S4648

An Act concerning cottage food operators and supplementing Title 24 of the Revised Statutes.

Be It Enacted by the Senate and General Assembly of the State of New Jersey:

1. a. A person or entity that engages in the production, distribution, or sale of food to consumers shall:

(1) have a cottage food operator permit; or

(2) comply with applicable laws to retail food establishments.

b. A person seeking to obtain a cottage food operator permit shall submit to the Public Health and Food Protection Program in the Department of Health:

(1) a completed application in the form at N.J.A.C.8:24-11 Appendix or its successor regulation;

(2) a copy of a certificate issued by an accredited program showing that the applicant is a food protection manager in good standing with the accredited program;

(3) if the cottage food operator's kitchen:

(a) uses private well water, a microbiological total coliform analysis of the private well water that is conducted using samples collected no earlier than 60 days prior to the filing date of the application, which is the postmark date, if the application is mailed, or the date of submission, if hand-delivered; and

(b) does not use private well water, a copy of most recent water bill for the location of the cottage food kitchen; and

(4) the nonrefundable application fee established at N.J.A.C.8:24-11.6, or its successor regulation, payable to the Treasurer, State of New Jersey.

c. (1) The Department of Health shall conduct a completeness review of the application and notify the applicant in writing of any deficiency or incompleteness therein that the applicant shall correct before the department will process further the application.

(2) If an applicant fails to correct a deficient or incomplete application within 30 days of the issuance of a notice pursuant to paragraph (1) of this subsection, the department shall deem the application abandoned.

(3) Upon determining an application to be complete, the department shall issue a cottage food operator permit to the applicant.

d. An applicant for a cottage food operator permit shall ascertain and comply with applicable local laws of the municipality in which the applicant seeks to operate a cottage food operation.

2. a. Notwithstanding the provisions of any State law, rule, or regulation to the contrary, a cottage food operator permit authorizes a holder thereof:

(1) to produce cottage food products in the private kitchen of the operator's residence and at no other location;

(2) subject to N.J.A.C.8:24-11.5 or its successor regulation, to distribute cottage food products to consumers thereof without being subject to initial or periodic inspection by a health authority and other requirements applicable to retail food establishments under State law or regulation and the Public Health Practice Standards of Performance for Local Boards of Health in New Jersey at N.J.A.C.8:52, or its successor regulation, other than as specified in this act;

(3) to distribute and sell cottage food products to:

(a) a wholesale establishment as N.J.A.C.8:21-9, or its successor regulation, defines that term;

(b) a retail food establishment; or

(c) a consumer located within the State through United States postal mail or a common carrier, subject to N.J.A.C.8:24-11.2(b).

b. A cottage food operator may transact activities that are ancillary to the delivery or relinquishment of cottage food products to a consumer by means of United States postal mail, common carrier, electronic communication, internet, or telephone, provided the delivery or relinquishment of cottage food products occurs in New Jersey in compliance with N.J.A.C.8:24-11.3(a) or its successor regulation. Authorized ancillary transactions include:

(1) accepting order placements;

(2) receiving payments;

(3) engaging in marketing or advertising activities; and

(4) participating in other business activities other than cottage food product delivery and relinquishment.

3. a. A cottage food operator shall not deliver or relinquish cottage food products:

(1) at a location other than:

(a) the home of the cottage food operator, but not for onsite consumption;

(b) the home of the consumer, provided the home is in New Jersey;

(d) a retail food establishment;

(e) a wholesale establishment;

(f) in New Jersey, to the consumer, provided applicable law does not otherwise prohibit the delivery or relinquishment at the location;

(2) to a person who is not the consumer; or

(3) in interstate commerce, that is, outside of the State of New Jersey, subject to N.J.A.C.8:24-11.2(b) or its successor regulation.

b. The gross annual sales that a cottage food operator generates from the sale of cottage food products shall not exceed $150,000.

