The number of farmers markets in the United States has increased by almost 7,000; from 1,755 in 1994 to 8,771 in 2017 (USDA ERS, 2022). And while this growth in the number of markets has increased access to fresh, locally produced foods for many, those individuals and families receiving Supplemental Nutrition Assistance Program (SNAP) benefits (formerly known as the Federal Food Stamp program) do not have the ability to spend those benefits at all farmers markets in Ohio.
In 2013 there were 117 Ohio farmers/farm markets that accepted SNAP benefits. The number increased to 132 in 2020 and there were $446,360 in SNAP benefits redeemed at Ohio farmers/farm markets in 2020, a 97.75 percent increase from $225,722 in 2013 (USDA FNS, 2022). Even with this positive increase there are many more markets in Ohio that could accept SNAP benefits to increase where SNAP recipients can shop.
This fact sheet details the process Ohio farmers markets can follow to begin accepting SNAP benefits at their markets. The first section includes management items to consider before applying to the USDA Food and Nutrition Service (FNS) for SNAP eligibility to accept Electronic Benefit Transfer (EBT) card payments. The second section discusses the application process and implementation for the farmers market.
Accepting SNAP Benefits at a Farmers Market
There are a few management items farmers markets need to explore before beginning the process of accepting SNAP benefits:
- How is the market legally organized? In other words, is the market structured as a cooperative, Limited Liability Company, corporation, sole proprietorship, or not-for-profit organization? While is it not required for markets to accept SNAP, it is a good business practice for markets to be legally organized.
- How does the market manage its finances? Does the market have a bank account that is dedicated to handle the income and expenses of the market? SNAP benefits are electronically deposited once transactions have been processed—a bank account is required.
- How will the market administer and manage the acceptance of SNAP benefits? These management capabilities include a person or persons responsible for operating the SNAP terminal or mobile app, processing transactions, maintaining records, and training and reimbursing vendors. For some markets this person is a market staff member or volunteer. Some markets work with a local non-profit organization to provide this service to the market vendors and SNAP recipients.
- How will the market promote its ability to accept SNAP benefits? Many markets accepting SNAP benefits have great success in offering matching dollars to benefit recipients. However, these dollars currently come from funds other than the USDA Food and Nutrition Service (FNS). Markets often work with charitable organizations and/or local foundations to offer matching funds to consumers. For more information about matching programs, refer to the Ohioline nutrition incentives fact sheet series.
Applying for SNAP Eligibility
Once the items listed above have been evaluated, and the farmers market has the capacity to manage the program, the next step is to apply to USDA FNS to become an eligible retailer. This application can be completed online at the USDA FNS website here. Find it by searching for the SNAP farmers market application at USDA FNS, or you can email SM.FN.ROB-WC1RETReply@usda.gov.
Questions on the application include the market contact, the market’s physical location, and information about responsible officials. Depending on the type of legal structure of the farmers market, you will be asked to provide either an employer identification number (EIN) or a social security number of a responsible official. The EIN number can be obtained, or applied for, online (at no cost) at the IRS website (irs.gov) by searching Employer Identification Number (EIN).
For additional assistance on completing the application to become an authorized farmers market to accept SNAP benefits, review this guidance from the USDA (USDA FNS, n.d.).
Receiving SNAP Benefits
Once your application is approved by USDA FNS, you will receive notice that the market has been approved to accept SNAP benefits. Upon approval, you will need to secure the equipment needed to accept SNAP at your market. There are several ways a market can choose to accept SNAP benefits.
- Manual Voucher system–This system does not require an Electronic Benefits Transfer (EBT) terminal. However, telephone access is required at the market to call a 1-800 number to verify the benefits are available for purchasing eligible products. After calling the number, an authorization number will be given, the customer will sign the voucher, and then the customer will be able to shop for eligible items at the market. The market will then mail the vouchers with the authorization number to the processor. Once processed, payment for the benefits used will be electronically deposited into the market’s designated bank account. For additional information about the voucher system, contact the EBT Section of the Ohio Department of Job and Family Services (ODJFS).
