational materials.

The Office of the Administrator is responsible for overall management of the
agency and activities such as public affairs, food safety education, and
coordination of U. S. involvement in international standard setting for food
safety and maintaining liaisons with trade organizations. As shown in table
8, the office accounted for expenditures of about $5 million and $6 million
in fiscal years 1998 and 1999, respectively, or about 1 percent of agency
expenditures and 1 percent of staff years.

Table 8: Office of the Administrator Activities, Expenditures, and Staff
Years, Fiscal Years 1998 and 1999

Dollars in thousands

Expenditures Staff years Office of the Administrator 1998 1999 1998 1999

Education $2,351 $1,822 29 24 Office of the Administrator 1, 374 1,777 9 10
Executive management 1,248 1,204 21 21 The Congress and public affairs 309
578 5 7 U. S. Codex a 0746 0 6

Total b $5,283 $6,127 64 68

a All Codex expenditures in fiscal year 1998 were charged to the Office of
Policy, Program Development and Evaluation. b Totals may not add because of
rounding.

Source: FSIS.

A significant portion of the Office of the Administrator's funding, about 30
percent in fiscal year 1999, was expended on food safety education. The
functions of the Food Safety Education staff are different from other units
in the office because, while others primarily conduct management and policy
type activities, the food safety education staff provides FSIS food safety
education programs to the public. These programs are designed to educate
producers, distributors, food preparers, and consumers on the prevention of
foodborne illnesses. This office also operates the agency's Office of the
Administrator

Appendix II: The Food Safety and Inspection Service's Fiscal Years 1998 and
1999 Food Safety Expenditures

Page 37 GAO- 01- 177 Food Safety Expenditures

Meat and Poultry Hotline to answer consumer inquiries. In fiscal year 1999,
this staff coordinated the agency's food safety education campaign,
FightBAC! tm , and handled about 36,000 consumer calls to the hotline.

Appendix III: The Food and Drug Administration's Fiscal Year 1998 and 1999
Food Safety Expenditures

Page 38 GAO- 01- 177 Food Safety Expenditures

Food safety is one of the Health and Human Service's (HHS) Food and Drug
Administration's (FDA) many responsibilities, shared by multiple units
within the agency. FDA food safety activities undertaken by each unit during
fiscal years 1998 and 1999, the costs and staff years associated with each
activity, and outcomes associated with selected activities are presented in
the following sections.

FDA accomplishes its mission of protecting the public health by ensuring the
safety of a broad range of products, including foods, animal drugs and
feeds, human medicines and vaccines, radiation- emitting devices, medical
devices, blood and blood products, and cosmetics through six centers. Three
of these centers are responsible for food safety activities: the Center for
Food Safety and Applied Nutrition (CFSAN) for the Foods Program; the Center
for Veterinary Medicine (CVM) for the Animal Drugs and Feeds Program; and
the National Center for Toxicological Research (NCTR) for research into the
toxicity of products. In addition, the Office of Regulatory Affairs conducts
inspections and compliance reviews and collects and analyzes product samples
in support of the centers. The three centers and the Office of Regulatory
Affairs are also provided administrative support through numerous offices,
such as the Office of the Commissioner and the Office of Management and
Systems.

FDA food safety facilities are distributed nationwide. FDA headquarters and
CVM are located in Rockville, Maryland, CFSAN is located in Washington, D.
C., and NCTR is located in Jefferson, Arkansas. The two Centers, CVM and
CFSAN, have a research facility in Beltsville, Maryland; CFSAN has a fishery
research center in Dauphin Island, Alabama, and a food technology research
center in Chicago, Illinois. Field facilities, primarily staffed by Office
of Regulatory Affairs personnel conducting inspections and laboratory
activities, are distributed across 5 regional offices, 19 district offices,
and 13 laboratories, and are supported by over 120 resident posts.

FDA's appropriations for fiscal years 1998 and 1999 were about $1. 050
billion and $1.130 billion, respectively. Each of FDA's programs received a
specified amount of the total appropriation to conduct both their food
safety and nonfood safety- related responsibilities. For example, in fiscal
year 1999, the Foods Program received about $235 million, of which about
$222 million was expended on CFSAN and related field food safety activities.
The difference reflects that while most of the Food Program's
responsibilities relate to food safety, the program also has other
responsibilities and related expenditures for other activities, such as
Appendix III: The Food and Drug

Administration's Fiscal Year 1998 and 1999 Food Safety Expenditures

Mission, Organization, and Funding

Appendix III: The Food and Drug Administration's Fiscal Year 1998 and 1999
Food Safety Expenditures

Page 39 GAO- 01- 177 Food Safety Expenditures

cosmetics safety. Similarly, in fiscal year 1999, the Animal Drugs and Feeds
Program received about $43 million, of which about $38 million was expended
on CVM and related field food safety activities. The difference reflects
that while the majority of the Animal Drugs and Feeds Program's
responsibilities relate to food safety, the program also has
responsibilities and related expenditures for nonfood animals, such as dogs
and cats. The Office of Regulatory Affairs receives a specific amount of the
appropriation for each program to conduct field activities in support of the
centers.

For fiscal years 1998 and 1999, as shown in table 9, about 56 percent of
FDA's food safety expenditures and over 60 percent of its staff years were
for food safety activities conducted in the field, and the remaining 44
percent of expenditures and nearly 40 percent of the staff years were for
the headquarters- based activities of the centers.

Table 9: FDA's Expenditures and Staff Years for Food Safety Activities by
Center, Fiscal Years 1998 and 1999

Dollars in millions

Expenditures (percent of total) Staff years

(percent of total) Center 1998 1999 1998 1999

Field Operations – Center for Food Safety and Applied Nutrition

$127.2 (50)

$145.2 (51)

1,426 (57)

1,535 (59)

Field Operations – Center for Veterinary Medicine 13.7

(5) 13.5

(5) 138

(6) 137

(5)

Field Operations– Subtotal 140.9 (56)

158.7 (56)

1,564 (62)

1,672 (64)

Headquarters Operations –

Center for Food Safety and Applied Nutrition

85.7 (34)

95.6 (34)

733 (29)

721 (28)

Headquarters Operations –

Center for Veterinary Medicine 25.9 (10)

27.7 (10)

203 (8)

206 (8) Headquarters Operations –

National Center for Toxicological Research

0.8 (< 1)

1.5 (1)

5 (< 1)

10 (< 1)

Headquarters Operations –

Subtotal 112.4 (44)

124.8 (44)

941 (38)

937 (36) Total a $253.4

(100) $283.4

(100) 2,505

(100) 2,609

(100)

a Totals may not add because of rounding. Source: FDA.

