1. (a) Purpose. The purpose of this section is to establish the criteria and procedures by which the commissioner of health will assess administrative penalties for violations relating to the provisions of the Texas Meat and Poultry Inspection Act, Health and Safety Code, Chapter 433, these rules, and licenses and orders issued pursuant to the Act or the rules.
2. (b) Determining the amount of the penalty. In determining the amount of the penalty, the commissioner of health shall consider the criteria described in subsections (c)-(g) of this section.

3. (c) The seriousness of the violation.

   1. (1) Violations shall be categorized by one of the following severity levels.

      1. (A) Severity Level I covers violations that are most significant and have a direct negative impact on, or represent a threat to, the public health and safety and including, but not limited to, adulteration, misbranding, false representation, or false advertising that results in fraud.
      2. (B) Severity Level II covers violations that are very significant and have impact on the public health and safety including, but not limited to, adulteration, misbranding, false representation, or false advertising, that results in fraud.
      3. (C) Severity Level III covers violations that are significant and which, if not corrected, could threaten the public and have an adverse impact on the public health and safety, including, but not limited to, adulteration, misbranding, false representation, or false advertising that results in fraud.
      4. (D) Severity Level IV covers violations that are of more than minor significance, and if left uncorrected, would lead to more serious circumstances.
      5. (E) Severity Level V covers violations that are of minor safety or fraudulent significance.
   2. (2) The severity of a violation shall be increased if the violation involves deception or other indication of willfulness. In determining the severity of a violation, there shall be taken into account the economic benefit gained by a person through noncompliance.

   3. (3) The following are examples only of severity levels; they are not exhaustive or controlling.

      1. (A) Severity Level I shall apply to:

         1. (i) any person causing a meat or poultry product to contain a poisonous or deleterious substance that may render it injurious to human health;
         2. (ii) any person causing an unidentified or incorrectly identified and undecharacterized meat or poultry (such as meat from condemned livestock or livestock that died other than by slaughter) to be placed in food channels where it could enter the human food chain undetected; or
         3. (iii) any person selling any product derived from condemned livestock or livestock that died other than by slaughter into the human food chain.

      2. (B) Severity Level II shall apply to:

         1. (i) any person selling a product adulterated with turkey gizzards, beef hearts, offal products, other species products and/or extenders to schools, governmental institutions or to anyone whose written specifications specifically prohibit the inclusion of these items;
         2. (ii) any person selling livestock slaughtered without approved state or federal ante-mortem and post-mortem inspection; or
         3. (iii) any person purchasing a product from livestock slaughtered without approved state or federal ante-mortem and post-mortem inspection or who processes such product into consumer items, or who sells or makes the product available for sale.

      3. (C) Severity Level III shall apply to:

         1. (i) any person causing the removal of detain tags and/or the removal or use of detained product without authorization of the department;
         2. (ii) any person denying access to review the records and/or a place of business where livestock products are being slaughtered, processed, sold, or made available for sale; or
         3. (iii) any person threatening an authorized state employee in an effort to prevent such employee from performing his/her duties.

      4. (D) Severity Level IV shall apply to:

         1. (i) any person failing to maintain records of business transactions which will correctly identify all purchases and sales involving livestock product; or
         2. (ii) any person adulterating product which has a standard, such as ground beef, hamburger, ground chuck, ground round, by the addition of extenders, offal products, other species products, or additives which will make the product appear better, or of greater quality, than it is, or sells or who makes the product available for sale.

      5. (E) Severity Level V shall apply to:

         1. (i) any person continuing unauthorized custom slaughter and/or processing of livestock;
         2. (ii) any person continuing to exceed HRI sales (that is other than household consumers, such as hotels, restaurants, institutions, etc.) limitation;
         3. (iii) any person selling or making available for sale uninspected meat and/or poultry product amenable to the inspection requirements of Title 9, Code of Federal Regulations, §303, titled "Exemptions," (product examples: tacos, eggrolls, sausage, tamales, jerky, etc.);
         4. (iv) any person selling or making available for sale ground beef, hamburger, or similar items whose fat content exceeds the standard limitation or the fat content stated on the product label as set out in Title 9, Code of Federal Regulations, §319, titled "Definitions and Standards of Identity or Composition," as amended;
         5. (v) any person failing to correct labeling irregularities as set out in Title 9, Code of Federal Regulations, §317, titled "Labeling, Marking Devices, and Containers," as amended; or
         6. (vi) any person failing to maintain records of custom operations as required by these sections.

4. (d) History of previous violations. The department may consider previous violations. The base penalty may be reduced or increased by as much as 50% for past performance. Past performance involves the consideration of the following factors:

   1. (1) how similar the previous violation was;
   2. (2) how recent the previous violation was; and
   3. (3) the number of previous violation(s) in regard to correction of the problem.
5. (e) Demonstrated good faith. The department may consider demonstrated good faith. The base penalty may be reduced by as much as 50% if good faith efforts to correct a violation have been made, or are being made. Good faith effort shall be determined on a case by case basis and be fully documented.

6. (f) Hazard to the health and safety of the public. The department may consider the hazard to the health and safety of the public. The base penalty shall be increased by as much as 50% when a direct hazard to the health and/or to the safety of the public is involved. It shall be taken into account, but need not be limited to, the following factors:

   1. (1) whether any disease or injuries have occurred from the violation;
   2. (2) whether any existing conditions contributed to a situation that could expose humans to a health hazard; or
   3. (3) whether the consequences would be of an immediate or long range hazard.
7. (g) Other matters. The commissioner may consider other matters as justice may require.

8. (h) Levels of penalties.

   1. (1) The Department will impose different levels of penalties for different severity level violations as follows:

      1. (A) Level I--$15,000;
      2. (B) Level II--$10,000;
      3. (C) Level III--$6,250;
      4. (D) Level IV--$3,750; and
      5. (E) Level V--$1,250.
   2. (2) Each day a violation continues may be considered a separate violation.

9. (i) Assessment, payment, and refund procedures.

   1. (1) The commissioner may assess an administrative penalty only after a person charged with a violation is given an opportunity for an administrative hearing. The hearing shall be in accordance with the Health and Safety Code, §433.095; the Government Code, Chapter 2001; and the department's formal hearing procedures in Chapter 1 of this title (relating to Texas Board of Health).
   2. (2) Payment of an administrative penalty shall be in accordance with the provision of the Health and Safety Code, §433.096.
   3. (3) Refund of an administrative penalty shall be in accordance with the provisions of the Health and Safety Code, §433.097.

Source Note:The provisions of this §221.13 adopted to be effective March 15, 1995, 20 TexReg 1417; amended to be effective June 21, 2000, 25 TexReg 5901.