While I'm not a big fan of junk mail, I find it much less distasteful than telemarketers. I also appreciate that local businesses sometimes need direct marketing because all the billboard type advertising is dominated by massive corporations.
On the other hand, junk mail is a complete waste of paper
and delivery resources, so it seems like it would be good to have some way to get local junk mail over email. Since a lot of money in delivery fees would be saved, to avoid tons of low quality advertising, and to make it worthwhile for the potential customer to open the email, a fee would be charged and a large percentage of the proceeds would end up going to the potential customer. If the recipient deletes or ignores the "Local Spam (tm)" email, nothing happens. If they open the email, the ad should be simple enough to absorb very quickly, for example a nice picture and text such as, "Snack Shack grand opening near you this Saturday!" with two buttons: "Tell me more / Coupons", or "No thanks". Clicking on the "No Thanks" button would acknowledge that you saw the ad and possibly be logged to provide better targeting. Assuming 10 seconds to read and 5 seconds to hit the No Thanks button, that's a total of 15 seconds of your life wasted. As compensation, the advertiser would give you 10 cents, equivalent to $24/hour, but I think cheaper than the cost of sending junk mail, and would only actually pay it to someone who took the time to find the No Thanks button.
Obviously there would need to be measures to avoid people setting up bot farms harvesting meaningless clicks. Losses could be limited by having no more than one or two accounts per physical address. The "No Thanks" button could be designed with features similar to a captcha, so a human user could fairly easily see where to click, but clicking anywhere else would activate the "Tell me more" which would not pay out unless a further verification was performed. An alternative way to avoid fraud might be to actually have no direct payouts to recipients, but have variable coupons that have better deals for those that read more of the ads, but someone still might make a tool to maximize your coupons.
After thinking about this more, it seems that Groupon is providing a similar service in that it is opt-in local advertising, but their whole model of having to act now on one special offer a day doesn't really fit well with me, and probably doesnt fit well with many times of local businesses as well.