Geraldine R. Dodge Foundation

The final installment of our Food Finance mini series

Creating Opportunity Along the Entire Food Chain

By Nessa Richman
Brightseed Strategies Founder and President

The goal of the federal Healthy Food Finance Initiative (HFFI) is to increase the availability of healthy food in low income communities. Most visible to the consumer is the matter of increasing the number of supermarkets, grocery stores, and corner stores in underserved communities, and the healthful food choices they provide therein. The role of Community Development Financial Institutions (CDFI) in this scenario is to support the development of new retail food stores and to expand and improve existing stores in their target communities.

But retail is not just about the storefront, it’s about how products get to market. What if the money spent on food at the retail level also helped develop the local economy?

Retail is just one link in the “food marketing chain.” This chain comprises a possible six segments, each of which houses many types of food enterprises.

1. Retail/Food Access; e.g., grocery stores, corner stores, farmers’ markets, Internet-based ordering platforms.
2. Distribution; e.g., Food Hubs: centrally-located facilities designed to aggregate, store, process, distribute, and/or market locally produced food.
3. Processing; e.g., commercial kitchens, value-added producer cooperatives, fresh-cut produce operations, meat processing facilities.
4. Agricultural Production; e.g., farms and ranches.
5. Technology and Infrastructure; e.g., fertilizer/pest management companies, farm equipment companies, seed and feed businesses.
6. Waste Management; composting facilities and recycling operations.

Brightseed Strategies is working with the CDFI Fund, the co-writers of this Food Finance mini series, Opportunity Finance Network (OFN) and The Reinvestment Fund (TRF), and other strategic partners, to help CDFIs understand why it is important to think about the whole food system when developing a national financing initiative. Educating CDFIs about the full spectrum of healthy food enterprises within healthy food systems increases their lending opportunities, and maximizes the positive impacts of these businesses on their communities.

Healthy food systems are critically important to increasing healthy food access and affordability. This is true in communities of all income levels. Vibrant food production, processing, and distribution enterprises support healthy retail options and a healthy local economy. If these enterprises are locally owned, they provide more benefit to the community in at least three measurable ways:

1. Better jobs. Local ownership of small businesses matters for economic growth. On the community level, more locally owned small (10-99 employees) businesses mean higher individual per capita income growth. Conversely, a high density of large (more than 500 employees) firms that are not owned locally leads to lower individual per capita income growth. This is true for both rural and urban areas.
2. Bigger economic return. Local businesses are better for the local economy. When compared to leading chain competitors, local stores generate twice the annual sales, recirculate revenue within the local economy at twice the rate, and, on a per square foot basis, have four times the economic impact.
3. More community pride. Markets exist within social and cultural contexts, and these contexts affect how resources are allocated. A greater density of locally owned businesses increases the likelihood of community members voting and participating in community civic, political, religious organizations, and even sports clubs, a noteworthy point for those interested in improved health outcomes

HFFI will increase food access in targeted communities, and do much more. If the national initiative’s vision includes goals to encourage or develop economically vibrant, socially equitable, and environmentally sustainable food systems, investments made by CDFIs will benefit agricultural producers, healthy food enterprises of all sorts, and consumers of all socioeconomic levels.

In order to do this, a CDFI can develop a go-to-market strategy in collaboration with potential borrowers, intermediaries, investors, and partners. This may be the best way to develop a customized plan responsive to community needs. In the government and non-profit sectors, we may phrase this work differently: the national HFFI is really an opportunity to develop a HFSFI, a healthy food system financing initiative. And some regions, cities, and communities are creating innovative programs – from TRF’s growing interest in investing in the local food system to Boston-based The Carrot Project, with its focus on supporting small and midsized farms and farm-related businesses.

images courtesy Brightseed Strategies

For the complete series, please visit these links:

Food Financing 101: Introduction
Food Financing 101: Part 1
Food Financing 101: Part 2

Special thanks to Alison Hastings of the Delaware Valley Regional Planning Commission (DVRPC), who coordinated the Food Finance series, and to Patricia Smith of The Reinvestment Fund, Pam Porter of the Opportunity Finance Network, and Nessa Richman of Brightseed Strategies for contributing.

