If you still think of hot dogs and deep dish pizza as the icons of Chicago’s culinary scene, you need to think again. The so-called “Capital of the Midwest” is a hub of innovation in the food industry. Chicago has the largest food and beverage production in the U.S., with an annual output of $9.4 billion Startup companies in the region raised $723 million in venture capital last year.
“Chicago is one of the most diverse cities for eating,” says Anna Desai, Chicago-based influencer of ‘Would You Like Something to Eat’ on Instagram. ”Our culinary scene is constantly elevating and evolving. We are always just a neighborhood or tollway away from experiencing a new culture and cuisine. I’m most excited when I find an under-the-radar spot or discover a maker who can pair flavors and ingredients that get you curious and wanting more.”
Desai wanted to celebrate and champion the Asian American and Pacific Islanders (AAPI) community in the Chicago food and beverage scene. She says “food has long served as a cultural crossroad” and Chicago’s multicultural cuisine exemplifies that sentiment.
Chicago is home to some of the most creative minds in fermentation, from celebrity chefs, zero waste ventures, alternative protein corporations, the world’s largest commercial kefir producer and plenty of regional and artisanal producers lacto-fermenting vegetables, brewing kombucha and experimenting with microbes in food and drink.
“Chicago is a great food city in its own right, so naturally there is a ton of talent in the fermentation space,” says Sam Smithson, chef and culinary director of CultureBox, a Chicago fermentation subscription box. “The pandemic’s effect on restaurants has also spawned a new wave of fermenters (ourselves included) that are looking for a path outside the grueling and uncertain restaurant structure to display our creative efforts. This new wave is undoubtedly community-motivated and concerned more with mutual aid than competition. There is a general feeling that we are all working towards the same goal so cooperation and collaboration is soaring and we are seeing incredible food come from that.”
Flavor is King
Flavor development is still the prime motivation for chefs to experiment with fermentation. A good example is at Heritage Restaurant and Caviar Bar in Chicago’s Humboldt Park neighborhood.
“Fermentation has been a cornerstone of the restaurant since its inception,” says Tiffany Meikle, co-owner of Heritage with her husband, Guy. “With the diverse cuisines we pull from, both from Eastern and Central Europe and East Asia, we researched fermentation methodologies and histories, and started to ‘connect the dots’ of each culture’s fermentation and pickling backgrounds.”
Menus have included sourdough dark Russian rye bread, toasted caraway sauerkraut, kimchi made from apples, Korean pears and beets and a kimchi using pickled ramps (wild onions). Heritage has also expanded their fermentation program to the bar, where they’ve created homemade kombucha, roasted pineapple tepache, sweet pickled fruits for cocktail garnishes, and kimchi-infused bloody mary mix.
“It’s fascinating to me that there are so many ingredients you can use in a fermented product,” says Claire Ridge, co-founder of Luna Bay Booch, a Chicago-based alcoholic kombucha producer. “People are really experimenting with interesting ingredients in kombucha…I have seen brewers do some of the wildest recipes and some recipes that are very basic.”
Chicago-based Lifeway Kefir is indicative of the innovation taking place in the city. Last year the company expanded into a new space: oat-based fermentation, launching a dairy-free, cultured oat milk with live and active probiotics.
“We’ve spent so many years laying the groundwork in fermented dairy,” says Julie Smolyansky, CEO. “Now we’re experimenting and expanding to see what’s over the next horizon, though we’ll always have kefir as our first love.”
Chicago is home for two inventive fermented alternative protein startups: Nature’s Fynd and Hyfé Foods. Both companies were born out of the desire to create alt foods without damaging the environmental.
“Conscious consumerism is a trend that’s driving many people to try alternative proteins, and it’s not hard to understand why,” says Debbie Yaver, chief scientific officer at Nature’s Fynd. The company uses fermentation technology to grow Fy, a nutritional fungi protein. “Fungi as a source of protein offer a shortcut through the food chain because they don’t require the acres of land or water needed to support plant growth or animal grazing, making fungi-based protein more efficient to produce than other options.”
Alternative foods outlasting the typical trend cycle is a challenge for companies like Nature’s Fynd. When grown at scale, Fy uses 99% less land, 99% less water and emits 94% fewer greenhouse gasses than raising beef. But, to make an impact, “we need more than just vegans and vegetarians to make changes in their diets,” Yaver adds.
Numerous companies are using fermentation as a means to eliminate waste. Hyfé Foods, another player in the alternative protein space, repurposes sugar water from food production to create a low-carb, protein-rich flour. Fermentation turns a waste product into mycelium flour, mycelium being the root network – or hyphae (hence the company name) — of mushrooms.
“[We’re] diverting input to the landfill and reducing greenhouse gas emissions at scale,” says Michelle Ruiz, founder. “Hyfé operates at the intersection of climate and health, enabling regional production of low cost, alternative protein that reduces carbon emissions and is decoupled from agriculture.”
Symmetry Wood is another Chicago upcycler. They convert SCOBY from kombucha into a material, Pyrus, that resembles exotic wood. Founder Gabe Tavas says Pyrus has been used to produce guitar picks, jewelry and veneers. Symmetry uses the discarded SCOBY from local kombucha brand Kombuchade.
Many area restaurants and culinary brands also use fermentation to preserve food for the long Chicago winters, when local produce isn’t available. Pop-up restaurant Andare, for example, incorporates fermentation into classic Italian dishes.
“Finding ways to utilize what would otherwise be waste products inspired our initial dive into fermentation. The goal is not just to use what’s leftover, but to make it into something delicious and unique,” says Mo Scariano, Andare’s CEO. “One of our first dishes employing koji fermentation was a summer squash stuffed cappellacci served with a butter sauce made from carrot juice fermented with arborio rice koji. Living in a place with a short grow season, preservation through fermentation allowed us access throughout the year to ingredients we only have fresh for a few weeks during the summer.”
Despite growing interest and increasing sales, fermenters face some significant hurdles.
Smithson at CultureBox says he sees that consumers are open to unorthodox, less traditional ferments. Though favorites like kombucha and sauerkraut dominate the market, “their share is being encroached on by increasingly more varied and niche ferments.” But getting these products to market can be a challenge. Small-scale, culinary producers are challenged by the regulatory hoops they need to jump through to legally sell ferments – especially unusual ones a food inspector doesn’t recognize.
“The added layer of city regulations on top of state requirements, sluggish health department responses, and inflexible policy chill the potential of small producers,” Smithson says. But he highlights the recently-passed Home-to-Market Act of Illinois as positive legislation helping startup fermenters.
Consumer awareness and education are also vital. “Many longstanding and harmful misconceptions on the safety and value of fermented products still exist,” Smithson says.
Matt Lancor, founder and CEO of Kombuchade makes consumer education a core part of marketing, to align kombucha as a recovery drink.
“Most mainstream kombuchas are marketed towards the yoga/crystal/candle crowd, and I saw a major opportunity to create and market a product for the mainstream athletic community,” he says. “We’re on a mission to educate athletes and the general public about these newly discovered organs [the gut] – our second brain – and fuel the next generation of American athletes with thirst quenching, probiotic rich beverages.”
Product packaging provides much of a consumer’s education. Jack Joseph, founder and CEO of Komunity Kombucha, says simplicity is key.
“People are more conscious of their health now, more than ever before,” he says. “So now it comes down to the education of the product and creating something that is transparent and easy for the consumer to digest.”
Sebastian Vargo of Chicago-based Vargo Brother Ferments agrees.
“Oftentimes food is considered ‘safe’ due to lack of microbes and how sterile it is,” he says. “Fermentation eschews the traditional sense of what makes food ‘safe’. We need to create a set standardized guide for fermented food to follow, and change our view of living foods in general. One of the brightest spots to me is the fact that fermentation is really hitting its stride and finding its place in the modern world, and I don’t see it going anywhere but up in the near future.”
Three Washington breweries are suing the state of Oregon, arguing a law puts out-of-state brewers at an unfair disadvantage.
Oregon allows in-state brewers to sell their beer to licensed retail businesses. Out-of-state breweries that want to do the same must obtain a federal wholesaler’s permit, then use a licensed Oregon distributor. It’s expensive, especially for small- and mid-sized breweries.
Fortside Brewing Co. co-founder Michael DiFabio (pictured on the left with co-founder Mark Doleski) went through the arduous process four years ago, and founded a separate Oregon company (Fortis) just to distribute beer in the state. The process of getting their Washington beer to Oregon customers costs their brewery thousands of dollars a year. Fortside is one of the breweries involved in the lawsuit.
A Seattle Times article points out there is precedent for the case. A 2005 U.S. Supreme Court ruling “established the principle that states could not favor their own alcohol beverage industries.”
The breweries involved – which also include Mirage and Garden Path Fermentation – want Oregon to treat out-of-state breweries the same as they do for in-state ones. Oregon brewers submit a statement each month detailing how much beer they sold. The state calculates the tax due and the breweries pay, with no additional permits or distributor fees.
“We’re just trying to level the playing field,” DiFabio says.
Read more (Seattle Times)
Changes in the global food system influenced the types of laws U.S. legislators passed in 2021. States are loosening the regulations on breweries and wineries, offering more government support to local restaurants, allowing the sale of homemade foods and cracking down on hidden fees from third-party food delivery services.
In our last newsletter, we shared the food and beverage laws passed in 20 states in 2021. The list below completes the balance of the country — Massachusetts to Wyoming.
HB21 — Allows temporary licenses for nonprofit charitable corporations. Allows alcoholic beverages sold to be donated at no charge to the license holder.
