<p>I've set up Passenger in development (Mac OS X) and it works flawlessly. The only problem came later: now I have a custom <code>GEM_HOME</code> path and ImageMagick binaries installed in <code>"/usr/local"</code>. I can put them in one of the shell rc files that get sourced and this solves the environment variables for processes spawned from the console; but what about Passenger? The same application cannot find my gems when run this way.</p>

I've run into this issue as well.  It
appears
that Passenger doesn't passthrough values set using the
```
SetEnv
```
apache directive - which is unfortunate.
Perhaps it might be possible to set environment variables in your environment.rb or boot.rb (assuming you're talking about a Rails app; I'm not familiar with Rack but presumably it has similar functionality)