In 2012, local food sales in the United States totaled an estimated $6.1 billion [1
]. There were 163,675 farms (7.8 percent of U.S. farms) selling local foods, defined as conducting either direct-to-consumer (e.g., farmers’ markets, roadside stands, pick-your-own sites) or intermediated (e.g., direct to restaurants, institutions or regional distributors) sales of food. Of these farms, 70 percent used only direct-to-consumer marketing channels. The remaining 30 percent used a combination of direct-to-consumer and intermediated channels or only intermediated channels. In recent years, consumer interest in local food has grown, including but not limited to the following locations: farmers markets, supermarkets, and institutions (such as schools and hospitals) [2
Government programs and policies that address barriers to growth in local food production and directly support local food purchases can serve as a catalyst for further growth of local food markets. Currently, the primary Federal policy that supports local and regional food systems is the Agricultural Act of 2014, or 2014 Farm Bill [3
]. Policies and provisions enacted in the 2008 Farm Bill are generally continued or expanded. Most notably, support for intermediated marketing channels has greatly increased in response to capacity constraints for small farms and lack of distribution systems for moving local food into mainstream markets. A number of states have also passed legislation to address access to and expand urban agriculture. At the local levels, zoning and regulation, fiscal incentives, and institutions are used to strengthen local food systems.
Though “local” has a geographic connotation, there is no consensus on a definition in terms of the distance between production and consumption. Definitions related to geographic distance between production and sales vary by regions, companies, consumers, and local food markets [4
]. In addition, there may be other characteristics associated with local food, including sustainable agriculture and community development [5
]. Conceptually, we consider “local food” to be defined by proximity and by relationship [4
]. Proximity includes both a distance measure and a geographic or political boundary, such as states, regions of states, or counties. We refrain from specifying a specific distance as defining local because it is a term best determined by stakeholders in the food system. Geopolitical boundaries may influence how food and agricultural policies (at the state, national, or other level) may support certain types of agriculture over others [4
]. Local relationships refer to closer personal connections between participants in a local food system. Although there is also no single definition, we define “local food systems” as geographic clusters of agricultural producers, along with consumers and organizations involved in processing, distributing, and selling foods.
Other factors may influence an operation’s participation in a local food system, including size and type of operation [4
]. Small farms (those with less than $50,000 in gross annual sales) account for most farms reporting local food sales and are more likely to rely exclusively on direct-to-consumer marketing channels, such as farmers markets and roadside stands [6
]. In addition, for small and medium-sized farms (those with gross annual sales between $50,000 and $250,000) that sell local foods, operators devote more time to their farm operation than similarly sized farms without local sales, and vegetable, fruit, and nut farms dominate local food sales.
In this study, barriers to local food expansion in the United States are first discussed. We then document how policies and programs are addressing these barriers. In this way, we reveal changes occurring in support of local food systems, and the types of policies that can best encourage future growth. The major federal, state, and local programs and policy levers that affect growth of local food systems are examined. Federal policies are further delineated by the agency responsible for administering the program.
3. Federal Policies that Address Local Food Barriers
Federal food and farm policy and programs have evolved to address the needs of small farmers, development of food system infrastructure, and sustainable agriculture [5
]. Legislative and regulatory changes are essential to establish meaningful, sustainable improvements in the local food system. The 2014 Farm Bill provides support for several significantly revamped programs that promote local food production and marketing. In addition, the 2014 Farm Bill reauthorizes many programs from the 2008 Farm Bill that support local food systems with minor modifications to funding levels. The 2014 Farm Bill represents an additional $501.5 million investment over the next five years in programs that may affect local food systems, more than a 50 percent increase from the 2008 Farm Bill [5
]. However, based on survey responses from nearly 2000 municipalities and counties across the United States in 2013, a modest number were accessing USDA resources to support farm or food business development [26
]. This suggests that greater awareness of these programs may be needed to address barriers to further expansion of local food systems. The programs, administered at the state level, are described in the following sections (Table 1
3.1. Food and Nutrition Service
While the USDA has been engaged in farm to school efforts for a number of years, a USDA National Farm to School Program was formally created by the Healthy-Hunger Free Kids Act of 2010 to increase access to local foods by schools, including grants, training, technical assistance, and research. The Farm to School Grant Program assists eligible entities in implementation of farm to school programs that improve access to local foods in eligible schools. On an annual basis, the USDA awards up to $5 million in competitive grants for training, supporting operations, planning, purchasing equipment, developing partnerships, and implementing farm to school programs. Seven regional offices around the country have a Farm to School Regional Lead available to provide farm to school related support to state agencies and other entities in the region. The Farm to School Program also collects information through the Farm to School Census. According to the 2015 Census, during the 2013–2014 school year, school districts purchased $598 million in local food, an increase from $386 million during the 2011–2012 school year when the first Census was conducted. In addition, forty-six percent of school districts report they will buy more local foods in the future. At the national level, 42 percent of the 12,500 school districts that responded to the Census are operating farm to school programs as of the 2014–2015 school year and another 16 percent have plans to implement the program in the future. Farm to school programs have grown rapidly over the last decade (Figure 1
). According to the census data, 5254 school districts participated in 2014, up from 400 districts in 2004. Farm to school programs now exist in every state in the country and Washington DC, USA.