HD1331 — Provides that a license to operate a restaurant may be connected to other on-site premises, even if it is not a grocery store.
SB2475 — Extends to-go cocktail sales through May 1, 2022.
SB2603 — Sets minimum standards for the confinement of chickens, veal calves and pigs, and bans the in-state sale of products that don’t comply. Mandates cage-free conditions for egg-laying hens with welfare enrichments like perches, dust bathing areas, scratching areas and next boxes. The law also expands coverage to egg products and liquid eggs.
SB2841 — Reform state’s franchise laws, allowing a new qualified brewer for craft brewers. Allows craft brewers who produce fewer than 250,000 barrels annually to end their contract with a wholesaler. It repeals the state’s 1971 franchise law, enacted to protect in-state distributors from larger, out-of-state, foreign brewers, during a time when the craft beer industry did not exist.
HB4711 — Allows baseball stadiums at Michigan universities to serve alcohol.
SB49 — Allows wineries, breweries and distilleries to operate both an on-premise and off-premise tasting room at the same location.
SB141 — Allows small craft distillers to self-distribute up to 3,000 gallons per year of product to retailers. Also allows craft distillers to ship directly to consumers.
SB142 — Allows a small wine maker to self-distribute directly to retailers.
SB144 — Expands the definition of a mixed spirit drink to allow increased ABV percentage.
SB559 — Amends state liquor code to allow more entertainment complexes to receive liquor licenses; drops number of needed races from seven to two for a motorsports venue to qualify for a liquor license.
SB958 — Raises the sales cap for cottage food sales from $18,000 (formerly the lowest sales cap in the country) to $78,000.
HB562 — Allows online sales of cottage foods.
HB572 — Expands boundaries of resort areas where alcohol can be sold.
HB997 — Authorizes private retailers to obtain wholesaler permits for alcohol sales. Also removes the state’s Department of Revenue as a wholesale distributor of alcohol.
HB1091 — Amends code to increase the alcohol content for alcoholic products. Defines how much product can be produced and sold at a microbrewery.
HB1135 — Allows alcohol delivery from a licensed delivery.
HB1288 — Amends code to allow a charter ship to sell and serve alcohol.
HB537 — Allows online sales of cottage foods and removes the $50,000 sales limit on cottage foods.
HB574 — Prohibits inspectors of agricultural grounds or facilities to enforce laws of states other than MIssouri.
SB126 — Legalizes the permanent sales of to-go alcohol. Also expands the sale of alcohol in the state on Sundays.
HB79 — Provides regulatory clarity for how breweries produce fermented-style beverages, including any alcoholic beverages made by fermentation of malt substitutes, like rice, grain, glucose, sugar or molasses.
HB157 — Removes restrictions for alcohol licensing, allowing brewers and immediate families to both hold a license.
HB226 — Makes permanent the curbside delivery and to-go drink options for licensed retailers established during the Covid-19.
SB199 — Establishes the Montana Local Food Choice Act. The food freedom bill exempts certain homemade or cottage food products from food licensing and inspection regulations. It also expands the types of foods that can be sold.
SB247 — Allows colleges and universities in the state to serve beer and wine at sporting events.
SB320 — Legalizes the home delivery of beer and wine.
LB274 — Amends the Nebraska Liquor Control Act, making permanent licenses to sell to-go alcoholic beverages. Also allows craft breweries and wineries to sell alcoholic beverages at open-air farmers markets.
LB324 — Establishes the Independent Processor Assistance Program, improvising the Nebraska Meat and Poultry Inspection Law. Helps small locker plants make the transition to a federally-inspected facility.
LB396 — Adopts the Nebraska Farm-to-School Program Act, which establishes a structure to facilitate communication between farmers and schools.
SB297 — Requires the Council on Food Security to research and develop recommendations on community gardens and urban farms.
SB307 — Prohibits direct-to-consumer (DTC) shipping of alcohol from both in-state and out-of-state breweries, distilleries and retailers. In-state retailers can also make local deliveries from licensed wholesalers. However, DTC wine shipments will still be allowed.
SB320 — Requires food delivery services such as Uber Eats and DoorDash to disclose fees to consumers, breaking down what price is for food, taxes, delivery fee and commission charted to the restaurant. Restaurant committees are limited to 20% of a credit card processing fee during a state of emergency (like the Covid-19 pandemic).
HB226 — Gives state department of agriculture authority to stop the sale of any produce in violation of state agricultural laws.
HB345 — Establishes a license for wild mushroom harvesters. Allows state department of health and human services to fine people who distribute wild mushrooms without a license.
HB593 — Requires food delivery service to enter into an agreement with a food service establishment before offering delivery service from that restaurant.
SB66 — Allows takeout and delivery of alcoholic beverages.
SB125 — Eases certain regulatory restrictions for a number of beverage manufacturer licenses. Removes limitation on quantity of beer a beverage manufacturer may sell in a day to the public and allows direct-to-consumer shipping to consumers within the state.
SB155 — Allows restaurants to permanently expand dining into a shared space, like a sidewalk or street, with approval from local authorities. This temporary dining space was originally established during the Covid-19 pandemic.
AB1091 — Requires Division of Travel and Tourism to advertise and promote tours of breweries in the State.
AB1478 — Permits theaters with 50 seats or more to apply for liquor license.
AB5906 — Rescinds prohibition on return of certain items purchased from retail food stores during Covid-19 state of emergency. It also provides that future limitations on returns occur during declared public health emergencies.
SB673 — Establishes New Jersey’s first cottage food law (they were the only state in the U.S. without a cottage food law). Allows home-based producers to make food from home rather than a commercial kitchen. These producers must obtain a license every two years, cannot earn more than $50,000 a year and are limited by products that can be sold (though state permission can be granted for additional items).
SB3340 — Expands opportunities for restaurants, bars, distilleries and breweries to operate during the Covid-19 pandemic. Provides outdoor dining space and opens new permits for sales at farmers markets.
SB3364 — Allows certain liquor licenses to acquire alcoholic beverage licenses from a retail food store that is a bankrupt asset.
HM1 — Requests the New Mexico Department of Agriculture to study the economic benefits of regional mobile livestock slaughter units, which would make livestock slaughtering easier for small ranchers.
HB177 — Enacting the Homemade Food Act. Allows anyone in the state to start a cottage food business — and opens sales to be from home and online (cottage food sales were previously limited to events only).
HB255 — Allows restaurants to purchase a liquor license at a more affordable rate ($2,500-$10,000, depending on size) if serving alcohol with dinner. Also allows alcohol deliveries with food.
HB303 — Bans unlawful liquor incentives. No liquor licensee shall accept money or a gift of monetary value to influence the purchase or a certain brand of alcoholic beverage.
SB1 — Allows qualified state food and beverage establishments to claim a temporary gross receipts tax (GRT) deduction on sales of food and beverages from March 2, 2021 through July 1, 2021 as a stimulus incentive.
SB2 — Waives the annual liquor license fees for licensees, aiming to boost businesses hit by the Covid-19 pandemic.
AB952 — Directs the commissioner of agriculture and markets and the commissioner of economic development to work with the state’s land grant university system to produce a report to provide advice, guidance and recommendations on improving the resiliency of the state’s farm and food supply. Also will provide guidance on the related supply chain logistics to address food shortages, food waste and the inability to get New York farm goods to markets that occurred as a result of the Covid-19 pandemic, with the goal of creating permanent solutions beyond the state of emergency to reflect the changing wholesale, retail and consumer marketplace.
AB4613 — Creates a task force on improving urban and rural access to locally produced, healthy foods.
AB5386 — Establishes the New York Soil Health and Climate Resiliency Act to enhance and maintain the health and resilience of agricultural soils. The program will assist farmers in improving the health of their soil. It also establishes a climate resilient farming initiative to promote and encourage farmers to reduce the effects of farming on climate change and to adapt to and mitigate the impact of climate change by improving and maintaining water management systems and soil health.
AB7506 — Requires grease traps at food service establishments be designed to withstand expected loads and prevent unauthorized access, making them safer for the general public.
AB7207 — Authorizes and directs the commissioner of agriculture and markets to conduct a study on urban agriculture, including vertical farming, community gardens and urban farming.
SB1630 — Requires third-party food delivery services to have a valid agreement with a merchant before they advertise, promote or sell the merchant’s products on their platform.
SB2743 — Authorizes the issuance of a temporary retail permit by the state liquor authority to licensees located in a municipality having a population of one million or more persons.
SB6353 — Allows restaurants to utilize municipal spaces like sidewalks and streets for outdoor dining for another year. First granted under an executive order during the Covid-19 pandemic, the law makes restaurant use of public spaces to allow restaurants to recover from the pandemic.
HB4 — Extends ABC permit renewal payment deadlines for bars.
HB890 — Allows consumers to order online and pick-up alcohol from state Alcoholic Beverage Control stores, expands growler sizes from 2 to 4 liters, loosens rules for distillery tours and allows distillers to sell alcohol at festivals.
HB1284 — Modifies special event alcohol permit requirements to remove the rule that persons under 21 years of age must remain out of the area where alcohol is served.
HB1475 — Creates a $10 million agriculture diversification and development fund to provide loans and grants for value-added agriculture businesses in the state.
SB2220 — Moves the sale of Sunday alcohol sales to 8 a.m., the same as the rest of the days of the week in the state..
SB2321 — Allows microberies and taprooms to ship products in-state.
