The Power of Institutional Food Procurement

Institutional food procurement, or sourcing the food for institutional market channels like schools, hospitals, correctional facilities, senior care facilities, and especially government agencies, holds more power to benefit farmers than any other local food market. 

Public and private institutions spend billions of dollars on food purchases each year to provide meals. Each one of these institutions represents an opportunity for U.S. farmers and ranchers to gain access to large markets, which can greatly impact their income and livelihood and also provide a way to dramatically change the way we procure food throughout the nation. 

A rising national movement is working to incentivize institutions to source a higher percentage of food from local and regional farmers using a value-based procurement approach. By integrating values such as environmental sustainability, justice for farmworkers, nutritious food, and animal welfare, value-based procurement is a purchasing model that can be used by institutions to align their core values with their food service programs and vendors. 

Implementing value-based food purchasing can hold the key to transforming the U.S. food system.

Federal Food Procurement

The Federal government has a significant food purchasing footprint. Each year, the U.S. government spends billions of dollars on food. In 2022, including everything from food for military bases to school lunch programs, the government directly procured and spent more than $9 billion on food purchases. The U.S. Department of Agriculture (USDA) and the Department of Defense (DoD) receive the largest portions of the procurement funding; their authority to spend billions of taxpayer dollars on food translates into a great deal of power to shape our food system. The USDA and DoD make up 90 percent of federal government food purchases for child nutrition programs, food banks, Native American reservations, foreign aid, low-income seniors, troops, veterans, and others.

USDA’s Agricultural Marketing Service and its Commodity Procurement Program buy more than $3 billion dollars’ worth of meat, poultry, produce, dairy, and grains every year, and many of these vendor contracts go primarily and routinely to large, industrial agribusiness corporations like Cargill, Tyson, JBS, and Smithfield. 

A recent impact analysis of government’s food purchases in 2022 showed just how much more taxpayer money these consolidated multinational corporations receive than any other farmers. For each category of food purchased, the majority of contracts were awarded to a small handful of corporations, rather than being spread out among different producers and vendors. Tyson Foods, alone, received 43 percent of all of the USDA’s poultry purchases and USDA’s top 25 vendors – or 8% of total vendors – received almost half of the total spending. Government food procurement is working to reinforce corporate control and consolidation of the food system and control of our public supply chains.

If more government procurement contracts were awarded to family farms and ranches, this change alone could greatly impact the rebuilding of local and regional food systems that were destroyed by decades of industry consolidation. Instead of using taxpayer money to support large multinational corporations with records of animal welfare violations, labor abuse, environmental destruction, and unfair business practices, public funds could be used to support local, family-owned farms using environmentally responsible, fair, and humane practices. This type of procurement would be more aligned and reflective of values and behavior that supports the USDA’s pledge to transform the current U.S. Food System.

How to Center Institutional Procurement Around Values 

Good Food Purchasing Program

The Good Food Purchasing Program, developed by the Los Angeles Food Policy Council, is a model for institutional food procurement that creates transparency and equity by centering food purchases on five core values: local economies, health, valued workforce, animal welfare, and environmental sustainability. The Center for Good Food Purchasing helps institutions successfully implement this program by providing a comprehensive set of tools, technical support, and verification system to assist institutions in meeting their program goals and commitments. 

The Good Food Purchasing Program was tested in Los Angeles starting in 2012 with the adoption by the City of Los Angeles and Los Angeles Unified School District. The Los Angeles Good Food Purchasing Program impacts 750,000 meals a day and has shifted millions of dollars toward suppliers aligned with program values. Before the program was adopted, only about 10 percent of produce served in LA schools was sourced within 200 miles of the district. Now under the program, that percentage has jumped to 50 to 72 percent, depending on the season, bringing roughly $12 million into the local economy and to local producers.

Community leaders across the country are experiencing the power and unifying spirit of valued-based institutional procurement. To date, the Good Food Purchasing Program is being explored and adopted by over 15 cities across the nation. The program can potentially serve as  a model that Arizona cities and institutions can also look to adopt. 

Good Food Communities 

Good Food Communities (GFC) is a diverse coalition of national, local, and regional organizations representing millions of people who eat, produce, process, deliver, and serve the food through the U.S. GFC is led by grassroots leadership from Buffalo, NYC, Cincinnati, Chicago, Gainesville, and Oakland and also partners with the national organizations HEAL Food Alliance and the Food Chain Workers Alliance. 

GFC provides a framework for grassroots coalitions to prioritize equity outcomes in their policy and organizing efforts, and for participating public institutions to give preference to food vendors and suppliers with shared principles. The organization seeks to leverage public procurement through policy and organizing to win living wages for frontline workers, infrastructure for BIPOC producers, and better protections for the environment.

GFC works to empower local, community-based coalitions that give voice and agency directly to those impacted by institutional food procurement. The goal is to ensure that the values of community members are reflected in the food purchases that local and public institutions make.

Good Food Communities and partners recently released the report “Procuring Food Justice: Grassroots Solutions for Reclaiming Our Public Supply Chains.” The report analyzes value-based procurement policies in 10 U.S. cities that have collectively influenced over $540 million in public food dollars. It outlines lessons to offer advocates a blueprint for leveraging a values-based purchasing strategy to challenge corporate control of public food and redirect billions of taxpayer dollars toward small farmers, producers of color, and suppliers with fair labor practices.

National and Local Policy that Upholds Value-Based Food Procurement 

Recently, lawmakers in both the House and Senate introduced legislation aimed at transforming the USDA’s food purchasing processes by directing the agency to seek out not only the most cost-effective foods, but also to weigh factors including supply chain resiliency, environmental impact, and labor policies when awarding companies the billions of dollars it spends on food each year. 

The piece of legislation – Enabling Farmer, Food worker, Environmental, and Climate Targets through Innovative, Values-aligned, and Equitable (EFFECTIVE) Food Procurement Act - has been endorsed by over 200 organizations. With a lack of bipartisan support and the delay of the next farm bill, however, the future of the bill remains uncertain. 

Change at the national policy level can move at a very slow pace, but through local policy initiatives like the Good Food Purchasing Program, communities can take action locally. The power of the institutional procurement contract can significantly influence supply chains, support local economies and producers, and ultimately create serious change.

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