Economic impact analysis: BSE rulemaking
In September 2003, the U.S. Department of Agriculture’s Food Safety and Inspection Service (USDA, FSIS) contracted with RTI International (RTI) to assist in estimating the costs of the Bovine Spongiform Encephalopathy (BSE) rulemaking and to develop an operational model to estimate the economic effects of the rulemaking. Initial efforts under the contract focused on regulatory options that FSIS was considering in fall 2003. After the discovery of a BSE-infected cow in the United States in December 2003, FSIS published four BSE interim final rules in January 2004; the analysis under this contract was subsequently altered to focus on the new regulations. This report describes the process RTI followed in developing estimates of the costs of the interim final rules and an operational facility-level model designed to estimate the economic effects of the BSE rule on cattle slaughter operations. We collected data for the analysis through primary and secondary data sources, including detailed interviews with industry participants. This method provided a structure for obtaining data from individuals knowledgeable about production practices in the industry within a relatively short time frame. The analysis presented in this report focuses on federally inspected cattle slaughter plants. In a subsequent analysis, we will analyze the effects of the BSE regulations on beef processing-only plants.