FDA Food Safety Activities, Expenditures, and Staffing

Appendix III: The Food and Drug Administration's Fiscal Year 1998 and 1999
Food Safety Expenditures

Page 40 GAO- 01- 177 Food Safety Expenditures

Field activity expenditures of about $141 million and $159 million in fiscal
years 1998 and 1999, respectively, accounted for about 56 percent of total
FDA food safety expenditures each year and 62 to 64 percent of FDA's staff
years. CFSAN is responsible for directing field activities related to food
products, and CVM is responsible for field activities related to feeds and
drugs for food animals. These field activities, conducted by FDA's Office of
Regulatory Affairs, include the inspection of food and animal feed and drug
establishments under the agency's jurisdiction, field examination of food
and feed products, and the collection and analysis of product samples to
ensure that the products comply with applicable regulations. The overall
results of FDA's inspection and sample analysis fieldwork are presented in
table 10. FDA Field Food Safety

Activities for Foods and Animal Drugs and Feeds

Appendix III: The Food and Drug Administration's Fiscal Year 1998 and 1999
Food Safety Expenditures

Page 41 GAO- 01- 177 Food Safety Expenditures

Table 10: Number of FDA Food Safety Field Inspections, Examinations, and
Samples Analyzed, Fiscal Years 1998 and 1999

Activity 1998 1999

Inspections Food importers 940 765 Domestic food establishments a 11,922
14,680 Feed establishments b 4,182 3,128 Animal drug establishments 439 357

Total Inspections c 17,483 18,930 Field Examinations

Imported foods 17,140 15,828 Domestic foods 2, 172 1,992 Imported animal
drugs/ feeds 46 59

Total Field Examinations 19,358 17,879 Sample Analyses

Import food samples 16,802 15,439 Domestic food samples 10,894 9, 335 Animal
drug/ feed samples d 1,580 1,784

Total Samples Analyzed 29,276 26,558

a Includes state contract inspections that are funded by the Center for Food
Safety and Applied Nutrition at a cost of a little over $2 million each
year. b Includes state contract feed mill inspections that are funded by the
Center for Veterinary Medicine at

a cost of $833, 000 and $614,000 in fiscal years 1998 and 1999,
respectively. c An individual importer, food, or feed establishment may be
inspected more than once a year.

d FDA and the states also analyzed over 200 Bovine Spongiform Encephalopathy
tissue residue samples each year. Source: FDA.

Field activities for foods accounted for about $127 million in fiscal year
1998 and $145 million in fiscal year 1999, or about 90 percent of FDA's food
safety field expenditures. Table 11 lists the fiscal years 1998 and 1999
food field expenditures of $1 million or more. FDA food field activities
accounting for less than $1 million in annual expenditures each, such as
criminal investigations, emergency response to foodborne outbreaks, and
various unplanned activities, represented in aggregate less than $8 million
in expenditures each year. The expenditures reflect the total cost of each
activity, including inspection, investigation, field examination, sample
collection, sample analysis, and other costs, such as Office of Regulatory
Affairs management and administrative support expenditures, associated with
each activity. FDA agencywide support expenditures accounted for about 8
percent of food product field expenditures.

Appendix III: The Food and Drug Administration's Fiscal Year 1998 and 1999
Food Safety Expenditures

Page 42 GAO- 01- 177 Food Safety Expenditures

Table 11: Food Field Activities Accounting for Over $1 Million in
Expenditures and Staff Years, Fiscal Years 1998 and 1999

Dollars in thousands

Expenditures Staff years Food field activities 1998 1999 1998 1999

Imported foods general – import entry review/ refused entries $24,939
$26,932 312 314 Domestic fish and fishery products inspection (hazard
analysis and critical control point)

11,371 14,420 142 168 Imported seafood products inspection (hazard analysis
and critical control point)

11,283 12,755 141 149 Domestic food safety 7,382 10,805 92 126 Pesticides
and industrial chemicals in imported foods 5,361 6,580 67 77 Office of
Regulatory Affairs/ Center directed research projects 4,919 4,701 62 55
Other domestic food safety initiative activities 4,717 1,543 59 18 Consumer
complaints 4,270 4,642 53 54 Pesticides and industrial chemicals in domestic
foods 3,597 3,436 45 40 Total diet studies 3,516 4,447 44 52 General retail
food protection (state) 3, 311 4,318 41 50 Interstate milk shippers 3, 005
3,502 38 41 Imports – food and color additives 2,863 3,504 36 41
Import produce assignment (fiscal year 1999) 0 3, 023 0 35 Molluscan
shellfish evaluation 2, 670 2,380 33 28 Toxic elements in foods (domestic/
import) 2,521 2,789 32 33 Interstate travel sanitation 2,365 2,592 30 30
Domestic and import cheese 2, 088 1,371 26 16 Mycotoxins in domestic foods
2,084 3,126 26 37 State contract inspection 2,040 2,036 0 0 Short- term
assignments 1, 512 2,146 19 25 Domestic acidified and low- acid canned food
1,396 2,375 17 28 Import acidified and low- acid canned food 1,211 1,110 15
13 Domestic nutrition sampling 1,153 1,703 14 20 Other activities 6,617
7,337 82 85

Agencywide support 11,000 11,600 0 0 Total a $127,191 $145,173 1,426 1,535

a Totals may not add because of rounding. Source: FDA.

Appendix III: The Food and Drug Administration's Fiscal Year 1998 and 1999
Food Safety Expenditures

Page 43 GAO- 01- 177 Food Safety Expenditures

Five of the field activities listed in table 11 accounted for about $71
million, or almost 50 percent, of total food field expenditures in fiscal
year 1999.

? Imported foods general activities accounted for about $27 million, or
about 19 percent, of food field expenditures. The objective of this activity
was to ensure that imported foods comply with federal law and with
guidelines for gross and microbiological filth. To attain this objective,
FDA conducted import field examinations of the foods most likely to be out
of compliance, collected samples, and conducted analysis for filth,
decomposition, and microbiological contamination.

