South Dakota Cottage Food Laws and Regulations: How to sell your homemade foods in South Dakota

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South Dakota Cottage Food Laws and Regulations: How to sell your homemade foods in South Dakota

South Dakota Cottage Food Laws, Regulations and Facts

Date of the enactment of the South Dakota cottage food law: 2010: Home Processed Foods, South Dakota Codified Law 34 18 to 37.  In 2011, the law was expanded with a new section to allow the sale of home-baked goods .
This SD law allows home-based food operations that operates out of an individual's home to prepare, package, store and distribute non-potentially hazardous foods (fresh fruits and vegetables, Some dried herbs, fruits and vegetables; non-refrigerated baked goods and and certain canned goods) directly to consumers for sale. In a nutshell, under the SD home processing cottage food law, you can sell baked goods and canned goods at venues such as road side stands, Farmer's Markets and church bazaars.

Which foods are subject to the South Dakota Cottage Food law?

Non-temperature controlled baked goods, acid and acidified canned goods, and fresh fruits and vegetables; and Dried herbs, dried fruits and some dried vegetables are allowed for sale.  These are the only items allowed to be sold;  no other products are allowed to be sold

Fresh fruits and Vegetables

Dried herbs and fruits (and some dried vegetables)

Dried foods do not require approval from a third party processor.

Baked Goods

Only non-temperature controlled baked goods such as bread, cake, and cookies are also allowed to be sold at Farmer's Markets. Non-temperature controlled baked goods do not need to be reviewed in order to be sold. See South Dakota Requirements for the Sale of Baked Goods Made within Your Home .

• baked cookies,
• baked cakes,
• baked breads*,
• baked high-acid fruit pies (apple, apricot, grape, peach, plum, quince, orange, nectarine, blackberry, raspberry, boysenberry, cherry, cranberry, strawberry, red currants) and
• candy.

Canned Goods:

• Only acid or acidified canned goods are allowed to be sold. This means things like applesauce, apple butter, pickles, etc.
• These products will have either a natural pH of 4.6 or lower or will be acidified to have a pH of 4.6 or lower.
• These products must be reviewed by a third party processing authority and tested for either pH to be below 4.6 or water activity to be below 0.85. SDSU Extension has an individual that is a certified processing authority for acidified and acid foods. Therefore, processors can have their food reviewed and approved by SDSU Extension. SDSU Extension will also provide the written verification notice which is necessary to sell canned products at Farmer's Markets.
  Additionally, SDSU Extension is able to provide an ingredient declaration and nutrition facts panel based off of the recipe provided by the processor.
  Ultimately, it is the responsibility of the processor to ensure the accuracy of the label, but SDSU Extension can provide this using Genesis R&D Labeling software. The cost is $85 per product.
• For more information, see South Dakota Requirements for the Sale of Home: Canned Processed Foods at Farmers Markets .

Prohibited foods

Examples of potentially hazardous baked goods include, but are not limited to the following:

• cheese cake,
• custard pies,
• cream pies,
• pastries with potentially hazardous toppings or fillings.
• animal foods that are raw or heat-treated (i.e., meats);
• Fresh or dried meats or poultry (jerky)
• Fish or shellfish
• Refrigerated baked goods
• Vacuum sealed products
• Tempered and/or molded chocolate (fudge)
• Milk and dairy foods (yogurt, cheese, milk)
• Ice/ice products
• Home-canned, low-acid foods like peas, green beans, beets, corn, carrots, squash or soups (that are not acidified [pickled/fermented])
•  Whole eggs in the shell,
• dairy or meat products such as smoked fish, butter, raw milk, or jerky-these products fall under regulatory jurisdiction of the South Dakota Department of Agriculture, FDA and or USDA (dependent upon the food that is being marketed).
• Home-processed apple cider and other fruit juices (all juices must meet FDA requirements)
• Foods that require refrigeration (such as fresh salsa and pesto) and many food products containing milk or eggs (such as kuchen, pumpkin pie, flan)
• Garlic and oil mixtures or flavored oils
• Vegetables packed and frozen for preservation (Some exceptions apply. See FAQ sheet.)
• Honey
• Refrigerator pickles

If your food product does not meet the definition of a Cottage Food:

Don't give up. You may still be able to make and sell it commercially, through a startup approach.

