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Minnesota Soon to Dramatically Expand Cottage Food Businesses

New law will raise sales cap, simplify rules

As part of an omnibus agriculture bill Gov. Tim Walz signed on Tuesday, Minnesota will loosen restrictions on cottage food businesses, which let residents sell homemade, shelf-stable food. The bill, SF 958, more than quadruples the state’s annual sales cap for cottage food businesses, raising it from $18,000 to $78,000. Further expanding economic opportunity, cottage food producers will finally be able to incorporate their businesses. And the new law will also simplify rules for selling homemade pet treats under the cottage food law, making it easier for cottage food entrepreneurs to sell pet treats to consumers. 

“It’s going to help us diversify our farm and expand into new markets,” said Aaron Wills, who runs Little Hill Berry Farm in Northfield. “This also will extend our season so we can use our products in different ways year-round, opening up new opportunities for our business.”

In 2017, the Institute for Justice authored the nation’s first comprehensive study of cottage food businesses, which showed that they serve as an important path to entrepreneurship for their owners, who are often lower-income women. Even a small amount of extra income from a cottage food business can be helpful to lower-income households struggling during the economic recovery from the COVID-19 pandemic. 

“This bill will make a huge difference in the lives of so many entrepreneurs who are working from home, including stay-at-home parents, veterans, people with disabilities and many others who will now have the opportunity to earn a living selling cottage food,” said Shelley Erickson, president of the Minnesota Cottage Food Producers Association.

Minnesota is just the latest state to liberalize its home baking laws, joining 21 other states that have dramatically expanded their cottage food programs. During that time, the Institute for Justice has won constitutional challenges to Minnesota’s restrictions on the right to sell home-baked and home-canned goods and Wisconsin’s ban on the sale of home-baked goods. IJ has also helped pass laws expanding the sale of homemade foods in several states across the country, including Alabama, Florida, Kentucky, Maryland, Nebraska, New Mexico, Oklahoma, West Virginia, Wyoming and Washington, D.C. 

“Minnesota’s sales cap made it unfeasible for most Minnesotans to have a successful home-based food business,” said IJ Legislative Counsel Meagan Forbes. “This law will enable thousands of Minnesotans to pursue their calling and support their families by selling homemade food in their communities.”

 

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