Food Stamp Redemptions at New Hampshire Farmers' Markets

Food Stamp Redemptions at New Hampshire Farmers' Markets

Summary

The goals of the “Food Stamp Redemptions at New Hampshire Farmers’ Markets” project were to test a potential new customer base for vendors at New Hampshire farmers’ markets and to offer a new service to food stamp recipients. In 1997, food stamp recipients effectively lost the ability to use food stamp benefits at farmers’ markets and farm stands when the New Hampshire Food Stamp Program changed the system of delivering benefits from a paper system to an electronic benefit transfer card (EBT). The change in technology improved efficiency of delivering benefits and lowered administrative costs of the program; however; it inadvertently eliminated the use of food stamp benefits at farm stands and farmers’ markets because either the cost of the new technology, or the infrastructure required to use it were not feasible at farmers’ markets and most farm stands.

Our project was designed to test a procedure at farmers’ markets where food stamp recipients could use their Food Stamp EBT cards to shop at farmers’ markets. The project assists farmers’ market vendors in accepting food stamp EBT cards without the burden of applying for an individual license or handling the electronic transaction. For the farmer the transaction is managed as a cash transaction. Under this model the farmers’ market, rather than the individual farmer, assumes the responsibility for the food stamp transaction. This procedure restores the food stamp recipient’s ability to shop at the market using food stamp benefits, but requires an added step in the process. Once the food stamp transaction is approved, recipients receive market scrip in the amount they determine and then have the ability to spend the scrip on any food at the market. The only restrictions on food purchases are ones that also apply to any retail food outlet that accepts food stamp EBT cards.

During the first two seasons of the project, funding was provided by the SARE grant to staff the Food Stamp EBT booth at each of the three pilot markets. In the third year the markets were expected to take over the management of the Food Stamp booth at their individual markets. 2006 was the third season of the project. A survey of vendors was conducted between the second and third project years, in 2006, in order to determine the value of the project to market vendors. Outcomes are reported below.

Objectives/Performance Targets

Within three years 40 farmers from three farmers’ markets in New Hampshire will collectively increase their revenue by accepting food stamp benefits. The goals of this project are consistent with the Northeast SARE outcome statement because they increase the profitability for a diverse set of farmers; and will have a positive influence on their communities by increasing the accessibility of healthful products to an additional subset of customers.

Degree of Change: This project will be successful if, within three years, food stamp redemption figures at farmers’ markets exceed $18,000 per year in revenue for farmers. This number is based on the value of the farmers’ market redemptions of food stamps in 1998; the year the EBT card was implemented in New Hampshire. At that time thirty-two farm stands/farmers’ market vendors accepted food stamps and redeemed $18, 407, with an average redemption of $575.22 per vendor. We believe that our goal of $18,000 is a conservative estimate based on the greater number of farmers participating in farmers’ markets in 2003.

Without Intervention: Farmers lost a source of revenue when the Food Stamp EBT card was implemented in New Hampshire in 1998. Many markets rely heavily on the revenue from the FMNP coupons. If lost to state budget cuts, as in 2003, the New Hampshire Department of Agriculture estimates that up to half the farmer’ markets in New Hampshire may close . The FMNP was eventually approved to operate; however, food stamp benefits at the farmers’ markets provide a margin of safety to retain customers who live in low-income communities and support the farmers’ markets.

Accomplishments/Milestones

The first four milestones were completed in the first year of the project and are reported in the 2004 annual report. Educational workshops were held with farmers prior to the start of the project in February 2004 at the New Hampshire Farm and Forest Expo in Manchester, NH. Five farmers attended that the session. An ice storm the day of the Expo may have contributed to overall low turnout that day and prevented additional interested farmers from attending the workshop. Focus groups and informational sessions with farmers were held in Enfield, Manchester, and Sanbornton, New Hampshire in the Spring of 2004. Farmers and market managers provided initial input prior to the start of the 2004 market season. The grant was awarded and trainings were held with the market managers, staff, and vendors at the markets who were eligible to accept the scrip from food stamp EBT transactions. A post-season debriefing with market vendors was held at the November, 2004, New Hampshire Farmers’ Market Annual meeting. Farmers and market managers provided detailed input into the benefits and challenges they experienced with the project.