DVRPC and their partners are regular contributors to the Dodge blog on issues of food policy and regional food systems.

By Nina Stack
President, Council of New Jersey Grantmakers

According to the Council on Foundations, in 2008 there was nearly $18 billion in philanthropic assets in the state of New Jersey. We don’t have a clear sense of where those assets are today with the stock market’s rollercoaster recovery of late. Whether up or down, the Council of New Jersey Grantmakers’ (CNJG) mission remains the same: to strengthen and promote effective philanthropy. As the state’s forum for learning, sharing ideas, and advancing the field, CNJG worked throughout 2011 to inspire our members to be responsive, proactive and effective funders.

CNJG offered grantmakers over 50 roundtable and panel discussions, workshops, teleconferences and webinars in 2011. We hosted 140 New Jersey non-profit and foundation leaders at our annual conference where we explored the powerful role philanthropic networks play in advancing issues and causes. During our popular Conversations with the Cabinet sessions, CNJG members discussed opportunities to partner with state government on mutual issues of concern with Human Services Commissioner Jennifer Velez, Community Affairs Commissioner Lori Grifa and Acting Education Commissioner Chris Cerf. And, last week, our 2011 Annual Meeting featured Dr. Jeffrey Brenner, a Camden doctor in the national spotlight for his work to reduce healthcare costs by “hot spotting” or “super serving” chronic healthcare system users. The Nicholson Foundation‘s Charles Venti and Robert Wood Johnson Foundation‘s Gretchen Hartling offered their insight into seeding this type of work and rewards of working with such an innovative champion.

In addition to our programming and services for grantmakers, work progressed significantly on several CNJG leadership initiatives this past year. For example, the Board Bank, which I’ve written about on this blog before, is just about ready to launch with our partners, the American Conference on Diversity, at the helm. Facing Our Future, the groundbreaking initiative that has objectively examined New Jersey’s long-term fiscal problems, is heading into a second phase of its work. I’ve outlined the findings of our first report as part of Facing Our Future in this column before but in the next few months we’ll be releasing an update to the findings, along with some options or best practices that are underway in New Jersey and elsewhere that could prove promising to help address the fiscal crisis we face.

And we saw the continued advancement of a truly successful partnership with the Council’s Newark Philanthropic Liaison Jeremy Johnson, now in place for 5 years. Among the notable achievements: the rollout of Living Cities $15 million blended investment in the “Strong, Healthy Communities Initiative,” submission of a multi-partner application to the White House-endorsed “Promise Neighborhood” program for the Fairmount section of the city and a commitment by the Mayor’s office for a six-community neighborhood revitalization project. The Newark Funders Group grew to over 25 members and it’s Education Subcommittee created the Newark Public Schools Innovative Investment Fund – a pooled fund to support the school district’s strategic plan priority of building “a system of great schools that serve students, their families and the community.”

We also saw the membership of the Council grow with 16 new members. These foundations and corporate grantmakers recognize the importance and value of engaging with their philanthropic colleagues to leverage their impact and staying abreast of the latest trends and best practices. On behalf of the CNJG Board and staff, we thank the Dodge Foundation for allowing us to share our story through their blog. Dodge Foundation’s noble commitment to our region has spurred social sector growth and education, and it has nourished New Jersey’s soul through their generous support of the arts. For that and so much more, we are grateful.

Nina Stack is the President of Council of New Jersey Grantmakers, the statewide association for corporate, family, independent, and community foundations. She is a regular contributor to the Dodge blog.

Continuing our Food Finance mini series from last week:

Making it Happen Across the Country

By Pam Porter
Executive Vice President, Strategic Consulting
Opportunity Finance Network

We all agree that too many communities across the country have very limited access to healthy foods. Sometimes called “food deserts” or “limited supermarket access areas,” the dearth of healthy foods undermines the health of residents, and drags on a community’s economic prospects.

Opportunity Finance Network, headquartered in Philadelphia, PA, is leading a national effort to work with community lenders across the country to help them successfully finance healthy food options in underserved communities.

