FREQUENTLY ASKED QUESTIONS
When does the Food Freedom law become effective?
August 1, 2017.
What are the rules for Food Freedom?
Right now, the actual
wording of the legislation is what you are required to follow. The ND
Department of Health has issued “guidelines” to clarify their position on the
law, but those guidelines do not have any official teeth. For example, their
guidelines appear to require you to get a permit to sell eggs, but that is specifically exempted in the law. Here's a link to their guidelines: http://www.ndhealth.gov/FoodLodging/CottageFood.asp
In February, 2017, the Department of Health attempted to issue draft
rules and ask for comments. Those draft rules
were extremely restrictive and, we believe, were specifically NOT ALLOWED in the legislation. Thanks to intervention and legal opinions from the Institute of Justice and the Weston A. Price Foundation, some of our legislative supporters were able to convince the Governor and Health Department to stop the rulemaking process. In 2019 we need to be vigilant. Although we managed to get through the 2019 Legislative Session without any changes, we believe there will be an attempt to conduct rulemaking.
What signs or labels must be used?
Any product created in a kitchen must have a sign or label
stating “This product is made in a home kitchen that is not inspected by the
state or local health department.”
Refrigerated or frozen products should be labeled with safe handling instructions and a statement the product was transported and maintained at the refrigerated or frozen temperature.
Producers should inform customers – verbally, by sign or label – that the food sold is not certified, labeled, licensed, packaged, regulated or inspected.
Are we permitted to use our own labels?
Absolutely! A good label is a great marketing tool. For processed, main courses or baked goods, you’re encouraged to include a list of ingredients, processing method, handling instructions, etc. If you’re selling an item that requires a warning label, be sure to include the correct language.
Where can we advertise and sell our cottage food products?
Where can we advertise and sell our cottage food products?
Under HB 1433, you may sell products almost any place in North Dakota where you have direct contact with the end consumer – outside of a retail establishment. So you may sell from your home, deliver to a customer, sell at a farmers market, etc. In discussion with the Health Department – as a point of clarity – the Cottage Food Working Group agreed that you may advertise anywhere – including the Internet on a website, Facebook, etc. as long as the product transfer was done person to person. Items may NOT be shipped via the mail, etc.
We had a lot of discussion about payments and if you could use a credit card to buy your items. Many farmers markets are now accepting electronic payments; though the customer may have to go to the market manager to swipe the card; then take the receipt back to the producer to obtain their goods. We determined that using PayPal on a website was no different than that type of farmers market payment as long as your actual “sale” (handing over the product) is done in person. So you may accept an order for a case of jam off the Internet and deliver it a month later to the customer….as long as you aren’t crossing state lines.
What type of eggs can be sold?
Eggs from any domesticated poultry can be sold to the home consumer without a permit, refrigeration, etc. If you are selling to a store or other outlet, you’ll need a permit in accordance with state law.
May we sell to restaurants or stores?
ONLY fresh fruits and vegetables may be sold directly to restaurants or stores. All other items can only be sold to the home consumer for use in their home. Items purchased through the Food Freedom Act may not be resold or used in other Food Freedom products. That means - you can't purchase noodles from one farmer and chicken from another farmer, then make chicken noodle soup for resale. However, you and your family may enjoy that delicious soup at home.
Bakers may use eggs from their own flock for baked goods to sell. But a consumer who purchases eggs under this law may only use their eggs for their own use. That consumer may NOT use those eggs for baking and sell to other consumers.
Who is responsible for food safety under this law?
Everyone involved! Of course, the primary responsibility is the producer who needs to use good food safety practices at every step of production – including labeling for products which need labels. This is your reputation on the line, so do your very best.
Consumers also are responsible for questioning producers about their handling methods and deciding if this is a producer from whom they are willing to purchase a product. Then consumers need to think about safe transport, storage, and use of the product on their end.
We encourage you to review safe handling procedures and do a self-audit of your food preparation. For information about industry-approved techniques, go to: https://www.ag.ndsu.edu/publications/food-nutrition/food-safety-basics-a-reference-guide-for-foodservice-operators
Are we required to pay income tax and collect sales tax?
Absolutely. You need to keep good financial records for your business and, if you generate income, you must pay that tax. You’re also responsible for paying self-employment tax, taxes for employees, etc. Depending on your food products and how you sell them, you may be required to collect and pay sales tax.
If you have questions about collecting taxes, try this link: http://www.nd.gov/tax/faqs/
Do I need special insurance?
It's not required by the law. We strongly
suggest you have a conversation with your homeowners or farm insurance agent
about any products you’re selling under Food Freedom, where you plan to sell,
etc. to make sure that you’re covered for liability.
Are we allowed to sell at craft fairs? That depends on the organizer of the event. If the organizer says "ok," be sure you have appropriate signage and labels so it is very clear that you are selling products created in an uninspected home kitchen.