Microenterprise home kitchen operations., the official text

An act to amend Section 114367 of the Health and Safety Code, relating to the California Retail Food Code.

LEGISLATIVE COUNSEL'S DIGEST

Existing law, the California Retail Food Code (code), authorizes the governing body of a city, county, or city and county that is designated as the enforcement agency to permit microenterprise home kitchen operations (MEHKOs), and prohibits MEHKOs from operating unless they have obtained a permit from the enforcement agency. Existing law requires the permitting of MEHKOs to apply to all areas within a city, county, or city and county’s jurisdiction, including to all cities within a county that authorizes MEHKOs. Existing law requires MEHKOs, as a restricted food service facility, to meet specified food safety standards. Existing law makes a violation of the code a misdemeanor.
This bill would instead require the governing body of a city, county, or city and county that is designated as the enforcement agency to grant a nondiscretionary permit to use a residence as a MEHKO, and would prohibit a governing body of a city, county, or city and county that is designated as the enforcement agency from prohibiting MEHKOs from operating in any residential dwelling. The bill would prohibit the governing body of a city, county, or city and county from imposing a restriction on the number of MEHKOs permitted to operate within the governing body’s jurisdiction or restrict operations based on geography.
This bill would require the enforcement agency to issue a permit without a hearing and would prohibit the enforcement agency from requiring, among other things, additional permits, approvals, or discretionary review by any other local department or agency. The bill would require the enforcement agency to be the sole local permitting authority of a MEHKO, and would require the enforcement agency to make permits available no later than July 1, 2027.
By expanding the scope of a crime for a violation of the code and by imposing additional duties on local enforcement agencies, this bill would impose a state-mandated local program.
The California Constitution requires the state to reimburse local agencies and school districts for certain costs mandated by the state. Statutory provisions establish procedures for making that reimbursement.
This bill would provide that with regard to certain mandates no reimbursement is required by this act for a specified reason.
With regard to any other mandates, this bill would provide that, if the Commission on State Mandates determines that the bill contains costs so mandated by the state, reimbursement for those costs shall be made pursuant to the statutory provisions noted above.

The people of the State of California do enact as follows:

SECTION 1.
The Legislature finds and declares all of the following:
(a) In 2019, the California Legislature enacted Assembly Bill 626 (Chapter 470 of the Statutes of 2018) into law, creating the microenterprise home kitchen operation (MEHKO) category in the California Retail Food Code, establishing a first-of-its-kind legal pathway for individuals to operate small, home-based food businesses from their permitted home kitchens.
(b) The MEHKO program allows individuals to sell freshly prepared meals directly to consumers from their homes under a regulatory system that includes health permits, kitchen inspections, and food safety certification, while supporting public health and consumer protection.
(c) Eighteen jurisdictions have now opted into the MEHKO program and 60 percent of California’s population now lives in a jurisdiction where MEHKOs are permitted to operate.
(d) Data from the COOK Alliance shows that MEHKOs have an exceptional safety and community impact record, with 97 percent of MEHKOs within the program’s first five years never receiving a complaint related to nuisance, food safety, noise, traffic, parking, or waste issues, and foodborne illness reports being extremely rare.
(e) Consumer surveys included in the report indicate strong public support for the MEHKO model, with a majority of Californians expressing positive attitudes toward legal home kitchen operations as a way to try new foods and support local entrepreneurship.
(f) The same report finds that MEHKO operators are overwhelmingly diverse, with 70 percent identifying as women and 79 percent as people of color, and that 46 percent of operators are immigrants, reflecting the program’s success in expanding economic opportunity to traditionally underserved entrepreneurs.
(g) MEHKO participants report positive economic outcomes, with 73 percent stating their MEHKO provides meaningful financial support for their households, 61 percent reporting profitability, and many operators citing their MEHKO as a means of income when other work was unavailable, demonstrating the value of MEHKOs as a tool for economic resilience.
(h) Unlike other state-authorized home-based food programs, the MEHKO program requires individual jurisdictions to undertake a local legislative approval process, resulting in significant administrative, legal, and staff commitments to adopt a program already established in statute and supported by years of demonstrated safe operation.
(i) Since 2019, the MEHKO program has established a sustained operating record across multiple, geographically diverse jurisdictions, functions on a cost recovery basis, and is supported by established administrative tools and shared guidance that facilitate efficient local implementation.
(j) Because all California jurisdictions already administer and inspect cottage food operations, local environmental health agencies have existing frameworks and experience relevant to the oversight of home-based food enterprises.
(k) The MEHKO program creates accessible pathways for aspiring food entrepreneurs who might otherwise be unable to afford the high startup costs associated with traditional commercial kitchens or brick-and-mortar restaurants, helping them test and scale their business models with reduced financial risk.
(l) MEHKOs serve diverse communities across California, operating in urban, suburban, and rural areas alike, and help strengthen local food systems by increasing access to home-cooked, culturally relevant meals while fostering community connections.
(m) Because the MEHKO program remains available only in jurisdictions that choose to opt in, access to this regulated pathway is determined by location rather than health standards, creating inequitable opportunities for low-income, immigrant, and rural entrepreneurs.
(n) The Legislature of the State of California honors the achievements of microenterprise home kitchen operations, recognizes their contributions to public health, economic opportunity, entrepreneurship, and community vibrancy throughout the state, and supports continued efforts to strengthen, expand, and promote MEHKO programs for the benefit of Californians.

SEC. 2.
Section 114367 of the Health and Safety Code is amended to read:
114367.
(a) The governing body of a city, county, or city and county that is designated as the enforcement agency, as defined in Section 113773, shall not prohibit microenterprise home kitchen operations from operating in any residential dwellings.
(b) (1) The governing body of a city, county, or city and county that is designated as the enforcement agency, as defined in Section 113773, shall grant a nondiscretionary permit to use a residence as any microenterprise home kitchen operation that complies with the requirements of this chapter.
(2) The enforcement agency shall issue a permit pursuant to this section upon determining that the applicant meets the requirements of this chapter. The enforcement agency shall be the sole local permitting authority for a microenterprise home kitchen operation. The enforcement agency shall issue a permit without a hearing. The enforcement agency shall not require additional permits, approvals, or discretionary review by any other local department or agency, and shall not require a general plan adopted pursuant to Article 5 (commencing with Section 65300) of Chapter 3 of Division 1 of Title 7 of the Government Code.
(c) The governing body of a city, county, or city and county shall not impose a restriction on the number of microenterprise home kitchen operations permitted to operate within the governing body’s jurisdiction or restrict operations based on geography.
(d) Notwithstanding any ordinance or regulation previously adopted by a city, county, or city and county pursuant to this section or any prior version of this section, a microenterprise home kitchen operation that complies with this chapter shall not be subject to additional local permitting requirements, discretionary review, or operational restrictions that conflict with this chapter.
(e) The governing body of a city, county, or city and county that is designated as the enforcement agency, as defined in Section 113773, shall make permits available pursuant to this section no later than July 1, 2027.

SEC. 3.
No reimbursement is required by this act pursuant to Section 6 of Article XIII B of the California Constitution for certain costs that may be incurred by a local agency or school district because, in that regard, this act creates a new crime or infraction, eliminates a crime or infraction, or changes the penalty for a crime or infraction, within the meaning of Section 17556 of the Government Code, or changes the definition of a crime within the meaning of Section 6 of Article XIII B of the California Constitution.
However, if the Commission on State Mandates determines that this act contains other costs mandated by the state, reimbursement to local agencies and school districts for those costs shall be made pursuant to Part 7 (commencing with Section 17500) of Division 4 of Title 2 of the Government Code.