In 2006 there was a change in the work plan and the vendor surveys were conducted by mail. A follow up mailing was made in an attempt to gather information from as many participating vendors as possible. Twelve out of 25 vendors anonymously responded to the survey. Post season 2005, the project manager met with representatives from the markets to evaluate the project and determine which markets would agree to participate in 2006. Although food stamp recipient participation in the project increased from the 2004 to 2005 growing seasons, one market clearly indicated that they would not participate in the third year. The other two markets indicated they would participate, however, a second market chose not to participate in the third year as described below. These developments changed the needs for post season briefings and turned the efforts toward looking for other solutions. The project manager intends to complete the “How to Accept Food Stamps at Farmers’ Market” user manual; and the project manager will continue to be available as a resource for market managers who wish to offer this service at their markets. The project manager, along with the director of the New Hampshire Farmers’ Market Association continue to meet with the state food stamp program manager, EBT manager, USDA Food and Nutrition Service officials and their counterparts in other New England states and around the country to find a more streamlined solution to solving the problems of food stamp recipients’ access to farmers’ markets.

Impacts and Contributions/Outcomes

The New Hampshire Farmers’ Market Association was an active partner in this project and their director, along with the market manager from the Enfield Farmers’ Market and a steering committee member from the Manchester Farmers’ Market provided convenient venues for their farmers to participate in informational sessions about the project.

Some New Hampshire farmers’ markets have shifting vendor membership from year to year. We anticipated having 40 farmers in three markets accepting food stamp scrip. One of the markets in the project has as little as two vendors. They were accepted into the project because the majority of their customers were from an adjacent low income neighborhood. This brought the usual number of farmers participating in any given year from 25-30 rather than 40 as projected. The variability is due to some farmers participating in a market one year and then not again the next or vice versa. Also, some members do not participate throughout the whole season. For example, one blueberry producer only attends the market in July when her berries are in season. At one market a garlic producer only participates during the first few weeks of the season when his crop is available.

As reported in the 2004 and 2005 Annual SARE reports, food stamp recipients were purchasing scrip and using it at the markets. More food stamp recipients used their EBT cards at the markets from 2004 to 2005, however, it was not enough activity for the markets to agree to support the equipment, service fees, and staff needed to offer the service. Sales from EBT customers in 2005 covered the costs of running the service. The Nashua market made the decision not to accept food stamp EBT cards after the 2005 season. With only two vendors at the market they would have been able to share a machine and accept EBT cards as a single transaction without using scrip. They were using the landline point of sale machines which are provided to vendors free of charge. The only cost would have been the phone line into the market and electric power can be sourced from a portable power source. The volume and pace of customers, limited staff, and security issues at the market; however, factored into their decision not to offer this service in 2006.

The Manchester market was the largest market in the project and benefit from the largest volume and sales from food stamp EBT customers. Without financial support for service to use the wireless equipment, and staff to support a booth, the market was unable to offer this service in 2006. The project manager made several attempts to secure sponsorship from business leaders in the city to support the project; however, was unable to secure sponsorship for the project. This market would likely allow this service at the market in the future if dedicated sponsorship were provided.

The Enfield farmers’ market was located in a rural community with the smallest population and offered the service in 2006. The Enfield Village Association, a local Main Street Program, has a booth at the market each week. They are sponsors of the market and staff their booth with regular volunteers from their organization. They used the free landline equipment and paid for the additional telephone service. This community support for the project is what is required for a market to support a model that utilizes market scrip and staff. If the food stamp customer base utilized the service, this community model would make the project sustainable.

