How Local Food Helps Iowa's Economy

How Local Food Helps Iowa's Economy

New report shows institutional purchases of locally produced food added nearly $9 million to the Iowa economy in 2012.

A new report from the Leopold Center for Sustainable Agriculture at Iowa State University shows that institutional purchases of local food added nearly $9 million to the Iowa economy in 2012.

What's more, the report points out enormous opportunities for local foods in Iowa that could benefit rural communities and farm-based businesses. Researchers measured significant sales from only a small segment of potential markets for local foods among grocery stores, restaurants, hospitals, nursing homes, college and school food services and other institutions. The report, "2012 Economic Impacts of Iowa's Regional Food Systems Working Group," is available on the Leopold Center website.

LOCAL FOOD HELPS LOCAL ECONOMY: Abigail Breitbach (left) delivers produce from the University of Northern Iowa's first student garden to the UNI dining service. Susan Devine (right), is the assistant manager of dining services. Photo by Rachel Wobeter

The findings are part of an evaluation of the Regional Food Systems Working Group, or RFSWG, that supports local food systems in 90 of Iowa's 99 counties. It is the first coordinated, comprehensive attempt to measure actual economic and community impacts associated with regional food system development in Iowa.

The evaluation tracked local food purchases by grocery stores, restaurants and institutions, and sales from Iowa farm-based enterprises that marketed their products locally in 2012. Nearly 180 businesses and individuals participated in the data collection effort, including 74 buyers and 103 producers of local foods. The evaluation also measured job creation as a result of local food production, processing or utilization, and counted funds leveraged by the regional food groups that comprise the statewide RFSWG network.

Real data

ENCOURAGING IOWA-GROWN FOOD: Purchases of locally-produced food added $9 million to Iowa's economy last year, says a statewide report. Photo by Jan Swinton

"Most of the information we've had in the past came from economic models, that is, projections based on potential scenarios and assumptions, not what actually happened during a specific time period," says associate scientist Corry Bregendahl, who coordinated the data collection project for the Leopold Center with Leopold Center program assistant Arlene Enderton.

She says the report also differs in the type of sales information that was collected, which included data from institutional and intermediary markets as well as direct sales.

"Most people think local food sales are only those between farmers and individual consumers, such as farmers markets or community supported agriculture, CSA enterprises," she explains. "We also measured sales to institutions such as hospitals and nursing homes, and schools, grocery stores and restaurants. These markets represent huge potential markets for local foods, and serve a population that needs greater access to healthy food."

Area food buyers, farmers surveyed

Bregendahl and the coordinators of the 15 regional food groups in the RFSWG network collaborated to gather and assess the data. The coordinators distributed surveys to area buyers and farmers they worked with to collect information about these key indicators of economic impact:

* Local food purchases in 2012: 74 buyers reported total purchases of $8,934,126.

* Local food sales in 2012: 103 farmers reported total sales of $10,549,296;

* New jobs related to local food in 2012: A total 36 new jobs (24 full-time equivalent) were created in 2012 (reported by a subset of buyers and farmers).

* Funds leveraged by eight regional food groups in 2012: $766,020.

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The 74 buyers spent an average $120,700 on local foods, or about 8.7% of their total food budget. If local food purchases were increased to 30% of the total food budget, an additional $21.5 million in sales would have been generated, leading to the creation of 71 new full-time buyer-based jobs. Less than half of 1% of the estimated 22,000 institutional and intermediary markets in Iowa participated in this evaluation.

Locally-produced food means local jobs

"When you look at jobs related to public money invested in the local food groups, we found that it's relatively inexpensive to create full-time employment opportunities in Iowa communities," says Bregendahl. Calculations showed that it cost the public $17,874 to support one new FTE job in the local foods sector. "Local foods commerce expands and complements what we're already doing in Iowa agriculture; it does not compete with it," she adds.

The evaluation reflects efforts throughout Iowa by RFSWG's 15 geographically-based groups. Each group works with different stakeholders: farmers, food-based businesses, non-profits, Extension, Resource Conservation and Development organizations, educational institutions and government agencies to support local food systems development in their region.

They are:

- Flavors of Northwest Iowa

- Northern Iowa Food and Farm Partnership

- Northeast Iowa Food & Farm Coalition

- Southern Iowa Regional Food Systems

- South Central Iowa Area Partnership

- Hometown Harvest of Southeast Iowa

- Dubuque Eats Well

- Field to Family Food Coalition

- Healthy Harvest of North Iowa

- Eat Greater Des Moines

- Quad Cities Food Hub

- Harvest from the Heart

- Food and Farm Initiative of the Heartland

- Greene County Local Foods Working Group

- Central Iowa RFSWG

The statewide report," 2012 Economic Impacts of Iowa's Regional Food Systems Working Group", is available on the Leopold Center website. Additional data and profiles of local food champions also are available from coordinators of 11 regional groups. For more about RFSWG, go to their website.

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