Under a groundbreaking new law, Utah will let home chefs sell their home cooked meals directly to the public, legalizing a type of home-based business that’s technically against the law in 48 states. Simply put, Utah’s Microenterprise Home Kitchen Act will let almost anyone turn their own kitchen oven or backyard grill into a restaurant incubator.
Starting a business under the Act just requires a permit, an annual inspection from the local health department, and following common-sense food safety practices. Home cooks will also need to inform consumers that the regulations for a home kitchen may be different than a commercial restaurant.
With so many restaurants shut down, “we have a lot of good cooks out there who are not working in their trade,” said Rep. Christine Watkins, who sponsored the bill, HB 94. Legalizing home-based cooking businesses “can help people who have been impacted by the pandemic survive financially,” she added.
Opening a new restaurant has always been a risky proposition, especially during a K-shaped recovery. Across the country, the median startup cost to open a restaurant is around $375,500. Meanwhile, food trucks, long prized for their lower overhead costs, can still cost an entrepreneur anywhere from $50,000 to $175,000.
In sharp contrast, the startup cost for a home cooking business is usually just permitting and inspection fees, plus the cost of liability insurance, which together go for under $1,000. By dramatically lowering barriers to entry, HB 94 could make it much easier for aspiring chefs to earn a living from cooking.
Signed into law last month, the Microenterprise Home Kitchen Act is just the latest food policy innovation enacted in Utah. According to the Institute for Justice, the state has one of the nation’s few “food freedom” laws, which let Utahns freely sell just about any “homemade food product” imaginable, so long as it doesn’t contain raw milk or many forms of meat, aside from rabbit or personally-raised poultry. Since its enactment in 2018, hundreds of local businesses have flourished.
Designed as a “complement to the food freedom bill,” the newly enacted home cooking law goes one step further and expressly allows residents to sell home cooked meals containing meat. Like the food freedom law, the Act bans onsite consumption but does allow delivery for the ordered meals. (Customers themselves can of course always pick up what they ordered.)
However, as a concession to restaurant associations, Utah will briefly limit the number of home-kitchen businesses per county. Depending on the county’s size, the number of microenterprise home kitchens can be no more than either 15% or 70% of all “food service establishments” (i.e. restaurants) in a given county. Thankfully, this cap will be in place for just one year.
Utah is now just the second state that has legalized selling home cooked meals with meat, following California. But California’s 2018 microenterprise home kitchen law has flamed out spectacularly, thanks to a fatal flaw. Counties need to opt in and pass ordinances regulating microenterprise home kitchens. Otherwise, it’s still illegal for home cooks to open for business.
With local governments effectively granted veto power, the results have been predictable. More than two years after AB 626 took effect, just two counties—Imperial and Riverside—have opted in and issued permits, while a third, Lake County, has begun a six-month trial program with no more than 10 home kitchens permitted.
Another four counties, plus the city of Berkeley, have opted in but haven’t issued any permits yet, according to the COOK Alliance, which lobbied for the bill. With more than 2.5 million residents, Riverside County has by far the most home cooking businesses in the state, with more than 110 microenterprise home kitchens operating as of April 2021.
In addition, California heavily micromanages microenterprises. Under the law, home-kitchen businesses can sell no more than 30 meals a day or 60 meals per week, though localities can lower—but not raise—those limits. The state further imposes a sales cap, preventing home cooks from earning more than $50,000 in gross annual sales. And home cooks are only allowed to hire one additional full-time employee.
Utah wisely avoids California’s regulatory mistakes. Unlike California, Utah requires local health departments to set up permitting for microenterprise home kitchen operations. Nor does the Beehive State impose a sales cap, or limit the number of meals a home cook can sell or employees they can hire.
“Businesses are already doing this. Individuals are already operating out of their kitchens. We need to give them a pathway to work with the health departments and to have some sort of regulatory framework so they know how to operate,” said Sen. Derek Kitchen (yes, really) when discussing Utah’s HB 94 in early March.
Sen. Kitchen, who owns and operates a restaurant in Salt Lake City, even admitted on the Senate floor that he had started illegally. “Back in 2012, when I first got going with my food business, I started, illegally, in my kitchen,” he noted. “We just started selling to friends and family. It wasn’t anything major. But this is where a lot of small businesses get their start.”