Most states require a hot dog vendor or any food vendor to prepare, cook and store food there. If you were to buy 1000 hot dogs and buns you could not store them on the cart. If you needed to cut sausages or slice onions or wrap tamales or fix pulled pork or, or or - the health department wants this done in a commercial kitchen; eg. a commissary.
Some states will wave the commissary requirement if your cart has adequate storage for your daily needs and if it has facilities to wash, rinse and sanitize your dirty utensils and pans. This would mean that you purchase your stock each day instead of buying in bulk. For a busy vendor this would not be feasible. But for starting out, it may suffice.
Most carts don't really have big enough sinks to wash, rinse and sanitize your pans. State health codes often require that the sinks be large enough to submerge the largest pan. With a half size pan: 12" X 10", this would require a very large cart to accommodate 3 sinks large enough to wash, rinse and sanitize. Imagine if your largest pan is a full size pan. 12" X 20" This is another major reason vendors need a commissary. A commercial kitchen will have the standard 3 bay sink and they can accommodate the large pans.
Depending on your inspector in your state, if your cart has 4 sinks (one to wash, one to rinse and one to sanitize with the required separate hand wash sink) they sometimes will wave the commissary requirement.
Even with the small sinks on a cart you can wash, rinse and sanitize your tongs or a ladle. Some states require the 4 sinks in the event you drop a fork, knife or other utensil and need to clean it properly, but they still may require a commissary for cleaning your larger items on the cart, like the pans and lids.
Most states do not allow food preparation on a cart. They allow re-thermalization (to heat up) of precooked foods, but not cooking from scratch. What I mean is they don't want you bringing raw sausages out and cooking them on the cart. Most require you precook at a commissary, freeze and then reheat on the cart. Most vendors will only use precooked foods anyway. Hot dogs are always precooked when you buy them, some sausages and brats are as well. Some states allow you to cut onions and sauté them on the cart as this is a non-potentially hazardous food product.
Some states will allow you to use your home as a commissary kitchen but most don't, but you can research and find out what the requirements are and make your own commissary. I have customers that have turned a storage building or a shed into a commissary. For example, TN will allow someone to take a portable building, add a 3 bay sink, a hand wash sink, a floor drain and hook ups to an approved septic or waste connection and be a licensed commissary. If you store food there, they will also require a freezer and refrigerator.
I have videos on http://www.benscarts.com/videos#scrollto about finding a commissary and tips on getting one.
In some areas where there are many vendors, someone may have a commissary just for the vendors. They charge a monthly fee and take the work out of finding you a restaurant or other licensed kitchen to allow you to use theirs.
If you still have questions please feel free to email firstname.lastname@example.org
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