Hi there,

Wow, the end of the year is creeping up fast!

I don't know about you, but things are busier than ever around here! Sierra turns one year old today, so happy 1st birthday to her! We celebrated her birthday this past weekend, and once again I tried my hand at making the birthday cake myself, which Liz Marek initially inspired me to do just before Ray's birthday. Artsy design stuff definitely does not come naturally to me, so if you told me a year ago (before Liz' podcast episodes) that I'd be making legit custom cakes for my kids' birthdays, I wouldn't have believed you! :)

Speaking of the podcast, we're only one week away from Episode #50! It's a very special episode, and I think you're going to love it!

Quick reminder: you have until December 31st to buy my CFO Pro membership at its former price of $97 (currently it's priced at $147). This offer is only for my email subscribers -- you can click here to access that price. Remember that this is for a lifetime membership... you won't pay per month, nor will you pay more as I improve the membership over time!


Well well well... what a year it's been for our growing cottage food industry!

As I wrote about last year, the pandemic really highlighted the need for people to be able to sell their homemade food, and that certainly translated into some massive improvements in the laws this year.

In total, 26 states tried to improve their laws in some way, and 18 them were successful! To compare, usually about 5 states improve their laws in a given year.

Massachusetts & South Carolina still have bills in the works, which will hopefully pass in 2022. See the 2021 Cottage Food Bills page for more details.

Not only did a ton of states improve their laws, they improved them by a LOT. A dozen states made big changes to their laws this year. In most years, only about one or two states implement major improvements.

Most notably, New Jersey finally passed their first cottage food law. For the first time in who knows how long, people in New Jersey are now legally selling homemade food!

Here are some of the trends I noticed in 2021:

1. Food freedom

This year we saw more food freedom (or freedom-ish IMHO) initiatives than ever before. We are learning that food freedom can mean a lot of different things, depending on the state, but generally food freedom laws are excellent laws that eliminate most (or all) government oversight.

Of the states that labeled their bill as "food freedom", Oklahoma's represented the biggest change, going from having one of the worst laws in the nation, to having one of the best!

Montana's food freedom law is the most similar to what we've seen before (in WY, ND & UT), and it's made it much much easier to sell homemade food there.

Arkansas emerged as a leader with their very impressive new law. The only thing they're missing is allowing perishable foods (like most food freedom laws have).

2. Removing burdensome government restrictions

Up until this year, three of the nation's largest cities (Boston, MA; Miami, FL; Albuquerque, NM) did not allow cottage food businesses at all. Boston created an ordinance to allow them, and Florida and New Mexico updated their laws.

In addition, two successful lawsuits eased restrictions this year. Wisconsin's lawsuit confirmed that all nonperishable baked goods are allowed (not just flour-based ones, as their state's ag dept ridiculously tried to claim). And a lawsuit in Lincoln, Nebraska removed burdensome restrictions there.

Minnesota, whose ag dept is almost as restrictive as WI's, was the only state to prevent cottage food entrepreneurs from forming LLCs for their businesses. They passed a bill this year that changed that, although they're still fighting with the ag dept to get them to update their website!

I would also lump Illinois into this category, as their health department has been very restrictive for many years. This was a breakout year for them, as their new law will allow producers to sell at venues other than farmers markets. It will also finally do away with the very restrictive Home Kitchen Operation law.

And certainly, New Jersey's new law eliminated the most extreme form of government red tape that our industry has ever seen!

3. Shipping allowances (including interstate!)

Brand new for 2021, we now have states that are explicitly allowing interstate shipping!

Arkansas, Florida, & Oklahoma now allow producers to ship to other states. There are some other states (like PA) that already allowed interstate shipping, but it's much more complex to become a cottage food business in those states.

There is a big catch: even though states are now allowing producers to ship interstate, technically the consumer also needs to live in a state that allows it.

I see this trend continuing into the future, and as more states start allowing this, it will become easier for producers to sell their products across the nation.

In addition, some states (Alabama, California & New Mexico) improved their law by allowing in-state shipping.

4. Lowering / removing sales limits

States are recognizing that sales limits aren't needed to ensure food safety.

Alabama, Florida, and New Mexico all removed their sales limits. Technically FL's is now at $250k, but that's essentially unlimited for a cottage food business.

California is raising their limit from $50k to $75k for Class A CFOs, and from $50k to $150k for Class B CFOs. Oklahoma raised their limit from $20k to $75k.

5. Removing home address requirements

This year I had Justina Rucinski on Episode #40 of the podcast. Justina's horrific experience in 2019 kickstarted a wave of law changes to remove the requirement of placing a home address on product labels.

We saw this trend start in 2020, and many states followed along this year by removing the requirement.

My guess is that it's only a matter of time before most states remove it.

6. Micro-restaurants

California was the first to pioneer the early seeds of the micro-restaurant (AKA micro-enterprise home kitchen operations, or MEHKOs) movement, but it took a global pandemic for counties in CA to start taking the new law seriously. In certain parts of CA, this industry is now growing fast!

This year, Utah successfully created our nation's 2nd MEHKO law, but unlike CA's, it applies to the whole state, not just counties that opt-in.

We will likely see this movement continue to grow rapidly in the years to come!


Alright, that about does it for my recap!

As you can see, 2021 really was an amazing year for the cottage food industry!

In 2022, I hope that Rhode Island can create a law that's usable by all citizens (not just farmers), and I also hope that Indiana's new cottage food working group can find a way to improve their law.

Next week, I look forward to sharing Episode #50 with you!

David

P.S. A quick reminder that I recently increased the price of my CFO Pro membership to $147. But because you're subscribed to my emails, you can still buy a lifetime membership at the former price ($97) until December 31st. To get the discount, click here.