First, you may be able to rent space in a local licensed commercial kitchen .

Second, if that doesn't work, you may be able to get a co-packer to make the food for you .

See this page for detailed information about selling foods that do not meet the Cottage Food definition

Definitions:

• An acid food is a food that has a natural pH of 4.6 or below.
• An acidified food (pickled/fermented) is a low-acid food to which acid(s) or acid food(s) are added and which has a finished equilibrium pH less than 4.6 or below and a water activity greater than 0.85.
• Equilibrium pH is the final pH of a food product after the acidulant (food acid) reaches equilibrium (i.e., has the same pH value) with the food itself. For example, fresh cucumbers in vinegar will not have the same pH as the vinegar until equilibrium has been obtained. Acidified foods that are 2 months past the processing date will have reached equilibrium, and the brine should have the same pH as the primary food ingredients.
• Hermetically sealed container is a container that is designed and intended to be secure against the entry of microorganisms and to maintain the commercial sterility of its contents after processing and does not allow the flow of oxygen or other gases into the product. For home-processing purposes, a hermetically sealed container will consist of a two-piece lid and glass jar.
• "Home-based food production operation" means an individual, operating out of the individual's dwelling, who prepares, processes, packages, stores, and distributes nonpotentially hazardous foods for sale directly to a person.
• Low-acid food is any food (other than alcoholic beverages) with a finished equilibrium pH greater than 4.6, excluding tomatoes and tomato products having a finished equilibrium pH less than 4.7.
• "Nonpotentially hazardous foods" are candy and baked goods that are not potentially hazardous foods.
• "Person" means an individual consumer.
• pH - measures the amount of acidity or alkalinity, using a numerical scale between 0 and 14. A pH value of 1 is most acidic, while a pH value of 14 is most basic or alkaline.
• Thermal processing is the application of heat to a food, either before or after sealing in a hermetically sealed container, for a period of time and at a temperature scientifically determined to achieve a condition of commercial sterility (i.e. the destruction of microorganisms of public health significance as well as those capable of reproducing in the food under normal non-refrigerated conditions).
• Water activity is a measure of the free moisture in a product. This moisture is available for microbial growth. Water activity values range from 0 to 1 (0 is considered bone-dry and 1 is pure water).

Verification and Testing

You food product and process must be tested. See SL 2010, ch 172, § 3.

34-18-36.   Canned good requirements--Verification. No canned good may be sold unless the pH level is 4.6 or less or the water activity level is .85 or less. A third-party processing authority with knowledge of the thermal processing required of food in hermetically-sealed containers shall verify the method of processing and that the pH or water activity threshold levels are met. The processing authority shall provide any such verification in writing.

SDSU Extension has a service to do this (there are other companies that do it).  SDSU charges (in 2020) $85 per product and will include the following

• pH
• water activity
• Genesis created label for Nutrition Facts Panel and Ingredient Declaration
• Third-party processing authority and a review of your processing method and
• then they send you the letter of verification

Some acid foods require a pH test and some may require a pH test. Acidified foods will require equilibrium pH testing and a microbial analysis. In some instances a water activity test may have to be conducted.

Submitting product samples for testing:

If you use the SDSU processing authority, they will need 2 samples of your product. The first sample will be analyzed by for either pH or water activity. The second sample will be analyzed for processing and packaging characteristics such as head space, lid/mouth jar cleanliness, air bubbles, mold/bacterial growth, and vacuum seal integrity. Additionally, the SDSU processing authority will require that a product safety evaluation form be filled out and returned which will include the recipe and processing/packaging parameters.