- Mobile Apps - The National Association of Farmers Market Nutrition Programs (NAFMNP) has a cooperative agreement with USDA FNS to provide access to the SNAP mobile application for farmers markets at no cost to the farmers market for one year. This allows the farmers market to process SNAP transactions with their own device. To see if your market is eligible, visit marketlink.org/apply. Be mindful that this program is contigent upon funding and may change if funds are expended.
In addition to using an app to process SNAP transactions, many markets or vendors use additional apps on their smart devices to accept debit and credit cards. There are many different apps available. If you are unsure which app might best meet your needs, talk with other markets and vendors to learn about their experience and recommendations.
- Accepting SNAP and debit and/or credit cards–Some markets choose to accept not only SNAP cards but also debit and/or credit cards at their markets. If the market chooses to accept multiple types of cards, the market will need to work with a third-party processor (TPP) to acquire their wireless EBT terminal. There are many different TPPs available. Markets are encouraged to talk with other farmers markets that accept multiple cards for recommendations on TPP companies. Some TPPs will allow the market to either purchase or lease an EBT terminal. There are fees for purchase or lease of these terminals as well as operating fees. Most TPPs will charge a monthly data package fee, a swipe fee, and a percent of sales fee. These fees can vary from TPP so markets should explore the various TPPs, and compare fees charged, services provided, and the length and flexibility of the contract.
Throughout the process of accepting SNAP benefits, records should be retained by the market. These records should include: the number of SNAP transactions per market, the number of tokens/scrip redeemed by vendors, and how and when vendors are reimbursed for tokens/scrip they redeem with the market. This information is usually printed when the market runs an end of day report from the EBT terminal. This information does not include personal or identifying information about the SNAP customers but can be compiled over the course of a market season(s) to track the performance of the farmers market as it relates to SNAP customers. The information can then be used to share community impacts, seek sponsorships for the market, and promote the increased access to fresh, local foods for food insecure individuals and families.
Accepting SNAP at farmers markets allows increased access by SNAP benefits recipients to fresh, healthy, and locally produced foods. It also allows for increased revenues for market vendors. In 2023, over 3.5 billion SNAP dollars were distributed in Ohio (OLSC, 2023). By increasing the choices where SNAP recipients can use these benefits to purchase healthy foods, the consumer wins, the market vendors win by increasing the consumer food dollars they capture, and the community wins by keeping those food dollars circulating in the community.
Resources
The SNAP farmers market application through USDA FNS is available at fns.usda.gov/snap/retailer-apply.
A SNAP how-to handbook published through a joint partnership of the U.S. Department of Agriculture, Agricultural Marketing Service; U.S Department of Agriculture, Food and Nutrition Service; and the Project for Public Spaces, Inc. is available at dx.doi.org/10.9752/MS039.06-2010.
References
Ohio Legislative Service Commission (OLSC). (2023). Legislative budget office of LSC, supplemental nutrition assistance program (SNAP) [PDF].
lsc.ohio.gov/assets/organizations/legislative-service-commission/files/infographics-supplemental-nutrition-assistance-program-snap.pdf
U.S. Department of Agriculture Economic Research Service (USDA ERS). (2022). Growth in the number of U.S. farmers markets slows in recent years.
ers.usda.gov/data-products/chart-gallery/gallery/chart-detail/?chartId=104402
U.S. Department of Agriculture Food and Nutrition Service (USDA FNS). (n.d.). Farmer/Producer. Retrieved June 7, 2024 from
fns.usda.gov/snap/farmer-producer
U.S. Department of Agriculture Food and Nutrition Service (USDA FNS). (2020). SNAP redemptions report. Retrieved June 7, 2024.
fns.usda.gov/snap/redemptions-report-fy-2013-2020
U.S. Small Business Administration (USBA). (n.d.). Choose a business structure. Retrieved June 7, 2024 from
sba.gov/business-guide/launch-your-business/choose-business-structure
Originally written November 5, 2018 by Christie Welch, Program Specialist; Direct Agricultural Marketing, Ohio State University Extension, South Centers.