Posts Tagged ‘Farmers Markets’

SD Home-Processed Foods Law Gets Unnoticed Updates

I no longer live in South Dakota, but when I saw this legislative–>hoghouse maneuver, it really ticked me off.

Without consulting or notifying those who are affected, or those who actually worked on this legislation in the last session, SD legislators made some changes to the Home-Processed Foods Law and got them through committee and passed without anyone noticing–until now, that is.

First off, on initial introduction, HB1240 would have required a yearly $40 license from the Health Department to operate a “cottage food industry.”  Then the bill was hoghoused (SD speak for “stripped of its language and pretty much completely changed but still under the same bill #”) and changed to one that sets a $5000 yearly income limit on sales of homemade baked goods (pdf!).

I know the history of the SD Home-Processed Foods Law, so I know whereof I speak.  When our producer group worked with the SD Dept. of Health to draft this law, we asked for our own version of the MN Pickle Law, which does have a $5K income limit per year on home-processed baked goods and acid or acidified canned goods, but does not require testing of those canned goods.

What we ended up with was a version that allowed home-processed shelf-stable baked goods and acid and acidified canned goods to be sold at farmers markets, farm stands, and “similar venues”–but those acid and acidified foods needed to be tested by a “third party processing authority.”  And, there was no yearly income limit on sales of these goods.  At that time, the Health Department deemed income limitations unrelated to preserving the public health.

The recent legislation does not set a yearly income limit for the canned goods (cutbacks to the Cooperative Extension–the main processing authority–should pretty much see to that), but it does set a yearly income limit on baked goods.

So, why exactly did South Dakota’s legislators suddenly decide a fee limit was needed?  And why weren’t there any discussions about this new legislation with the people who are affected by it?

Representatives Greenfield and Sly? Senator Nygaard?  South Dakota’s small producers are on the line, and they have some questions…



Farmers Markets and Tax Collection

Cross-posted from the Vermillion Area Farmers Market site.

With the market season ramping up (just a little over a week to go before the VAFM opening market!), I thought I’d get out a post on tax collection at farmers markets in South Dakota.

[Disclaimer!] Of course, I don’t work for the Department of Revenue, and I’m not a tax professional, so back up everything I say here with some calls and contacts of your own.  I’ve been really happy with the help I’ve gotten from Laura Cunningham in the Yankton office.

But I have been doing this farmers market thing for some time–both as a board member of a market and a vendor.  And I’ve been in contact with the Department of Revenue about market-related issues on numerous occasions, so I’ll tell you what I’ve learned.

First of all, vendors at regularly-scheduled farmers markets in regular locations do NOT have to pay a special event or tourism tax on goods they sell there.  Craft shows and flea markets and other non-regularly scheduled events, yes.  Farmers markets, no.

This may make reporting a little tricky for vendors who do both kinds of events, but just keep the regularly-scheduled, regular location thing in mind, and of course, call the Dept. of Revenue for back-up.

What can make this issue confusing for market managers and boards is that every year, the Dept. of Revenue sends out a letter, a list to fill out with the names of vendors, and a sheaf “Special Event” tax forms for vendors.

At the end of each season, farmers markets are required to provide the Dept. of Revenue with a list of all the vendors who sold at their market.  This is actually kind of useful, because the market manager or board can simply make a copy of that list to use for their own records (and for sending out info to vendors) without having to go through a huge stack of contracts.

But the “Special Event” tax forms can make vendors think they have to pay a “special events” or tourism tax for sales at that market, and they don’t.  We actually don’t end up using many of those forms because most of our vendors already have a sales tax license, and they file twice yearly–there’s no reason for them to fill out another form.

The forms are mostly for those vendors who are from out of town and may not know our tax rate, or for those who don’t have a sales tax license yet.  We do let vendors know that regardless of their preferred method of filing, their names are going to be reported, and if they don’t pay, they’ll be hearing from the tax woman.

Another issue that markets sometimes have trouble figuring out is whether or not they must pay taxes on vendor dues–if the market itself should have a sales tax license, even though they don’t really “sell” anything.  In our case, the answer is no.

From my understanding, this has to do with our status as a non-profit corporation.  We are simply collecting vendor dues into a pool that can be used for promotion, insurance, and other necessities.

We were actually advised against applying for a sales tax license by the Dept. of Revenue because then it’d look like we were intending to sell something, and we’d have to file twice a year even though we’d have nothing to report.

A couple final issues in regard to sales tax at farmers markets in South Dakota (which right now only applies to our market, but hopefully will apply to others soon): it is against the law to charge sales tax on EBT or food stamp purchases.

