Michigan legislators propose modernization of cottage food law to support small processors

The Michigan Legislature convened on March 20, 2025, to discuss significant updates to the state's cottage food law, aimed at supporting small-scale food processors. The meeting focused on House Bill 4122, which proposes several key changes to modernize the existing regulations.

The first major change outlined in the bill is an increase in the gross sales cap for cottage food operations. The current limit of $25,000 will be raised to $50,000. For products priced at $250 or more, such as wedding cakes, the cap will be set at $75,000. This adjustment is intended to help small food producers grow their businesses while keeping pace with inflation, as the cap will now be linked to the Detroit consumer price index.

Additionally, House Bill 4122 aims to remove outdated restrictions on sales channels. It will allow cottage food producers to sell their products online, via mail order, and through third-party delivery platforms. This change reflects modern consumer shopping habits and aligns Michigan's policies with those of other states. Importantly, the bill mandates that these sales require direct interaction between the consumer and producer, either in person or virtually, to ensure transparency and accountability.

Another notable aspect of the bill is the introduction of an optional registration system. This system will enable cottage food producers to register their businesses with the Michigan State University Product Center, allowing them to avoid publicly displaying their home addresses on product labels.

Since the cottage food law was enacted in 2010, the Michigan Department of Agriculture and Rural Development (MDARD) has reported no foodborne illness cases linked to cottage food products and has not investigated any violations related to the revenue cap. Cottage food businesses serve as a vital entry point for small-scale entrepreneurs, enabling them to explore the food industry without facing excessive regulatory barriers.

The meeting concluded with an invitation for questions regarding House Bill 4122, highlighting the importance of these proposed changes for the future of small food businesses in Michigan.