3.2. Agricultural Marketing Service Programs
USDA’s Agricultural Marketing Service administers several grant programs supporting local food initiatives across the country. The Federal State Marketing Improvement Program (FSMIP) provides matching funds to State agencies to assist in exploring new market opportunities for food and agricultural products, and encourage research to improve food marketing system performance. In 2015, eight out of 15 grants awarded went to projects dealing with local food barriers, such as funding for egg grading workshops to encourage uniformity and consistency in commercial practices ; determining the best marketing practices to enhance sales of local food identified under the Certified South Carolina label; identifying strategies to further develop value chain infrastructure and relationships needed for selling products to schools; and creating a statewide institutional procurement strategy to substitute products produced in Wisconsin, in place of products available through traditional distribution systems.
The 2014 Farm Act expanded the National Farmers’ Market Promotion Program (FMPP) to include a new program: the Local Food Promotion Program (LFPP), jointly referred to as the Farmers’ Market and Local Food Promotion Program (FMLFPP). Introduced in the 2002 Farm Bill, the FMPP is a competitive grants program for local governments, agricultural cooperatives, farmers markets, and other eligible groups to improve and expand farmers markets, CSAs, and other direct-to-consumer outlets. Projects that were awarded grants in FY 2015 included creating a Georgia Farmers Market Association to standardize farmers market policies, practices, marketing, and training and technical assistance; increasing the number of vendors at the On the Ranch Farmers and Artisan Market in Nevada by acquiring infrastructure that transports, stores, and preserves agricultural products for the market; and increasing access to local, fresh and safe food products for Chesapeake region consumers at area markets by coordinating on-farm Good Agricultural Practices (GAP) certification trainings to help local food producers prepare for GAP certification (The goal of the National GAP program is to reduce microbial risks in fruits and vegetables by developing a comprehensive extension and education program for growers and packers.) Through the LFPP, the FMLFPP broadened the program’s authority to provide grants for local and regional food enterprises that are not direct-to-consumer markets, but act as intermediaries between producers and consumers, such as farmers sales to local retail, restaurant, and regional distribution outlets. Under the 2014 Farm Bill, the FMLFPP receives a three-fold increase in mandatory funding of $30 million per year from 2014 to 2018, which is split equally between FMPP and LFPP.
Lack of distribution systems for moving local foods into mainstream markets has spawned the need for collaborative supply chains to market local food. Small local producers sometimes overcome scale limitations by pooling resources and diversifying tasks within the supply chain to expand local food sales. Production pooling allows small local farmers to capture the advantages that come with larger scale production systems (economic and logistical efficiencies), and may work to meet the supply requirements of large institutional markets [8
]. Producers can move higher volumes of local food along the supply chain by using an intermediary to pack, distribute, or ship local products to consumers through traditional supermarket channels, restaurants, or institutions. Such intermediaries allow farmer operators to spend more time managing the farm and scaling up.