HB665 — Increases the amount a county or independent agricultural society receives for operating expenses from a county. Removes caps on junior club membership .
HB669 — Makes to-go alcohol sales permanent.
HB674 — Allows home delivery of alcohol, as long as the beverage is served in an original container.
SB102 — Sweeping liquor reform. Lowers the age for serving alcohol to 18, expands Designated Outdoor Drinking Areas spaces, clarifies that homebrewers are allowed to brew their own drinks, enter them in tasting competitions and share them at local club gatherings.
HB1032 — Creates the Homemade Food Freedom Act which provides for regulation and oversight for the production, transportation and sale of homemade food products. Now allows almost all types of baked, non-perishable and perishable foods. Also increases sale limits from $20,000 to $75,000, allows direct sales and allows shipment of non-perishable items.
HB2117 — Allows certain communication and interaction via social media by alcohol wholesalers, beer distributors and retailers.
HB2122 — Allows the sale of to-go cocktails, mixed drinks or single-serve wine in a sealed container for off-premise consumption.
HB2277 — Permits licensed alcohol retailers to offer different drink specials at various locations owned and operated under their license, like a happy hour.
HB2380 — Allows customers to self-pour their own beer, wine or mixed beverage from automated machines.
HB2726 — Allows Oklahoma small businesses to offer bottle service to their customers.
SB85 — Authorizes holders of multiple small brewer licenses to sell beer at multiple locations.
SB262 — Requires wine and spirit wholesalers to remit alcohol excise taxes when purchasing alcoholic beverages for sale within the state except for wine shipped by wineries possessing a Winemaker Self-Distribution License.
SB315 — Allows licensed distillers to sell spirits for on- or off-premise consumption on distillery property or in an area connected and controlled by the licensee.
SB385 — Allows retail spirits, wine and beer licensees to host alcoholic beverage tastings.
SB499 — Requires that customer receipts for alcoholic beverages purchased at catered, public and special events include a line item for the 13.5% tax collected.
SB760 — Allows multiple alcohol licensees to designate a common drinking area.
HB2111 — Changes name of “Oregon Liquor Control Commission” to “Oregon Liquor and Cannabis Commission.”
HB2264 — Alcohol reform bill. Allows Indian tribe or airline that holds full on-premises sales license to negotiate with Oregon Liquor Control Commission purchase price of distilled liquor for specified sales. Directs Oregon Liquor Control Commission to study alcohol. Changes definition of “malt beverage.” Allows nonprofit organizations to sell alcoholic beverages for up to 45 calendar days per year without license issued by commission. Allows holder of full on-premises sales license to sell, deliver and ship to consumers specified alcoholic beverages for off-premises consumption. Allows holder of limited on-premises sales license to deliver and ship to consumers specific alcoholic beverages for off-premises consumption. Allows holder of off-premises sales license to sell specified alcoholic beverages for off-premises consumption. Allows holder of temporary sales license to ship specified alcoholic beverages to consumer. Repeals license application fee. Allows advertising by liquor store to be visible from outside store. Specifies that retail sales or distillery outlet agent’s deposit with commission is of check and cash receipts. Specifies wine containing more than 16% alcohol by volume is taxed at 10 cents per gallon. Requires manufacturer, purchaser and distributor of alcohol to retain records for three years.
HB2742 — Allows holder of off-premises sales license to sell factory-sealed containers of malt beverages that hold more than seven gallons.
HB2363 — Allows certain holders of temporary event licenses to sell specified alcoholic beverages for on and off-premises consumption at more than one location on licensed premises — or have up to three premises licensed under single temporary sales license and operate for up to 30 day.
HB2395 — Modifies single-use checkout bag prohibition in the state. Changes definition of “recycled paper checkout bag” to include bags that contain non wood renewable fiber.
HB2611 — Permits agricultural building to be used for uses other than uses set forth in definition of “agricultural building” if additional uses are incidental and accessory to defined uses, are personal to farm owner and farm owner’s immediate family or household and do not pose hazard.
HB3361 — Requires third-party food platform to enter into agreement with restaurant before arranging delivery of orders from food place or listing food place on application or website. Requires third-party food platform delivery service to receive written consent from restaurant before arranging for delivery or order from restaurant.
SB806 — Includes “fortified cider” in definition of cider. Allows holder of direct shipper permit to ship up to five cases of wine per month to Oregon residents. Deletes requirement that commission charge application fee for new licenses. Provides that the alcohol commission may allow applicant to defer or waive payment of annual license fee if Governor declares state of emergency.
HB425 — Allows a liquor licensee that has closed either permanently or for a long time to sell its liquor license.
HB427 — Gives establishments with liquor licenses a 15% discount (instead of 10%) on the purchase of liquor from the state stores for three years.
SB434 — Alters “sell by” and “best by” dates on milk. Allows processors to apply for Department of Agriculture approval to exceed the current 17 day limit.
HB5131 — Prohibits a food service establishment from providing a consumer with a single-use plastic straw, unless the consumer requests such a straw.
HB5214 — Eliminates the $10.00 fee requirement for businesses to obtain a sales tax permit.
HB5758 — Establishes the state’s first Cottage Food Law, but only allows farmers to sell homemade products.
SB142 — Allows the sale of alcoholic beverages on New Year’s Day by retail Class A licensees.
SB364 — Entitles dairy farms to the exemptions from taxation already granted to farmland, forestland and open space.
SB555 — Authorizes a Class B liquor license holder to sell to-go alcoholic beverages with take-out food orders (but rule will sunset on March 1, 2022).
SB788 — Prevents third-party food delivery services from using the likeness, registered trademark or any intellectual property belonging to the restaurant to falsely suggest sponsorship or endorsement without the restaurant’s consent.
SB619 — Allows more off-site tasting rooms in the state. Amends 1976 law affecting distilleries, breweries and wineries, to establish off-site “satellite locations” for sale of their products.
HB1109 — Updates state homebrew legislation to include cider as a permissible homemade alcoholic beverage. Allows (in limited quantities) for homemade alcoholic beverages permissible to be sold on licensed premises for certain events, and allows homebrewers to transport homemade alcoholic beverages from their household.
HB1121 — Deregulates the homemade or cottage food market. Repeals requirement that homemade canned goods must be inspected by a third-party authority for pH levels. Replaces lengthy warning that food wasn’t produced in a commercial kitchen and required allergen listing with a shorter summary. Allows sellers to sell their products through third parties without getting a good service license (as long as they aren’t making more than $150,000 a year).
HB1153 — Authorize the Board of Regents to contract for the design and construction of a new dairy research and extension farm on the campus of South Dakota State University, with equipment and furnishings.
HB306 — Extends the Tennessee dairy promotion committee to June 30, 2029.
HB1129 — Adds requirements for farmers to participate in herdshare programs, like maintain owner records, include warning labels on products and notify owners in case of contamination.
HB1514 — Reduces the population threshold (from 925 to 700) to make a municipality eligible to hold a referendum on the sale of alcoholic beverages.
SB17 — Allow breweries to self-distribute 1,800 barrels of beer throughout the state each year without having to go through a wholesaler.
SB269 — Authorizes a delivery service licensee to charge a fee based on a percentage of the sales of the alcoholic beverages or beer being delivered; limits the fee to no more than 10% of the price of each alcoholic beverage sold.
SB299 — Defines “food hall” for purposes of consumption of alcohol on the premises of a food hall; enacts certain requirements governing the operation of a food hall.
SB403 — Requires state to disclose certain information on contracts with wholesalers of alcoholic beverages.
SB591 — Authorizes a person or entity holding liquor license to sell or transfer their alcoholic beverage inventory to another licensee if they’re closing their establishment.
SB681 — Allows to-go alcohol sales for the next two years.
SB705 — Prohibits licensure as a winery direct shipper of in-state or out-of-state wine fulfillment houses.
HB1024 — Allows permanent sales of to-go beer, wine and mixed drinks for pickup and delivery food orders.
HB1276 — Allows restaurants to sell bulk foods directly to the public.
HB1518 — Loosens alcohol restrictions on Sunday mornings, allowing sales starting at 10 a.m. rather than noon.
HB1755 — Allows customers to take home unopened bottles of wine.
HB1957 — Sets new standards on what can be labeled as a Texas wine. If putting Texas on the wine label, winery must grow majority of grapes (75%-95%) within the state, county and/or vineyard on the label.
HR2002 — Recognizing June 2022 as National Dairy Month in Texas.
SB617 — Allows all food producers to sell food directly to consumers, not just farmers. Limits permit fees.
SB911 — Bans third-party food delivery service from using a restaurant’s trademark or charging a restaurant fees (unless agreed upon in writing). Also protects a restaurant from predatory food delivery services — allows a restaurant to be removed from the third-party delivery services listing if requested, and required third-party delivery services to provide consumers with a means to express concerns with their delivery. Gives restaurants the power to sue a third-party delivery service if it violates the terms. Also prohibits cities and counties from creating interfering regulations than what the state approved.
SB1226 — Allows brewpubs to legally host tastings.
HB94 — Legalizes microenterprise home kitchens, allowing home chefs to sell their homemade meals.
HB296 — Creates the Utah Soil Health Program.
SB137 — Gives the Utah Department of Alcoholic Beverage Control an additional $4.3 million to raise salaries for its retail clerks, warehouse workers, store managers and assistant managers up to market standards.
SB147 — Prohibits farm owners and operators in the state from confining egg-laying hens to enclosures. Must implement cage-free housing systems by 2025.
HB166 — Criminalizes theft of livestock.