? The domestic fish and fish products inspection activity accounted for
about $14 million, or about 10 percent, of food field expenditures. The
objective of this activity was to ensure that domestic establishments
involved in the production, storage, and distribution of fish and fish
products are in compliance with the applicable hazard analysis and critical
control point regulations as well as with federal law. To attain this
objective, FDA conducted establishment inspections, and samples were
collected and analyzed when appropriate, with a priority on firms processing
scombrotoxic products, smoked products, vacuum packed products, and ready-
to- eat products, as well as follow- up on firms found to be in
noncompliance with hazard analysis and critical control point regulations.

? The imported seafood products inspection activity accounted for about $13
million, or about 9 percent, of food field expenditures. The objective of
this activity was to ensure a safe imported seafood supply by enforcing
importer compliance with the seafood hazard analysis and critical control
point regulation and federal law, focusing on importers of high- risk
products and firms found in noncompliance with the hazard analysis and
critical control point regulations. To attain this objective, trained
investigators reviewed importers' written documentation demonstrating that
the product was produced under a hazard analysis and critical control point
program, with priority assigned to firms processing scombrotoxic products,
smoked products, vacuum packed products, and ready- to- eat products.

? The domestic food safety activity accounted for about $11 million, or
about 7 percent, of food field expenditures. The objective of this activity
was to ensure that domestic establishments involved in the production,
storage and distribution of food products are in compliance with federal law
and that manufacturers produce products under good manufacturing practices.
To attain this objective, FDA conducted inspections (including hazard
analysis and critical control point) and investigations and

Appendix III: The Food and Drug Administration's Fiscal Year 1998 and 1999
Food Safety Expenditures

Page 44 GAO- 01- 177 Food Safety Expenditures

necessary sample collections and analyses to document and support inspection
findings.

? The pesticides and chemicals in imported foods activity accounted for
about $7 million, or about 5 percent, of food field expenditures. The
objective of this activity was to determine the incidence and level of
pesticides and industrial chemicals in imported food (including seafood and
aquaculture products) and to prevent importation of products not meeting
federal requirements. To attain this objective, FDA developed pesticide
import sampling plans, collected samples, and analyzed samples for chemical
contamination.

Animal drugs and feeds field activity expenditures of about $13.7 million
and $13.5 million in fiscal years 1998 and 1999, respectively, accounted for
about 10 percent of FDA's total food safety field expenditures each year.
Table 12 lists the fiscal years 1998 and 1999 animal feed and drug field
activity expenditures of $1 million or more. Other field activities, such as
criminal investigations, response to consumer complaints, and various
unplanned activities in aggregate, accounted for just over $3 million in
expenditures each year. The expenditure amounts reflect the total cost of
each activity, including inspection, investigation, field examination,
sample collection, sample analysis, and other costs, such as Office of
Regulatory Affairs management and administrative support expenditures,
associated with each activity. FDA agencywide support expenditures accounted
for about 8 percent of feed and drug field expenditures.

Appendix III: The Food and Drug Administration's Fiscal Year 1998 and 1999
Food Safety Expenditures

Page 45 GAO- 01- 177 Food Safety Expenditures

Table 12: Animal Drugs and Feeds Field Activities Accounting for Over $1
Million in Expenditures and Staff Years, Fiscal Years 1998 and 1999

Dollars in thousands

Expenditures Staff years Animal drugs and feeds field activities 1998 1999
1998 1999

Medicated feeds $2,316 $2,081 27 24 Feed contaminants 2,222 2,380 26 28 Drug
processing and new animal drug inspection 1,974 1,605 23 19 Illegal residues
in meat and poultry 1, 412 1,793 17 21 Office of Regulatory Affairs/ Center
directed research projects 1,207 1,213 14 14 Other field activities 3,418
3,338 31 31

Agencywide support 1, 200 1,100 0 0 Total a $13,749 $13,510 138 137

a Totals may not add because of rounding. Source: FDA.

Five of the field activities listed in table 12 accounted for about $9
million, or almost 70 percent, of total animal drugs and feeds field
expenditures in fiscal year 1999.

? The feed contaminants activity accounted for about $2.4 million, or about
18 percent, of expenditures. The objective of this activity is to monitor
domestic and imported animal feed and feed ingredients to prevent the
widespread contamination of the nation's food supply. To attain this
objective, FDA conducts inspections and investigations and collects and
analyzes samples of feed and feed ingredients, including chemical and
microbiological testing for mycotoxins, pesticides, industrial chemicals,
metals, and microbiologicals.

? The medicated feeds activity accounted for about $2.1 million, or about 15
percent, of expenditures. The objective of this activity is to ensure the
marketing of safe and effective animal feeds. To attain this objective, FDA
conducts inspections of registered medicated feed establishments, collects
and analyzes feed samples, and audits the results of coordinated state
inspection efforts.

? The illegal residues in meat and poultry activity accounted for about $1.8
million, or about 13 percent, of expenditures. The objective of this
activity is to ensure a safe food supply by conducting follow- up
investigations and inspections when illegal residues are reported to FDA by
the Food Safety

Appendix III: The Food and Drug Administration's Fiscal Year 1998 and 1999
Food Safety Expenditures

Page 46 GAO- 01- 177 Food Safety Expenditures

and Inspection Service, 1 and to initiate regulatory sanctions against those
persistently causing residues. To attain this objective, FDA works
cooperatively via memorandums of understanding with the Food Safety and
Inspection Service and the Environmental Protection Agency, as well as
through agreements or contracts with states to inspect first- time
violators.

? The drug processing and new animal drug inspection activity accounted for
about $1.6 million, or about 12 percent, of expenditures. The objective of
this activity is to fulfill FDA's obligation to inspect animal drug
establishments that are registered with FDA, ensuring that animal drug
products are being manufactured, processed, and controlled under approved
conditions. To attain this objective, FDA conducts inspections of registered
animal drug establishments and chemical and microbiological examinations to
ensure the sterility, purity, identity, and potency of the drugs.

? Office of Regulatory Affairs/ Center directed research projects accounted
for about $1.2 million, or about 9 percent, of expenditures. The objective
of this activity is to develop new and/ or improved methodology in support
of regulatory analysis for animal drugs and feeds. To attain this objective,
FDA establishes research goals in its workplan; the research results are
distributed within FDA and/ or published in the scientific literature.

