[Congressional Record Volume 162, Number 93 (Monday, June 13, 2016)]
[Extensions of Remarks]
[Pages E889-E890]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]
PUERTO RICO OVERSIGHT, MANAGEMENT, AND ECONOMIC STABILITY ACT
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speech of
HON. MATT SALMON
of arizona
in the house of representatives
Thursday, June 9, 2016
The House in Committee of the Whole House on the state of
the Union had under consideration the bill (H.R. 5278) to
establish an Oversight Board to assist the Government of
Puerto Rico, including instrumentalities, in managing its
public finances, and for other purposes:
Mr. SALMON. Mr. Chair, I rise today to speak to an action taken by
the Puerto Rican Secretary of Health who issued Administrative Order
No. 346 on February 9, 2016. This Order is noteworthy in that it was
issued without the benefit of review by Puerto Rico's legislature, and
without any prior notice or comment period afforded to impacted parties
that typically accompanies the publication of such Orders.
Order No. 346 imposes an unprecedented set of regulatory requirements
and fees on the nutritional dietary supplement industry that will
invariably increase the cost to consumers who rely upon nutritional
supplements as an adjunct to their normal diet.
This Order creates significant economic barriers to acquiring
nutritional supplements that have been widely accepted by consumers as
a way of maintaining healthy lifestyles and preventing adverse health
events in their lives.
The Congress has recognized the importance of encouraging American
adults to maintain minimum average daily intake of a variety of
nutrients that are essential to maintaining health and well-being. The
U.S. government has encouraged and funded a broad range of consumer
education initiatives across the spectrum of public health agencies in
the federal government with the goal of providing consumers with
valuable information about the importance of the minimum daily
nutritional intake standards required to maintain good health.
Nutrition experts at the Harvard School of Public Health have
emphasized the importance of a food pyramid that recommends a ``daily
multivitamin plus extra vitamin D (for most people).''
Researchers at Tufts University have designed a specific food guide
for the elderly that features the benefits of daily supplements of
calcium, vitamin D, and vitamin B-12 that are needed for optimal
health.
The American Academy of Nutrition and Dietetics has issued a policy
statement that emphasizes the importance of good food choices, and it
also recognizes that nutritional supplements can help some people meet
their daily nutritional needs.
Supplements should be seen as one component of the search for a
healthier lifestyle, including improvements in overall food habits and
engaging in physical exercise. Much of the current research on
nutrition and health focuses on prevention of chronic disease, but the
primary reason most people use multivitamins and other nutritional
supplements is to support overall wellness.
I was astounding to me to find out about Order No. 346 issued by the
Puerto Rican Secretary of Health that imposes a set of onerous market
access fees in Puerto Rico for nutritional supplements, including a $25
fee on retailers and distributors for every variation of the supplement
by size, flavor, and stock keeping unit (``SKU'').
But the ``money grab'' did not stop there.
Manufacturers must file an application and pay an additional $500 fee
every 2 years for products that they intend to sell in Puerto Rico.
Wholesale and Retail distributors must also register and pay an
additional $100 fee every 2 years.
Facilities are subject to inspection, and must pay a $50 fee every 2
years.
In addition, Order No. 346 also imposes an additional significant
administrative burden by requiring quality control data, Certificates
of Analysis, the process used to obtain the product, label samples,
promotional materials, Advertisements, Laboratory Certificates, and any
and all warning statements which the FDA does not require of retailers
of any regulated goods, which includes foods, drugs, and devices.
These requirements are transparently only justifications for the
imposition of this new regimen of fees.
This onerous new fee structure may have the unintended consequence of
usurping the role of the FDA in regulating the introduction of
nutritional supplements into commerce as this Congress has determined
by statute to be sufficient.
There has not been any significant incident in Puerto Rico where a
nutritional supplement manufacturer has introduced a tainted product to
consumers. Nor is there any record of any significant number of adverse
events attributable to the sale of nutritional supplements to Puerto
Rican consumers. Furthermore, there are no reports of abusive
commercial activities by nutritional supplement retailers in Puerto
Rico.
Finally, there are no unique public health concerns or issues
attributable to nutritional supplement manufacturing or sales to
consumers in Puerto Rico that have not been fully and adequately
addressed by the FDA.
