By Peter Ruddock, COOK Alliance Policy Director
California’s Cottage Food law turned 9 years old this month. Governor Jerry Brown signed AB 1616 into law in the fall of 2012; it took effect on Jan 1, 2013. Despite California being the 33rd state to enact a Cottage Food law, the law began cautiously, with a multi-year roll in of the income cap, which finally settled at $50,000 / year in 2015, Regulators were nervous about expanding food sales to home operations.
Cooks signed up, started cooking and selling, and problems did not materialize. There was no rash of food poisoning; there was no spate of nuisance complaints. By 2018, at least one environmental health department regulator was heard to say that he “loved his cottage food operators.”
Still, when advocates proposed amending the law at the end of 2020, they approached the idea with some trepidation, wondering if the legislators and regulators were ready to acknowledge the success of the program and expand it. Cottage Food operators were succeeding, but the limitations of the original law were keeping many of them from thriving. In particular they were looking to expand the income caps and improve opportunities for sales.
As such, they reached out to Assemblymember Robert Rivas (D-Salinas) and worked with him to craft AB 1144. The bill was kept fairly simple, an important consideration due not only to the uncertainty of its reception, but also the uncertainties of introducing legislation in a pandemic year. Perhaps they shouldn’t have worried, as the bill passed through the legislature without opposition and with little pushback from regulators around the state. Last fall, Governor Gavin Newsom signed the bill and on Jan 1, 2022 it became law.
So what do Cottage Food operators need to know? The following are the most important changes:
- Class A Cottage Food operators (those who sell directly to their customers) can now make up to $75,000 / year in gross income.
- Class B Cottage Food operators (those who also sell indirectly through a retailer) can now make up to $150,000 / year in gross income.
- Income caps will be modified each January to apply a cost of living adjustment to all income caps.
- All permitted Cottage Food operators can sell in all counties in California.
- All permitted Cottage Food operators can ship their products within California, as well as use third-party delivery services.
This law is a validation of the success of the program, acknowledging that homemade food can be sold safely. It is an important step in the evolution of the laws regarding homemade food sales, other amendments likely being desirable within Cottage Food and amendments absolutely being desired by Micro Enterprise Home Kitchen Operators (MEHKOs) – but we take things one step at a time. For now, it seems like a good time to celebrate.
David Crabill has become a driving force behind Cottage Food in California. Not only is David a Cottage Food operator, but he documents the movement, throughout California and the country, at Forrager. And it was David who led the effort to enact AB 1144. Rather coincidentally, David produced his 50th episode of The Forrager Podcast at the end of 2021. He asked the administrators of Facebook Groups which support Cottage Food Operators and MEHKOs to weigh in with advice and tips, such as they would give to their own group members. In total, the owners of these groups represent over 125,000 people! Facebook groups are the glue that holds the homemade food industry together. They are fantastic resources for entrepreneurs to find support and connect with each other.
We were happy to have our How To Sell Home Cooked Food group included!
The Facebook Group, Cottage Food Law – supporters of AB 1616, the California Homemade Food Act was also included. It is the place to go for the nitty gritty about operating a Cottage Food business in California – recent discussions included one on the best way to package scones for shipping.