CFSAN headquarters operations, which is responsible for FDA's Foods Program,
accounted for expenditures of about $86 million and $96 million in fiscal
years 1998 and 1999, respectively, or about 34 percent of total agency food
safety expenditures. As shown in table 13, CFSAN's fiscal years 1998 and
1999 headquarters activities were divided into four major categories:
premarket, postmarket, crosscutting, and FDA agencywide support
expenditures. CFSAN expenditures for management and administrative support
of food safety activities are included in the expenditure amount for each
activity.

1 The Food Safety and Inspection Service obtains samples when it fulfills
its food safety responsibilities for meat and poultry. Center for Food
Safety and

Applied Nutrition Headquarters Food Safety Activities

Appendix III: The Food and Drug Administration's Fiscal Year 1998 and 1999
Food Safety Expenditures

Page 47 GAO- 01- 177 Food Safety Expenditures

Table 13: CFSAN Headquarters Activities, Expenditures, and Staff Years,
Fiscal Years 1998 and 1999

Dollars in thousands

Expenditures Staff years CFSAN headquarters activity 1998 1999 1998 1999
Premarket activities

Food and color additives $6,788 $9,062 75 73 Infant formula and medical
foods 1, 090 1,246 13 13

Premarket subtotal 7,878 10,308 88 86 Postmarket activities

Planning and policy implementation for microbial contaminants 3,882 6,726 14
13 Federal/ state cooperative programs 2,906 3,537 32 35 Planning and policy
implementation for monitoring imports 1,177 1,184 14 13 Seafood safety
(hazard analysis and critical control point) 1,177 1,511 3 3 Hazard analysis
and critical control point (other than seafood) 931 1,288 7 11 Low- acid
canned foods 672 637 8 7 Nutrition monitoring 589 546 4 6 Planning and
policy implementation for chemical and other contaminants 447 346 3 3
Recalls, outbreak investigations and tracebacks 336 546 4 6 Planning and
policy implementation for pesticide residue monitoring 302 488 2 4 Food
labeling 255 157 0 0 Adverse event reporting 84 91 1 1

Postmarket subtotal 12,758 17,057 92 102 Crosscutting activities (pre- and
postmarket)

Food safety research/ risk assessment (intramural) 32,112 32,343 336 310
Regulatory policy development 9,887 9,845 114 106 Education/ outreach 6, 719
7,560 71 76 Collaborative research with academia/ industry 6,465 7,699 7 11
International activities 2,492 3,166 25 31

Crosscutting subtotal a 57,675 60,613 553 534 Agencywide support 7, 400
7,600 0 0 Total b $85,711 $95,578 733 721

a According to FDA officials, crosscutting activity staff provide
significant support to certain premarket and postmarket activities; for
example, the seafood safety (hazard analysis and critical control point)
activity receives support of approximately 30 staff years from various
crosscutting activities. b Totals may not add because of rounding.

Appendix III: The Food and Drug Administration's Fiscal Year 1998 and 1999
Food Safety Expenditures

Page 48 GAO- 01- 177 Food Safety Expenditures

Source: FDA.

Premarket activities to evaluate the safety of products before they are
available to consumers accounted for about 11 percent of CFSAN's
headquarters expenditures in fiscal year 1999. Food and color additive
activity expenditures accounted for about $9 million, or nearly 90 percent,
of premarket expenditures. In addition to its ongoing review of food
additive petitions, CFSAN implemented procedures to expedite the review of
food additives intended to decrease the incidence of foodborne illness
through their antimicrobial actions against pathogens that may be present in
food. Other activities addressed food contact substances and irradiation
labeling.

Postmarket activities to evaluate the safety of products that are in the
marketplace accounted for about 18 percent of CFSAN's headquarters
expenditures in fiscal year 1999. CFSAN's planning and policy implementation
for microbial contaminants, which accounted for $6.7 million, or 39 percent,
of postmarket expenditures, included surveillance to assess antimicrobial
resistance, microbiological research, and risk assessment to develop
science- based solutions to detect and control microbial contamination.
Another $3.5 million, or 21 percent, of postmarket expenditures, were for
cooperative programs with states addressing the safety of retail dairy and
shellfish products.

Crosscutting activities that address both premarket and postmarket food
safety issues accounted for about 63 percent of CFSAN's headquarters
expenditures in fiscal year 1999. CFSAN's food safety research and risk
assessment, which accounted for $32.3 million, or 53 percent of crosscutting
expenditures, included activities such as the completion of draft risk
assessments for Listeria, Vibrio parahaemolytics, and methylmercury and food
safety research in support of the National Food Safety Initiative.

FDA agencywide support accounted for about 8 percent of CFSAN's headquarters
expenditures in fiscal year 1999. These expenditures represent CFSAN's
allocation for its share of central direction and administrative services to
ensure that FDA's efforts are effectively managed and that resources are put
to the most efficient use. Functions include agencywide policy, regulatory
and legislative development, scientific coordination, planning and
evaluation, consumer communication and public information, and management
expertise and coordination in financial management, personnel, contracts and
grants administration, and procurement.

Appendix III: The Food and Drug Administration's Fiscal Year 1998 and 1999
Food Safety Expenditures

Page 49 GAO- 01- 177 Food Safety Expenditures

CVM headquarters operations, responsible for FDA's Animal Drugs and Feeds
Program, accounted for about $26 million and $28 million in fiscal years
1998 and 1999, respectively, or about 10 percent of total agency food safety
expenditures. As shown in table 14, for fiscal years 1998 and 1999, CVM
headquarters activities were divided into three major categories: premarket,
postmarket, and FDA agencywide support expenditures. 2 CVM expenditures for
management and administrative support for food safety activities are
included in the total cost for each activity.

Table 14: CVM Headquarters Activities, Expenditures, and Staff Years, Fiscal
Years 1998 and 1999

Dollars in thousands

Expenditures Staff years CVM headquarters activities 1998 1999 1998 1999
Premarket activities

Application review $8,097 $8,310 82 78 Intramural research 3,257 3,344 25 26
Education/ outreach 691 710 9 10 Risk assessment 0 450 0 3

Premarket subtotal 12,045 12,814 116 117 Postmarket activities

Epidemiology systems and surveillance 4,670 4,360 44 42 Intramural research
3,595 3,849 25 27 Compliance activities 1,400 2,000 15 16 Extramural
research 1,100 971 2 2 Education and outreach 876 1,490 2 2

Postmarket subtotal 11,641 12,670 88 89 Agencywide support 2, 200 2,200 0 0
Total a $25,886 $27,684 203 206

a Totals may not add because of rounding. Source: FDA.

