A new tool demonstrates how buying local food products can support businesses in the region and generate more tax revenue.
The algorithm was created by researchers at Cornell University for local schools, hospitals, prisons and other public service providers to calculate the net benefits of spending at least some of their food budget on New York products, even if it would cost more upfront compared to what they would pay an out-of-state supplier.
Some school districts do currently emphasize the inherent value of fresh, local food.
"But utilizing a framework like this actually values it based on the actual economic values to the state," said Todd Schmit, a professor of applied economics and policy at Cornell.
Why would a district or any other entity want to pay more than they have to, especially considering the pressures of inflation and economic uncertainty in the U.S.?
Schmit reasoned that if increased sales of locally produced food boosts tax revenue, state policymakers may be inclined to share some of the proceeds by offering buyers greater subsidies.
New York state already reimburses schools that spend at least 30% of their food budget on New York-made products.
"Ultimately, that's a policy discussion in Albany," Schmit said. "But I think providing that sort of information and documentation that's readily available through the use of the tool, helps support that argument."
While some agencies already use a geographic preference model in the bidding process, Schmit said the net cost multiplier tool is more precise.
