Earlier this year, the New York legislature passed an important bill (S7833/A10584) to benefit New York State farmers and food insecure communities. If signed by the Governor, the farm to foodbank bill will assist farmers in donating food into the emergency food system—reducing food waste and getting more food to New Yorkers in need.
Each year, millions of pounds of fresh fruits and vegetables go unharvested here in New York. Much of this produce is perfectly good, but cannot be marketed at retail value due to aesthetic imperfections or other market considerations. At the same time, more than 13% of New Yorkers struggle to have consistent access to healthy food. This bill would ultimately help cover the steep costs associated with harvesting, processing, and transporting crops, making donations a viable option for New York’s farmers—and getting more fresh food to hungry New Yorkers.
In short, the bill allows farmers to claim up to $5,000 annually through a refundable tax credit equal to 25% of the wholesale value of their donations to emergency food programs. This bill, unlike its 2015 predecessor, limits the credit to New York State farmers.
In December 2015, before passage of this NY bill, the U.S. Congress passed legislation to permanently extend an enhanced deduction for tax paying businesses that donate food to a food bank or other charitable organization. Prior to the change, only C corporations could claim a deduction; now all for-profit farms can benefit. This enhanced federal deduction is a great options for some farms—see our factsheet for more information—but a state credit is still needed to help farmers here in New York.
Currently, the majority of New York State farmers generate little or no farm income. According to data from the 2012 USDA Census of Agriculture, of 35,557 farmers in New York, 19,848 reported net losses and a further 3,354 reported farm income below $5,000. For these individuals, the recently enhanced federal tax deduction is not likely to be helpful. But a refundable credit would help—allowing farmers to lower the amount of taxes they owe and possibly receive a cash refund. By helping to divert food that would otherwise have gone to waste, this legislation could provide food insecure communities with a new source of fresh, local produce.
This legislative victory is the result of hard work by a broad coalition of agriculture and anti-hunger groups—including Farm Bureau, Hunger Action Network of New York State, National Young Farmers Coalition, and City Harvest. NRDC looks forward to continuing to work with this group to encourage Governor Cuomo to sign the bill in to law. Full passage of this law would compensate farmers for their hard work; increase the amount of much-needed produce in the emergency food system; and make better use of our valuable natural resources.