Premarket activities to ensure that products are safe before they are
available to consumers, accounted for about 46 percent of expenditures each
year. CVM's New Animal Drug Application review and approval process,
including associated education, research and risk assessment activities,
accounted for $12.8, or 100 percent, of its premarket expenditures. CVM is
implementing a phased review process, which will provide drug application
sponsors with more timely feedback and early

2 Differing from CFSAN, CVM did not identify crosscutting activities as a
category. Center for Veterinary

Medicine Headquarters Food Safety Activities

Appendix III: The Food and Drug Administration's Fiscal Year 1998 and 1999
Food Safety Expenditures

Page 50 GAO- 01- 177 Food Safety Expenditures

detection of application deficiencies. CVM approved 523 original or
supplemental new and generic animal drug applications in fiscal year 1999.

Postmarket activities to ensure the safety of products that are in the
marketplace accounted for about 46 percent of expenditures each year. CVM's
epidemiological systems and surveillance activities, which accounted for
nearly $4.4 million, or about 34 percent, of postmarket expenditures,
included collaborative efforts with other federal agencies to monitor
nationwide changes in susceptibilities to 17 antimicrobial drugs through the
National Antimicrobial Resistance Monitoring System and efforts to monitor
and reduce drug residues in meats. Intramural research to detect microbial
and chemical contaminants that may be present in animal feeds and animal
food products consumed by humans and research on antibiotic resistance
accounted for another $3.6 million, or 30 percent, of postmarket
expenditures. This included the development and validation of a test for
detecting bovine protein in animal feeds, an important component of its
Bovine Spongiform Encephalopathy regulatory strategy.

Agencywide support accounted for about 8 percent of expenditures. These
expenditures represent CVM's share of central direction and administrative
services, as previously described for CFSAN. These expenditures represent
CVM's allocation for its share of central direction and administrative
services to ensure that FDA's efforts are effectively managed and that
resources are put to the most efficient use.

NCTR, FDA's center for peer- reviewed scientific research upon which the
agency bases its regulatory decisions, was responsible for no more than 1
percent of agency food safety expenditures. In fiscal year 1998, NCTR
expended $842,000, including $75,000 from CVM, and 5 staff years on eight
food safety research projects. In fiscal year 1999, NCTR expended nearly
$1.5 million and 10 staff years on 10 research projects, including $500,000
to expand food safety method development research. 3 The annual

3 NCTR also conducted food safety research funded through an interagency
agreement with the National Institute of Environmental Health and Safety at
a total cost of $8. 4 million in fiscal years 1998 and 1999. National Center
for

Toxicological Research Headquarters Food Safety Activities

Appendix III: The Food and Drug Administration's Fiscal Year 1998 and 1999
Food Safety Expenditures

Page 51 GAO- 01- 177 Food Safety Expenditures

expenditures include about $100,000 for agencywide support. NCTR's
expenditures do not include any field activities related to food safety.

Appendix IV: States' Fiscal Years 1998 and 1999 Food Safety Expenditures

Page 52 GAO- 01- 177 Food Safety Expenditures

States (used hereafter to refer collectively to states, territories,
commonwealths, federated states, and the District of Columbia) play an
important role in overseeing the nation's food supply. State and local (e.
g., county and city) governments conduct the majority of inspections in the
United States, including food retailers, manufacturers, processors, and
distributors within their state boundaries in accordance with their own laws
and authorities. 1 State agriculture departments and health departments are
the two primary agencies that are responsible for food safety in states. As
shown in table 15, states devoted various amounts of resources for
activities to ensure the safety of foods under its jurisdiction in fiscal
years 1998 and 1999.

Table 15: Aggregate Agriculture and Health Department Food Safety
Expenditures and Staff Years by State, Fiscal Years 1998 and 1999

Expenditures Staff years State a 1998 1999 1998 1999

Alaska $4,446,800 $4,363,300 54 55 Alabama 11,270,784 11,833,244 126 130
Arkansas 4,382,183 4,508,055 83 81 American Somoa b 255 2,884 16 18 Arizona
1, 760,400 1,860,400 41 41 California 15,843,487 17,127,897 207 222 Colorado
c 1,110,519 1,093,953 16 16 Connecticut 679,881 788,866 39 39 District of
Columbia 1,200,000 1,250,000 10 24 Delaware 1,251,645 1,243,527 34 34
Florida 17,716,712 17,325,231 349 327 Federated States of Micronesia 176,702
149,693 8 8 Georgia 12,408,865 12,495,507 242 233 Guam 896,034 877,331 42 43
Hawaii 2,684,000 2,684,000 73 73 Iowa 2,679,358 2,693,158 71 71 Idaho
1,349,000 1,397,000 20 21 Illinois 12,332,131 12,612,702 211 214 Indiana 5,
808,034 5,553,450 163 164 Kansas 4,498,349 5,118,281 98 111 Kentucky
7,372,977 7,144,475 142 143 Louisiana 13,226,490 13,732,189 224 225
Massachusetts 2,141,935 2,181,490 33 33

1 While local agencies such as county and city health departments also play
an important role in food safety, they were not included in the scope of
this review. Appendix IV: States' Fiscal Years 1998 and

1999 Food Safety Expenditures

Appendix IV: States' Fiscal Years 1998 and 1999 Food Safety Expenditures

Page 53 GAO- 01- 177 Food Safety Expenditures

Expenditures Staff years State a 1998 1999 1998 1999

Maryland 2,498,984 2,509,984 20 20 Maine 1, 794,000 1,938,000 35 35 Michigan
9,342,206 9,782,912 130 133 Minnesota d 5,629,701 5,627,821 77 77 Missouri
640,000 840,000 18 23 Mississippi 5,243,890 5,265,155 83 81 Montana
1,425,193 1,517,160 28 28 North Carolina 13,833,657 14,041,171 271 271 North
Dakota 862,000 862,000 13 13 Nebraska 1,813,456 1,851,698 21 21 New
Hampshire 777,073 868,174 26 26 New Jersey 2,161,000 2,185,000 37 37 New
Mexico 887,681 962,146 14 14 Nevada 410,055 493,465 9 11 New York 19,786,927
20,083,690 504 514 Ohio 14,022,939 14,535,872 254 252 Oklahoma 5, 806,533
5,722,518 117 115 Oregon 5,015,442 5,811,711 60 65 Pennsylvania 7, 540,000
8,040,000 136 136 Puerto Rico 4,986,990 4,900,810 133 180 Rhode Island
2,146,539 2,342,054 33 33 South Carolina 4,899,643 5,251,946 80 85 South
Dakota 1,383,051 1,517,324 38 38 Tennessee 5,390,400 5,744,310 154 159 Texas
14,225,574 15,466,741 373 368 Utah 3,953,870 4,035,571 72 74 Virginia
5,777,810 6,125,182 107 107 Vermont 905,004 1, 018,423 21 21 Washington
5,439,265 5,414,274 89 87 Wisconsin 14,538,824 14,440,247 249 254 West
Virginia 2,481,000 2,537,000 90 90 Wyoming 1, 081,824 1,100,694 25 25

