By Jacqueline Gleason
The Homemade Food Act of 2012 makes it legal for the people of California to prepare certain types of food products in their homes and sell them directly to the public, or through an intermediary such as a retail store. The bill creates an opportunity for would-be food entrepreneurs to try their hand at starting a food business with relatively low stakes.
Cottage food operators (CFOs) are allowed to make a variety of food products, as long as they’re considered “potentially non-hazardous.” A general rule of thumb is that products that need to be refrigerated or cooked are prohibited. The list of permissible foods includes baked goods, granolas/cereals, dried fruits, jams/jellies, nut mixes/butters, popcorn, vinegars, mustards, candy, and more. By excluding potentially hazardous foods, the bill circumvents any major concerns regarding food safety in a home kitchen.
There are two types of CFO licenses permitted under the law. A ‘Class A’ designation allows the business owner to sell directly to the consumer via farmers markets, festivals, through Community Supported Agriculture (CSAs), and other avenues. The ‘Class B’ CFOs are able to sell their products to retail outlets, however they must submit to a Health Department inspection of their kitchen. The Homemade Food Act also requires that the owner register with the Health Department, attend a food safety class and pass the associated exam, adhere to food safety best practices as designated by the California Health and Safety Code, and properly label all food items including listing allergens. Lastly, the new law caps the amount of revenue a CFO can earn at $45,000/annually in 2014, increasing to $50,000/annually in 2015.
The creation of a new class of food businesses allows people to enter the marketplace who may not have access to the large amounts of capital often associated with starting a business. A cottage food operator can utilize the space and equipment available to them in their home kitchen, eliminating the need to rent or lease commercial kitchen space, purchase costly equipment, and even pay for a health inspection. By lowering the barriers to entry, the Homemade Food Act creates an avenue for economic development accessible to many more.
This act is an important step for the food movement. It shifts ownership of food production from large corporations to individual citizens while increasing the amount of locally produced foods available in the market. Cottage food operations also serve as a small business incubator, allowing entrepreneurs to test their skills and product without investing large sums of money. They have the ability to be flexible in adapting their recipes, packaging, and marketing practices. Eventually, some may expand their perfected business models, moving out of the cottage food industry and into bigger operations. Or, the small-scale businesses can serve as an additional source of income for those that are unemployed or underemployed.
In the last year that the law has been in affect, approximately 2,000 people have applied for cottage food licenses. Hopefully we will continue to see an expansion of this sector as more people make the leap into the food business world. Additional resources for business owners such as guidance through the licensing process, which differ by city and county, and technical support for running your own business would greatly increase the viability of cottage food organizations. CFOs also face difficulties in finding ways to get their products in front of consumers, as some retailers are reluctant to sell homemade foods. The Bay Area Homemade Food Market addresses this need by providing a space for cottage food makers to sell direct to the community, however they’re only able to convene once a month. Additional support would enable potential entrepreneurs to take full advantage of this new opportunity. California Department of Public Health. Cottage Food Operations: New State Law Effective January 1, 2013. Accessed March 2014. http://www.cdph.ca.gov/programs/Pages/fdbCottageFood.aspx  Interview with Christina Oatfield, Policy Direct, Sustainable Economies Law Center. A goal of The Policy Forum is to promote a respectful discourse around the issues raised by our featured authors. We expect all comments to be constructive and relevant. As a courtesy to our users: the public, your colleagues, and our staff, we reserve the right to moderate comments to ensure the professional atmosphere of this academic journal.