Federal public health agencies, research organizations, and non-
government organizations widely encourage the use of nutritional
supplements to maintain minimum dietary intake, particularly for at-
risk populations like the elderly and low-income families.
Intuitively, one would think that the Public Health Agency
responsible for the promotion of health and well-being of the people of
Puerto Rico would be tearing down any barrier that exists for its
people to access nutritional foods and supplements that promote the
health and well-being of families.
But the reality is, and it is a conundrum that is well known to this
body, is that Puerto Rico is in the midst of a serious financial crisis
for which it is seeking relief.
As I understand it, Order No. 346 is a transparent and perverse way
for the Puerto Rican government to generate revenue. I cannot help but
remember the lyrics of a favorite song of mine sung by country music
star Waylon Jennings, ``Looking for Love in All the Wrong Places.''
Is it not wrong to be looking for new revenue by increasing the costs
to Puerto Rican families for nutritional supplements that assist them
in maintaining a healthy lifestyle and thereby help them avoid adverse
and costly health events that would incur potentially avoidable costs
both to patients and government health care programs?
Is it not wrong for the Secretary of Health to impose a back-door tax
on nutritional supplements without the benefit of a statute authorizing
these fees enacted by the Puerto Rican legislature?
Is it not wrong to single out one industry, particularly an industry
whose products support a public policy to promote the health and well-
being of its citizens--particularly the elderly and children?
How can the Puerto Rican government come to this Congress and expect
to be taken seriously in their request for fiscal relief from their
current debt burden when they are continuing to enact policies like
Order No. 346 that are so grossly counterintuitive to good government
policy?
My colleague, Mr. Zinke, has authored a legislative remedy that will
nullify Puerto Rico Administrative Order No. 346.
I fully support this legislative effort that will protect the people
of Puerto Rico from arbitrary and onerous restrictions on their access
to nutritional supplement products, and threatens to damage the
economic growth of the economy in Puerto Rico.
If Administrative Order No. 346 is allowed to stand, the cumulative
effect of a new layer of bureaucratic ``red tape'' and the unjustified
imposition of regulatory fees will make Puerto Rico the costliest place
to do business by natural products retailers anywhere in the United
States or its territories.
Low income consumers will likely be forced away from legitimate
retailers on the Island and seek access to reasonably priced products
on the Internet. The problem with that strategy is that the Internet is
well known as a haven for counterfeit products and fly-by-night
suppliers who regularly avoid the scrutiny of the FDA and failed to
maintain good manufacturing practices for the production of its
products.
The perverse outcome of Administrative Order No. 346 is that it will
actually increase the threat to public health among the citizens of
Puerto Rico.
An equally perverse outcome of Administrative Order No. 346 is that
many Puerto Rican families will be unable to afford the increase in
prices on nutritional supplements that they rely
[[Page E890]]
upon, and they will likely forgo those expenditures. Low income
families will be hit the hardest as they are less likely to get
nutrition they need from food alone, and nutritional supplements our
key part of their maintaining the health and well-being.
And I would ask my colleagues to consider this: Administrative Order
No. 346, if it is allowed to stand, sets a dangerous precedent for
every legitimate business operating in Puerto Rico today. If the
Congress fails to nullify this order, nothing will stand in the way of
the Government of Puerto Rico from imposing similar regulatory regimens
on every other industry on the Island, without any notice or debate,
and it will become the incubator for this terrible policy to migrate to
other states and territories who are looking to enhance revenues.
Much of what we do here in the Congress is to establish public
policies to protect consumers from exploitive and predatory actions of
unscrupulous manufacturers of products that economically harm our
citizens.
We are confronted today by a desperate Puerto Rican Government who
appears to have set aside its duty to responsibly enact public policies
that are consistent with the regular order of commerce, particularly as
it relates to nutritional supplements, and has embarked on a clearly
exploitive and predatory path to fleece nutritional supplement
manufacturers and penalize its own consumers in the process.
The Congress is now required to act to defend its own authority and
regulatory framework for nutritional supplement products as
administered by the FDA, the Federal Trade Commission, and the
Department of Justice. We must act in order to prevent this exploitive
and predatory action by the Puerto Rican Government that will have the
inevitable consequence of harming its own citizens.
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