HB218 — Expands raw milk sales for producers selling at farm stands and CSA’s in the states.
HB313 — Extends for two years the governor’s executive order to allow curbside pickup and delivery of alcohol.
HB434 — Establishes the Agricultural Innovation Board.
SB20 — Bans the sale of common items containing PFAS (perfluoroalkyl and polyfluoroalkyl substances used to make food packaging grease- and water-resistant). The bill takes steps to restrict harmful phthalate and bisphenol chemicals from food packaging.
HB1299 — Allows for the sale of to-go alcohol beverages until July 1, 2022.
HB1902 — Prohibits food vendors from using single-use expanded polystyrene food service containers. Requires chain restaurants to stop using such containers by July 1, 2023, and sets the date for compliance by all food vendors as July 1, 2025. A penalty will be inflicted of $50 a day for violators.
HB1973 — Allows nonprofits conducting online fundraisers to sell and ship wine in closed containers as part of a fundraising activity.
HB2068 — Establishes the Local Food and Farming Infrastructure Grant Program. The governor will award the grants based on infrastructure development projects that support local food production and sustainable farming.
HB2302 — Allows farmers markets to be treated as grocery stores during state of emergency and are allowed to remain open as essential businesses during a state of emergency declared by the Governor.
SB1188 — Establishes the Virginia Agriculture Food Assistance Program and Fund for Virginia farmers and food producers to donate, sell, or otherwise provide agriculture products to charitable food assistance organizations.
SB1193 — Establishes the Dairy Producer Margin Coverage Premium Assistance Program. Gives dairy farmers (with a resource management or nutrition management plan) the ability to receive a refund of their annual premium payment paid into the federal program.
SB1428 — Prohibits the Virginia Alcoholic Beverage Control Authority from selling in government stores low alcohol beverage coolers not manufactured by licensed distillers.
SB1471 — Allows the Board of Directors of the Virginia Alcoholic Beverage Control Authority to increase the frequency and duration of outdoor events that sell alcohol. The laws are expected to provide flexibility to restaurants during COVID-19.
HB1145 — Allows the use of non wood renewable fiber in recycled paper carryout bags.
HB1480 — Allows sale of to-go alcohol products, including cocktail kits and growlers.
HB5362 — Ensuring the funding of agricultural fairs.
SB5022 — Enacts recycling requirements for plastic beverage containers. Bans polystyrene (EPS) products and sets-up opt-in requirements for dining establishments using single-use foodware.
SB5272 — Waives a one-time annual liquor license and cannabis license fee for those establishments for 12 months.
SB 51 — Requires dairy foods processed in the state to be added to the list of items to be purchased by state-funded institutions.
SB 58 — Creates the West Virginia Farm Fresh Dairy Act.
SB56 — Allows alcohol beverage retailers to make online or phone sales of alcohol beverages, to be picked up by the customers at a designated parking space that is not part of the retail licensed premises.
HB13 — Increases the amount of wine that a licensed out-of-state wine shipper may ship to any one household address. Allows Wyoming consumers to receive up to 12 cases of wine in a 12-month period (the former limit was four cases per year).
HB51 — Establishes grant program to meat processing facilities suffering during the COVID-19 pandemic.
HB54 — Focuses efforts and resources of the Wyoming Business Council on developing slaughter plant options for producers.
HB118 — Allows sale of eggs under the state’s Food Freedom Act.
HB156 — Allows winery permit holder to be issued an off-premise wine permit for a 24-hour period.
HB159 — Allows any liquor license holder — who then obtains an out-of-state shipper’s license — to ship alcohol to Wyoming households. Increases satellite permits for liquor manufacturers from one to two.
HB229 — Allows Wyoming ranchers the choice of selecting lawful forms of animal identification devices. Rejects USDA mandate to only use higher-cost RFID ear tags for livestock.
After the Covid-19 pandemic shortened their legislative sessions last year, lawmakers across the 50 states had a productive year in 2021. State leaders were able to pass hundreds of bills relating to food, beverages and food service.
Numerous new laws were aimed at helping restaurants survive — permitting permanent outdoor dining spaces, allowing carryout food services and to-go alcohol sales. Many of these regulations had been enacted in 2020 as temporary, emergency measures to aid restaurateurs, but expired this year.
This year was also big for cottage food laws. As more people experimented in their home kitchens during the pandemic, there was pressure to modernize cottage food laws. Over half the states updated their laws in 2021, regulating sales of homemade food.
Below are the key food, beverage and food service laws passed this year in, alphabetically, Alabama through Maryland. We’ll feature the balance of the states — Massachusetts to Wyoming — in TFA’s next newsletter (January 12, 2022).
HB12 — Extends protections granted for cottage food businesses to include roasted coffees and gluten-free baking mixes.
HB539 — Increases the amount of alcohol which breweries and distilleries can sell to customers for off-premise consumption.
SB126 — Allows licensed state businesses to deliver wine, beer and spirits to customers’ homes.
SB160 — An update to Alabama’s cottage food law, SB160 allows for most non-perishable foods to be made in home-based food businesses without commercial licenses (instead of just only baked goods, jams/jellies, dried herbs and candies). It also removes the $20,000 sales limit for home-based food businesses. It also allows online sales and in-state shipping of products.
SB167 — Permits Alabama wineries to sell directly to consumers at special events.
SB294 — Authorizes wine manufacturers to sell directly to retailers without a distributor.
SB397 — Allows opening of wineries in Alabama’s 24 dry counties. The wineries will be allowed to produce and operate in a dry county, but they may not sell on premise.
HB22 — Legalizes herd share agreements for the distribution of raw milk in the state.
HB2305 — Amends law to allow two or more liquor producers, craft distillers or microbrewery licenses at one location.
HB2753 — States that licensed producers, craft distillers, brewers and farm wineries are subject to rules and exemptions prescribed by the FDA. Exempts production and storage spaces from state regulation.
HB2773 — Allows bars, liquor stores and restaurants to sell cocktails to-go.
HB2884 — Exempts alcohol produced on premise in liquor-licensed businesses from food safety regulation by the Arizona Department of Health Services, which adds rules regarding production, processing, labeling, storing, handling, serving, transportation and inspection. Specifies that this exemption includes microbreweries, farm wineries and/or craft distilleries.
HB118 — Permits the sale of cottage foods over the internet. Interstate sales are permitted if the producer complies with federal food safety regulations.
HB1228 — Allows for municipalities in dry counties to apply to be an entertainment district, just like in wet counties.
HB1370 — Establishes mead as an allowed liquor for a small farm winery — and allows wineries to ship mead. Also allows for mead to be taxed in the same manner as wine.
HB1426 — Establishes the Arkansas Fair Food Delivery Act, stating that a food delivery platform (like UberEats) must have an agreement with a restaurant or facility to take food orders and deliver food prepared.
HB1763 — Allows distilleries to self distribute their own products and allows out-of-state, direct-to-consumer shipments.
HB1845 — Restricts advertising alcohol in microbrewery-restaurants in dry counties.
SB248 — Replaces Arkansas’ cottage food law with the Food Freedom Act. Allows all types of non-perishable foods to be sold almost anywhere without a food safety license and certification, including grocery stores and retail shops.
SB339 — Allows permitted restaurants to sell on-the-go alcoholic beverages.
SB479 — Allows restaurants with alcohol beverage permits to expand outdoor dining without approval of the Alcoholic Beverage Control Division.
SB554 — Authorizes beer wholesalers to distribute certain ready-to-drink products.
SB631 — Authorizes a hard cider manufacturer to deliver hard cider.
AB61 — Allows restaurants and bars with alcohol licenses that added temporary, outdoor sidewalk dining spaces during the Covid-19 pandemic to continue serving alcohol in these spaces.
AB239 — Allows wineries to refill wine bottles at off-site tasting rooms, similar to breweries reusing growlers
AB286 — Requires third-party delivery companies to itemize cost breakdowns of delivery transactions to both restaurants and customers.
AB425 — Updates regulations regarding definitions, assessments, fees and funding mechanisms for the Dairy Council of California.
AB831 — Mandates that all labels on cottage food must include the disclaimer “Made in a Home Kitchen” along with the producer’s county and cottage food permit number.
AB941 — Establishes a grant program for counties to apply for farmworker resource centers, supplying farmworkers and their families information on education, housing, payroll, wage rights and health services.
AB962 — Requires the creation of a returnable bottle system in the state by 2024. Allows recyclable bottles to be washed and refilled by beverage producers rather than being crushed for recycling.
AB1144 — Updates California’s outdated cottage food laws, raising sales limit to either $75,000 (Class A permits) or $150,000 (Class B permits) and simplifying the approval process for sampling cottage food products. Also allows homemade food to be sold online.
AB1200 — By 2023, no eatery in California is permitted to distribute or sell food packaging that contains regulated perfluoroalkyl and polyfluoroalkyl substances or PFAS. Manufacturers of food packing must use the least toxic alternative when replacing their food packaging. Food packaging includes food or beverage containers, take-out containers, liners, wrappes, eating utensils, straws, disposable plates, bowls and trays.
AB1267 — Allows licensed manufacturers, distributors and sellers of alcoholic beverages to donate a portion of beverage purchases to a nonprofit.
AB1276 — Requires California eateries to only give take-out customers single-use utensils and condiment packets if they ask for them.
AR15 — Establishes Nov. 22 as Kimchi Day in the state.
SB19 — Allows wineries to open additional off-site tasting rooms without applying for a new license (former law allowed for only one off-site tasting room).