Financing for healthy food businesses is a critical factor for successfully increasing access to healthy food. It gets great ideas off the ground, and keeps them running and growing:

• by financing supermarkets, corner stores, and food cooperatives, we increase the availability of healthy food options in neighborhoods, employ local residents, and serve as a catalyst for other types of business in the immediate community.
• by financing the supply chain businesses that aggregate food, process it and distribute it, we provide economic opportunities for the growers and processors of food, and increase the availability of locally grown food to our communities.
• by financing food producers, such as farmers, ranchers and fisheries, we ensure that the supply of locally grown food continues to increase, producers can invest in new equipment, and farmers can transition their crops to meet new market demand.

Recognizing the importance of financing, especially in low-income and low-wealth communities where access to traditional sources of capital is often limited, the US Department of Treasury’s Community Development Financial Institutions Fund (CDFI Fund) launched a two-year Capacity Building Initiative to train community-based lenders, or CDFIs, to learn the unique characteristics of Healthy Food Financing. The CDFI Fund contracted with OFN to design and implement this program, based upon its 25-year track record of working with CDFIs across the country.

To design and implement this program, OFN pulled together a roster of experts including the co-writers of this mini series: The Reinvestment Fund and Brightseed Strategies. Other experts include: The Food Trust, Coastal Enterprises, Inc., The Carrot Project, and Mission+Money Matters.

OFN developed and has delivered workshops to help CDFIs learn best practices to support healthy food businesses across the entire healthy food continuum. The first workshop was held in June 2011 in Philadelphia and hosted by the Delaware Valley Regional Planning Commission. Twenty-five participants from around the country came together for in-depth training, practitioner panels and networking with others interested in this sector. Subsequent workshops have been held in Madison, Wisconsin and Denver, Colorado.

Just last week, the Capacity Building team released a Resource Bank on Financing Healty Food Options. This online resource makes the training and resource materials used at the workshops available to the general public and members of the community development industry.

In 2012, OFN has already scheduled workshops in New Orleans, Los Angeles, and Durham. In addition to workshop training, we also ensure that CDFIs have access to one-on-one technical assistance from our roster of experts to help them implement the programs they have learned about in the workshops.

In case you missed them:

Food Financing 101: Introduction
Food Financing 101: Part 1 (Pennsylvania’s Initiative Becomes the Model for the Nation)

image courtesy Opportunity Finance Network

By Ann Marie Miller
Executive Director, Art Pride

In this hyper-connected world there are a multitude of online fundraising possibilities now available to non-profit organizations. It’s often dizzying to wade through them (Kickstarter and Razoo are just two) to find the “best fit.” For the last three years the Art Pride New Jersey Foundation has used the online auction as a way to draw attention to not only its programs and services, but to offer a brand new audience a glimpse of the many exciting cultural events happening throughout New Jersey.

Theaters, dance companies, performing arts centers and museums have all donated tickets to help Art Pride continue its work promoting the value of the arts to our daily lives. Art Pride staff took some cues from our astute destination marketing organizations (DMO) by creating tourism packages for the auction that match cultural events with dinners at local restaurants and, in some cases, hotel stays in Cape May, New Brunswick and Princeton. In a few instances, the DMOs donated their own cultural tourism packages, like the one offered by Destination Jersey City that features salon services and an overnight stay along with gala tickets to Art House Production’s annual Snow Ball.

It’s a win-win for all involved. Bidders come from as far as San Jose, CA and Hawaii to bid on getaways, cultural experiences, and unique items autographed by New Jersey artists and entertainers. Savion Glover recently autographed tap shoes for Art Pride’s auction when he performed at the New Jersey Performing Arts Center, and Maplewood resident and Tony-award winning actor Norbert Leo Butz agreed to have dinner with a highest auction bidder at a local eatery. The range of items for auction is diverse geographically and culturally, showcasing the best that New Jersey arts groups offer all year round.

As with all fundraising special events, the online auction requires board and staff support from hunting down attractive items to answering questions from individual bidders, to assuring that payments are made and items are appropriately delivered. Marketing is essential and Art Pride uses every tool in the box from traditional direct mail, to our blog, to social media channels like Facebook and Twitter to get the word out during an intense two week stretch that includes the annual last minute bidding wars!

