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Food Stamps and Farmer's Markets

Accepting Food Stamps at Farmers Markets in SD...

Accepting EBT/food stamps at your market is a great way to expand access to fresh, locally produced foods. It can expand your market's customer base and provide vendors with additional sales, as well as increasing goodwill in your community.

Meet with your vendors to discuss the proposed program. It will require some paperwork and bookkeeping, so it is best to obtain vendor support ahead of time. Make the obligations of the program clear, and write the rules and expectations into your vendor contract.

There are a couple of options for accepting EBT at farmers markets. Both require a credit card machine, or POS (Point-of-Sale) device. One is a (free and provided by the state) wired machine that requires electricity and a phone line. If your market does not have access to these utilities, you can use a paper voucher system at the market, which requires your market manager or individual vendors to call and authorize the amount of purchase before it is made. The voucher is filled out by the manager or vendor, and the collected vouchers are reported to the state using the wired POS device at the close of the day.

A wireless POS device is also an option. Though it is expensive ($1250) and requires a monthly contract with a wireless provider and a per-transaction fee. The wireless POS device allows vendors or the market manager to swipe the EBT card at the time of sale and not have to call for authorization or fill out a paper voucher. Another benefit of the wireless machine is that it can also be used to accept debit and credit cards, which may further enhance vendor sales. Grant monies are available for wireless POS devices for farmers markets--check with your state's department of agriculture.

With either system, your market will have to decide how to reimburse vendors for the purchases made using the market's POS device, as the money from purchases made with one central machine will be deposited into the market's bank account. Keep good records of transactions and reimbursements to vendors, and don't forget that food stamp sales are non-taxable.

Before the POS device is obtained, the market must fill out the USDA food stamp application for stores.  It is much easier for markets to use the print form, obtained by calling 877-832-4369. You will also need a list of food vendors to accompany the application--a list of the previous year's vendors will suffice. Once your market's application has been approved, the state's contracted supplier of services will contact your market and help with the POS device and bank account set-up.

The Vermillion Area Farmers Market chose to purchase the wireless POS device for several reasons.  One, our market has no land-based utilities on-site. Two, because of the lack of land-based utilities required for a wired POS, the paper voucher system would have to be used, posing greater chance for human error that might result in the market not being reimbursed for the EBT sales. Three, we felt the paper voucher system added too much of a workload for our vendors that might not be balanced by enough additional sales, which might result in vendor rejection of the new program. Four, the use of the wireless POS allows the market to "swipe" both EBT and debit cards on-site, allowing easier payment and a likely increase in both the number and amount of sales for our vendors.

For further information about accepting EBT/food stamps at your farmers market, contact Sandy Vanneman, EBT Administrator, SD Dept. of Social Services: (605)773-6527.

by Rebecca Terk, President of the Vermillion Area Farmers Market and DRA member


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