SB314 — Allows restaurants and bars that added temporary, outdoor sidewalk dining spaces during the Covid-19 pandemic a one-year grace period to apply for permanent expansion.
SB389 — Allows restaurants and bars to serve to-go alcohol alongside a meal.
SB453 — Establishes an Agricultural Biosecurity Fund specifically for the California State University system’s Agricultural Research Institute. The California State University’s 23 campuses and 8 off-campus branches can then use that fund to apply for grants related to supporting research on agriculture biosecurity, best practices around infectious agents hurting the state’s animal herds and plant crops.
SB517 — Authorizes a licensed beer manufacturer who obtains a beer direct shipper permit to sell and ship beer directly to a resident of the state for personal use.
SB535 — Makes it unlawful to manufacture or sell imitation olive oil in the state. Also restricts using “California Olive Oil” on a label unless 100% of the oil is derived from olives grown in California. The label can also only share that the oil comes from a specific region of California if at least 85% of the olives were grown in that region.
SB721 — Establishes Aug. 24 as California Farmworker Day.
HB1027 — Extends sales of to-go alcohol from licensed restaurants and bars to 2026.
HB1162 — The Plastic Pollution Reduction Act, the law bans single-use plastic bags and containers made from polystyrene (styrofoam) for restaurants and other retailers by 2024. All stores will also implement a 10-cent bag fee for plastic and paper bags by 2023.
SB35 — Prohibits third-party restaurant delivery services from cutting pay to a driver to comply with fee limits. Also prohibits third-party delivery services from putting restaurants on their platforms without the eateries’ permission.
SB235 — Sends the Department of Agriculture $5 million for energy efficiency and soil health programs.
SB270 — Allows more Colorado wineries, cideries and distillers to attain a pub license and sell a variety of food in addition to their craft beverage. Current law puts small limits on the amount of craft drink made for a brewery to sell food, leaving out larger Colorado producers.
HB5311 — Enables permitted transporter to sell and serve alcohol on boats, motor vehicles and limousines.
HB6610 — Codifies expanded outdoor dining, allowing municipalities to close off streets and sidewalks for outdoor restaurant dining space.
SB894 — Allows patrons to pour their own alcoholic drinks at restaurants and bars. Will allow self-pour automated systems to be used in the state’s dining establishments.
HB6580 — Expands food agricultural literacy programs of study and community outreach, by increasing certification, education and extension programs with rural suburban and urban farms for students in grades Kindergarten through 12th grade.
HB1 — Allows restaurants to continue selling to-go alcohol beverages. The bill also allows restaurants and bars to continue using outdoor dining spaces originally used during the Covid-19 pandemic.
HB46 — Allows brewery-pub and microbrewery license holders to brew, bottle and sell hard seltzers and other fermented beverages made from malt substitutes. Also includes a specific tax on fermented beverages.
HB143 — Reduces the amount of licensed taprooms to only one taproom within a ½ mile from another taproom.
HB212 — Increases minimum thickness for plastic bags (used by grocery stores and restaurants) to qualify as a reusable bag from 2.25 mils to 10 mils.
SB46 — Allows wedding venues and event centers licensed as bottle clubs to allow customers to bring alcoholic beverages on premise.
HB751 — Authorizes issuance of special licenses to mobile food vehicles to sell alcohol beverages within certain areas.
HB1647 — Allows more Orlando eateries to sell alcohol. Allows eateries with a smaller footprint (80-person capacity; formerly 150-person capacity) to sell beer, wine and spirits in six additional Orlando Main Street Districts.
SB46 — Increases production limits for distilleries from 75,000 gallons a year to 250,000 gallons. Eliminates the “six bottles per person per brand per year” requirement. Also allows craft distilleries to qualify for a vendor’s license to conduct tastings at Florida’s fairs, trade shows, farmers markets, expositions and festivals.
SB148 — Authorizes restaurants or bars also holding a public food service license to sell or deliver alcoholic beverages in sealed, to-go containers.
SB628 — Establishes a new program, the Urban Agriculture Pilot Project, to distinguish between traditional rural farms and emerging urban farms. Exempts farm equipment used in urban agriculture from being stored in certain boundaries.
SB663 — Updates Florida’s cottage food law to allow shipping of products, and raises the sales limit for shipped cottage food from $50,000 to $250,000. The bill also prevents counties or cities from banning cottage food businesses (Ed. note: Florida’s largest county, Miami-Dade, prohibits cottage food businesses).
SR2041 — Establishes a Food Waste Prevention Week in the state to acknowledge the importance of conserving food and preventing food waste.
HB273 — Allows local municipalities to pass an ordinance, resolution or referendum election to authorize allowing a liquor store to open in their jurisdiction
HB392 — Allows a person to have a mixed cocktail or draft beer from the hotel delivered to their room by a hotel employee.
HB498 — Expands eligibility requirements for the state’s tax exemption for agricultural equipment and farm products. Any family-owned farm entity (defined as two or more unrelated, family-owned farms) can now share equipment, land and labor without losing ad valorem tax exemptions enjoyed by stand-alone family farms.
HB676 — Creates a legislative advisory committee on farmers’ markets (Farmers’ Markets Legislative Advisory Committee), made up of five members from the state’s Senate and House.
SR155 — Recognized February 17 as State Restaurant Day.
SB219 — Permits small brewers to sell alcohol for consumption on their premise. Allows state’s breweries to transfer beer between locations.
SB236 — Extends the Covid-era rule that allows restaurants to sell to-go alcohol.
HB817 — Requires state agencies to purchase an increasing amount of locally grown food.
HB237 — Earmarks $350,000 to the department of agriculture for the mitigation and control of the two-lined spittlebug, which has damaged nearly 2,000-acres of pasture land.
SB263 — Establishes a “Hawaii Made” program and trademark, to promote Hawaiian-made products.
HB51 — Amends existing law to provide nutrient management standards on dairy farms. Allows dairy farmers the option of using phosphorus nutrients.
HB232 — Changes the distribution of tax on high-alcohol-content beer from the state wine commission to the state hop growers commission, helping promote the craft industry.
HB2620 — Allows small breweries, meaderies and winemakers to distribute their products to local bars, grocery stores and liquor stores directly rather than through a third party.
HB3490 — Amends Illinois Food, Drug and Cosmetic Act, which says, if a restaurant includes milk as a default beverage in a kid’s meal, the drink must be dairy milk and contain no more than 130 calories per container or serving.
HB3495 — The Brewers Economic Equity & Relief Act, allows for limited brewpub self-distribution, permanent delivery for small alcohol producers, direct-to-consumer shipping for in-state and out-of-state brewers and distillers and self-distribution for manufacturers producing more than one type of alcohol.
HR33 — Creates the Illinois Good Food Purchasing Policy Task Force to study the current procurement of food within the state and explore how Good Food Purchasing can be implemented to maximize the procurement of healthy foods that are sustainably, locally and equitably sourced.
HR46 — Urges the Illinois Department of Agriculture to study the effects and the types of land loss to Black farmers. Calls for state support and capacity building for Black farming communities across the state and a dedication to helping grow agriculture in rural, urban, and suburban areas.
HR117 — Urges the United States Department of Agriculture and the United States Department of Commerce to increase the exportation of Illinois dairy products to other nations.
SB2007 — The Home-to-Market Act, updates the state’s Illinois Cottage Food Law. Expands sales avenues for cottage food producers, allowing sales at fairs, festivals, home sales, pick-up, delivery and shipping (cottage food was previously only allowed to be sold at farmers markets).
HB1396 — Updates many of Indiana’s outdated alcohol laws, some from the Prohibition Era. Amended various sections of Indiana’s alcohol code impacting permittees, trade regulation and other various definitions.
HB2773 — Allows bars, liquor stores and restaurants to permanently sell to-go alcohol orders, originally allowed temporarily during the Covid-19 pandemic.
SB144 — Allows bulk wine purchasing limits for farm wineries to apply only to wine sold directly to a consumer and not to wine sold through a wholesaler. Also allows the holder of an artisan distiller permit to also hold a distiller’s permit.
SB185 — Creates a working group made up of industry organizations, food safety experts, Indiana State Department of Health, Indiana State Board of Animal Health and Indiana State Department of Agriculture to submit recommendations to the state concerning home-based vendors and cottage food laws.
HB384 — Updates rules regarding alcohol licenses. Lengthens the hours of sale for alcoholic beverages on Sunday.
HF766 — Allows home delivery of alcoholic beverages from bars and restaurants by third-party delivery services, such as Uber or DoorDash.
HB2137 — Allows bars, liquor stores and restaurants to permanently sell to-go alcohol orders, originally allowed temporarily during the Covid-19 pandemic.
HR3 — Recognizes March 23 as Agricultural Day in the state.
HR19 — Recognizes June as Dairy Month, honoring the state’s dairy workers.
SB15 — Allows a microbrewery licensee to sell and deliver up to 2,500 barrels of product to any retail licensee and to set forth terms of contracts between microbrewers and distributors.
SB67 — Allows bars, liquor stores and restaurants to permanently sell to-go alcohol orders, originally allowed temporarily during the Covid-19 pandemic.
HB192 — Authorizes credit card payment to manufacturers and wholesale dealers of alcoholic beverages (when previously cash was only allowed).
HB219 — Allows the delivery of ready-to-drink alcohol beverages (sold in manufacturer sealed containers), allowing brewers with a brewing facility to self-distribute.
HB269 — Allows authorized state employees to destroy meat, seafood, poultry, vegetables, fruit or other perishable food of foreign origin which are subject of a current import ban from the federal government.