Labeling requirements

Cottage Food Production Operations must label all of their food products properly, in compliance with federal laws and regulations (mostly, Federal Food, Drug and Cosmetic Act (FD&C) (Section 403 - Misbranded Food) and The Fair Packaging and Labeling Act (FPLA). Labels must include:

• Name and address of the home-based food operation, including Contact Information  (Address and Phone Number)
• Name of the product being sold
• Complete ingredient list (including all allergens) -  You must list ingredients in the product from the largest to the smallest in net weight or volume. The  actual weight or volume of each ingredient does not need to be listed.
• A net wt. in customary and metric measurements
• Nutrient panel (unless exempt through Title 21 of the Code of Federal Regulations (21 CFR) 101.9(j)(1) and 21 CFR 101.36(h)(1)
• A conspicuous statement printed in all capital letters and in a color that provides a clear contrast to the background that reads
   "This product was not produced in a commercial kitchen. It has been home-processed in a kitchen that may also process common food allergens such as tree nuts, peanuts, eggs, soy, wheat, milk, fish, and crustacean shellfish."
• Note: You cannot put anything related to SDSU (South Dakota State University) on your label. Also, a statement regarding tested for safety is NOT allowed. SDSU (and other processing authorities) only verify your process for safety. They do not deem that a specific food is safe since SDSU (or other processing authorities) do not have daily control over the food produced in your kitchen (home or licensed).

For more help with labeling, please see this page.

The FDA has a labeling course summary page FDA Labeling Course that goes into detail around requirements for each required section of the food label. This site can be used as guidance to help the food entrepreneur understand the general requirements needed for an FDA compliant label. SDSU Extension is also available to answer questions regarding labeling.

Where may Cottage Food Production Operations sell the food products?

In  South Dakota, home food processors can sell baked goods and canned goods at venues such as:

•  road side stands,
• Farmer's Markets, and
• church bazaars.
• community food festivals

Retail Sales that are not allowed under the Cottage Food Law

Food products produced at home as allowed by this legislation are NOT allowed to be sold in establishments such as retail and grocery stores, restaurants, bed and breakfasts, wholesalers, or directly out of the home.

Any product that is sold wholesale or interstate will fall under Food and Drug Administration (FDA) jurisdiction. Wholesaling is the sale and distribution of goods to specific customer types such as those most commonly referred to as resellers. Resellers are traditionally retailers, other wholesalers or merchants who will resell the good to an end user.

If a product is sold at retail directly to the end user and is also sold within South Dakota, it falls under the South Dakota Department of Health's Jurisdiction 34-18-34 to 34-18-38. Retail differs from wholesale in that retail stores typically charge a slotting fee for shelf space. The processor will typically pay a slotting fee to sell their merchandise at a retailer and thus directly sells to the end user. Note that home processors who sell directly to the end user at retail stores fall under the Department of Health's jurisdiction; which has additional requirements.

If a home processor may not sell directly to a retail store, unless they ensure that they are processing in a commercial kitchen. There are requirements set forward in South Dakota Codified Law 44:02:07. Kitchens that are certified, must be registered with the department of health and must comply with the SD Dept of Health and Federal laws. Again, the home processor that sells to retail, must ensure that all food products that are sold at retail are processed in a commercial licensed kitchen .

Other requirements

• Direct sales to consumers only: These foods cannot be sold for re-sale/wholesale and must be within the state.
• Verification letter: The individual selling home-processed (canned) foods under this exemption must have a letter of verification from the third-party processing authority approving the method of processing and documentation that the pH and/or water activity standards are met. A copy of the letter of verification for all products must be at each location where products are sold.
• The letter of verification must include the following:
  • Name of the food processor
  • Food item as it appears on the jar label
  • Size of the food container
  • Testing results
  • Approval of the thermal processing method
  • Results of microbial analysis (if conducted)
  • Date tests were completed
  • Date letter of verification is issued
  • Signature and contact information of the food processing authority
• Annual limits: You may sell no more than $5,000 per year.
• Additional lab testing: Certain products, those that fall outside the defined allowed foods,  may require lab analysis.

Selling retail or opening a shop?

When a processor chooses to sell directly to a retail store , they must ensure that they are processing out of a commercial kitchen . There are requirements set forward in South Dakota Codified Law 44:02:07. Kitchens that are certified, must be registered with the department of health and must comply with the aforementioned laws. The home processor that sells to retail, must ensure that all food products that are sold at retail are processed out of the commercial kitchen. You can rent some commercial kitchens and make your food under their license for a fee. 

Want to start an ice cream business or something similar?  See this page for fixed shops, food businesses, food trucks, peddle carts, etc.

Recommendations:

Beyond the requirements, common sense, good practices and reducing liability suggests you should do the following.

