Many participants in SNAP, the federal government's Supplemental Nutrition Assistance Program, turn to farmers' markets for a healthier alternative to processed food. And farmers' markets, in turn, offer discounts and matching programs to help keep food costs down. When Novo Dia Group, a company that runs a program to process SNAP benefits at farmers' markets, announced that it would end service by July 31, many growers and shoppers around the country were put in a bind. But luckily for most Colorado organizations that run local farmers' markets, the change will not be a problem.
"We will still be able to take SNAP," says Brian Coppom, executive director of Boulder County Farmers Markets (BCFM), which handles the Boulder, Union Station, Lafayette and Longmont farmers' markets. "The Novo Dia machines have not functioned reliably, so we had already been transitioning our SNAP transactions to Clover POS."
SNAP, formerly known as food stamps, has had a partnership with farmers' markets for years. It's beneficial to both the vendors and the people using the program, as many farms offer double dollars for SNAP recipients, which means more produce for less money and an incentive to spend money on good, clean food that's grown locally.
The Washington Post reported that the Austin-based Novo Dia Group processes around 40 percent of SNAP transactions at markets around the country. That means when service ends at the end of the month, about 1,700 of the 7,000 markets that offer the Electronic Benefits Transfer (EBT) for SNAP will no longer have the capability. And new machines with a new system are expensive.
"Novo Dia's departure was totally unexpected, so I consider our own timing serendipitous," adds Coppom in an email. "There are probably a dozen other markets in Colorado who will be affected negatively."
Coppom adds there are other alternatives to Nova Dia Group (which act under the name Mobile Market Plus) out there, such as the Clover system that BCFM started using. He concedes that "the machines are more expensive than the Novo Dia machines were, particularly given there is no government subsidy to buy alternative machines. I have heard that Square was working on integrating SNAP protocol into their systems, which could be an affordable solution for smaller markets."
The Nova Dia Group's exit from the EBT market comes on the heels of the USDA's decision to replace the middleman organization in November 2017, when its contract expired. For years that middleman has been the Farmers Market Coalition, a national nonprofit that promotes and assists farmers' markets. But as of April, the contract went to Financial Transaction Management, which, according to an article in Modern Farmer, doesn't have experience with farmers' markets and will not take on Nova Dia Group.
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"Overall, it is a temporary but significant setback for food access," says Coppom. "Because of the equipment cost and complexity of becoming authorized, SNAP purchases at farmers' markets saw a huge decline once SNAP went electronic. The FNS program that distributed the Novo Dia machines for free helped. Now small markets are back to zero and will have to make new investments."
The Colorado Department of Agriculture lists 102 markets this year, and some are sure to be in this bind. We reached out to HobNob Events to find out if its markets, on South Pearl Street and in Highland Square, use Nova Dia Group, but haven't heard back. Colorado Fresh Markets, which runs the Cherry Creek, City Park Esplanade, Golden and Stapleton markets, says those markets don't use the Nova Dia Group software, so SNAP participants can still use it at those markets — and the BCFM markets — without a problem.
Updated 3:55 p.m., Friday, July 13: HobNob Events indicates that its markets are not affected by the change and will be able to continue to accept SNAP payments.