Today, restaurants are subject to various forms of foodservice legislation on a daily basis. This has a tremendous impact on businesses—for this reason, it’s of vital importance to understand and acknowledge these legislative issues as an industry.

Ken Cutshaw, EVP, chief legal officer, secretary, and chief compliance officer of the Cajun Operating Company for Churches Chicken moderated the Legislating Foodservice session and introduced the following three panelists:

Charles Hoff: general counsel, Georgia Restaurant Association

Keisha Carter: Carter Political Group & RaZors Consulting

Mike Vaquer: lobbyist, Georgia Restaurant Association; Founder; The Vaquer Firm

Cutshaw opened the session by discussing some vital issues that are currently being addressed not only by the federal government, but by the state government as well. He pointed out that many restaurant owners feel that they have very little impact on legislation and public policy; however, when we come together as restaurant associations or within group conferences, we can make significant changes. Case in point: we’ve seen recent success on the credit card interchange swipe fees.

Interchange Swipe Fees

Charles Hoff commented on this topic by pointing out that the interchange fee has been “the bane of restaurateurs’ existence for three years”. Between 2001 and 2008, costs catapulted from 16 billion to 48 billion—in terms of overall costs, it’s been #3 behind food and labor. Thankfully, the NRA and other organizations joined forces and lobbied against this legislation, which provided some welcome relief. Now, improved legislation stipulates that debit card charges must be “reasonable and proportional to the cost of processing.” Additionally, merchants will have set costs for credit card usage, allowing them to set a $10 minimum purchase amount.

Hoff pointed out that while we’re not quite where we’d like to be with the legislation, it’s a great start.

Card Check Legislation

Cutshaw shifted the conversation to card check legislation, and Keisha Carter explained that this was one of the unions’ biggest pushes in 2008. The legislation would allow employees to go into businesses (mainly retail establishments) with a card, fill it out, check a box, and employers would suddenly find themselves subject to the unionization process. In the next few weeks, we could see a majority shift in Congress, which would delay and possibly deter this proposed legislation. That said, card check legislation isn’t going away, and businesses should educate themselves on how they could be affected by this bill. As it stands, it’s likely that we won’t see this legislation addressed in 2010, or even in 2011.

Menu Labeling with Nutritional Values

Cutshaw introduced the much-discussed topic of menu labeling, and Charles Hoff responded by raising an interesting point: many restaurant chains actually support this legislation. However, issues arise when an uneven patchwork of nutritional policies are put in place. These challenges would be preempted if we could adhere to one uniform regulation, which would allow us some protection from lawsuits and ambiguity. Although the federal government will eventually preempt state regulations, many jurisdictions are taking steps to initiate policies for their own protection.

Mike Vaquer commented on this topic as well, and warned restaurateurs not to rest on their laurels and assume that the issues are being resolved with the federal government’s intervention. He cautioned us to be wary of overzealous food inspectors and regulatory “creeps” who attempt to implement ridiculous stipulations, such as disclosing the origin of species of fish for items on a menu, or indicating the temperature of cooked meat, e.g. medium, well-done, rare, etc. Vaquer encouraged the audience stay vigilant, and to inform and question governmental regulatory figures about imposed regulations that seem questionable.

Keisha Carter urged us to stay involved from a regulatory perspective, and pointed out that currently, the FDA is in a “comment period”, where restaurateurs and other interested parties can go online to fda.gov and communicate their questions and concerns regarding legislation. This sort of proactive involvement applies to our communications with federal legislators and congresspeople as well.

Healthcare Reform

Keisha Carter also contributed valuable advice on the topic of Healthcare Reform, and mentioned the upcoming statewide elections—which serve as a huge opportunity to take advantage of relationships with our insurance commissioners. Carter pointed out that when it comes to regulatory healthcare issues, the restaurant industry is an area that is often ignored. For this reason, it’s important to stay in touch with legislators and stay informed of regulations that may or may not apply to your state.

First Lady Michelle Obama / The Childhood Obesity Pledge

Cutshaw segued from the subject of Healthcare into Michelle Obama’s pledge to make childhood obesity her personal cause. Keisha Carter took on this topic, and explained that the First Lady’s plan to lower the rate of childhood obesity by 5% by the year 2030 is a considerable goal. The logic behind the movement is that healthy children will grow up to be healthy adults, and make healthier food choices.

Keisha mentioned that certain aspects and repercussions of this pledge are reminiscent of the menu labeling issue.  For example, the government is essentially asking the industry to self-regulate by stopping the use of certain marketing tools, such as kid-friendly characters to entice children to eat at a particular restaurant. One study revealed that children would be more likely to eat more fruits and vegetables if a fast-food restaurant such as McDonald’s told them to do so. Therefore, many jump to the assumption that the QSR/fast-food industry is responsible for kids’ food choices. Carter mentioned two plan recommendations under discussion:

1)  food and beverage industry and the media and entertainment industry jointly adopt meaningful, uniform nutrition standards for marketing food and beverages to children, and establish a uniform standard for what constitutes marketing to children

and…

2)  restaurant industry should provide technology to help consumers distinguish between advertising for healthy and unhealthy food and limit their children’s exposure to unhealthy food advertisements

These recommendations are going as far as suggesting that parents will have the ability to set parental guidelines on their televisions and block certain restaurant advertisements. Television food rating systems will come into play, causing parents and children to make healthier choices. Another possible future development is additional taxes on foods considered unhealthy.

Carter made an excellent point: if school systems would stop removing physical education and sports from school programs, children would be far less likely to be at home watching television and eating junk food. As businesses, we need to encourage kids to go out and play by supporting local softball teams, etc.

One of the major takeaways of this session was how crucial it is to maintain constant contact with our legislators. Restaurateurs have the ability to open their doors to fundraising events and thus establish deeper relationships with our legislators. If we join forces by leveraging the power of our associations and organizations, our voices will be heard.