Title
Consider/Discuss/Act on an Ordinance Amending Chapter 46 (Food Establishment Regulations) and Section 46-17 of Appendix A (Schedule of Fees) of the Code of Ordinances
Summary
COUNCIL GOAL: Financially Sound Government
(4.3: Balance resources generated by property taxes, sales taxes, hotel occupancy taxes and fees)
MEETING DATE: December 2, 2025
DEPARTMENT: Code Services
CONTACT: Phillip Hubbard, Director of Code Services
Richard Milam, Health Compliance Manager
RECOMMENDED CITY COUNCIL ACTION:
• Staff recommends approval of the proposed ordinance amendments.
ITEM SUMMARY:
• During the most recent Legislative Session, the State of Texas adopted Senate Bill 1008 into law, which became effective September 1, 2025. This bill restricts local governments' ability to regulate food service establishments by establishing statewide limits on fees and permitting requirements, as defined by the Department of State Health Services (DSHS).
• SB 1008 impacts McKinney primarily through the loss of control in determining the appropriate level of regulation to food establishments within the city. This shift may reduce overall revenue and weaken the city’s ability to respond to public health concerns or emerging food safety issues. Additionally, daycare facilities and non-profits are removed from traditional permitting requirements thus leading to a lack of oversight within these establishments.
• In order to respond to these changes in state law, Staff has proposed amendments to Chapter 46 (Food Establishment Regulations) and Section 46-17 of Appendix A (Schedule of Fees) of the Code of Ordinances.
• In general, the proposed amendments:
o Creates a tiered food establishment permitting fee schedule based on gross annual food sales
o Reduces the number of permits issued per location based on business ownership
o Eliminate health permit requirements for daycare facilities and non-profit organizations
o Eliminate fees pertaining to food establishment inspections and permit plan review
BACKGROUND INFORMATION:
• Historically, McKinney has maintained their own fee structure and permitting processes for food establishments, tailored to local public health priorities and operational costs. With the passage of SB 1008, McKinney must now align their practices with the maximum thresholds and definitions established by DSHS.
FINANCIAL SUMMARY:
• SB 1008 restricts local permitting to align with state standards, resulting in an estimated $55,237 annual loss in health permit fees for McKinney due to exemptions for 50 daycare facilities, non-profits, cottage food vendors, reduced temporary permit fees, and consolidated grocery store permits.
New tiered fee structure based on gross annual food sales ($258, $515, $773) replaces flat $300 fee. Impact on 541 current permits varies:
o Potential increase ranges from $115,980 to $255,893
o Potential decrease of $22,722 if all fall in lowest tier
BOARD OR COMMISSION RECOMMENDATION:
• N/A