Every day, millions of Americans bake and prepare unique foods in their own homes. A growing number of these people are looking to boost their income or start a business by selling their homemade recipes to others in their community. The members of this growing industry are known as cottage food producers.
Cottage foods typically consist of prepared foods that are considered non-potentially hazardous, including most baked goods and traditional jams and jellies. Foods that often need to be kept in the refrigerator, like dairy products or meat, are not usually considered cottage foods.
Many Nebraskans engaged in the cottage food industry believe they are doing harmless work often as a hobby or to make a few extra bucks on the side. However, some do not know that they are actually breaking the law.
On the surface, cottage food sales in Nebraska face few restrictions, but producers can only sell their food at a farmers market. The food must be sold with a clearly displayed sign notifying customers that the food was prepared in a kitchen that is not subject to regulation and inspection by regulatory authorities.
According to the Pure Food Act, failure to abide by these regulations can result in a Class IV misdemeanor, which carries a fine of $100 to $500.
While it makes sense to want to protect consumers from foodborne illnesses, there is little real evidence that cottage foods pose any risk to the public, making the current law limiting sales only to farmers markets an unnecessary burden that prevents people from starting their own small business. Jennifer McDonald, an analyst for the public interest law firm the Institute for Justice, notes, “These small business owners are overwhelmingly female, live in rural areas, and have below-average income.”
Rural cottage food producers may have limited options for farmers markets at which to sell their goods. Farmers markets are also typically seasonal in Nebraska, closing off large parts of the year to potential sales.
Most of Nebraska’s neighboring states provide more expansive cottage food laws. According to the cottage food website Forrager.com, Wyoming, Colorado, Iowa, and Missouri all allow cottage food sales by home-based producers. Furthermore, Wyoming, Colorado, and South Dakota allow online advertising of sales of cottage foods for in-state purchasers. While orders can be taken online, products still have to be delivered in person.
These policies create a welcoming environment for people who are looking to start their own small business, but may not have the ability to invest in a commercial kitchen. In the past, Nebraska lawmakers have attempted to expand the state’s restrictive cottage food law. However, recent bills filed in 2015 and 2018 failed to advance from the Legislature’s Agriculture Committee, under opposition from grocer and restaurant industry groups, who claimed food safety would be threatened.
Legislative Bill 764, the most recent bill, would have allowed sales beyond farmers markets, as well as advertising of cottage foods online to arrange in-state sales.
If Nebraska wants to be more competitive in providing additional income-earning opportunities for residents, and more local choices for consumers, policymakers should follow the lead of the many states that have expanded their cottage food laws.
Are you a current or aspiring cottage food producer? The Platte Institute would like to share your story. Please visit PlatteInstitute.org/Cottage.