One way the new LFPP can assist producers in expanding local food is by providing support for food hubs. Food hubs serve several functions including: (1) providing greater delivery reliability than can be obtained through purchasing from many producers selling independently; (2) facilitating access for agricultural producers to market outlets requiring larger volumes and providing consumers with access to a larger number of local food producers; (3) assisting in getting product from a production or aggregation point to the designated market outlet; (4) connecting farmers with the correct market outlet to fit their scale of production and their production practices; (5) extending the quantity of offerings to those consumers who expect greater variety and less seasonality in the availability of products; (6) providing technical assistance to producers; and (7) facilitating information sharing and risk reduction related to assurances of production processes and product quality [27
]. According to the 2013 National Food Hub Survey, over 40 percent of the food hubs offered production and post-harvesting services, business management services, and food safety training [28
The LFPP offers planning and implementation grant funds with a 25 percent match to support intermediated channels such as farm-to-institution, food hubs, and other businesses that aggregate, distribute, process or store locally or regionally-produced products within a 400 mile radius. Grants awarded in FY 2015 included expanding local food markets and access through an online food hub on the Lower Kenai Peninsula, Alaska; aggregating locally-produced wheat/flour and other ingredients for artisan bread; and use of an advisory committee, surveys and stakeholders meetings to investigate challenges and opportunities associated with aggregating and distributing local product to institutional markets.
The Specialty Crop Block Grant Program (SCBGP), authorized in 2004 and expanded in 2014, provides grants to states to enhance the competitiveness of specialty crops, which include fruits, vegetables, and floriculture. State departments of agriculture are eligible to apply for grant funds. It supports a variety of local food projects such as farm to school programs, food safety training, food hubs, and marketing research, thus providing a broad base of support for the development of local and regional food systems. Examples of funded projects in FY 2015 include those that increase the sales of Kentucky specialty crop farmers who are looking to scale up their production by offering a series of conferences and meetings designed to help farmers take advantage of underused resources in terms of capital, certifications, and marketing opportunities to help producers overcome the barriers that prevent them from entering agriculture supply chains; mitigate specialty crop food safety risks by reducing barriers to implementing Good Agricultural Practices (GAP) programs though specialty crop producer technical assistance, training programs, and one-on-one assistance on developing GAP programs; and partner with Michigan State University Extension to address a set of barriers for increased institutional food service procurement of specialty crops through implementation of a training curriculum for food service professionals to increase knowledge and skills to handle and prepare seasonal Michigan specialty crops. The 2014 Farm Bill increased mandatory funding from $55 million per year authorized by the 2008 Farm Bill to $72.5 million per year through 2017 and $85 million per year starting in 2018.
3.3. Rural Development
USDA’s Rural Development administers the Community Facilities Direct Loan and Grant Program that supports rural communities by providing loans and grants for construction, acquisition, or renovation of community facilities or the purchase of equipment for community projects. Projects must benefit the community as a whole rather than private, commercial entities. Examples include projects that support local food systems such as food hubs or greenhouses. The Community Facilities Guaranteed Loan Program provides loan guarantees to eligible private lenders to help build essential community facilities in rural areas.
The 2014 Farm Bill reauthorizes the Business and Industry Guaranteed (B&I) Loan Program to aid rural food enterprise entrepreneurs and local food distribution. Locally and regionally produced food is supported through a set-aside within the B&I loan program for facilitating the storing, processing, and distribution of local and regional food products. The 2008 Farm Bill mandated that at least five percent of the funds made available to the program will be reserved for local food initiatives, which is maintained under the 2014 Farm Bill. In 2014, USDA announced that $48 million in loan guarantees is available for local food projects.
The Value-Added Producer Grant Program (VAPG), provides grant funding for agricultural producers who add value to their products through processing or marketing, thereby raising farm income. Under the 2014 Farm Bill, veteran farmers were added to the list of farmers that priority projects will focus on to increase opportunities for small and midsized family farms and beginning and socially disadvantaged farmers. In addition, the USDA must now prioritize those projects that “best contribute” to creating or increasing these marketing opportunities. Producers of food that is marketed locally are eligible for the program, which supports activities such as assisting in the startup of a regional fresh produce food hub and packinghouse created to enhance access to wholesale markets for the local farm economy; working capital to process, package, market and deliver local, non-homogenized, pasteurized milk and ice cream and other dairy products; and expanding baking and milling capacity of local food products, including specialty breads and bread mixes. The 2014 Farm Bill provides $63 million in mandatory funding for the program over the 2014 to 2018 time period. The program also sets aside funds reserved for developing local and regional supply networks that connect small- and medium-sized farms to markets.