4. a. A cottage food operator shall make available for inspection, on request, the operator's permit if the point of sale is the residence of the operator or the consumer.

b. If the point of sale is a location other than the residence of the operator or the consumer, the operator shall place at the point of sale, on conspicuous and unobstructed display, the cottage food permit and a placard that states, "This food is prepared pursuant to P.L. , c. (C. ) (pending before the Legislature as this bill) in a home kitchen that has not been inspected by the Department of Health."

c. A cottage food operator shall affix one or more labels or tags on cottage food that collectively state at least the following:

(1) the common name of the cottage food product;

(2) the cottage food product ingredients in descending order of predominance by weight;

(3) if the cottage food product contains a major food allergen, the word, "Contains" followed by a list of the major food allergens that the cottage food product contains;

(4) the cottage food operator's name, business name, and cottage food operator permit number;

(5) the name of the municipality in which the cottage food operator prepares the cottage food product, which shall be the same as the municipality that appears of record with the Department of Health as the cottage food operator's residence, followed by either "New Jersey" or "NJ"; and

(6) the statement, "This food is prepared pursuant to P.L. , c. (C. ) (pending before the Legislature as this bill) in a home kitchen that has not been inspected by the Department of Health.

5. a. Pursuant to R.S.24:1-1 (C.24:1-1 et seq.), a health authority shall be authorized to enter upon, examine, and survey any premises, including the home kitchen of a cottage food operator, and things thereof, including materials, equipment, books, and records:

(1) to enforce or confirm compliance with any health law or other law under the official's jurisdiction; and

(2) to investigate complaints associated with cottage food products, such as contamination, foodborne illness, misbranding, or adulteration.

6. a. The fee to apply for a cottage food operator permit shall be $100.00.

b. A cottage food operator permit shall be valid for two years from date of issuance.

c. The fee to apply for renewal of a cottage food operator permit shall be $100.00.

d. To prevent permit lapse, a cottage food operator permittee shall submit an application for permit renewal to the Department of Health by no later than 45 days before the expiration of the permit that is in effect.

7. a. A person or entity that violates any provision of this act or refuses to comply with a lawful order or direction of a health authority shall be liable for penalties as provided by R.S.24:17-1 (C.24:17-1 et seq.) and section 10 of P.L.1947, c.177 (C.26:1A-10), and any injunctive action as provided by law.

b. The Department of Health may impose a monetary penalty pursuant to R.S.24:17-1 (C.24:17-1 et seq.) and section 10 of P.L.1947, c.177 (C.26:1A-10), suspend, revoke, or refuse to issue or renew, a cottage food operator permit, if the applicant or permit holder fails to comply with applicable provisions of this act, Titles 24 and 26 of the Revised Statutes of New Jersey, or any other applicable rules or statutes, or if a health authority determines that the applicant or permit holder poses a threat to public health, safety, or welfare. The department shall provide the applicant or permit holder notice of the monetary penalty, suspension, revocation, or denial of issuance or renewal, of a permit, and the reason for the action taken.

c. The department may issue a summary suspension of the permit of a cottage food operator if the permit holder's continued operation poses an immediate or serious threat to public health, safety, or welfare. The department shall provide the permit holder notice of a summary suspension and the reason for the action taken. A summary suspension shall be effective as of the date of issuance. A cottage food operator whose permit the department summarily suspends shall have the right to apply for emergency relief, as provided at N.J.A.C. 8:24-11.8 or its successor regulation.

d. If a person, entity, or cottage food operator operates as a cottage food operator without a valid permit issued by the department, fails or refuses to comply with an order of a health authority, poses a threat to public health, safety, and welfare, or engages in activity that is violative of applicable provisions of Titles 24 and 26 of the Revised Statutes of New Jersey or this act, the department may:

(1) issue an order requiring the person, entity, or cottage food operator to cease and desist operations;

(2) take action in the New Jersey Superior Court against the person, entity, or cottage food operator to enjoin its operations;

(3) confiscate, condemn, seize, sell, destroy, detain, or embargo articles of food in accordance with R.S.24:1-1 (C.24:1-1 et seq.); or

(4) impose monetary penalties pursuant to R.S.24:17-1 (C.24:17-1 et seq.) and section 10 of P.L.1947, c.177 (C.26:1A-10).

