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After Loss of Markets, NY May Boost Groceries

New York City has lost supermarkets as rents have risen, but the demand for fresh food is high as ever. State officials are looking at how to help.

By Tracie McMillan


City Limits • April 21, 2008

Harlem— While the city’s trying to increase the number of produce carts and encourage bodegas to carry healthier food, state officials are angling for bigger game: Supermarkets.

Agriculture officials said they’re hoping to establish a program to boost supermarket development in underserved communities, basing the effort on a Pennsylvania program – the $120 million Fresh Food Financing Initiative – that’s been on the books since 2004. Widely considered a national model, Pennsylvania’s program has already helped to renovate or build 50 food stores statewide, all in underserved areas, since its inception.

The Penn program encourages supermarket development by coordinating an array of funding sources, including the New Markets Tax Credit, private foundation grants, and municipal and state development funding. To receive funding assistance, stores must be located in low- or moderate-income census tracts; provide a full selection of fresh foods; and be located in areas where fresh food is lacking.

“I think we’re on a track that will lead to better food access in lower-income communities,” said New York State Agriculture Commissioner Patrick Hooker at an April 3 “listening session” of the New York State Council on Food Policy. Founded last year to help coordinate and set priorities for the state’s food system, the council will be holding similar sessions around the state, including one slated for late May in Harlem.

“We’re familiar with [the effort in] Pennsylvania,” said Hooker, adding that he’d held agency-level meetings with Pennsylvania officials, as well as supermarket industry leaders in New York. “I’m looking forward to moving ahead with that.” New York wouldn’t be the first to mimic the Keystone State’s efforts: cities such as Baltimore, Washington D.C. and Chicago have all put energy into fostering supermarket development, and other cities like Detroit are exploring their options.

In New York, the project is still in early discussion stages. Nonetheless, the effort could find a welcoming home here. City residents have lost one-third of their supermarkets in recent years, dropping from 1,312 in 2002 to 877 in 2008, according to a market analysis done by F&D Reports, a research group focused on food retail and distribution. That loss, said F&D’s Larry Sarf, is due to one thing: Skyrocketing rents. Twenty years ago, the industry average here was to pay 2 percent of gross sales in rent; today, the average is 12 percent. “Everything is driven by real estate values,” Sarf said of the trend. “That’s what’s hurting the supermarket operator … they can’t make it work.”

Losing markets can be more than just an inconvenience—it might well worsen residents’ health. For every additional supermarket in a census tract, fruit and vegetable consumption increases by as much as 32 percent, according to an American Journal of Public Health study from 2002.

Bringing supermarkets into low-income neighborhoods certainly sounds like a good idea to Cynthia Butts, a longtime Fort Greene resident and a community organizer with Families United for Racial and Economic Equality. When developer John Catsimatidis closed a low-rise shopping center on Myrtle Avenue—and the Associated supermarket within it—in 2006, and later razed it to make way for a condominium development, Butts and her neighbors were left without a convenient, high-quality supermarket. (Catsimatidis, who owns the Gristede’s supermarket chain, has said he will include a new market in the commercial space of the new building.)

With that in mind, said Butts, anything that makes it easier to get markets into a neighborhood sounded good to her. “I think the proposal is great if you want to fairly put a supermarket that’s going to give us straight-from-the-farm, fresh-picked food like you would do in any other neighborhood,” said Butts upon hearing of the Pennsylvania program. “Just because we’re low-income, that doesn’t mean we don’t have the same needs. We do like vegetables around here.”

It’s a sentiment that F&D’s Sarf agrees with. “The best area for a supermarket operator would be in … the poor areas,” said Sarf, citing a demand for economical shopping and supermarkets’ proficiency in administering public benefits programs like food stamps and the Women, Infants and Children program. “But they don’t have the ability to pay the rents.”

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