REGULATORY REFORM HEADS INDUSTRY AGENDA

WASHINGTON (FNS) -- Supermarket industry officials have long complained of being buried under costly federal regulations and now view the Republican takeover of Congress as their first real chance at regulatory relief in years.How extensive reform will be is unclear, given the long wish lists for change being pushed by lawmakers and lobbyists representing various industries and public interest groups.

WASHINGTON (FNS) -- Supermarket industry officials have long complained of being buried under costly federal regulations and now view the Republican takeover of Congress as their first real chance at regulatory relief in years.

How extensive reform will be is unclear, given the long wish lists for change being pushed by lawmakers and lobbyists representing various industries and public interest groups. But there will likely be increased scrutiny by Congress of the way federal agencies promulgate regulations, given the aggressive antigovernment tone struck by Newt Gingrich, the new speaker of the House.

"We are hopeful that the regulatory agencies will take this opportunity to reexamine their regulations and reinvent themselves," said George Green, vice president and general counsel of the Food Marketing Institute, Washington. "But if they are not inclined to do this, we intend to seek congressional oversight and the appropriations process to reexamine them."

"There have been too many examples in recent years of the supermarket industry being exposed to regulatory programs that have gone beyond the parameters set out for them by Congress," said Tom Wenning, general counsel for the National Grocers Association, Reston, Va., also an advocate of increased monitoring by Congress of agency initiatives. He cited the U.S. Department of Labor's enforcement of post-World War II paper baler operating regulations and the U.S. Department of Agriculture's new E. coli bacteria testing program of ground beef at retail stores as ripe for congressional oversight.

"I think the impetus for regulatory change is one that independent businesses feel an urgency for very strongly from a grassroots perspective," Wenning said. "They live with it every day. They face regulations that don't make sense to them. It is a burden from a financial and an efficiency perspective that I think the new Congess has been elected with a mandate to address."

Bruce Gates, vice president of public affairs with the National-American Wholesale Grocers' Association, Falls Church, Va., who is heading a multi-industry regulatory reform lobby called Project Relief, strongly allies himself with the new Republican leadership in saying that old and new regulations should face a means test.

"Do their costs justify their benefits?" Gates asked, reiterating the formula. "Beyond providing us the sensible and necessary protections that government should offer, Uncle Sam has in the past few decades become increasingly arrogant and capricious in the way he burdens us with red tape."

The regulations the supermarket industry will be working to change -- or to head off implementation of -- in 1995 include:

ERGONOMICS -- The supermarket industry is skeptical about the scope of regulations the Occupational Safety and Health Administration is drafting concerning ergonomics standards that would designate at-risk jobs and require businesses to provide equipment and make other accommodations to avoid worker injuries.

The proposed standards, in the works since the Bush administration and due for release this year, would address workplace injuries caused by a variety of factors that typically affect the hands, wrists, forearms and backs. Areas likely to be targeted are stock clerks who lift heavy boxes and retail clerks who use scanners or cash registers. The industry is concerned the regulations will be overprescriptive, adding another set of paperwork to deal with, increasing worker compensation claims and otherwise raising costs.

PACA -- High on the supermarket industry's regulatory wish list is repeal of the 60-year-old Perishable Agricultural Commodities Act, administered by the USDA. Under PACA, the USDA collects licensing fees from grocers and wholesalers of $400 per outlet, for a maximum of $4,000. The program is intended to ensure sellers of produce are paid by retailers and wholesalers and to provide dispute resolution outside the court system. The industry claims the program is antiquated, dating back to times when produce wasn't

delivered on a timely basis, and thus has outlived its usefulness.

PAPER BALERS -- A perennial target for reform is the Labor Department's enforcement of paper baler regulations, written in the 1950s when balers had no safety mechanisms and were threatening to worker life and limb. Technically, when a worker under the age of 18 tosses a piece of paper in a modern-day baler, rendered harmless by a safety shut-off and key, it is considered a violation. For years, the industry has been paying fines in the hundreds of thousands of dollars annually for such transgressions. Wage and Hour administrator Maria Echaveste last year solicited comments from the industry on how best to change the regulation. Labor officials are still weighing the comments and no date has been set as to when, or whether, proposed changes will be made.

MEAT INSPECTION -- The USDA's Food Safety and Inspection Service this year plans to release a proposal to extensively reshape the way meat and poultry pass through the federal inspection system. The proposal will be based on a Hazard Analysis Critical Control Point system, or one that stresses inspection of meat and processing methods at points where product can easily be contaminated. The supermarket industry supports HACCP-based inspection, but is lobbying the FSIS to ensure that such a comprehensive program emphasizes inspection at the producer end of the meat supply, not in stores. The industry also hopes to convince FSIS administrator Mike Taylor to back off an in-store ground meat testing program targeted at detecting the potentially deadly E. coli O157:H7 bacteria. The industry views the program as being at odds with HACCP-based principles since the testing occurs at the end of the meat-supply chain, instead of the beginning. The industry also argues the program, which has yet to find any E. coli-tainted meat, is threatening the reputations of retailers should a recall of meat be ordered upon a positive finding.

INGREDIENT LABELING -- Still on deck at the Food and Drug Administration is a proposal by the supermarket industry to modify ingredient labeling requirements for in-store prepared takeout foods sold at retail, as spelled out in the Nutrition Labeling and Education Act of 1992. The agency is still examining the industry's request that retailers be spared from listing every ingredient contained in each component and condiment of a sandwich, salad or the like sold in stores, a requirement that supermarkets say is unnecessary and time-consuming.

PESTICIDES -- The manner in which safe levels of pesticide residues in processed foods should be measured is a battle sure to heat up in 1995. Although more of a focus for food processors and produce suppliers, the issue could affect retailers in terms of supplies. The pesticide residue definition surfaced last year after a federal court upheld the strict definition of the Delaney Clause, a provision of the Food, Drug and Cosmetic Act, that prohibits the use of all cancer-causing pesticides on vegetables and fruits slated for processing. A less stringent standard has governed raw produce. If the Delaney Clause were strictly enforced, it would eliminate the use of some 80 pesticides. The industry is backing a Delaney Clause alternative, which will be resubmitted in the 104th Congress by Thomas J. Bliley Jr., R-Va. His plan calls for the Environmental Protection Agency to use its discretion and apply a negligible-risk pesticide standard to both raw and processed food. While the Clinton administration also wants processed and raw produce treated equally, it has lobbied for the EPA setting specific risk standards, using risk to children as a baseline.

EMPLOYMENT -- There are

several employment-related issues, some on the books for years, that the new Republican leadership on Capitol Hill has targeted for change. These include hiring standards in the Americans With Disabilities Act, an initiative signed by the Bush administration and passed by the Democratic Congress in 1992. Critics of these provisions, which are enforced by the Justice Department, say they are too narrowly drawn and leave employers open to lawsuits. Another employment law that is on the Republican things-to-do list involves the Fair Labor Standards Act of 1938, which has been revised throughout the years and falls under the purview of the Labor Department. A Republican position paper from the Committee on Education and Labor proposes changing the FLSA's criteria of a work week, which defines a week as 40 hours worked in a consecutive seven-day period. The paper says this strict formula is inflexible for workers and employers. One alternative proposed would be to use a 14-day, 80-hour work period, which for example could cover working 20 hours one week and 60 hours the next.