HB291 — Allows self-distribution to any brewer who operates a brewing facility in the state.
HB706 — Adds microwinery to microdistillery permits.
HR104 — Designates May 19, 2021, as Louisiana Craft Brewers’ Day in the state.
HR210 — Authorizes a state subcommittee to study and make recommendations to the government on the regulation of the growing craft brewing industry in the state.
SB133 — Clarifies that licensed Maine manufacturers of spirits, wine, malt liquor and low-alcohol spirits products may sell and ship their products to a person located in another state.
SB205 — Allows bars and restaurants to permanently sell to-go alcohol orders through take-out and delivery services if the liquor is accompanied by a food order. Also temporarily permits licensed Maine distilleries that operate tasting rooms but do not operate licensed on-premise retail to sell spirits through take-out and delivery services accompanied by a food order.
SB306 — Temporarily waives certain requirements for relicensing for restaurants that serve liquor to help food establishments during the Covid-19 pandemic.
SB307 — Allows all Maine alcohol manufacturers to sell directly to out-of-state consumers (current law only allows wine to be sold out-of-state).
SB479 — Amends definition of “low-alcohol spirits product” by raising the maximum alcohol level of a low-alcohol spirits product from 8% to 15%.
SB630 — Prohibits shelf-stable products from being sold as cider. Products that do not require refrigeration or are heat-treated cannot be labeled as cider.
SB636 — Establishes the Local Foods Fund, which helps schools purchase produce and other minimally processed foods from local farmers and producers.
SB822 — An act affirming that food seeds are a necessity in the state.
HB185 — Prohibits an alcoholic beverages license holder from requiring that an individual buy more than one bottle, container or other serving of alcohol at a time.
HB264 — Requires entities that generate at least two tons of organic waste per week to arrange for disposal alternatives, like reduction, donation, animal feed or composting.
HB269 — Establishes the Urban Agriculture Grant Program in the Department of Agriculture to increase the viability of urban farming and improve access to urban-grown foods.
HB 555 — Repeals a prohibition on allowing drugstores to apply for a liquor license.
HB1232 — Codifies emergency orders to grant permanent to-go delivery of alcohol and online shipment privileges.
SB205 — Authorizes local alcoholic beverage licensing boards to temporarily allow restaurants and bars to sell to-go alcoholic beverages. Also requires Maryland’s Alcohol and Tobacco Commission and the Maryland Department of Health to study expanding alcohol access.
SB821 — Codifies the governor’s 2020 executive order to grant alcohol delivery and shipment. Also allows permitting to serve alcohol at off-premise, special events.
Brands need to be extra vigilant over the health claims they put on their labels. A simple phrase like “Supports immunity,” “Aids respiratory health” or “Full of natural flavors” could result in a lawsuit from the Food and Drug Administration (FDA), Federal Trade Commission (FTC) or a state attorney general.
“The FDA is able to set very broad and very narrow regulations in terms of what our labels can look like, what can be included in the products, what kind of claims we can make for the products, who the products can be distributed too, how they can be imported and exported and the like,” says Claudia Lewis, partner at Venable LLP, a Washington D.C.-based law firm.
Complying with these sometimes archaic laws can be challenging. The FDA, which ensures food safety, has a large jurisdictional footprint, regulating about 30 cents of every dollar Americans spend. The FTC is the authority on advertising and marketing claims for food, beverage and supplement products, and it may challenge a food brand if its marketing is deemed false, deceptive and/or misleading.
“Typically, if you’re in an FTC investigation, you’re going to have at least $300,000 in legal fees by the time you’re finished, if not over half a million dollars,” says Todd Harrison, partner at Venable. “The FTC is a very expensive regulatory agency to deal with. They can make your life pretty miserable.”
Harrison and Lewis specialize in representing functional food brands at their law firm and spoke at Expo East on the topic of Legal and Regulatory State of the Natural Products Industry. [The Fermentation Association’s virtual conference, FERMENTATION 2021 will also cover this and related topics — please check our Agenda for the latest sessions and speakers.]
Harrison and Lewis reviewed two main areas where improper labeling can get a food brand into trouble with regulators.
Using Covid-19 as a Marketing Tool
Shortly after the Covid-19 pandemic started, the FDA offered a unique relaxation of their rules and regulations for food products. Brands were challenged with supply chain disruptions and ingredient shortages. The FDA allowed temporary ingredient and formulation changes without a label overhaul, as long as the new ingredient was non-allergenic, 2% or less of the weight of the finished product, not a main or characterizing ingredient and not affecting health claims.
Though the temporary rule allows for flexibility, Harrison advises it still leaves room for litigation. Plaintiff attorneys can still sue for changes in a product’s flavor.
“Minor changes are fine from an FDA perspective, but not necessarily good from a plaintiff perspective,” he adds.
Covid-19 has also spurred a gray area in food marketing claims. Labels claiming the product prevents, treats or mitigates Covid-19 are illegal and being “aggressively pursued.”
“Anytime you mention the word coronavirus or Covid, the FDA is not going to agree with what you say because everyone will think you’re somehow implying something,” Harrison says.
Context is critical, as the agency is cracking down on any brands making health claims implying their product could prevent Covid. Brands using the phrases “immunity support” or “immune boosting” on their labels — or even on their social media pages — could be targeted by the FDA.
“The FDA has historically not liked (brands to use the term) immunity, but it was always low risk (pre-pandemic), you’d likely get a warning letter,” Harrison says. “However, in the world we live in today, the word immunity is persona non grata to the agency. Especially if you add the word respiratory on it. If you put the words ‘immunity’ and ‘respiratory’ on a label, the agency is saying ‘It’s Covid.’”
Harrison also cautions against connecting science-backed supplements and vitamins to treating a Covid infection. He uses the example of vitamin D — plentiful scientific research proves vitamin D boosts immunity, but a food brand cannot legally make that association, and doing so can set it up for litigation. Though vitamin D “is a cheap way of helping reduce your risk of (Covid-19) severity, it’s not going to keep you from getting Covid,” Harrison explains. “The way the paradigm is set up, even if you have really good science in your favor, you can’t make the claim unless you have approval by the FDA.”
“Natural” and “Health Food” Still Debatable Terms
Because there is no FDA or FTC definition of “natural,” lawsuits against brands claiming their product is natural or similar claims are prevalent. (The FDA requested public comments on the term “natural” in 2016, but no rule was issued on the policy.)
And these lawsuits don’t always come from the federal agencies. Class action lawsuits are “still alive and well,” Lewis adds. A formal definition would help protect brands because plaintiffs are filling in the holes and filing costly lawsuits. She uses the example of Welch’s Fruit Snacks, which was sued for being “more candy than fruit.”
“The plaintiffs bar has seized on that and taken these companies to task,” she says. “This wording about ‘healthy’ and this wording of ‘natural’ is also taking on a different dynamic because of consumer perception. How consumers perceive these words and how consumers’ expectations are not keeping with FDA regulations, but the plaintiff bar is using that as an opening and getting pretty good settlements in connection with consumer perception.”
Making a health inference is a slippery slope. The FDA deems a healthy food as one that suggests the product can help maintain “healthy dietary practices.” Health foods are required to be low in fat, saturated fat, cholesterol and sodium.One or more qualifying nutrients must also make up at least 10% of their weight..
For example, IZZE, makers of sparkling juices, was sued for misleading marketing because, though the drink advertised “no sugar added,” it failed to disclose it was not low in calories — a requirement under FDA regulations. Harrison takes issue with the FDA defining healthy in these confusing terms.
“I’d say it’s unconstitutional and I think I’d win that case because healthy is now low fat, low saturated food and a certain amount of macronutrients. It’s a much more complex question than that. But yet this is what plaintiff attorneys seize on,” Harrison says.
Though a new food product may be utilizing health ingredients on the cutting edge of scientific research, Harrison warns the FDA is “notoriously behind nutrition science” and brands need to be careful. He says don’t trust the government agency to keep up.
“Nutrition has evolved and continues to evolve,” he says, noting the FDA regulation to put “low fat” as a nutrient content claim just stripped fat out of food (including beneficial fat) and replaced it with simple carbohydrates. Most members of Congress “don’t know a damn thing” about health food. “We know what’s good for us. We’re not stupid people.”
Kombucha producers across the U.S. have organized an awareness campaign for the KOMBUCHA Act. The legislation — which was reintroduced into Congress this year for the 5th year in a row — would exempt kombucha from excise taxes intended for alcoholic beverages.
The KOMBUCHA ACT Days of Action, organized by the trade organization Kombucha Brewers International (KBI), is from September 14 to 18. The act would raise the alcohol by volume (ABV) threshold for kombucha from its current level of 0.5% to 1.25%. Producers plan to lobby, emailing representatives, posting on social media and encouraging the public to sign a petition in support of the bipartisan bill.
In a statement from KBI President Hannah Crum, she points out that kombucha is not an alcoholic beverage. The fermented tea rarely exceeds 0.5% ABV, while light lager beers contain about 3.2% ABV and most craft beers are 5% or higher. (Note: hard kombucha, an increasingly popular drink option, is specifically brewed to have higher alcoholic content and is labeled accordingly.). Here are some of the key paragraphs from her statement:
“Today, most kombucha sold in the United States contains trace amounts of alcohol due to the fermentation that occurs during production. The alcohol, a natural preservative, acts to protect kombucha’s live cultures, as well as the safety of consumers, from unwanted pathogens,” Crum says. “Traditionally made kombucha seldom tests above 1 percent ABV, as kombucha cultures are not suited to high levels of alcohol, so this level allows kombucha brewers to feel confident distributing their products by providing ample buffer room to shield them from the threat of this tax.”