Is it all worth it? We think so! The Art Pride New Jersey Foundation has reaped $10,000 from its online auction that is a fun alternative to the traditional annual fund appeal at the end of the calendar year (although you can donate cash through the auction page, too). This year’s auction ends TONIGHT at 8pm on, so check your watch and get your credit card ready to make a bid and give a gift of New Jersey arts this holiday season.

Go to the auction before it’s too late!

Ann Marie Miller is the Executive Director of Art Pride, the premier arts advocacy organization in New Jersey, and a regular contributor to the Dodge blog.

Pennsylvania’s Initiative Becomes the Model for the Nation

By Patricia Smith
Senior Policy Advisor
The Reinvestment Fund

The Reinvestment Fund (TRF), a Community Development Financial Institution (CDFI), creates opportunity in low-wealth communities through socially and environmentally responsible development. In 2004, TRF partnered with the Commonwealth of Pennsylvania, The Food Trust, and the Urban Affairs Coalition to create the Pennsylvania Fresh Food Financing Initiative (PFFI).

Leveraging an initial State allocation of $30 million, TRF made $85 million in grants and loans to support grocery stores in communities where infrastructure and credit needs are unmet by conventional financial institutions. By the time the State program closed in June 2010, Pennsylvania’s Fresh Food Financing Initiative had assisted 83 supermarkets and fresh food outlets in underserved rural and urban areas throughout the state, creating or retaining 5,000 jobs.

Kennies Marketplace, Gettysburg, PA

In 2009, TRF partnered with The Food Trust again, and PolicyLink, a national research and policy action institute, to raise awareness on the issue of limited food access in communities across America and the need for a national program to finance the development of supermarkets, grocery stores and other fresh food retail. Together, the organizations developed and disseminated research on areas with inadequate access to healthy food, built a broad coalition of national support and created the policy framework for the national Healthy Food Financing Initiative (HFFI), modeled after Pennsylvania’s FFFI.

The current national campaign has generated extensive media coverage and widespread support for HFFI. More than 90 organizations representing a diverse set of stakeholders (the grocery industry, labor unions, public health and food security advocates, state and local governments, civil rights groups and community development organizations) have voiced their support for a national solution to increase access to healthy food in low-income communities. HFFI is also one of the four pillars of Let’s Move!, First Lady Michelle Obama’s campaign to reduce childhood obesity.

This advocacy, together with Pennsylvania’s success story, helped fuel President Obama’s launch of an interagency Healthy Food Financing Working Group in February 2010. Instead of attacking inequitable access through separate agency and program silos, the federal departments of Health and Human Services, Treasury, and Agriculture coordinate their review and award processes, as well as mechanisms to track annual investment performance. To date, these agencies have awarded nearly $45 million to support a wide range of interventions that will expand the availability of nutritious foods, including increasing the distribution of agricultural products, developing and equipping grocery stores and strengthening the producer-to-consumer relationship.

Just last week, a bipartisan coalition in the House and Senate introduced legislation that will expand the HFFI to increase access to healthy foods in underserved communities. This comprehensive HFFI legislation responds to issues of limited food access and will invest $125 million to target the number of low-income Americans living without adequate access to healthy food. The legislation calls for critical seed capital to establish new and expand existing healthy food financing partnerships in communities across the United States.

TRF continues to improve access to healthy food in the mid-Atlantic region by providing loans to finance a variety of healthy food retail formats. In addition to financing efforts, TRF has completed a nationwide analysis on low access food areas (available on PolicyMap.com) and researched the benefits of supermarkets on economically distressed neighborhoods. TRF is also developing strategies to broaden a successful food retailing investment program into a diversified sustainable agriculture and local food system funding initiative. As part of this effort, TRF is scanning the landscape of food production, processing and distribution in southeastern Pennsylvania and southern and central New Jersey.

The need for a comprehensive federal policy is critical, particularly in low-income communities and communities of color. With constricting credit markets, grocery store operators face higher obstacles to developing stores and other food-related businesses in underserved communities. Obesity and health-related problems are expected to worsen during these hard economic times. Leveraging combined public dollars and coordinating national policy through HFFI could create new opportunities for improving health and well-being and creating wealth in America’s communities.

In case you missed it, here is the introduction to our Food Financing 101 Series.

Stay tuned next week for Part 2: Making It Happen Across the Country

Image: courtesy The Reinvestment Fund