Total e $291,937,072 $300,869,686 5,617 5,717

a The territories of the Virgin Islands and the Commonwealth of the North
Mariana Islands did not respond to the survey. b The agriculture department
of American Somoa did not respond to the survey. The American Somoa

Department of Health did not include staff salary and benefits in its
reported expenditures. c The agriculture department of Colorado did not
respond to the survey.

d The health department of Minnesota did not respond to the survey. e Totals
may not add because of rounding.

Source: GAO survey of states.

Appendix IV: States' Fiscal Years 1998 and 1999 Food Safety Expenditures

Page 54 GAO- 01- 177 Food Safety Expenditures

State food safety responsibilities can be grouped into four categories that
cover a broad range of activities: licensing and inspection, response to
food safety problems, laboratory analysis, and training and technical
assistance. States reported a high degree of involvement in some activities
within each category and little involvement with others. For example:

? Regarding licensing and inspection activities, more than 40 states
reported that they were involved to a great or very great extent in
registering and licensing food producers, processors, sellers, and others
and inspecting dairy farms and dairy product plants. The number of states
engaged in inspection activities at other types of establishments such as
meat and poultry slaughter and processing plants, egg and egg product
plants, groceries and restaurants varied more widely. Forty- five states
reported that they engaged in little or no inspection activity at nondairy
foodproducing farms.

? In response to food safety problems, 48 states reported a great or very
great involvement in activities to enforce food safety regulations, and 45
states reported a great or very great level of involvement in response to
natural disasters that effect food safety, such as tornadoes, hurricanes,
and floods.

? Regarding laboratory analysis, 41 states reported great or very great
involvement in analyzing food products for microbial contamination. States
were generally involved in laboratory analysis for pesticides and chemical
residues, filth, or food labeling accuracy to a lesser extent.

? Fifty- one states reported providing training and technical assistance to
a great or very great extent to staff employed by their own departments, and
more than half reported providing such assistance to grocery, restaurant,
and other retail food service workers to a great or very great extent.
States provided training and technical assistance to farmers, processors,
consumers, health professionals, and others to a lesser extent.

As shown in table 16, state expenditures reported for these categories of
activities, as well as administrative and support, other, and uncategorized
activities, were about $292 million in fiscal year 1998 and about $301
million in fiscal year 1999. In fiscal year 1999, federal funds accounted
for 13 percent of state expenditures, other funding sources such as license
fees accounted for 18 percent, and state revenues funded the remaining 65
percent of these expenditures. 1 In aggregate, states dedicated 5,617 staff

1 States did not categorize the source for about 4 percent of funds each
year. Food Safety

Activities, Funding, Expenditures, and Staffing

Appendix IV: States' Fiscal Years 1998 and 1999 Food Safety Expenditures

Page 55 GAO- 01- 177 Food Safety Expenditures

years to food safety activities in fiscal year 1998 and 5,717 staff years in
fiscal year 1999.

Table 16: State Agriculture and Health Department Expenditures for Food
Safety Activity Categories, Fiscal Years 1998 and 1999

Dollars in thousands

Expenditures (percent of totals) Staff years

(percent of totals) Activity Category 1998 1999 1998 1999

Licensing and inspections $142,163 (49)

$144,052 (48)

3,075 (55)

3,039 (53) Response to problems 15,361

(5) 15,701

(5) 291

(5) 343

(6) Laboratory analysis 32,871

(11) 34,070

(11) 472

(8) 467

(8) Technical assistance and training 14,596

(5) 17,484

(6) 322

(6) 371

(6) Administration and support 31,896

(11) 32,944

(11) 664

(12) 681

(12) Other a 4,642

(2) 4,978

(2) 38

(1) 37

(1) Uncategorized b 50,408

(17) 51,641

(17) 755

(13) 779

(14)

Total c $291,937 (100)

$300,870 (100)

5,617 (100)

5,717 (100)

a “Other” includes expenditures for items such as committee or
council activities, computers and other equipment, and data base
development. b “Uncategorized” represents food safety
expenditures and staff years that were reported as a total

amount or pooled together for multiple categories. c Totals may not add
because of rounding.

Source: GAO survey of states.

State expenditures for licensing and inspection food safety activities were
$142 million in fiscal year 1998 and $144 million in fiscal year 1999. As
shown in table 17, states reported over 1 million establishments under their
jurisdiction in fiscal years 1998 and 1999. This includes over 370,000
restaurants, about 300,000 groceries and other retail outlets, and about
90,000 dairy farms. States also reported their typical frequency of
inspection for each type of establishment, which ranged from continuous,
meaning that an inspector is onsite at all times during production, to once
per year. In total, states reported that they actually conducted about 2
million inspections annually, not counting continuous inspections. Licensing
and Inspection

Activities

Appendix IV: States' Fiscal Years 1998 and 1999 Food Safety Expenditures

Page 56 GAO- 01- 177 Food Safety Expenditures

Table17: Number of Food Establishments Under State Inspection Jurisdiction
and Most Common Inspection Frequency, Fiscal Years 1998 and 1999

Establishments under state inspection jurisdiction

Establishment 1998 1999 Most common inspection frequency a

Dairy farms 91,797 88,316 Quarterly Other food producing farms 9,361 9,773
Other b Meat and poultry slaughter plants 1,371 1,487 Continuous Meat and
poultry processing plants 2,914 2,906 Daily Fish and seafood plants/ farms
4,818 4,804 Annually Shellfish operations 1,904 1,930 Quarterly Dairy
product plants 3,613 3,560 Quarterly Eggs and egg product plants 834 837
Quarterly Plants/ facilities that process commercially raised or wild game
for food

574 606 Annually Other food processing plants 42,522 42,901 Annually Feed
plants for food producing animals 5,680 5,627 Annually Groceries and other
retail outlets 302,746 307,429 Twice a year Restaurants 371,740 379,046
Other b Institutions 47,637 50,365 Annually Food packaging and storage
facilities 31,213 31,552 Annually Food transport (e. g., vans and tankers)
9,487 9,902 Other b Other c 35,018 35,309 Annually Uncategorized d 98,284
98,774

Total 1,061,513 1,075,124

a If two departments within a state reported different inspection
frequencies for a category, the highest frequency is reported in the table.
b Some frequency other than continuous, daily, weekly, monthly, quarterly,
twice a year, or annually.

c “Other” includes establishments such as mobile food
operations, daycare centers, youth camps, and civic organizations. d
“Uncategorized” represents food establishments under state
jurisdiction that were reported as a total

amount or pooled together for multiple categories. Source: GAO survey of
states.