“Nevertheless, for the purpose of assessing federal excise taxes on beer for its alcohol content, the Internal Revenue Code defines the term ‘beer’ in a way that encompasses kombucha, if the kombucha contains 0.5 percent or more of ABV.”
“For kombucha brewers, this federal law presents a real dilemma. While their kombucha may be leaving the facility below the 0.5 percent ABV threshold, trace alcohol can increase slightly – in some cases above 0.5 percent ABV – if the product is exposed to temperature fluctuations on distribution trucks or grocery store shelves after it has left the kombucha brewery.”
“Under the current law as written, kombucha brewers have a Damocles sword hanging over their heads. That is, their kombucha can leave the brewery untaxed, only for its ABV level to rise slightly above 0.5 percent once out of their control, thus becoming subject to the federal excise taxes.”
Hard cider makers waged a similar battle in 2015. Federal law had limited hard cider to under 7% ABV, but cider makers (particularly smaller producers) found it difficult to control alcohol levels because of apple varieties and cultures. Congress passed a bill increasing the allowable alcohol content in hard cider to 8.5%.
Crum continues: “While hard cider is an alcoholic beverage and kombucha is not, the two products nonetheless share a similar issue: the alcohol level in each can vary naturally due to fermentation.”
“As with cider makers in 2015, this dilemma and the anxiety it causes kombucha brewers would be easily remedied through the enactment of a similar common-sense update: the bipartisan KOMBUCHA Act (H.R. 2124/S. 892) now being considered in Congress. The bill – sponsored by House Representative Earl Blumenauer (D-Oregon) and Senate Finance Committee Chairman Ron Wyden (D-Oregon) – creates an exemption in the tax code for kombucha, so long as the ABV level of the product is 1.25 percent ABV or lower.”
Crum says many kombucha producers limit growing their business “in order to protect themselves from this risk, as well as facing burdensome costs of testing to comply with the arbitrarily restrictive limit.” There are over 600 kombucha producers in the U.S. Kombucha has “garnered a cult following in the last 20 years for its unique taste and probiotic benefits,” she says, adding:
“We are hopeful that Senator Ron Wyden (D-OR) and Congressman Earl Blumenauer (D-OR) and their colleagues on both sides of the aisle (multiple Republicans in various states have co-sponsored the bill) can succeed in getting this legislation enacted into law this year. If they do succeed, they’ll pave the so-far rocky path for a new and rapidly growing industry that promises to add thousands of jobs with benefits to the economy at a time when they are desperately needed.”
For the fifth year in a row, the KOMBUCHA Act was reintroduced to Congress. If the legislation passes, kombucha beverages would be exempt from excise taxes intended for alcoholic beverages. The act proposes to raise the alcohol by volume (ABV) threshold for kombucha from its current level of 0.5% to 1.25%.
“The past year has been incredibly hard on businesses in Oregon and across the country, especially as supply chains have been disrupted. Still, kombucha is one the fastest growing beverage industries in the world,” says U.S. Rep. Earl Blumenauer (D-OR). “There’s no reason why kombucha brewers and sellers should get taxed like beer. Our common sense legislation would eliminate this burden and support a burgeoning industry that has a major impact on Oregon’s food and beverage economy.”
U.S. retail sales of kombucha sales grew 2.4% over the twelve months though mid-July 2020, to $703.2 million, according to SPINS.
“Modernize Taxes & Regulations”
Blumenauer first introduced the bill in 2017 — and has reintroduced it every year since. Senator Ron Wyden (D-OR), the Senate Finance Chair, is the bill’s co-sponsor.
The word “KOMBUCHA” also has a double meaning — it is an acronym for Keeping Our Manufacturers from Being Unfairly taxed while Championing Health Act. The legislators understand kombucha is a fast-growing beverage category, especially in their home state of Oregon, home to many kombucha brands.
“The growth of kombucha production in Oregon and nationwide creates jobs and a beverage folks enjoy,” Wyden said. “It’s been a particularly difficult year for small businesses, and our bill would modernize taxes and regulations so these businesses can continue to grow and sell their products in stores across the country.”
Kombucha Brewers Lobby
Commercial kombucha brewers are especially concerned with the regulation. In 2010, Whole Foods and other retailers pulled kombucha off shelves as the Alcohol and Tobacco Tax and Trade Bureau investigated whether alcohol levels in kombucha were higher than what was printed on the label. And since then, consumers — and even other brands — have filed lawsuits against various kombucha brands, alleging alcohol levels higher than indicated.
Kombucha can keep fermenting after it’s made, as the yeasts continue to eat sugars. Under current law, if kombucha leaves a processing facility at 0.4% ABV, but increases to over 0.5% by the time it’s placed on grocery store shelves, the brewer would have to pay federal alcohol taxes like a beer brand.
Hannah Crum, co-founder and president of Kombucha Brewers International (KBI), the trade organization for kombucha brewers, emphasizes that kombucha producers fear constant repercussions from the law.
“These numbers were created over 100 years ago during prohibition,” says Crum, and notes there are no scientific studies on these ABV values. “Kombucha labels say ‘Alcohol is present’ — no one is trying to trick the consumer.”
Reads a statement from KBI: “ These laws were never intended to make kombucha subject to taxes designated for beer. Passing the KOMBUCHA Act under the next appropriations bill will relieve this unnecessary burden on kombucha brewers. Only kombucha above that level (1.25%) will be subject to federal excise taxes when this Act becomes law.”
KBI has actively lobbied for the bill’s passage. Big kombucha brands (GT’s and Health-Ade) have supported the bill actively. KBI — for the first time — is asking consumers to write to their government representatives (via a form on their website) to urge them to support the bill.
By August, any manufacturer labeling their fermented or hydrolyzed foods or ingredients “gluten-free” must prove that they contain no gluten, have never been through a process to remove gluten, all gluten cross-contact has been eliminated and there are measures in place to prevent gluten contamination in production.
The FDA list includes these foods: cheese, yogurt, vinegar, sauerkraut, pickles, green olives, beers, wine and hydrolyzed plant proteins. This category would also include food derived from fermented or hydrolyzed ingredients, such as chocolate made from fermented cocoa beans or a snack using olives.
Read more (JD Supra Legal News)
Every year, the nation’s 50 state legislatures pass dozens of new laws that have an impact on fermenters. For example, some states amended alcohol laws to allow drink sampling for craft wineries, while others repealed outdated cottage food laws to help small producers operate and more loosened take-out restrictions to help small restaurants survive the pandemic.
Indicative of this year’s focus on the pandemic, laws were introduced but never debated as lawmakers focused on more pressing issues surrounding the coronavirus. The most common new laws passed in 2020 revolved around helping businesses survive — states called special sessions to aid restaurants, stop price gouging of high-demand products and provide emergency grants to small businesses.
Read on for key food, beverage and food service laws passed this year, most taking effect in 2021.
AB82 — Prohibits an establishment with an alcohol license from employing an alcohol server without a valid alcohol server certification.
AB3139 — Establishments with alcoholic beverages licenses who had premises destroyed by fire or “any act of God or other force beyond the control of the licensee” can still carry on business at a location within 1,000 feet of the destroyed premise for up to 180 days.
HB 237 — Eliminates old requirements that movie theaters selling alcohol must have video cameras in each theater, and that an employee must pass through each theater during a movie showing.
HB275 — Permits beer gardens to allow leashed dogs on licensed outdoor patios.
HB349 — Permits any restaurant, brewpub, tavern or taproom with a valid on-premise license to sell alcoholic beverages for take-out or drive through food service, so long as the cost for the alcohol did not exceed 40% of the establishment’s total sales transactions.
SR84 — Creates a Restaurant Reopening Task Force to help restaurants in Hawaii safely reopen that were closed during the COVID-19 pandemic.
SR94 — Urges restaurants to adopt recommended best practices and safety guidelines developed by the United States Food and Drug Administration and National Restaurant Association in response to the COVID-19 pandemic.
HB343 — Amends existing law to require licensing to store and handle wine as a wine warehouse.
HB575 — Allows sampling of alcohol products at liquor stores, which was formerly forbidden under law.
SB1223 — Eliminates obsolete restrictions on food products, to match federal standards. It repeals requiring extra labels on some imported food products, and repeals using enriched flour in bread baking.
HB2682 — Amends Liquor Control Act of 1934. Allows a cocktail or mixed drink placed in a sealed container at the retail location to be sold for off-premises consumption if specified requirements are met. Prohibits third-party delivery services from delivering cocktails or mixed drinks.
HB4623 — Amends Food Handling Regulation Enforcement Act, regulating that public health departments provide a certificate for cottage food operations, which must be displayed at all events where the licensee’s food is being sold.
HB2238 — Amends code regarding food stands operated by a minor. Bans a municipality from enforcing a license permit or fee for a minor under the age of 18 to sell or distribute food at a food stand.
HB420 — Implements Food Safety Modernization Act, authorizing a department representative to enter a covered farm or farm eligible for inspection.
SB99 — Amends alcohol laws for state’s distillers, brewers and small wineries. Eliminates the sunset on local precinct elections to grant distilleries, and allows distillers to sell other distiller’s products.
HR17 — Allows third-party delivery services to deliver alcohol.
HB136 — Makes adulterating a food product by intentional contamination a crime.
