Wednesday, February 3, 2010

Montpelier, VT is Piloting a Food Currency

On the subject of food - we are in the process of piloting a food currency here in Central Vermont that is designed to help our local farmers cope with low prices and escalating costs. It will be a hybrid, where dollars, food storage units, and food credits will be used for transactions...

We envision that there will be three currencies in the system - a food storage currency (FS), where people buy shares of food in storage with dollars, and can redeem them for food, a food credit currency (FC), which will be electronic credits - no dollars or food backing involved, and dollars ($). This makes it possible to use a mix of currencies for sales and purchases, which will hopefully level the playing field for local food sellers and buyers who are competing with the continually dropping commodity
food prices on a global level...

How would it level the playing field? Well, a local currency that is redeemable for other food and food related products actually creates real wealth based in that system. So, if a farmer usually sells a bushel of apples for $40, but could offer them for $30 plus 10 Food Credits, knowing that they can use the Food Credits to pay part of their workers wage, or pay part of the bill to the local processor who bottles their applesauce, or even part of the cost of their local newspaper advertisement, there is still real value to those Food Credits for the farmer. Meanwhile, they will still earn the dollars they need to pay for their diesel or machinery or other things that come in from outside the local area.

The critical piece of organizing that needs to be done at the outset is to close the loops in the local economy for the people who will be using it. Make sure the farmers, the restaurants, the food service workers, the food processors, all have somewhere to spend it, and you're there.

Just yesterday - as serendipity would have it - our local paper published an article about how local towns in Vermont used to accept food as payment for taxes and fees. That's a fast way to close all the loops.

The food storage units will be "backed" by food in storage, so you would pay dollars to buy the units and would be able to redeem them for items from a couple of the larger food storage facilities we have been developing over the past couple years. The food credits will be more like a pure complementary currency, where the units are exchanged without a link to dollars or food in storage.

You can see the prototype web site we've established for it at: It is not in use yet. We are meeting this week to develop a plan to roll it out among the people and businesses in the local food system.

The software we're using - Cyclos - is open source (free) software that enables anyone to set up a local currency. All you need is a web server that can run Java and Apache and someone sufficiently geeky to help set it up... You can read more about it at:

Please be sure to let them know it is a prototype - we have some unusual members in there right now,

Cheers, Gwen.
Gwendolyn Hallsmith, Director
Department of Planning and Community Development
City Hall
39 Main Street
Montpelier, VT 05602

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