traci_doodle Posted 24 Jul 2012 , 5:31pm
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I volunteered to lobby my Senator for the California cottage food law, and I would love to sound informed about the issue! Does anyone know where I can find some reputable literature on the benefits of cottage food laws? Especially anything related to the economics of the bill. My senator is likely worried about the fiscal impact to a state already floundering in debt, and I'd love to calm his fears! This is for California, if it makes a difference.

8 replies
jason_kraft Posted 24 Jul 2012 , 7:41pm
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Several positive fiscal arguments can be made in support of this bill:

- More business licenses issued (increased revenue to municipalities)
- More local spending on ingredients and supplies (more sales tax collected = increased revenue to counties)
- More income tax collected from legitimate businesses (increased state revenue)
- Cost savings on government handouts as CFL income picks up some of the slack
- Theoretically revenue neutral on enforcement, as the only inspections required are due to violations and the cost of those inspections can be charged back to the CFL business

The main argument against the CFL would be the potential erosion of the existing tax base if CFL businesses undercut market prices.

kelleym Posted 24 Jul 2012 , 7:59pm
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My senator is likely worried about the fiscal impact to a state already floundering in debt, and I'd love to calm his fears!



Sell it as a jobs bill. I'm not sure how more jobs would threaten the debt-ridden state.

jason_kraft Posted 24 Jul 2012 , 8:04pm
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The counterpoint to selling it as a jobs bill is the $50K gross income limit, that's not anywhere near a living wage.

kelleym Posted 24 Jul 2012 , 8:08pm
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Originally Posted by jason_kraft

The counterpoint to selling it as a jobs bill is the $50K gross income limit, that's not anywhere near a living wage.



My opinion remains that any income limits are window dressing only, as one's production in a home kitchen is naturally limited by space and equipment. However, even if one cannot earn a "living wage", it is still a legitimate way to supplement a family income. A part-time job is still a job.

jason_kraft Posted 24 Jul 2012 , 8:15pm
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Originally Posted by kelleym

My opinion remains that any income limits are window dressing only, as one's production in a home kitchen is naturally limited by space and equipment.



Can you clarify what you mean here? Are you expecting people to ignore the income limits?

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However, even if one cannot earn a "living wage", it is still a legitimate way to supplement a family income. A part-time job is still a job.



Agreed, and that is one argument against the counterpoint.

traci_doodle Posted 25 Jul 2012 , 4:23pm
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I think the real problem is the that the health and food safety department (whatever it's really called), has told people that it's going to cost the state $300,000 to get this up and running. The lady I'm working with said that figure represents what the department thinks it will cost them to figure out what will qualify as non-perishable foods (bull, if you ask me--seriously, there are so many other states with CFLs, getting a start up list shouldn't be much more work than a copy and paste). They also say it will cost them hundreds of thousands each year after as they track down complaints of food illness against offending parties. From what I've heard, other states haven't really had problems with this, so we think that figure is also a gross exaggeration, but I don't really have proof in writing. I think this is what I'd most like to see written about.

jason_kraft Posted 25 Jul 2012 , 4:43pm
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Originally Posted by traci_doodle

The lady I'm working with said that figure represents what the department thinks it will cost them to figure out what will qualify as non-perishable foods



They have already done this, in fact a list of allowed foods is codified in the bill. Plus the CA food code provides a more scientific definition:
http://codes.lp.findlaw.com/cacode/HSC/1/d104/7/2/s113871

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They also say it will cost them hundreds of thousands each year after as they track down complaints of food illness against offending parties.



Given the population of California that is probably about right for the additional costs of enforcement statewide. Some of those costs will be recoverable by chargebacks to the offending CFL business, and the rest should be more than offset by the increased revenue generation I outlined above.

traci_doodle Posted 27 Jul 2012 , 7:01am
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Thank you for all your help. I can't wait to get started writing up my "speech". Thank you! Keep your fingers crossed!

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