If your market decides to go with a collective EBT and/or debit program with the market bank account receiving the funds from electronic transfers to be reimbursed to the vendors who have made those sales, make sure to keep very good records on the money that comes in from those transactions and the money that goes back out in vendor reimbursements–otherwise it could look like your market is making sales instead of simply facilitating them.

Once again, make sure to back up the information provided here with a call to the Dept. of Revenue to make sure it’s accurate for your market and/or your vending situation.

And have a great market season!

HB 1222 Passes Senate with Unanimous Support

Yesterday afternoon, HB 1222, the Home-Processed Foods Bill, passed the South Dakota Senate with unanimous support.  All that is left for it to become law is the governor’s signature.

We will be working with the Health Department on implementation and to get the word out to producers and farmers markets.

Thanks for your support on this bill!

Farmers Market & Community Garden Workshop

Sponsored by Farmers’ Market Moms

February 27, 2010 – 12:30-4:00pm

Corps of Discovery Welcome Center

3 miles south of Yankton on Hwy 81

Topics will include:

  • What is “Farmers’ Market Moms Project”
  • The Makings of a Successful Farmers’ Market
  • Communicating with the Consumer
  • Buy Fresh Buy Local
  • Funding opportunities
  • Community Gardens
  • Marketing and Promoting Your Market


Billene Nemec managed the Haymarket in Lincoln, Nebraska from 1986 – 2000, the Old Cheney Road Market from 2006-2008 and still manages a small mid-week Havelock market. Billene has presented many work shops on building and sustaining a farmers market in communities. Billene also heads the Nebraska Buy Fresh Buy Local Program.

Pat Garrity began his mid-sized organic fruit farm, with his wife Jan in the early 1980s near Mission Hill, South Dakota and sold the produce in a variety of farmers’ markets throughout the area. Pat started running a stand at the Floyd Boulevard Market in Sioux City, Iowa in 2004 and took leadership of the market in 2006. Today Pat is South Dakota’s Buy Fresh Buy Local program coordinator.

Healthy Yankton, a group in Yankton, SD, along with the City of Yankton worked to develop a community garden on the edge of town. In 2009 they developed 96 garden plots and hoped they would be able to rent out 20-25 of them the first year. They will explain what it took to develop the “Community Garden/Dog Run” and how they managed to rent 50 of the plots.

Sandy Patton, director of “Farmers’ Market Moms” and Curt Arens, asisstant director,  are working together to assist in the growth of new farmers market vendors and customers for existing and new rural farmers markets in northeast Nebraska and southeast South Dakota. Sandy and Curt recently completed the “Farm to Family Connection” project with the Northeast Nebraska RC&D in the fall of 2008 when they co-authored the local food campaign booklet & CD, “Making the Connection: A Toolkit for Starting a Radio and Web-based Local Food Campaign”.

HB 1222 Passes out of Commerce Committee

Cross-posted from the Vermillion Area Farmers Market blog.

The Home Processed Foods Bill, which paves the way for small producers to sell certain products direct to consumers at farmers markets and roadside stands without a commercial food vendors license, has passed unanimously out the the House Commerce Committee this morning.

The bill provides for sales of shelf-stable baked goods and home-canned goods (with third party certification of the recipe and method) prepared in producer’s homes to be legally sold direct to consumers, as has been the tradition across the state for many decades.

The bill was a joint effort between members of the Dakota Rural Action Small Farms Committee and the South Dakota Department of Health to alleviate the current strict regulations against all sales of home-produced foods anywhere in the state.

DRA Small Farms Committee approached the Department of Health last season, following surprise inspections at the Black Hills Farmers Market in Rapid City that shut down some long-time vendors, and because of producer questions and concerns about the accessibility and clarity of existing rules and regulations concerning small-scale food production in the state.

Earlier this winter, Small Farms Committee members (myself included), DRA staff, and Dept. of Ag and Health officials met in Pierre to start talking over the needs of small producers and hashing out what the Home-Processed Foods Bill might contain.  Work on the proposed bill continued via phone and e-mail through the winter months.

The Home-Processed Foods Bill, or HB 1222, now passes to the full House for consideration.

Jiggity Jig–For a Couple Days

Returned late yesterday afternoon from the Farmers Market Workshop in Rapid City–some good presentations there about Buy Fresh Buy Local SD, ethnic vegetables, grants and resources, and organic production.  We had a lunchtime session with Rep. Sly about HB 1222 as well.

