Lawmakers in New York and Illinois last week took steps toward creating incentives to stimulate supermarket development in low-income communities.
Both the initiative in New York — which was introduced last week by Gov. David Patterson as the Healthy Food/Healthy Communities initiative — and a nascent Illinois program that was called for by a task force and supported by some legislators, are based on a program in Pennsylvania that administrators say has sparked $120 million in supermarket investments from a three-year state investment of $30 million. The plans in both states call for $10 million in loans and grants to finance food stores in underserved communities.
The Food Trust, a Philadelphia-based organization that helped implement and administers the Pennsylvania programs, has also helped to launch the program in New York and Illinois. It advocates bringing supermarkets to inner cities, rural areas and other underserved communities to increase access to healthy food and provide jobs and economic development in those areas.
In conjunction with the state fund, New York City officials announced a separate program called FRESH (Food Retail Expansion to Support Health), which combines financial and zoning incentives to support food store developments in designated neighborhoods around the city. The city expects that program could create as many as 15 new stores and spark renovations of another 10 stores over the next decade.
Incentives under FRESH — which allow the construction of larger buildings than otherwise permitted if they include a ground-level grocery store; include reduced parking requirements and a special designation allowing supermarkets to build in light manufacturing districts — will be available in neighborhoods deemed as underserved according to a 2008 survey. Financial incentives include real estate tax abatements and tax exemptions of purchases to construct or renovate stores, or upgrade equipment.
Nick D'Agostino, president and chief operating officer of Larchmont, N.Y.-based D'Agostino's Supermarkets and co-chairman of a supermarket commission established in 2008 to study the issue, in a statement said the programs would “help supermarket operators overcome some of the economic and bureaucratic challenges we face in opening new stores and keeping open our existing stores.”
One retailer, however, felt the legislation does not address supermarkets leaving other areas of the city.
“The program has some merit, but it begs the real question of how to preserve and support existing supermarkets,” Richard Lipsky, a spokesman for New York-based Gristedes, told SN last week. “The problem the city faces is the loss of the existing supermarkets and the difficulty of existing supermarkets to stay competitive.”
In Illinois, the Food Marketing Task Force called on legislators to create a fresh-food fund initiative, to modify economic development incentives to meet the needs of supermarkets, and to expand job training programs to ensure a quality workforce.
“We applaud the state's recognition that access to fresh, healthy foods play a vital role in the health of our communities,” said Mark Anderson, a co-chair of the task force and president of Supervalu's Midwest Division.