February 13, 2014. Troy, IL. When 11 year-old Chloe Sterling started a cupcake business out of her parents’ kitchen in Troy, Illinois, she probably never imagined she’d be featured on ABC News, Good Morning America and have legislation named after her. But after being shut down by government regulators, an Illinois State Rep has sponsored legislation that would get Chloe’s cupcakes back up and running, at least for a while.
Chloe Sterling, the Cupcake Kid. Image courtesy of Derik Holtmann, BND.com.
As detailed by Good Morning America, Madison County, Illinois Health Department officials notified Chloe’s home business - Hey Cupcake! - it had to either buy a bakery or build a separate kitchen. Standing their ground but attempting to deflect criticism, Toni Corona of the Madison County Department of Health released a statement after widespread outrage insisting the law is, "applied uniformly and without discrimination", she “applauds the entrepreneurial spirit”, and “joins with her many fans in hoping she will find a location for her cupcake enterprise that complies with state laws."
"It bummed me out because I wanted to keep baking," Chloe told ABC, "I had a bunch of orders and they said I had to cancel them all." The impressive sixth grader explained that her home business called Hey Cupcake! isn’t new. She began it two years ago with her mom’s oversight and has slowly built a loyal customer base. Which brings us to another popular question - who narcs on an 11 year-old with a dream? The health department didn’t say.
After seeing a picture of a Hey Cupcake!, it’s easy to see why Chloe’s cupcake inventions are so popular. Some are typical cupcakes while others are baked to resemble certain items, like one version she makes into edible high heel shoes. Chloe and Hey Cupcake! have been selling their cupcakes at a price of $10 for a dozen or $2 each for the novelty cupcakes. Sounding like any typical kid, Chloe told GMA, “It felt good because with all my money I could buy stuff I wanted and didn't have to wait until my birthday or Christmas.”
GOP State Rep sponsors Bill
Upon seeing the story on TV, Illinois State Rep. Charlie Meier (R-Okawville) quickly drafted and sponsored a Bill that would buy Chloe some time and allow her to continue selling cupcakes on a limited basis. They’re calling it Chloe’s Law since she was the lynch-pin for it. And if passed and signed into law, it wouldn’t just help Hey Cupcake! and other small foodservice start-ups. Charities, schools, religious groups and any other “home kitchens” and non-profits that hold their own brand of bake sales would be exempt from state and local Health Department oversight.
Rep. Meier was quoted by the Illinois Observer after announcing his new Bill touting, “This Bill will allow Chloe Stirling and her business Hey Cupcake! to continue making cupcakes in a limited capacity. It will also allow churches and other charities to hold bake sales and be within the law.” The Bill, as drafted and explained, does raise some additional issues and questions however. The State Rep pointed out three main requirements “home kitchens” will need to satisfy to be exempt from Health Dept oversight:
At $2 per cupcake, Chloe is limited to no more than 500 custom cupcakes per month. She didn’t disclose what her current average monthly sales were. But with Good Morning America and the other media exposure, it’s a guarantee that Hey Cupcake! will be selling a lot more than that, again shutting down Chloe’s home business before she even gets it started again. With that kind of name recognition though, she could easily use an online group-funding site to raise enough money to buy her own bakery, just like the Health Inspectors laughingly suggested she do when they first shut her down.
Churches, charities and schools would seemingly be out of luck as well seeing as they typically need to raise 100-times that amount each month just to stay afloat. But if each student or each parishioner is treated as an independent contractor, then it’s possible some institutions could forge a loophole and sell well beyond the $1,000 limit. But Chloe and her mom don’t have that option.
Smothering small businesses
One thing is for certain, Chloe’s story illustrates something many local would-be entrepreneurs have been warning for some time. Illinois and its cities and counties have so many laws, regulations, forms, fees, fines, permits, licenses, regulatory filings, and other insurmountable and expensive barriers to starting a small business, that most people forego the nightmare and accidental criminal experience.
And while the Mayor, Governor and counties pay millions to multi-national corporations to move a dozen office jobs here, thousands upon thousands of home-grown businesses like Chloe’s are never being created thanks to the government burdens and zero interest in helping out small businesses, real small businesses, not those with 1,500 employees as defined by the Small Business Administration.
There’s a separate Hey Cupcake! in Texas with multiple retail locations and food trucks. That’s not Chloe’s home-kitchen Hey Cupcake! But keep an eye out. Something tells us she’s only just begun building her cupcake empire. More power to her.
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