I made a presentation on EBT (food stamps) and debit cards at farmers markets, and there was a great contingent of participants from Pine Ridge and Rosebud interested in providing that at their beginning markets, as well as getting information about markets in general.

Black Hills Farmers Market management and vendors were also there in numbers, along with parties interested in starting markets elsewhere in the Hills.  I’m hoping this will be the year that a few more markets will make the jump to accepting EBT as payment–especially considering the numbers of people that option can serve.

So, I’m home now for a couple of days–retrieved the last of my seed orders from the mailbox yesterday, so dividing them up into their boxes and re-inventorying everything is on the agenda.

On my way out to Rapid, I got a call from a friend who is back in Vermillion for a couple of weeks and wants to talk trade: some of my frozen, canned, and cellared produce for some of his antelope sausage and duck.  Hoping to hear from him today or tomorrow–LOVE me some antelope sausage!

And I need to get ready for my next adventure–Northern Plains Sustainable Ag’s Winter Conference up in Watertown.  I’m also doing a presentation up there (on local foods in rural America), so that has to be finalized before I take off.

Unfortunately, the wireless internet at my house has been getting slower and slower, so I’m heading to the library this afternoon to work.  I hear the Superbowl is today, so hopefully there’ll be plenty of open workspace (either that or it’ll be packed with fugitives from blaring TVs and howling fans).

And I suppose before I leave again I should re-clear my sidewalks for the next round of white stuff–maybe it’s just my imagination, but this latest storm felt a little more spring-like–warmer and wetter–than the last several we’ve gotten.  Wishful thinking?

HB 1222–More Important than You Know

Have you ever been to a farmers market in South Dakota?  Did you love that homemade chokecherry jam and those fantastic handmade pies?  Did you know that selling those products is actually illegal in South Dakota?

Of course you didn’t.  Neither did your legislator, and neither did the sweet old grandma who was making those products with loving care.  After all, it’s a grand tradition that has been going on for decades–what would a farmers market be without the pickles and pies, the jams and rolls?

But because we lack a specific exemption–an exemption that every bordering state has codified–markets that have just taken off in this state have already started to languish once word started getting out last summer at the Black Hills Farmers Market–after the Health Department made a visit and shut down vendors there.

But this isn’t to call the Health Department a bunch of bad guys–they’re enforcing the laws of this state, and they’ve made clear that it’s not their intention to be spoilers (no pun intended).  They’re simply doing their job.

And this winter, representatives from the Health Department met and worked with members of the Dakota Rural Action Small Farms Committee (myself included) to help draft HB 1222–to provide a safe way for market vendors to continue providing these homemade products and to alleviate what is fast becoming an overwhelming burden of enforcement.

This Bill, with bipartisan support, is coming through the House Commerce Committee.  This makes sense because should the bill become law, it would significantly boost the ability of markets to start up, grow, and flourish in rural and not-so-rural communities.  And that’s HUGE–especially in a time of economic difficulty.

Not only are market vendors remitting state and local sales taxes (markets are required to submit a list of vendors to the Dept. of Revenue), they’re bringing the entrepreneurial spirit, as well as cold, hard cash, into the communities in which they sell, and they, in turn, are more likely to spend the dollars they earn at local businesses.

The multiplier effect of dollars spent at locally-owned businesses is well-documented, and what’s more local than a farmers market?

On the other hand, if HB 1222 fails to pass, it’s not unreasonable to expect farmers markets to be greatly diminished in the 2010 season, and for the smaller and start-up markets to simply collapse.

Another possible outcome is that the growing local foods economy will simply go “underground”–out of sight, and out of the view of the state and local tax-man (or woman–let’s be fair). And really, those jars of preserves will be awfully heavy under grandma’s trenchcoat.

Neither of these scenarios is helpful to the state, nor to communities already struggling with a lack of funding.

As previously mentioned, HB 1222 is currently making its way through the House Commerce Committee before (hopefully!) passing on to the full House.

Members of that committee include: Susy Blake, Kristin Conzet, Mitch Fargen, Brock Greenfield, Phil Jensen, Patrick Kirschman, Shantel Krebs, David Novstrup, Eldon Nygaard, Carol Pitts, Tim Rounds (Chair), Darrell Solberg, and Roger Solum.

Maybe it’s time to make a phone call or shoot off an e-mail asking for their support of farmers markets, local economies, and HB 1222.

Simply click here, then click on the names of the State Reps for their contact information.  While the bill’s in committee, you can (and should) contact any or all of the members on that committee, even if they’re not from your district.