Training

Take the ServSafe® training classes for Manager and employees, the 7th Edition Book that accompanies this course should be purchased here .. 

Testing of pH

It's best to use a pH meter, properly calibrated on the day used. I use this one, which is reliable and inexpensive . And this pH meter is really good, but isn't always available .
Short-range paper pH test strips, commonly known as litmus paper , may be used instead, if the product normally has a pH of 4.0 or lower and the paper's range includes a pH of 4.6.

Record-keeping is suggested

Keep a written record of every batch of product made for sale, including:

• ​Recipe, including procedures and ingredients
• Amount canned and sold
• Canning date
• Sale dates and locations
• Gross sales receipts
• Results of any pH test

Sanitation

Although inspections are not required, you should consider doing the following:

• ​Use clean equipment that has been effectively sanitized prior to use
• Clean work surfaces and then sanitize with bleach water before and after use
• Keep ingredients separate from other unprocessed foods
• Keep household pets out of the work area
• Keep walls and floors clean
• Have adequate lighting
• Keep window and door screens in good repair to keep insects out
• Wash hands frequently while working
• Consider annual testing of water if using a private well

Best Practices

• Allergens:  Most state home baking acts require an "ingredient statement" and/or an "allergen listing" on the label of the bakery item for sale; but if your state does not, you should anyway. The eight major food allergens are
  • milk,
  • eggs,
  • fish,
  • crustacean shellfish,
  • tree nuts,
  • peanuts,
  • wheat and
  • soybean.
• Cross-allergenicity: There are also ingredients available, even flours, that can cause a cross-allergenicity. The American Academy of Allergy Asthma & Immunology explains cross-allergenicity as an allergic reaction when proteins in one substance are similar to the proteins found in another substance. For example, consumption of lupine flour may trigger an allergic reaction to peanuts, and cricket flour may trigger an allergic reaction to shellfish. Again, providing such information might be a beneficial marketing tool and help keep potential consumers safe.
• The 2 Hour/4 Hour Rule -   Anyone wishing to make and sell refrigerated bakery items should remember to follow the "2 Hour/4 Hour Rule." This is a system that can be implemented when potentially hazardous foods are out of temperature control (temperatures greater than 45 degrees Fahrenheit) during preparation, serving or display for sale. The rule guidelines are as follows:
  • If a potentially hazardous food has been out of temperature control for 2 hours or less, then it may continue to be used or be placed back in the refrigerator.
  • If a potentially hazardous food has been out of temperature control for more than 2 hours but less than 4 hours, it needs to be used quickly or discarded.
  • If a potentially hazardous food has been out of temperature control for more than 4 hours, it must be discarded.

More resources:

• South Dakota Legislature Home Processing Food Law
• SDSU Extension Factsheet
• The original house bill (HB 1222)
• SD in-home bakery law, HB 1240.
• Fact Sheet: SD Home-canned Processed Foods at Farmers Markets
• More FAQs about this SD law
• South Dakota Cooperative Extension "Drying Fruits, Vegetables, and Herbs: General Safe Food Handling Recommendations Sheet"
• SD Farmers Market Sampling Requirements Sheet
• SD Food Service Codes

Additional help:

SDSU Extension offers:

•  staff who can be an information resource to provide data regarding food safety considerations on the product and process.
• testing your product for pH and water activity.
• review your label to check if it is meets the FDA Labeling requirements as outlined in the FDA Labeling Course.
• an ingredient declaration and nutrition facts panel based off of the recipe provided by you, the processor.
• Of course, it is your responsibility to ensure the accuracy of the label, but SDSU Extension can provide assistance using Genesis R&D Labeling software. The cost is $150 per product.

Interstate or Wholesale Commerce

South Dakota statutory requirements for the sale of baked goods and home-canned processed foods can be found in these SDSU Extension publications:

• Farmers Market Online Guidebook: Development, Operation, Promotion, Safety, Regulations
• Food Sampling Requirements
• Drying Foods

Questions? Contact Information:

For more information, contact

• Curtis Braun, MBA
  SDSU Extension Food Safety Field Specialist
  SDSU Extension Sioux Falls Regional Center
  2001 E. Eighth St.
  Sioux Falls, SD 57103
  Office: 605.782.3290