Supporting Local and Regional Supply Chains

The  innovation brief  linked below highlights state governments’ use of COVID-19 pandemic relief investments in local and regional food systems. These investments were largely funded through Section 5001: Coronavirus Relief Fund (CRF) of the CARES Act and Section 9901: Coronavirus State and Local Fiscal Recovery Funds (SLFRF) program of the ARP Act. The CARES and ARP Acts were passed in March 2020 and 2021, respectively. Congress provided a total of up to $500 billion directly to state, local, tribal, and territory governments by means of the U.S. Department of the Treasury to help the country respond to and recover economically from the COVID-19 pandemic.

States, tribes, and local governments were granted significant discretion with CRF and SLFRF to stand up COVID-19 pandemic-related programs. Through CRF these entities were allocated $150 billion to help cover costs related to the public health emergency incurred between March 1, 2020, and December 31, 2021. SLFRF also provided these same entities an additional $350 billion to support families and businesses dealing with the impacts of the COVID-19 pandemic, support public services, and make investments that support recovery. The majority of the funds, $219.8 billion, were reserved for states, tribal and territorial governments, and $130.2 billion was allocated to local governments.

Many state governments directed a portion of federal COVID-19 pandemic relief funds toward local and regional food system (LRFS) development. The USDA, National Association of State Departments of Agriculture (NASDA), and the NASDA Foundation partnered to gather more information on these efforts. Between February 16, 2022, and September 9, 2022, NASDA and the NASDA Foundation, with support from USDA, administered a voluntary survey to state departments of agriculture to collect program information. Nine departments responded, sharing information on 29 programs. The USDA reviewed the survey results for programs specific to LRFS. Those findings were combined with program information collected from multiple state interviews, news articles and internet searches on LRFS and state developed LRFS programs dating back to October 2020. Overall, USDA, NASDA, and the NASDA Foundation identified 45 local and regional food systems-oriented programs in 22 states, valued at $326 million.

The CRF and SLFRF provided states with a historic opportunity to develop, shape, and fund programs to address existing and future needs that resulted from the COVID-19 pandemic. Almost half of the nation’s states used these funds to establish or expand existing LRFS-related programs. These programs covered many areas, from direct producer support to meat and poultry processing and farm to school. Using federal COVID-19 pandemic relief for LRFS programming by states marks a new era for LRFS. There is growing acknowledgment and interest in LRFS by state and federal governments alike to support food systems resiliency and economic development.

Download the full Innovation Brief to learn about the results of the research conducted by USDA, NASDA, and the NASDA Foundation and read up on several state spotlights.

LRFS supply chains should be as diverse as the food systems and communities they support. Communities’ thoughtful investments in the many interconnected LRFS operations and supply chains, encourage resilience following future disruptions.

The case studies in this section highlight innovations that occurred across LRFS during the pandemic and are areas for future growth and opportunity. They also illustrate multi-stakeholder collaboration between public and private partners, and a focus on long-term strategic investment in infrastructure.

Investing for the Future of School Food Case Study: This case study highlights how strategic investment in farm to institution infrastructure is a wise investment in both the short- and long-term resilience of LRFS supply chains and markets.  School meals are an essential source of food and nutrition for tens of millions of American children. For LRFS, the growth of farm to school and institution programs has been a significant driver of local market expansion. However, limited on-site kitchen and storage capacity often limits opportunities for further growth of such programs, especially in historically underserved districts.

State Investments and Innovations in Meat Processing Case Study: This case study provides examples of state-led investment and capacity building initiatives for regional meat processing from Iowa, Kentucky, and Colorado. Grocery store meat counter shortages and dramatic slowdowns across livestock processing, during the pandemic, brought to light an unquestionable need for additional processing infrastructure and skilled labor. Public funding and state-level coordination are essential to rebuilding both regional processing capacity and a high value agricultural sector.   

Building a Decentralized Food Supply Chain in Puerto Rico Case Study : This case study provides examples of how food systems leaders leveraged diversity and dispersion of community efforts as a strength to coordinate investments and activities via a hub and spoke model of knowledge and resource sharing informed by an ethos of mutual aid. Adapting to both the physical and social infrastructure of island communities, local and regional food system leaders of Puerto Rico coordinated efforts to ensure valuable resources (capital, foods, seeds, equipment) were equitably distributed across the geographically distinct communities of the Island.  

This section provides a big picture guide to types and uses of financial resources that can support both the recovery and development of LRFS supply chains to encourage resilience in times of disruption.  

In times of disruption, finding and securing funds for response and recovery efforts are top priorities for LRFS leaders and stakeholders. Analysis of the LRFS response to a COVID-19  resource hub  showed that ad-hoc lists of where and how to apply for federal grants and other funding programs proliferated during the pandemic. Additional LRFS stakeholder research indicated a need for further guidance on how to assess sources along with types and uses of funding most appropriate for their needs.  

Federal and state funds provide a foundation for both the short-term recovery and long-term resilience of LRFS. However, other sources and strategies may better suit the needs of specific stakeholder groups or communities. Existing mutual aid and crowdfunding platforms provide flexible and timely funding mechanisms to address unique and immediate needs within a community’s local food system. Municipal governments are not a commonly recognized funding source for LRFS initiatives, but they can partner with community-based organizations for contracted service provisions (e.g., emergency feeding, nutrition security, workforce development), as well as procurement and economic development initiatives.  Philanthropic organizations support strategic priorities and values-aligned initiatives. These organizations commonly work more through established partnerships in longer-term relationships than through publicly funded grants. 

Navigating COVID-19 Relief for Farmers : Throughout the COVID-19 pandemic, resource guides for farmers were developed to help navigate the challenging circumstances and the steady stream of federal and state relief programs. This resource published in collaboration by Farmers’ Legal Action Group, Farm Aid, the Indigenous Food & Agriculture Initiative, the Intertribal Agriculture Council, Rural Advancement Foundation-International, and the National Sustainable Agriculture Coalition is an example of one such resource that outlined relief programs related to COVID-19 and how they apply to farmers.

Developing an effective strategy for secure financial sources that can address different types of financial need is challenging in times of disruption, but is critical to LRFS resilience. This section provides an overview of funding sources as well as case studies that serve as examples for developing just such a strategy, while recognizing that the context and capacity of every organization, community, or sector will shape how that strategy evolves.   

Wildfire Relief Fund for Oregon Farmers Case Study: This case study provides ground-level reflections from communities that self-organized to provide direct financial support to farm operators and food businesses impacted by natural disasters.  Weather-related disruptions are associated with destruction of on-farm and supply chain infrastructure. Small-scale and diversified food producers may not have access to traditional forms of risk-management and insurance or may require immediate financial support to continue operations.   

The webinar,  Formal and Informal Cooperative Development to Support Local and Regional Food Systems  features leaders from LGBTQ+ and BIPOC led local food enterprises that center principles of cooperative economics and equity in their designs and operations. The discussion emphasizes that innovations such as sliding-scale, pay-what-you-can initiatives, and food sovereignty-informed policies are not new and have deep roots in historically marginalized and BIPOC communities. 

The following is a high-level overview of the main categories of funding sources that support LRFS resilience in the short, mid, and long term. For each general category of funding sources, our research team and project partners identified key considerations for common and best-fitting uses, time frames, considerations for administration or groundwork, and scope of funding for each source.

Click the link below to explore types and sources of local and regional food systems funding.