The Rural Microentrepeneur Assistance Program (RMAP) was created by the 2008 Farm Bill to provide grants and loans to organizations that then provide microloans of up to $50,000 and business development technical assistance to rural microentrepreneurs. Although not directed specifically at agriculture-related businesses, examples include funding to provide loans and technical assistance for small farmers to obtain to purchase the building space and equipment necessary to modernize a honey bottling facility in Nebraska; assist an organic fruit and vegetable farm in Nevada County, CA transition from selling exclusively through a community supported agriculture (CSA) model to expanding to also selling at farmers markets and a co-op grocery store; and provide working capital to package and market fresh locally grown basil. The 2014 Farm Bill reauthorizes and provides $3 million in mandatory funding for RMAP each year from 2014–2018.
3.4. Farm Service Agency
Outside of the 2014 Farm Bill, the Farm Storage Facility Loan Program (FSFL), administered by USDA’s Farm Service Agency, provides low-interest loans for producers to build, upgrade, or purchase permanent or portable facilities for cold storage, sorting, washing, packing, and other food-safety-related buildings and equipment. Historically, these loans have primarily benefited grain farmers, but a provision in the 2008 Farm Bill extended the program to fruit and vegetable producers for cold storage. In 2014, FSA took several actions to improve the program, particularly for small and mid-sized farms. For example, the loans can now also finance certain handling equipment, such as cold dip tanks, grading bins and tables, and waxers, among others. This will improve the ability of farmers selling in local and regional food markets to finance the storage and packing sheds required to keep food fresh and safe prior to marketing. For fruit and vegetable growers, especially small and mid-scale family farmers, packing and storage sheds are critical elements of their farm operations, where fresh produce is washed, sorted, graded, labeled, packaged, and stored before market delivery.
The purpose of the FSA’s Microloan Program is to meet the credit needs of small, beginning, socially disadvantaged, and veteran farmers through a simplified loan application process. Capital barriers are particularly problematic for small and beginning farmers, farmers in urban areas, and those with diversified operations selling directly to consumers. This program may be appropriate for farmers serving local and regional food markets, including urban and diversified farmers. Operators of these types often have difficulty obtaining financing due to a lack of credit history, increased risk associated with lending to a new or young farmer, or unfamiliarity with small, diversified farming operations. The Microloan program was created in order to meet the smaller credits needs and reflect the scale of operations of small, beginning farmers and diversified farms serving local markets. Loans of up to $50,000 are provided to cover costs of operating the farm and can be used in conjunction with FSFLs. The Microloan program was launched in 2013 and is permanently authorized by the 2014 Farm Bill.
3.5. National Institute of Food and Agriculture
The Food Safety Outreach Program (FSOP), while not a Farm Bill program, awards grants to projects that implement food safety training, education, extension, outreach, and technical assistance related to the Food Safety Modernization Act (FSMA). In 2015, both USDA’s National Institute of Food and Agriculture (NIFA) and the Food and Drug Administration collaborated to establish the National Food Safety Training, Education, Extension, Outreach and Technical Assistance Competitive Grant Program. FSOP was established to complement and expand this program to help smaller operations comply with the new food safety regulations created by FSMA. The grants are offered through FSOP and are administered by NIFA. The projects address the needs of small- to mid-sized farms, beginning farmers, socially-disadvantaged farmers, small processors, or small fresh fruit and vegetable merchant wholesalers. To address the safety concerns associated with the growth in local food sales, USDA offered $4.7 million in funding for the program in 2016.