Appendix IV: States' Fiscal Years 1998 and 1999 Food Safety Expenditures

Page 57 GAO- 01- 177 Food Safety Expenditures

As shown in table 18, states reported how much of their expenditures of over
$140 million annually for food safety licensing and inspection were
allocated to specific activities within the category. The activities that
were allocated a large amount of resources by states include inspections at
groceries and other retail outlets and restaurants.

Table 18: State Allocation of Resources to Food Safety Licensing and
Inspection Activities, Fiscal Years 1998 and 1999

Activity Number of states

reporting resource expenditures

Average (median) amount of resources reported by states for each activity
(excluding “no

resources”) a

Registration and licensing 54 Moderate

Inspection of:

Dairy farms 49 Moderate Other food producing farms 29 Small Meat and poultry
slaughter plants 36 Moderate Meat and poultry processing plants 37 Moderate
Fish and seafood plants/ farms 41 Small Shellfish operations 31 Small Dairy
and dairy product plants 52 Moderate Egg and egg product plants 38 Small
Plants/ facilities that process commercially raised or wild game for food

31 Small Other food processing plants 48 Moderate Feed plants for food-
producing animals 31 Moderate Groceries and other retail outlets 53 Large
Restaurants 49 Large Institutions 50 Moderate Food packaging and storage
facilities 52 Moderate Food transport (e. g., vans and tankers) 51 Small a
When two agencies within a state reported different amounts of resources
expended, we used the largest amount as the state response. Source: GAO
survey of states.

As shown in table 19, states reported how much of their total expenditures
of about $15 million annually to respond to food safety problems were
allocated to specific activities within the category. States allocated a
moderate amount of expenditures to enforcement of food safety regulations
and lesser amounts to other response activities. Response to Problems

Appendix IV: States' Fiscal Years 1998 and 1999 Food Safety Expenditures

Page 58 GAO- 01- 177 Food Safety Expenditures

Table 19: State Allocation of Expenditures in Response to Food Safety
Problems, Fiscal Years 1998 and 1999

Activity Number of states

reporting resource expenditures

Average (median) amount of resources reported by states for each activity
(excluding “no

resources”) a

Tracebacks and other investigations of outbreaks 54 Small Activities related
to recalls 53 Small Responses to natural disasters 52 Small Enforcement
activities 54 Moderate a When two agencies within a state reported different
amounts of resources expended, we used the largest amount as the state
response. Source: GAO survey of states.

As shown in table 20, states reported how much of their total expenditures
of more than $30 million annually for food safety laboratory analysis were
allocated to specific activities within the category. The activity that the
states most often allocated a large amount of expenditures was laboratory
analysis for microbial contamination.

Table 20: State Allocation of Expenditures for Food Safety Laboratory
Analysis, Fiscal Years 1998 and 1999

Food safety laboratory analysis for:

Number of states reporting resource

expenditures Average (median) amount

of resources reported by states for each activity (excluding “no

resources”) a

Microbial contamination 54 Large Pesticides and other chemicals 49 Moderate
Filth and or sanitation 51 Small Food label accuracy 46 Small to Moderate a
When two agencies within a state reported different amounts of resources
expended, we used the largest amount as the state response. Source: GAO
survey of states.

As shown in table 21, states reported how much of their annual expenditures
of about $15 million to $17 million for food safety technical assistance and
training were allocated to specific activities within the Laboratory
Analysis

Food Safety Technical Assistance and Training

Appendix IV: States' Fiscal Years 1998 and 1999 Food Safety Expenditures

Page 59 GAO- 01- 177 Food Safety Expenditures

category. The states allocated a large amount of expenditures to training
and technical assistance for staff employed by their own agriculture or
health department.

Table 21: State Allocation of Expenditures for Food Safety Training and
Technical Assistance, Fiscal Years 1998 and 1999

Food safety training and technical assistance for:

Number of states reporting resource

expenditures Average (median) amount

of resources reported by states for each activity (excluding “no

resources”) a

Farmers and producers 44 Small Processors 51 Moderate Grocery, restaurant,
and other retail foodservice workers

53 Moderate Institutional foodservice workers 48 Moderate Consumers 51 Small
Health professionals 45 Small Industry inspectors 42 Small Staff who are
employed by state departments of health or agriculture

55 Large Staff who are employed by other state departments 46 Small Staff
who are employed by community governments 47 Moderate a When two agencies
within a state reported different amounts of resources expended, we used the

largest amount as the state response. Source: GAO survey of states.

Although state departments of agriculture and health generally have primary
responsibility for overall food safety activities in each of the states,
other state departments and local governments also have responsibility for
such activities. According to the states we surveyed, these other agencies
generally had responsibilities for a specific type of establishment, such as
restaurants, jails or prisons, childcare facilities, and nursing homes or
for specific food products. For example, in the state of Florida,
restaurants are under the jurisdiction of the Department of Business and
Professional Regulations. And, in several states- Delaware, Louisiana,
Maine, Mississippi, New Jersey, New York, and Texas- seafood or shellfish
products are the responsibility of a state agency other than agriculture or
health. Role of Other State

Agencies and Local Governments

Appendix IV: States' Fiscal Years 1998 and 1999 Food Safety Expenditures

Page 60 GAO- 01- 177 Food Safety Expenditures

States also reported that local governments have an extensive role in food
safety inspection activities at certain types of establishments such as
restaurants, institutions, groceries, and other retail locations. For
example, although Georgia's health department has jurisdiction over almost
20,000 restaurants and institutions, county staff inspected all of those
establishments under contracts with the state. In some cases, state health
departments reported that local government inspections were conducted
primarily through state contracts or agreements. In a few cases, states
reported large expenditures by local governments. For example, the Idaho
Department of Health reported that most of the state's expenditures for food
safety were made by local multicounty health districts, which spent about $1
million on food safety in fiscal year 1999, while the state spent about
$650, 000.