SB455 — Increases the size of containers of high-alcoholic beverages.
SB508 — Gives restaurants protection from lawsuits involving COVID-19. The public will be unable to sue restaurants for COVID-19-related deaths or injuries, as long as the restaurant complies with state, federal and local regulations about the virus.
LD1167 — Encourages state institutions to serve Maine food and Maine food products, increasing the visibility of the state’s local food producers.
LD1884 — Amends current laws regarding businesses that hold dual liquor licenses, which authorized retailers to sell wine for consumption both on- and off-premise. Retailers with the dual license can now sell with just one employee at least 21 years of age present, and adds that wine can be sold for take-out if food is part of the transaction.
HB1017 — Allows cottage food businesses to put their phone number and business ID on their food label, rather than their address as currently required by the Maryland Department of Health.
SB118 — Expands definition of “alcohol production” and “agricultural alcohol production.” The new definitions aim to give Maryland farmers and producers the ability to sell beer, wine and spirits to increase agritourism.
SB2812 — Expands alcohol take-out and delivery options during COVID-19 pandemic. Allows restaurants to sell mixed drinks in sealed containers alongside other take-out and delivery food orders.
HB5343 — Revises regulations on brewpubs and microbreweries, increasing the quantity of beer a microbrewer is permitted to deliver to a retailer during a year from 1,000 barrels to 2,000 barrels.
HB5345 — Amends the Michigan Liquor Control Code to delete the Michigan Liquor Control Commission (MLCC) $6.30 tax levied on each barrel of beer manufactured and sold in Michigan.
HB5354 — Amends the Michigan Liquor Control Code to delete the requirement that a brewpub cannot sell beer in Michigan unless it provides for each brand or type of beer sold a label that truthfully describes the content of each container.
SB711 — Establishes new limited production brewer license for microbreweries at cost of $1,000 for license.
HB5356 — Amends the Michigan Liquor Control Code to ban the required $13.50 cent-per-liter tax on all wine containing 16% or less of alcohol by volume sold in Michigan.
HB5 — Authorizes emergency, small-business grants and loan funding for businesses affected by COVID-19.
HB4599 — Extends period of mediation for Minnesota farmers suffering economic difficulties to keep their farm.
HB326 — Amends outdated code to increase the maximum annual gross sales for a cottage food operation (from $20,000 to $35,000) before the producer would need to pay food establishment permit fees. Authorizes a cottage food operation to advertise products over the internet.
AB2371 — Requires large generators of food waste (like restaurants and supermarkets) to recycle food garbage rather than send it to incinerators or landfills.
AB3865 — Limits return of food from retail food stores during a public emergency.
SB864 — Prohibits sale of single-use plastic carryout bags, single-use paper carryout bags and polystyrene foam food service products, and limits single-use plastic straws.
SB1591 — Allows alcoholic beverages to be consumed from open containers in the Atlantic City Tourism District.
SB2437 — Limits service fees charged to restaurants by third-party food takeout and delivery applications during COVID-19 pandemic.
SB3 — Enacts the Small Business Recovery Act of 2020, which provides loans for small businesses suffering during the coronavirus pandemic.
SB8225 — Authorizes issuing a retail license for on-premise consumption of food and beverage within 200 feet of a church, synagogue or other place of worship.
AB8956 — Allows a licensed brewery or farm brewery to provide no more than four beer samples not exceeding four fluid ounces each.
SB1472 — Requires hospitals to offer plant-based food options to patients upon request.
SB7013 — Authorizes the manufacture and sale of ice cream or other frozen desserts made with liquor.
SB290 — The Alcoholic Beverage Control Regulatory Reform Bills, it allows distilleries the same serving privileges as wineries and craft breweries and reduces regulation on out-of-state sales.
HB160 — Aid for the restaurant industry to recover from COVID-19 pandemic, the bill doubles the maximum number of Designated Outdoor Refreshment Areas (DORAs) that can be created in a municipality or township. Also allows Ohio’s small wineries to sell prepackaged food without regulation from the Ohio Department of Agriculture, creates bottle limits for micro-distilleries and permits license holders to sell alcoholic ice cream.
HB4963 — Amends state alcohol code, allows licensed retailers to give wine samples in excess of 16% alcohol, cordials or distilled spirits, as long as they don’t exceed a total of three liters a year.
SB993 — Amends state alcohol code to allow a permitted winery to be eligible for a special permit to sell wine at off-premise events. Also increases the amount of beer a brewery can sell to an individual per day for off-premise consumption.
HB1073 — Authorize special event alcohol licenses for full-service restaurant licensees.
HB1081 — Allows colleges to teach brewing beer and wine classes on South Dakota campuses to students age 21 or older. Brewing must be held off campus as the education institution is not deemed a licensed manufacturer. Any distilled spirits, malt beverage, or wine produced under this section may only be consumed for classroom instruction or research and may not be donated or sold.
SB2423 — Allows alcohol sales at the Memphis Zoo.
SB1123 — Encourages farmers who produce raw milk to complete a safe milk-handling course.
HB134 — Legalizes the sale of raw butter and raw cream in Utah;
HB232 — An agri-tourism bill that allows farms and ranches to host events that include food that would not need to be prepared in a commercial kitchen. Farmers must apply for a food establishment permit to use their private home kitchen.
HB399 — Changes to the Alcohol Beverage Control Act, prohibits advertising that promotes the intoxicating effects of alcohol or emphasizes the high alcohol content of an alcoholic product.
HB5010 — The COVID-19 Cultural Assistance Grant Program, which appropriates $62 million for struggling arts, cultural and recreational organizations and businesses across the state.
HB6006 — In response to the coronavirus pandemic, the bill amends the Alcohol Beverage Control Act, delaying the expiration date of the retail licenses set to expire in 2020 for places selling alcohol. Also permits alcoholic beverage licensees at international airports to change locations if needed.
SB351 — A coronavirus relief bill which authorizes $36 million for agriculture and forestry sectors.
HB2217 — An update to Cottage Food Law eliminates the requirement that a home address must be put on a food label.
HB2412 — Increases amount of additional retail licenses for a domestic brewery or microbrewery from two to four, and directs health department to adopt rules allowing brewery owners to allow dogs on brewery premise
SB5006 — Allows sale of wine by microbrewery license holders.
SB5323 — A bill eliminating single-use, plastic carry-out bags
SB5549 — Modernizing resident distillery marketing and sales restrictions. Allows distilleries to sell products off-premise, similar to breweries and wineries.
SB6091 — Continues work on the Washington Food Policy Forum, including support for small farms and increasing the availability of food grown in the state.
HB4388 — Removes outdated restrictions on alcohol advertising, limiting the Alcohol Beverage Control Commissioner’s authority to restrict advertising in certain advertising mediums, such as at sporting events and highway billboards.
HB4524 — Making the entire state “wet,” permitting the off-premises sale of alcoholic liquors in every county and municipality in the state.
HB4560 — Permits licensed wine specialty shops to sell wine with a gift basket by telephonic, electronic, mobile or web-based wine ordering. Establishes requirements for lawful delivery.
HB 4697 — Removes restriction that a mini-distillery use raw agricultural products originating on the same premises
HB4882 — Allows unlicensed wineries not currently licensed or located in West Virginia to provide limited sampling and temporary, limited sales for off-premise consumption at fairs, festivals and one-day nonprofit events “in hopes that such wineries would eventually obtain a permanent winery or farm winery license in West Virginia.”
HB1038 — Bans customers from returning food items during a health pandemic or emergency, dissuading people from stocking up on too many supplies.
SB83 — Increases sales volume of alcohol by retail stores from four liters per transaction to any quantity.
SB170 — Allows minors to operate temporary food stands without a permit or license.
HB82 — Authorizes a microbrewery to operate at more than one location. The local licensing authority may require the payment of an additional permit fee not to exceed $100.00.
HB84 — Authorizes the sale of certain homemade food items that do not require time or temperature control. These include but are not limited to:
but is not limited to, jams, uncut fruits and vegetables, pickled vegetables, hard candies, fudge, nut mixes, granola, dry soup mixes excluding meat based soup mixes, coffee beans, popcorn and baked goods that do not include dairy or meat frosting or filling or other potentially hazardous frosting or filling;
“non-potentially hazardous” (no dairy, quiches, pizzas, frozen doughs, foods that require refrigeration and cooked meat, cooked vegetables and cooked beans). Allows someone other than the producer to sell the food, as long as food is not sold in a retail location or grocery store where similar food items are displayed or sold. Food must be labeled with “food was made in a home kitchen, is not regulated or inspected and may contain allergens.”
HB158 — Allows microbreweries to make malt beverages at multiple locations rather than one as deemed in current law.
A new restaurant survey shows 1 in 6 restaurants have closed during the pandemic. And 40% of restaurants say that ”it is unlikely their restaurant will still be in business six months from now if there are no additional relief packages from the federal government,” according to the survey by the National Restaurant Association. The association called the results “startling” and asked Congress for more help.
“For an industry built on service and hospitality, the last six months have challenged the core understanding of our business,” said Tom Bené, president and CEO of the NRA, in a statement. “Across the board, from independent owners to multi-unit franchise operators, restaurants are losing money every month, and they continue to struggle to serve their communities and support their employees.”
The NRA also found consumer spending in restaurants is down an average of 34%, the good service industry lost $165 billion in revenue from March to July and 60% of restaurant owners say their restaurant’s operational costs are higher prior to the COVID-19 outbreak.
Read more (Nation’s Restaurant News)