In Fresh Direct Move to the Bronx, Food Delivery to Borough Not a Priority
Monday, February 27, 2012
A recent deal with Fresh Direct is expected to deliver a $255 million economic boost to New York City, but it won't necessarily deliver food to the doors of South Bronx residents who live near the online grocer's planned facility in Mott Haven.
The company currently delivers to residences in only four of 27 zip codes in the borough — all of which are among the areas with the highest levels of median household income in the Bronx, according to 2010 Census Data.
Mott Haven, the location of the planned facility, has a median household income of between $25,000 and $50,000. The citywide median household income is $50,285.
Expanding delivery services to more of New York City was very low on the list when the city, state and the Bronx negotiated the deal that was announced February 7, according to Fresh Direct CEO Jason Ackerman.
"It wasn't really a big topic that we discussed," he said.
Fresh Direct has promised to look into ways to expand deliveries in the Bronx, but according to Ackerman, past efforts to do so have failed.
"We have always felt that the Bronx has not wanted our service, and we've seen over time no natural request for our service," he said.
(Graphic:The point farthest south in the proposed location of the new Fresh Direct facility. The pins above above show the zip codes to which they deliver.)
But many Bronx residents said they would welcome more fresh food delivery, especially since several neighborhoods in the area suffer high rates of obesity and diabetes.
"Everything around here is frozen," said Cecilia Depass, 47, who is unemployed and lives near 178th Street and Grand Concourse. "The fruits are not sweet like they should be. The vegetables is not good like they should be."
She added, "I'm not trying to sound prejudiced, but the white people get the good stuff before the poor people do.”
In return for putting down roots in the Bronx and creating approximately 1,000 jobs, the company will receive a suite of loans, grants, tax credits and other benefits from the city, state and organizations in the Bronx equal to $127.8 million. There are strictures Fresh Direct will have to abide by to get the money.
So-called Excelsior tax credits from the state will only begin to be distributed once construction of the new facility is complete, and several tax credits offered by the city, paid out over 25 years, will only be available as long as the company stays in the Bronx.
But very little of the money — only the $4.5 million from the Bronx borough president's office and the Bronx Overall Economic Development Corporation (BOEDC) — is tied to Fresh Direct expanding its delivery services in the Bronx.
The company signed a memorandum of understanding (MOU) with the borough president and BOEDC promising to discuss expanding service. According to the MOU, the company could lose the Bronx funding if it does not comply with its terms, which also include the purchase of 10 electric trucks as well as hiring and job training quotas.
BOEDC President Marlene Cintron called the understanding "binding" but conceded that if Fresh Direct does not meet all the requirements, the company would not necessarily lose the money.
"It depends on — If they do seven out of 10, if there are articulable reasons why they didn't do others, then, I mean, there are no absolutes." she said.
Community Board 1 member and Mott Haven homeowner Mychal Johnson was not convinced that the language in the MOU is strong enough to hold Fresh Direct to its promise to extend delivery service to more of the Bronx.
"The MOU...is non-binding," he said. "If you want to locate your plant here, where you can get all kind of great subsidies and grants from our tax dollars, then you should at least deliver to the community that you're trying to reside in."
With reporting by Sharyn Jackson