e. A monetary penalty that the Department imposes pursuant to
R.S.24:17-1 (C.24:17-1 et seq.) or section 10 of P.L.1947, c.177 (C.26:1A-10) shall become due 45 days after the deadline to file an appeal has ended. If an applicant for a cottage food operator permit or a permit holder files an appeal with the department, then the monetary penalty shall become due in accordance with N.J.A.C.8:24-11.8(b) or its successor regulation.

f. Failure to pay a monetary penalty when it becomes due pursuant to subsection e. of this section or N.J.A.C.8:24-11.8(b) or its successor regulation may result in one or more of the following actions being imposed on the applicant for a cottage food operator permit or the permit holder:

(1) the institution of a summary civil proceeding by the State, pursuant to the Penalty Enforcement Law of 1999," P.L.1999, c.274 (C.2A:58-10 et seq.);

(2) the department's denial of, or refusal to issue, a permit or a permit renewal; or

(3) the revocation of an existing permit.

8. a. When the Department of Health summarily suspends the permit of a cottage food operator, the operator shall maintain the right to petition the Commissioner of the Department for emergency relief.

b. To request emergency relief, the cottage food operator shall submit to the department, within 30 days from the date of the notice of summary suspension, a request in writing accompanied by a response to the notice of summary suspension. Failure to submit a request for emergency relief within 30 days from the date of the notice of summary suspension shall result in the cottage food operator's forfeiture of all rights to emergency relief.

c. All applications for emergency relief shall be handled in accordance with N.J.A.C. 1:1-12.6(c) or its successor regulation.

d. Unless emergency relief is granted, the summary suspension shall remain in effect until lifted by either the department or a court of competent jurisdiction.

e. Nothing in this act shall be construed to prevent the department from simultaneously, or thereafter, moving to suspend or revoke the permit of a cottage food operator or to issue the cottage food operator a monetary penalty.

f. If the Department issues a notice of proposed assessment of a monetary penalty, permit suspension or revocation, or denial of permit issuance or renewal, the department shall afford the applicant or permit holder an opportunity for a hearing to contest the proposed action.

g. (1) A monetary penalty, permit suspension, excluding summary suspensions, or revocation, or denial of permit issuance or renewal shall become effective and final 30 days from the date of the notice of proposed action, unless the applicant or permit holder, within that 30-day period, submits a written request for a hearing to the Department with a response to the proposed action. Failure to submit a written request for a hearing within 30 days from the date of the notice of proposed action shall result in the applicant or permit holder forfeiting all rights to such a hearing.

(2) If the applicant or permit holder submits a timely request for a hearing, then the monetary penalty, or the suspension, excluding summary suspensions, revocation, or denial of permit renewal shall be held in abeyance until the hearing is concluded and a final decision is rendered.

(3) A monetary penalty that is the subject of a hearing, which the applicant or permit holder timely requests pursuant to this section, shall be due 45 days after the Commissioner of Health's issuance of a final agency decision determining the penalty.

(4) A revocation, suspension, or denial of issuance or renewal of a cottage food operator permit is effective immediately upon the commissioner's issuance of a final agency decision on the action.

h. The department shall transmit hearing requests to the Office of Administrative Law.

i. Hearings conducted under this act shall be conducted pursuant to the "Administrative Procedure Act," P.L.1968, c.410 (C.52:14B-1 et seq.), and P.L.1978, c. 67 (C.52:14F-1 et seq.), and the Uniform Administrative Procedure Rules, N.J.A.C.1:1 or its successor regulation.

9. The Commissioner of Health shall adopt rules and regulations, pursuant to the “Administrative Procedure Act,” P.L.1968, c.410 (C.52:14B-1 et seq.), as may be necessary to implement the provisions of this act.

10. This act shall take effect immediately.

STATEMENT

This bill codifies existing regulations to stipulate the requirements for cottage food operators and obtaining a cottage food operator permit. The bill revises some of the requirements established by current regulation to permit a cottage food operator to:

1) distribute and sell cottage food products to wholesale establishments, retail food establishments, and consumers located within the State through in-State mailing; and

2) permit a cottage food operator to generate a gross annual sales from the sale of cottage food products up to $150,000, instead of the $50,000 limit established by current regulation.