Healthy Food Financing Delivers Economic Opportunity Where It Is Needed Most

25 Jul 2014 | America's Tomorrow
Healthy Food Financing Delivers Economic Opportunity Where It Is Needed Most
Above: Courtesy of Native Foodways Magazine

he federal Healthy Food Financing Initiative (HFFI) is best known as an innovative public-private partnership to improve access to healthy foods in low-income communities and communities of color. But it is also advancing an equitable economy by connecting residents to jobs, training, and capital to start and grow businesses that communities sorely need. Since 2011, the initiative has distributed more than $109 million in grants and leveraged more than $1 billion in investments and tax incentives to revitalize local economies while improving nutrition and health. The community-driven strategies are as diverse as America itself, from a culinary training program in Massachusetts to immigrant-owned agricultural cooperatives in Minnesota to grocery stores across the country. Today, America's Tomorrow profiles four ventures that demonstrate what's possible when our nation supports health and opportunity for all by investing in the people and places in greatest need.

Restoring the Indigenous Food Economy on the Tohono O'odham Nation in Arizona

This fall, 700 children on the Tohono O'odham Nation in southwestern and central Arizona will be served healthier school food sourced from local farmers. Tohono O'odham Community Action (TOCA), a grassroots community organization, received $300,000 in HFFI financing to pilot a school food service enterprise that supports healthier eating and a strong indigenous food economy.

TOCA's broad goal is to restore O'odham food sovereignty, to create jobs, improve health, and reclaim Native food traditions. In the early twentieth century, O'odham farmers cultivated over 20,000 acres. Today, they farm no more than 200 acres of food.

Of the O'odham Nation's estimated $70 million annual food expenditures, less than 1 percent is captured locally. Meanwhile, unemployment in the community hovers above 60 percent and more than 41 percent of the population is poor. Diabetes is rampant, and 76 percent of  middle schoolers are overweight or obese.

The school food program will serve TOCA-designed menus featuring dishes like brown tepary bean quesadillas. Food will come from O'odham farmers who have completed the agency's beginning farmer training program. To build the regional food economy and create institutional markets for tribal food producers, TOCA hopes the pilot will demonstrate that it can compete for district-wide school food contracts within the O'odham Nation, currently valued at $1.6 million and held by the multinational food services provider Sodexo.

School food service has fewer uncertainties than commercial food ventures, which makes it a good testing ground for TOCA's mission.  "It's easy to do school food systems," said Tristan Reader, TOCA co-director. "You have very clear numbers and a steady market."

Still, it took HFFI financing to lift the project from a great idea to a reality.  "Without HFFI funding, this would not be a project that is happening," Reader said.

Strengthening Community-Run Farm and Retail Co-ops in the San Francisco Bay Area

At age 15, James Berk began collecting neighborhood food surveys with Mandela MarketPlace, a nonprofit organization that works with communities of color to create cooperative food enterprises. Eight years later, Berk is a proud worker-owner of one of those enterprises, the Mandela Foods Cooperative (MFC), a 2,200-square-foot West Oakland grocery store with nearly $1 million in annual sales.

By investing in capacity building, leadership pathways, and ladder-up financing for local food entrepreneurs, Mandela MarketPlace builds health, wealth, and assets in neighborhoods with limited access to economic opportunity. Now, with a $400,000 grant from HFFI, the organization is creating a revolving loan fund to incubate and support businesses like MFC that connect their communities to farmers of color in the region.

One loan recipient, Mandela Foods Distribution, purchases and markets produce from a network of local farmers of color. The financing helped solidify a partnership with California FarmLink, a nonprofit organization that links underserved farmers to land and financing.

Through this partnership, Mandela can back loans for small family farmers in need of early-season capital to purchase seeds and pay employees before harvest-time revenues.  In 2013, Mandela Foods Distribution sold 150,000 pounds of produce, increasing income for the core team of eight farmers by $61,000.

Along with the City of Oakland, HFFI also is supporting the opening of a café at Mandela Foods Cooperative. The co-op has a team of three employees and four worker-owners who see about 250 customers a day. The hope is that the café will increase foot traffic, continuing the co-op’s growth to eventually support eight worker-owners, and further expanding the market for locally grown foods.

Building Immigrant-Owned Food Businesses in the Twin Cities Region

A small farming cooperative operated by a group of Latino food-industry workers saw sales increase more than three-fold this year thanks to HFFI financing. It was one of a series of HFFI investments coordinated by the Latino Economic Development Center (LEDC) in Minneapolis to help Latino and Hmong communities move out of low-paying jobs in the food sector and create robust food enterprises.

"Typically immigrant workers in the food industry have been paid low wages," said John Flory, special projects director at LEDC. "Our goal is to provide opportunities for immigrants to become business owners in the food industry."

In 2013, the Agua Gorda Cooperative grew $40,000 worth of produce but had to dump half because of limited storage and marketing options. Now the co-op has access to a walk-in cooler and two refrigerated trucks purchased with HFFI financing, and it has $65,000 in sales contracts.  The financing went to a marketing cooperative in which Aqua Gorda is a member. The four other members — three Latino farm ventures and a Hmong farm co-op — also benefit from these crucial assets.

HFFI financing also is supporting the expansion of La Loma Tamales, a Latino-owned wholesaler, caterer, and restaurant operator that produces one million tamales a year. The growth of this Twin Cities-based company is good for Aqua Gorda, which recently sold $30,000 worth of tomatillos to La Loma, and it is good for the regional food economy. With a $150,000 equity-match loan, La Loma is expanding its commercial kitchen, moving into a larger facility, and adding 15 production jobs.

Engaging, Inspiring, and Training Youth in Lowell, Massachusetts

Twenty-two young people in Lowell, Massachusetts, soon will start serving soups, salads, and sandwiches in a café set to open in the world’s oldest LEED-Platinum certified building. The United Teen Equality Center (UTEC), an innovative youth development agency, is using $800,000 in HFFI financing to expand programming into the culinary arts. Participants, ages 16-24, will earn wages as they develop workforce skills and continue working toward a high school diploma.

“This is not a second-chance program, but a sixth- or seventh-chance program,” said Ed Frechette, chief innovation officer. “We provide working platforms for youth so they can honestly fail with us and not be fired.”

The Center chose to expand into culinary training because of the vast number of jobs in the food sector. Participants will learn an array of skills, from gardening and food production to recipe design and knife safety to interacting with the community over something everyone loves: good food.

Learn more about the Healthy Food Financing Initiative in your community at the Healthy Food Access Portal.

Read the rest of the July 25, 2014 America’s Tomorrow: Equity is the Superior Growth Model issue.