Results of 2006 vendor surveys:

A questionnaire was mailed to farmers who participated in one or more of the markets in the pilot project. A second mailing was made two months after the initial one. The survey response rate was 48%. Of the twelve respondents who returned the vendor survey seven reported receiving market scrip from food stamp recipients.
Six of the seven reported that accepting the scrip from food stamp customers was easy and one reported a neutral response. Six of the seven reported that it was easy to turn in the scrip to the project staff for reimbursement. One respondent reported a neutral response to this question.
When asked whether they were reimbursed in a timely fashion all seven reported yes.
One farmer commented that they waited a couple of weeks to be reimbursed so that the scrip was in sufficient quantity for the market manager to write a check.
When asked how likely they were to participate if the terminal were provided to them for free but they had to pay the service fees – 42% reported they would be likely to participate. When asked how likely they were to participate if the terminal and all fees were provided for free – 75% reported they would participate.
All respondents were experienced farmers’ market vendors – mean 9.5 years, Range 3-29 years.
Farmers traveled moderate distances to their markets. In Nashua the mean distance traveled to the market was 28 miles, Manchester, 35.8 miles, and Enfield, 17.3 miles. The greatest distance traveled was 62 miles each way.
The respondents to this survey were from diverse farms – vegetable, livestock and mixed farms. The products they brought to market were also diverse and represented products from all of the food groups providing food stamp recipients a wide choice of fresh foods that fit into the United States Dietary Guidelines, 2005.

Additional comments provided by respondents:
“Being able to accept food stamps didn’t have a major impact on our sales, but it did enable some people to buy our products who otherwise would be unable to.”

“I think when it catches on people are going to really love this option. I feel it will take a few years for this to happen.”

“I don’t really think it had a huge impact. While it’s a good idea for nutrition, I believe the dollars (from USDA) are better spent in making the WIC program more efficient. Getting rid of the paper coupons and having a better redemption program.”

“It would seem to me that if a food stamp customer has a choice of whether to spend $20 of their benefits at a supermarket or at a farmers market; they are going to go where they get the most food for their money ie. supermarket in order to get them to spend benefits.”

When asked what action the NH Farmers’ Market Association or NH Dept. of Agriculture, Markets, and Food could take to support farmers’ markets, farmers provided the following responses:

“At a farmers’ market we would have to make the transaction process as easy as at a supermarket. Another idea might be to have some of the food stamp benefit redeemable only at a farmers’ market similar to what WIC does.”

“Perhaps make grants available for markets to hire market managers”

“Design and make an appropriate logo for NH Farmers’ markets for use on standard price cards and print media advertising.”

“Increase advertising- newspaper articles to keep it “fresh””

“We really like the card terminals at vendor stands idea. That would benefit all of our customers.”

“Broaden the eligible foods to include minimally processed items such as cider, jams etc. Also, have food stamp benefits be used at farm stands in addition to farmers’ markets.”

“Maybe help with advertising costs”

“Assist in getting business sponsers: get businesses to promote markets to employees. Poster campaign geared toward businesses- eat healthy, buy local, with lists of farmers’ markets. Maybe a mini-farmers’ market at Farm and Forest. Get on more radio talk shows.”

Plans for 2007

The milestones identified in the original grant proposal were achieved with the changes that were described above. Prior to the end of the funding period, December, 2007 the project manager will complete a user manual for farmers and markets who are interested in learning how to accept food stamp EBT cards at their farm stand or farmers’ market. A small number of print copies will be made and it will be placed on the University of New Hampshire Cooperative Extension website and the New Hampshire Farmers’ Market Association website. Discussions are underway to also post the manual on the USDA Food and Nutrition Service website, New Hampshire Department of Health and Human Services website, and New Hampshire Department of Agriculture, Markets, and Food website. As mentioned above the project manager will continue the discussion with USDA and other similar project managers nationally to look for affordable solutions for farmers’ to accept food stamp EBT cards at their markets.

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