Appendix V: Responses to GAO's Survey of State Agencies Responsible for Food
Safety Activities

Page 61 GAO- 01- 177 Food Safety Expenditures

Appendix V: Responses to GAO's Survey of State Agencies Responsible for Food
Safety Activities

Appendix V: Responses to GAO's Survey of State Agencies Responsible for Food
Safety Activities

Page 62 GAO- 01- 177 Food Safety Expenditures

Appendix V: Responses to GAO's Survey of State Agencies Responsible for Food
Safety Activities

Page 63 GAO- 01- 177 Food Safety Expenditures

Appendix V: Responses to GAO's Survey of State Agencies Responsible for Food
Safety Activities

Page 64 GAO- 01- 177 Food Safety Expenditures

Appendix V: Responses to GAO's Survey of State Agencies Responsible for Food
Safety Activities

Page 65 GAO- 01- 177 Food Safety Expenditures

Appendix V: Responses to GAO's Survey of State Agencies Responsible for Food
Safety Activities

Page 66 GAO- 01- 177 Food Safety Expenditures

Appendix V: Responses to GAO's Survey of State Agencies Responsible for Food
Safety Activities

Page 67 GAO- 01- 177 Food Safety Expenditures

Appendix V: Responses to GAO's Survey of State Agencies Responsible for Food
Safety Activities

Page 68 GAO- 01- 177 Food Safety Expenditures

Appendix V: Responses to GAO's Survey of State Agencies Responsible for Food
Safety Activities

Page 69 GAO- 01- 177 Food Safety Expenditures

Appendix V: Responses to GAO's Survey of State Agencies Responsible for Food
Safety Activities

Page 70 GAO- 01- 177 Food Safety Expenditures

Appendix V: Responses to GAO's Survey of State Agencies Responsible for Food
Safety Activities

Page 71 GAO- 01- 177 Food Safety Expenditures

Appendix V: Responses to GAO's Survey of State Agencies Responsible for Food
Safety Activities

Page 72 GAO- 01- 177 Food Safety Expenditures

Appendix V: Responses to GAO's Survey of State Agencies Responsible for Food
Safety Activities

Page 73 GAO- 01- 177 Food Safety Expenditures

Appendix V: Responses to GAO's Survey of State Agencies Responsible for Food
Safety Activities

Page 74 GAO- 01- 177 Food Safety Expenditures

Appendix VI: Comments from the Food Safety and Inspection Service

Page 75 GAO- 01- 177 Food Safety Expenditures

Appendix VI: Comments from the Food Safety and Inspection Service

Note: GAO's comments supplementing those in the report text appear at the
end of this appendix.

See comment 3. See comment 2.

See comment 1.

Appendix VI: Comments from the Food Safety and Inspection Service

Page 76 GAO- 01- 177 Food Safety Expenditures

See comment 4.

Appendix VI: Comments from the Food Safety and Inspection Service

Page 77 GAO- 01- 177 Food Safety Expenditures

Appendix VI: Comments from the Food Safety and Inspection Service

Page 78 GAO- 01- 177 Food Safety Expenditures

1. The report clearly identifies FSIS' responsibilities- i. e., ensuring
that meat, poultry, and processed egg products moving in interstate and
foreign commerce are safe, wholesome, and marked, labeled, and packaged
correctly. Regarding nonfood safety expenditures, FSIS officials assured us
during the review that the expenditure information that they provided was
for food safety or primarily food safety related activities. As such, we
believe the FSIS expenditures in this report are sufficiently related to
food safety to be appropriately characterized as

“food safety” expenditures. 2. We believe the report adequately
describes the size and scope of FSIS

activities. For example, the report includes information on the number of
meat, poultry, egg product, and import establishments FSIS oversees; the
number of state and foreign programs it reviewed; and the number and type of
inspections it conducted. The level of detail provided on FSIS'
responsibilities and activities is similar to that provided on FDA
activities.

3. It was not our intent to analyze or compare the relative risks of
products under the jurisdiction of FSIS and FDA. While the relative risk of
FSIS- regulated products may be greater in some cases than FDA- regulated
products, we believe that the data accurately reflect the proportion of each
agency's expenditures and the proportion of consumer expenditures for foods
under each agency's jurisdiction. The report also clearly identifies the
food products for which each agency has responsibility.

4. We modified the report to clearly identify FSIS' responsibilities under
the federal meat and poultry inspection acts and to describe its efforts,
with guidance from the courts, to realign the responsibilities and roles of
industry and federal inspectors. GAO's Comments

Appendix VII: Comments from the Food and Drug Administration

Page 79 GAO- 01- 177 Food Safety Expenditures

Appendix VII: Comments from the Food and Drug Administration

Note: GAO's comments supplementing those in the report text appear at the
end of this appendix.

Appendix VII: Comments from the Food and Drug Administration

Page 80 GAO- 01- 177 Food Safety Expenditures

Appendix VII: Comments from the Food and Drug Administration

Page 81 GAO- 01- 177 Food Safety Expenditures

See comment 1.

Appendix VII: Comments from the Food and Drug Administration

Page 82 GAO- 01- 177 Food Safety Expenditures

1. By design, the scope of this report was limited to FSIS and FDA food
safety activities and expenditures. However, the report recognizes that 12
federal agencies conduct food safety activities and cites our testimony Food
Safety: U. S. Needs a Single Agency to Administer a Unified, Risk- Based,
Inspection System (GAO/ T- RCED- 99- 256, Aug. 4, 1999), which provides the
fiscal year 1998 funding and staffing levels for these federal agencies.
GAO's Comments

Appendix VIII: GAO Contacts and Staff Acknowledgements

Page 83 GAO- 01- 177 Food Safety Expenditures

Lawrence Dyckman (202) 512- 3841 Keith Oleson (415) 904- 2218

In addition to those named above, Brad Dobbins, Kathy Colgrove- Stone, John
Nicholson, and Carolyn Boyce made key contributions to this report. Appendix
VIII: GAO Contacts and Staff

Acknowledgements GAO Contacts Staff Acknowledgements

(150172)

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