States advocate for legislation and regulation to support home-based micro-processing

      Posted On: April 19, 2011

By Drew Love, FMC Research & Education Intern

When the Food Safety Modernization Act passed in 2010, it established an important precedent by allowing smaller, direct-marketing farms to be exempt from many of the new federal requirements, provided that they could prove compliance with applicable state and local regulations. Now, a wave of legislative and regulatory activity has been sweeping across the country, with states attempting to create more explicit rules governing the sale of food at farmers markets and other direct-to-consumer outlets. Some of these laws, generally referred to as “Cottage Food,” or Home-based Food Processor bills, allow small-scale food producers to make low risk food products in their own kitchens, and then sell their products directly to consumers at venues like farmers markets. In 2011 alone, Arizona, Florida, New Jersey, South Dakota, Washington, and Pennsylvania have introduced similar legislation. Maryland and Oklahoma are in the process of re-introducing cottage food laws after seeing legislation die in committee in 2010.

It seems like a basic idea, doesn’t it? But reshaping cottage food regulation has a dramatic impact on the viability of small scale food producers. Without cottage food regulation, these same bakers, cupcake chefs and artisan jam producers would have to make their food in a certified commercial kitchen. Commercial kitchen rentals, as it turns out, are often prohibitively expensive for an upstart business. Even if small businesses do have the income stream to rent a kitchen, it still takes a significant bite out of their profit margin.

So how do these cottage food laws work? Well, like a lot of state legislation regarding farmers markets, it depends on the state, and sometimes it also depends on the county or city in which the business is operating. Typically, these laws allow cottage food businesses to sell non-hazardous foods at direct to consumer venues like farmers markets. Foods qualify as non-hazardous if they are at low risk for spoiling and do not require specific temperature controls. This means that cottage food laws typically cater to (pun intended) bakers selling breads, non-refrigerated pies, cookies, cakes, muffins, granola, and candy. After baked goods, the states start to differ from each other. Michigan, for example, specifically lists that salsa is not allowed under their regulations, while Wisconsin’s aptly titled “Pickle Bill,” allows home-canned fruits, pickles, salsa and other acid and acidified food.

Michigan, one of the most recent states to adopt a cottage food law, has produced an excellent chart that clearly demonstrates which foods are safe to sell under the new law, and which foods are not exempted. As mentioned before, these regulations will vary by state, but Michigan’s chart summarizes what is typically allowed.

Meanwhile, in Illinois, the Illinois Stewardship Alliance (ISA) is hard at work crafting their own bill. Wes King, policy coordinator for the association, announced an exciting victory earlier in March when SB137, the Local Food Entrepreneur & Cottage Food Bill, passed out of the Senate Agriculture Committee with overwhelming support from with a 10-0-0 vote. The bill still has to be approved by the senate, but King described the bill as a “stepping stone for potential local food entrepreneurs to experiment with recipes and business models by eliminating the costly barrier of constructing or accessing a certified kitchen as the current regulations require.”

King makes a great point for how this legislation affects actual farmers. Janet Eaton, President of Kentucky Farmers Market Association, has seen firsthand the positive impacts of these bills, even though Kentucky has a strict sales threshold of $1,000 for cottage food products. After $1,000, the cottage food products are no longer able to be sold unless they are produced in a commercial kitchen.

Despite the threshold, Eaton appreciates the opportunities such legislation provides her as a food producer. She reported that her homemade products have been a “godsend to my personal farming operation. It allows me to have something unique on my table and to carry me through between crops. An unexpected outcome of this program has been the preservation of old recipes as well as a renewed interest in canning in general.”

Rebecca Landis, President of Oregon Farmers Market Association, also sees these laws as having a tremendous impact on farmers markets. Oregon HB 2336, which has already passed the house and is now waiting on the senate floor, is unique in that it only allows people who grow food to then turn that food into a value added product like dried nuts and beans, jams, jellies, and salsas (as long as the magical pH level of 4.6 is maintained). Rebecca believes Oregon’s bill is especially helpful for farmers, as it gives them a competitive advantage, and another revenue stream to preserve small farms all across the state. By specifying that a food product sold at a farmers market must be grown, and processed on the farm, farmers themselves are given a unique opportunity to capitalize on the value added product niche at farmers markets.

Although it should be noted that while cottage food legislation does give home food producers more liberty than they had, there are still some restrictions. Most notable amongst those restrictions is the aforementioned sales threshold. The threshold sets a dollar value on the maximum amount of gross sales that the business is allowed to make to be eligible as a micro-processor under these bills. Once that threshold is met, the business is no longer protected under the cottage food legislation, and must resort to producing their food in a commercial kitchen if they want to continue selling their product through the rest of the year.

The thresholds themselves vary widely. Tennessee, which proposed cottage food legislation in March of this year, has a $1,000 sales limit similar to Kentucky’s.  Iowa, on the higher end, sets their threshold at $20,000. Meanwhile, Ohio has completely eliminated the sales threshold. Even more uncommon, is that the Buckeye state allows cottage food businesses to sell directly to restaurants and grocery stores.

Other state efforts are targeted at clarification and streamlining of the regulatory process for farmers. In October 2010, Maryland passed SB 198 which created a “Producer Mobile Farmers Market Unit” license. According to Amy Crone, Agriculture Marketing Specialist with the Maryland Department of Agriculture, this means that “no county or local jurisdiction can charge a licensing fee to sell raw agricultural products, and, to sell potentially hazardous foods sold at farmers markets (anything other than raw fruits & vegetables, eggs, and “naturally acid fruit jams/jellies and non-potentially hazardous baked goods”), the only license a farmer should need – even if selling at markets in multiple counties – is the $100 license from Department of Health and Mental Hygiene.”

Act 106

Several dozen Pennsylvania farmers market managers and farmers met on March 16th with the PA Department of Agriculture about new food safety regulations and permits.

Nearby, Pennsylvania advocates are reacting to the State Department of Agriculture’s interpretation of Act 106, which was recently was published in a Farmers Market Food Safety Guidance Document.  The Pennsylvania Association for Sustainable Agriculture (PASA) worked with the Department of Agriculture to host two public meetings for farmers and market managers to learn about the implications and ask questions. The regulation allows for a Mobile Unit license similar to ones already issued to vendors at fairs and carnivals. However, because only original copies can be displayed at market, farmers selling at more than one market on the same day would have to require multiple licenses (each requiring a fee). Many felt this defeated the purpose of a mobile unit license, and discussions are currently taking place to find a solution specific for these farmers market producers. It’s hoped that the State Department of Agriculture will now play a greater role in amelioriating the impact of duplicative or contradictory requirements coming from counties and municipalities. In an article published after one of the public meetings by Lancaster Farming, Brian Snyder, Executive Director of PASA, which recently set up a farmer hotline for regulatory issues, said that “ninety percent of the calls we get are about local municipalities that cause the problems.”  When counties, municipalities, and the state agree to uniform standards, the time and financial costs of researching, understanding, and filing paperwork is minimized both for farmers and market managers- and increases the likelihood of proactive compliance.

As a whole, these laws and regulations and guidance documents point to a changing national sentiment about the very meaning of food safety. While large-scale agricultural businesses are being put through the paces of recent food safety legislation, farmers markets are legally allowed, for the most part, to let their customers place their trust in the farmers and producers themselves. If you’re curious about the status of food safety laws in different parts of the country, the Texas Cottage Food law link, has a list of states that are currently considering cottage food laws, states that have recently such laws, and states with existing laws. While we can’t guarantee that the list is comprehensive and completely up to date, it’s a great place to start for anyone interested in learning more about food safety laws and farmers markets.