Thursday, September 24, 2009

Cardwell's Lacuna

Writing in the NY Times, Diane Cardwell puts a mostly positive spin on the city's plan to try to bring more supermarkets to designated underserved areas: "The Bloomberg administration, in its ever-expanding campaign to make New Yorkers eat better, has already clamped down on trans fats, deployed fruit vendors to produce-poor neighborhoods and prodded corner bodegas to sell leafy green vegetables and low-fat milk. Now, in a city known more for hot dogs and egg creams than the apple of its nickname, officials want to establish an even bigger beachhead for healthy food — new supermarkets in areas where fresh produce is scarce and where poverty, obesity and diabetes run high."

But she leaves out one crucial point-and the lacuna in her analysis is, we believe, a fatal flaw. The missing link, as it were, is the fact that the city has lost-some would say hemorrhaged-supermarkets during the Bloomberg tenure. As David Gonzales pointed out in the Times last year, approximately 300 markets have bitten the dust.

Here's what he said at the time: "A continuing decline in the number of neighborhood supermarkets has made it harder for millions of New Yorkers to find fresh and affordable food within walking distance of their homes, according to a recent city study. The dearth of nearby supermarkets is most severe in minority and poor neighborhoods already beset by obesity, diabetes and heart disease."

But Cardwell elides this crucial fact, and the underlying reasons for the exodus-and points out the following: "New York officials said they expected to help create 15 new stores and upgrade 10 existing ones." In ten years perhaps? Do the comparison shopping here.

The fact that we have lost so many markets is the elephant in the room in all this policy discussion. And it's no wonder Bloomberg doesn't want to address this embarrassing issue. It just might have something to do with taxes and regulations-and the over all high cost of doing business in Mike Bloomberg's New York. So, what does all that say about the benefits of the current initiative?

In our view, it erodes whatever positive features are manifest in the current plan. And also problematic-and unmentioned-is what subsidies for new stores would mean for contiguous stores that might have been doing business for years, and without city largess, in the very underserved areas being targeted. We notice that there was no citations, for instance, from the predominately Dominican run National Supermarket Association in the article. Their views would have balanced the mostly sanguine take that the story projected.

And the absence of the independent owners vitiates the following observation: "The plan — which has broad support among food policy experts, supermarket executives and City Council members, whose approval is needed — would permit developers to construct larger buildings than existing zoning would ordinarily allow, and give tax abatements and exemptions for approved stores in large swaths of northern Manhattan, central Brooklyn and the South Bronx, as well as downtown Jamaica in Queens."

Unless supermarket executives refer only to chains that are mostly absent from the city. And we're not sure that the CPC premise holds water either: "“This is about being able to walk to get your groceries in those areas that are really, really underserved and basically have no place to buy fresh produce,” said Amanda M. Burden, the city planning commissioner. Residents in such areas, she said, have been spending “their grocery dollars at Duane Reade and CVS on chips and soda.”

And the initiative, "breaks down barriers," for new store growth, but leaves unaddressed the barriers to profitability that the city itself creates: "The new zoning would break down some barriers that grocery stores face, said Ben Thomases, the city’s food policy coordinator, including competition from drugstores and other retailers that have higher profit margins than supermarkets do and can pay higher rents."

In our opinion, the city should look to create food enterprise zones where existing supermarkets could be exempted from real estate taxes and other fees that impede profitable store operation. And Planning Chair Burden doesn't understand how entrepreneurship really works: "If you’re thinking of moving your family to the Lower Concourse,” Ms. Burden said, referring to a large manufacturing area in the South Bronx that the commission recently rezoned to include residential construction, “you’re going to say, like, ‘Wow, there is no grocery store here. I’m not going to move here.’ ”

The fact is, that in every case where residential concentration has been developed over the past thirty or so years, a supermarket-or multiple of supermarkets-have followed-as Kathy Wylde, who built housing in the nineties for the NYC Partnership, always pointed out to us. We're trying hard not to be redundant, but the greater challenge is to keep the markets that we have.

Until the city develops a better preservation and nurturing policy for existing supermarkets, we remain unenthusiastic about the current policy. It's not necessarily a bad policy, it's simply a decent answer to the wrong question.