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California cottage food act introduced in state assembly - Page 9

post #121 of 145
9/21/12 at 6:10pm
OK, call me lazy, but I don't have any time to read thru the bill - is there a quick bullet point document or website someone has that lists what the final bill says? And when does it comes into effect?

Thanks!
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post #122 of 145
9/21/12 at 6:57pm
Thread Starter 
To summarize: Starting Jan 1, 2013, you no longer need a commercial inspected kitchen in California to make and sell non-potentially-hazardous food up to $35K/year gross ($45K in 2014, $50K in 2015 and beyond) either direct to consumers or wholesale within the state. Only private homes qualify.

You still must register (there may be a fee) and self-certify with local law enforcement to confirm that commercial food prep is not concurrent with anything else, no kids or pets are in the kitchen, and everything is clean. There are no inspections unless someone reports you and problems are found with your food, but enforcement officers can enter your facility during hours of operation or "reasonable times". Fees are more expensive if you sell wholesale.

You must complete a food processor course within 3 months of registering. Food you sell must be labeled with "Made in a home kitchen", the food name, your business name, the county name, your registration number, and ingredients in descending order.

Businesses are still responsible for compliance with zoning laws, municipal business licensing laws, HOA restrictions, and collecting sales tax if applicable (it usually won't be in CA).
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post #123 of 145
9/21/12 at 7:46pm
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post #124 of 145
9/21/12 at 7:49pm
Thread Starter 
Here's the list from the enrolled bill text:

(b) This list of nonpotentially hazardous foods shall include, but
not be limited to, all of the following:
(1) Baked goods without cream, custard, or meat fillings, such as
breads, biscuits, churros, cookies, pastries, and tortillas.
(2) Candy, such as brittle and toffee.
(3) Chocolate-covered nonperishable foods, such as nuts and dried
fruit.
(4) Dried fruit.
(5) Dried pasta.
(6) Dry baking mixes.
(7) Fruit pies, fruit empanadas, and fruit tamales.
(icon_cool.gif Granola, cereals, and trail mixes.
(9) Herb blends and dried mole paste.
(10) Honey and sweet sorghum syrup.
(11) Jams, jellies, preserves, and fruit butter that comply with
the standard described in Part 150 of Title 21 of the Code of Federal
Regulations.
(12) Nut mixes and nut butters.
(13) Popcorn.
(14) Vinegar and mustard.
(15) Roasted coffee and dried tea.
(16) Waffle cones and pizelles.

http://legiscan.com/gaits/text/662966
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post #125 of 145
9/21/12 at 7:50pm
http://www.theselc.org/cottagefood/cottage-food-lawscottage-food-law-bill-language
The site has been down for updates, but I know they have a list of the foods you can sell, don't know it they have a bullet point.
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post #126 of 145
9/21/12 at 9:34pm
Hurm - I'm curious if one could combine commercial baking with home baking - for example I'd never attempt a 4 tiered cake at my house, but it would be nice to just make that small order of cupcakes from home instead of having to drag myself into the bakery for 2 dozen cupcakes. Any thought? I mean, I already have permits and licenses and all the jazz I need to bake commercially, has there been any discussion about combining the two? Would the income cap still apply? Because $35K isn't that much at all, especially where I live. Or maybe the 2 "businesses" would need to be separate?

Your thoughts?
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post #127 of 145
9/21/12 at 9:54pm
Quote:
Originally Posted by FromScratchSF

Hurm - I'm curious if one could combine commercial baking with home baking - for example I'd never attempt a 4 tiered cake at my house, but it would be nice to just make that small order of cupcakes from home instead of having to drag myself into the bakery for 2 dozen cupcakes. Any thought? I mean, I already have permits and licenses and all the jazz I need to bake commercially, has there been any discussion about combining the two? Would the income cap still apply? Because $35K isn't that much at all, especially where I live. Or maybe the 2 "businesses" would need to be separate?

Your thoughts?


Your cottage food operation would have to be operated completely from your residence. I guess you could also maintain your license and commercial kitchen as a separate business, but that sounds like a headache. If you already have your whole business set up commercially, it would make sense to continue that way, without all the restrictions applied to cottage food operators.

The law defines a cottage food operation as being in a residence.

SEC. 7. Section 113758 is added to the Health and Safety Code, to read:
113758. (a) Cottage food operation means an enterprise that has not more than the amount in gross annual sales that is specified in this subdivision, is operated by a cottage food operator, and has not more than one full-time equivalent cottage food employee, not including a family member or household member of the cottage food operator, within the registered or permitted area of a private home where the cottage food operator resides and where cottage food products are prepared or packaged for direct, indirect, or direct and indirect sale to consumers pursuant to this part. In 2013, the enterprise shall not have more than thirty-five thousand dollar ($35,000) in gross annual sales in the calendar year. In 2014, the enterprise shall not have more than forty-five thousand dollars ($45,000) in gross annual sales in the calendar year. Commencing in 2015, and each subsequent year thereafter, the enterprise shall not have more than fifty thousand dollars ($50,000) in gross annual sales in the calendar year. A cottage food operation includes both of the following:
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post #128 of 145
9/21/12 at 9:59pm
Thread Starter 
My interpretation is that the two businesses would need to be separate. But I don't see anything stopping you from subcontracting orders from your main business to your CFL business (which would then need a Class B license for indirect sales). The income cap would apply to the CFL business, but since you are essentially selling to yourself at a markup you could adjust the wholesale "selling" price down (within reason of course) if you think you'll be in danger of hitting the cap.

The downside is that you would need to maintain two sets of books, two brand identities, two insurance policies, etc., but the rent savings might be worth it. You probably wouldn't even need a new LLC since your existing LLC could own both businesses.
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post #129 of 145
9/21/12 at 10:31pm
Hurm. I'll look into it. Thanks for the direction!
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post #130 of 145
9/24/12 at 11:33pm
YIPPEE!!!

I just spent hours poring over the bill and condensing it to the pertinent points for a Class A baker.

I honestly NEVER thought this could happen in California. Color me pleasantly surprised. Even though I may never bake for profit, it is darned nice to know I CAN!

Thanks again to Jason and others for keeping us updated throughout this process.
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post #131 of 145
9/25/12 at 7:24am
Congratulations to you guys!
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post #132 of 145
9/25/12 at 2:25pm
WOW!!! California has a Cottage Food Law!!! I am amazed and extremely excited!!!

I do have a question though. Since it stipulates that you can not use cream or custard fillings. Does that include things like SMBC or IMBC? Does that include pastry cream too? And would you (we) be telling customers that you can not use those?

What fillings could you use then?

Thanks in advance for your replies icon_smile.gif
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post #133 of 145
9/25/12 at 2:38pm
This is so exciting!!! But of course my family and friends have burned me out on caking for free that I can't stomach the thought of actually going into business.

But maybe in a year or so I will feel differently.
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post #134 of 145
9/27/12 at 2:16pm
I could cry right now, i'm so freaking happy!!!
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post #135 of 145
9/29/12 at 8:22am
I'm shocked and completely happy!!!!
Now to figure out what the first step is to get the cake ball rolling!!icon_smile.gif
Mare
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