A Case Study

The Fresh Food Financing Initiative

In recent years, a model—the Fresh Food Financing Initiative (FFFI)—has emerged that can support a range of healthy food access efforts and that has already demonstrated remarkable successes.

In 2001, the Food Trust, a nonprofit organization that promotes food access and healthy eating, released a report highlighting disparities in food access and high levels of diet-related disease for low-income residents in Pennsylvania. In response, the Philadelphia City Council charged The Food Trust to convene a task force of leaders from city government, the supermarket industry, and the civic sector, to recommend ways to expand access to affordable, nutritious food in underserved areas. Financing emerged as a key obstacle, and the task force recommended a statewide initiative to fund fresh food retail development.

State Representative Dwight Evans championed this recommendation, and with the support of other key legislators, the Pennsylvania General Assembly appropriated $30 million over three years to create the Fresh Food Financing Initiative (FFFI). Developed as a public-private partnership, FFFI provides one-time loans and grants to encourage fresh food retailers to locate or remain in underserved low-income communities. The Reinvestment Fund (TRF), The Food Trust, and The Greater Philadelphia Urban Affairs Coalition are charged with implementing and managing FFFI.

TRF, one of the nation’s largest community development financial institutions, successfully matched the $30 million state appropriation with more than $90 million in private capital to create a comprehensive program to finance fresh food retailers in underserved communities. FFFI loans and grants can be used for expenses such as demolition, environmental remediation, land acquisition, equipment financing, construction financing, and workforce recruitment and training.

Since 2004, the program has approved 83 new or improved grocery stores and other healthy food retailers in underserved low- and moderate-income neighborhoods in cities including Philadelphia and Pittsburgh, as well as in rural communities such as Derry and Williamsburg. The FFFI has supported grocery stores, small-scale corner stores, co-ops, and farmers’ markets. These projects have led to 5,000 full- and part-time jobs, 1.5 million square feet of grocery retail space, and expanded food access for more than 400,000 residents.

Studies have quantified the increases in jobs, wages, local tax revenues, and other economic activity that occurred when a supermarket financed by FFFI opened. These studies find that the vast majority of jobs were filled by local residents, the salaries and benefits were on par with their suburban and industry peers, and the jobs had a positive wage trajectory. The supermarkets financed by FFFI often served as retail anchors in their communities, sparking other kinds of economic activity. In addition, values of nearby homes located within a quarter to a half mile of the selected stores increased by 4 to 7 percent (an average of $1,500), slowing the downward trend in real estate values, especially in neighborhoods with weaker housing markets, where the effect was even larger.

In New York City, New Orleans, Washington, DC, Detroit, and California, Illinois, Louisiana, and New York State, policies and programs are being developed and implemented that are modeled on FFFI. These efforts are promising, but are not sufficient to address the full scope of the problem nationwide.

PolicyLink, The Food Trust, and The Reinvestment Fund are working to replicate the FFFI at the federal level. Momentum is building, and the so-named Healthy Food Financing Initiative (HFFI) already has support from a broad range of organizations representing public health, children’s health, civil rights, economic development, and the grocery industry. As with the Pennsylvania effort, the HFFI would attract healthy food retailing investment in underserved communities by providing critical one-time loan and grant financing through a combination of public and private sources—and as a result, improve children’s health, create jobs, and spur economic development across the nation. Click here to read the latest news about HFFI, and here to sign up for periodic updates and e-advocacy opportunities. This page highlights efforts across the USDA, Treasury, and HHS to address healthy food access.