Business License No Longer Required For Pennsylvania Lemonade Stands
Even the smallest entrepreneurs need some protection. Starting a business from a young age leads to tremendous lifetime impacts for a child and the community. A lemonade stand allows a child to apply communication and marketing skills. The business endeavor also sharpens their math abilities. Children also can expand their creativity to maximize their skill set. A lemonade stand, or a similar business, allows children to develop a myriad of skills outside of the classroom. For the community, it allows us to meet and converse with our neighbors over a refreshing drink and helps instill the ideal of hard work in young entrepreneurs.
House Bill 664 was approved June 30, 2021, by Governor Wolf which allows children to operate lemonade stands and other small businesses, such as mowing the lawn or neighborhood snow removal efforts, without receiving a business license from their local municipality or homeowners’ association.
Senator Hershey (R-Juniata) introduced the bill after hearing on the news that lemonade stands by children were forced to close because they did not have required municipal permits. He was reading the news, where he encountered an article about a family in Washington D.C. being fined $500 because the child was running a lemonade stand without a license. After further research, he found that there were similar occurrences in Pennsylvania.
Traditionally, to operate a food facility, such as a restaurant, bar, grocery store, catering, or similar public food facility; all retailers are required to obtain a Retail Food Facility License. Licenses are non-transferable to another proprietor, new facility, or location.
To apply for the license, the facility must submit an application and allow four to six weeks to process. If approved, then an inspector will complete an on-site inspection. If that step is successful, then the license will be granted.
If the facility does not pass inspection, the facility has a chance to correct the deficiencies and then contact the inspector for another on-site inspection If the facility is not approved for a permit, then there will be a letter explaining the reasons for the rejection. Applicants are encouraged to re-submit the plans again with the corrected or requested information. A new retail food facility permit will cost about $241. An annual renewal for the permit is $82. That is a lot of lemonade to sell to settle just the overhead cost.
In many states across the country, it is illegal for anyone under the age of 18 to operate a small business without a permit. Pennsylvania was one of those states before the passing of this bill. The bill was unanimously approved by the House and the Senate.
The bill includes an exemption for a business owned by one or more youths under the age of 18 that does not make more than $5000 per year. This would be waived if the proceeds of the stand are to go to charity. Additionally, the license exemptions would be available if a business is open fewer than 84 days a year.
Lemonade stands or other similar minor-owned businesses are not to be prohibited in areas that are primarily residential or unzoned in the municipality. The bill authorized that the stands or similar businesses must be set up a “sufficient distance” from other licensed businesses to alleviate potential competition.
Under this new law, children across the Commonwealth can act upon the phrase they are taught, “when life gives you lemons, you make lemonade.”
With contribution from Kayla G. Shellenhamer, second year J.D. candidate at Widener University