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Statement of Need: This proposed rule was mandated by section 4205 of the Affordable Care Act.

Summary of the Legal Basis: On March 23, 2010, the Affordable Care Act (Pub. L. 111-148) was signed into law. Section 4205 amended 403(q)(5) of the Federal Food, Drug, and Cosmetic Act by creating new clause (H) to require that vending machine operators, who own or operate 20 or more machines, disclose calories for food items. FDA has the authority to issue this proposed rule under section 403(q)(5)(H) and 701(a) (21 U.S.C. 343(q)(5)(H), and 371(a)). Section 701(a) of the act vests the Secretary (and, by delegation, the FDA) with the authority to issue regulations for the efficient enforcement of the act.

Alternatives: Section 4205 requires the Secretary (and, by delegation, the FDA) to establish, by regulation, requirements for calorie disclosure of food items for vending machine operators, who own or operate 20 or more machines. Therefore, there are no alternatives to rulemaking.

Anticipated Costs and Benefits: The bulk of the costs associated with this rule will be in managing the actual disclosure of calories at the machine. Since almost all vending machines sell food that is previously manufactured and packaged, most vended foods are subject to the Nutrition Labeling Education Act, which means that calorie content is already collected. A likely scenario for response to vending machine labeling is that food manufacturers include a set of calorie label stickers in each case of product. Since consumers of vended foods do not generally have access to nutrition information prior to purchase, requiring that operators make that information available should benefit consumers. Consumers may ignore future costs of overeating, relative to the current gains from eating, even when they understand the connection. Therefore, consumers do not generally demand calorie and other nutrition information for food away from home, even when they do, given a wider frame of reference, value that information. Given the costs and the uncertain reception for calorie information that many consumers appear not to care about, most vending machine operators have chosen not to display calorie information. The requirements of the proposed rule, specifically, that calorie and other nutrition information appear at the point of purchase, solves the apparent market failure in providing information provision stemming from present-biased preferences.

Risks: For some vending machine foods, consumers cannot view the nutrition facts panel or otherwise see nutrition information prior to purchasing the item. Completion of this rulemaking will provide consumers information about the nutritional content of food to empower them to make healthier food choices from vending machines.