Building Assets for the Rural Future

Improve Access to Nutritious Food in Rural Areas

Improve Access to Nutritious Food in Rural Areas

The Opportunity

A “food desert” is an area “with limited access to affordable and nutritious food.”[1]  Food deserts are typically characterized by an absence of chain grocery stores that offer a wide variety of foods at low prices.[2] North Carolina contains dozens of counties in which a significant population has “low access” to a supermarket, and five in which more than 50% of the population experiences low access.[3]

Communities with limited access to nutritious foods exhibit predictable characteristics. They tend to have higher poverty rates, lower median incomes, higher numbers of convenience and fast food stores per capita, more households without access to a vehicle, and larger minority populations.[4]  In rural areas, low population density is a root cause for the absence of a chain grocery store, and poor transportation infrastructure may also be a contributing factor.[5]

The absence of chain grocers in a community has important implications for asset-building. Residents without local access to grocery stores incur monetary and other costs related to obtaining food, such as increased transportation costs, increased food costs for some staple items, and costs associated with poor health.[6]  Local businesses suffer when the workforce cannot or will not adopt healthy lifestyles, and businesses with mobility may choose to locate elsewhere.[7] State and local government coffers may be depleted due to increased health care costs[8] and loss of tax revenue from residents leaving the taxing jurisdiction to purchase food.[9] Looking forward, rural food deserts are expected to increase in number as rural populations decline and the food industry continues to shift food distribution channels to larger superstores in more populous communities.[10]

How the Tactic Is Applied

Offer Subsidized Financing for Food Retail Operations in Underserved Rural Communities

Fresh Food Financing Initiative (Pennsylvania)

In 2004, a private-public partnership formed the Fresh Food Financing Initiative (FFFI) to address the lack of grocery stores in underserved communities of Pennsylvania.  The state legislature appropriated $30 million of seed money, which was used in conjunction with federal New Markets Tax Credits to leverage an additional $165 million in private investment.[11]  FFFI provides a mixture of grants and loans—up to nearly $2 million—to grocery store projects in low- or moderate-income areas that suffer from low supermarket density or significant store access limitations.[12] The program is intended for projects that are unable to obtain conventional financing, a common problem for grocery businesses seeking to locate in underserved communities.[13]  As of March 2009, FFFI had funded 68 projects across the state, half of which are in rural towns, committing $63.3 million in grants and loans.[14]  Similar initiatives have formed in at least three other states.[15]

Learn More

Pennsylvania Fresh Food Financing Initiative

Kansas State University – Rural Grocery Store Initiative

[1] Food, Conservation, and Energy Act of 2008, H.R. 6124, 110th Cong. § 7527(a).

[2] Economic Research Service, Access to Affordable and Nutritious Food: Measuring and Understanding Food Deserts and Their Consequences, Report to Congress 2-3 (2009) (reviewing literature on food access and commenting on limitations of considering only large grocery stores and supermarkets as proxy for availability and afforvdability), available at http://www.ers.usda.gov/Publications/AP/AP036/AP036.pdf

[3] Troy Blanchard & Thomas Lyson, Food Availability & Food Deserts in the Nonmetropolitan South 2-3 (2006), available at http://srdc.msstate.edu/focusareas/health/fa/fa_12_blanchard.pdf (displaying in Figure 1 a map of counties in which a significant population has “low food access”).

[4] Ibid.; Economic Research Service, above note 2, at 39-47.

[5] Michele Ver Ploeg, Access to Affordable, Nutritious Food is Limited in “Food Deserts,” 8Amber Waves 20, 27-28 (2010).

[6] Economic Research Service, above note 2, at 27-30, 51-57; Lois Wright Morton & Troy C. Blanchard, Starved for Access: Life in rural America’s Food Deserts, 1 Rural Realities 1, 4-6 (2007).

[7] See Truls Østbye, John M. Dement, & Katrina M. Krause, Obesity and Workers Compensation, 167 Archives of internal Medicine 766, 766 (finding that obese workers lose more workdays and incur greater workers compensation costs than other workers); Geraldine Gambale, 23rd Annual Corporate Survey and 5th Annual Consultants Survey, Area Development Online 22, available at http://www.areadevelopment-digital.com/CorporateConsultsSurvey/23rdAnnualCorporateSurvey#pg1 (“Decision makers must consider which states and communities offer the lowest healthcare costs….”).

[8] Centers for Disease Control, Overweight and Obesity: Economic Consequenceshttp://www.cdc.gov/obesity/causes/economics.html (last visited May 14, 2010) (estimating that more than $2 billion in additional health care expenditures in North Carolina could be attributed to obesity).

[9] Economic Research Service, above note 2, at 28; Morton and Blanchard, above note 6, at 7.

[10] Morton & Blanchard, above note 6, at 2.

[11] PolicyLink, A National Fresh Food Financing Initiative: An Innovative Approach to Improve Health and Spark Economic Development (2009).

[12] The Reinvestment Fund, Fresh Food Financing Initiative, Program Guidelines 1, 3 (No Date), available at.  Grants and loans can be used for land purchase, construction costs, gap financing, predevelopment costs, and others.

[13] Ibid.

[14] The Food Trust, Fresh Food Financing Initiative (2009).

[15] Allison Karpyn, et al., Policy Solutions to the “Grocery Gap,” 29 Health Affairs 473, 474-75, 479 (2010) (describing Pennsylvania’s project in relationship to similar programs in Illinois, Louisiana, and New York).