4. State and Local Policies
State and local governments have also taken on new roles in food system governance [5
]. Most regulations that directly affect local food systems take place at the state or local level, such as those related to zoning laws that affect farmers’ operation of a farm stand, public safety and health, or application of sales taxes. States and municipalities can support farmers markets by supporting land use policies that favor small farms, and zoning ordinances that make space for markets. State and local policies can also have important impacts in areas such as farm to institution procurement policies, such as Massachusetts’s mandated preference for food products grown or produced within the state [29
A number of states and localities have created Food Policy Councils to help establish state or local food policy that address concerns such as availability and marketing of local food. Food Policy Councils are comprised of a broad range of individuals from farm and consumer groups, retailers, academia, and state government. In some cases, the councils are created by governmental sanction, such as an executive order, or through an existing state or local agency. In other situations, grassroots efforts drive and maintain the Food Policy Council structure. These councils may have a relationship with the government or be completely separate and distinct from the government. In 2015, there were 215 food policy councils in 45 states and the District of Columbia as compiled by the John Hopkins Center for a Livable Future.
4.1. State Food Policies
At the state level, a range of policies help create the environment in which farmers markets operate. These include programs to expand the number of farmers markets and use the markets to accomplish other economic development goals, such as the marketing of state identified food. Legislatures in a few States have funded efforts to increase access to farmers markets and strengthen local food systems. States have appropriated funds for the construction and maintenance of farmers market spaces, and enacted policies that develop local and regional wholesale farmers markets. In the past five years, 26 states and the District of Columbia have passed legislation to increase access to healthy food through farmers markets [30
State legislatures have also supported the growth in food hubs. USDA recently awarded four grants to Massachusetts food hubs and other similar facilities through its Local Food Promotion Program. In 2014, the legislature enacted a bill creating the Massachusetts Food Trust Program, which included a wide-ranging set of duties to increase healthy food access and strengthen community food systems. The program is tasked not only with providing funding and support for grocery retail, but also with expanding urban agriculture, farmers markets, food hubs and other food security efforts in the state.
There are also policies at the state level on broader system-wide legislation. For example, North Carolina created a Sustainable Local Food Advisory Council in 2010 to consider and develop policies to build a local food economy. Additionally in 2010, Colorado created a Food Systems Advisory Council to develop recommendations that promote local food economies.
The National Conference of State Legislatures [31
] lists state legislation in all 50 states enacted between 2012 and 2014 that aim to strengthen various components of local food systems. Over half of these bills address development and promotion of farmers markets and farm to school programs. For example, in 2014, Missouri passed a bill that permits the state’s Agricultural and Small Business Development Authority to make grants, loans or loan guarantees to Missouri businesses for accessing and processing locally grown agricultural products for use in schools. In 2012, Florida, New York, and North Carolina appropriated funds for the construction, repair, and maintenance of capital infrastructure for farmers markets. Other legislation that addresses barriers to local food production include establishing a task force to encourage the purchase of local products that have traceable points of origin in the state; directing the appropriate state agencies to provide a training program for small food and farm businesses to navigate the procurement process; and providing funds to food hubs.
4.2. Local Policies
Most policy issues facing farmers markets develop at the local level because farmers markets are a local activity [32
]. The most commonly encountered local policy issues relating to farmers markets are operational questions, such as where the market can operate, parking, security, and conflicts with adjacent businesses. These policies can be most significant in determining the success and existence of a market. Cities also address issues related to regulation of farmers markets, such as the need for permits, licenses, zoning exceptions, or approval of a market ordinance. Cities may also be involved in promoting and developing markets as part of a local food policy initiative, or may assume responsibility for operating and funding markets. For example, Berkshire Grown, originally the Berkshire Regional Food and Land Council, promotes food, flowers, and plants produced in the Berkshire region of Massachusetts, and builds partnerships between farmers and food buyers (www.berkshiregrown.org
In recent years, Chicago, Cleveland, Madison, and San Diego, among others, have liberalized their zoning rules to allow urban land to be used for a range of agricultural activities [33
]. A variety of cities and counties including San Francisco, CA; Albany County, NY; Cabarrus County, NC; Cleveland, OH; Los Angeles, CA; and Woodbury and Linn Counties, IA, have also passed resolutions supporting regional and/or sustainable procurement [29
]. Based on an assessment of local policy databases, local policies that help to overcome local food barriers focus on supporting or enabling local food production; procuring local food for institutions (such as farm to school); and facilitating the development of food system infrastructure (processing and aggregation) [5
]. Local government institutions that support local and regional food systems may exist directly within local government agencies, such as the department of planning.