Funding the Bethlehem Food Co-Op: “Philosophically, we’re on the wrong path”

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Bethlehem Food Co-Op

Full disclosure: Gadfly is a member of the Bethlehem Food Co-Op, supports it, has talked it up with family and friends, has promoted it here on Gadfly, hopes to live to enjoy its “fruits” and to see it flourish. Gadfly published a collage of member yard signs with the caption: “Gadfly loves everything that speaks community.” The BFC is squarely aligned with the mission of the Gadfly project. But Gadfly must admit that he was not expecting to see the BFC receive City support. His understanding when he joined in February 2019 was that the BFC was drawing its financial base from the membership.

So the only problem raised with the proposed City allocation of CDBG funds at the Community Development meeting Monday night related to the Bethlehem Food Co-Op allocation of $105,000 (it had received another $50,000 last year).

The problem was three-fold:

1) Do the proposed BFC activities fit the criteria for CDBG funding?
2) Since at least 6 of 7 Council members are BFC members, is there a conflict of interest?
3) Should government be funding a private business?

In testimony Gadfly provided to you Wednesday, Dana Grubb, without denigrating BFC but seemingly quoting criteria for CDBG funds, noted that he had heard no argument made for BFC supporting low and moderate income folk, apparently a necessary criterion for CDBG funds.

In her presentation (also provided Wednesday), the City Administrator did not specify criteria against which applications were judged but did say the applications were reviewed internally for compliance.

Gadfly finds thefollowing statement relating to criteria for CDBG funds on the HUD web site:

Over a 1, 2, or 3-year period, as selected by the grantee, not less than 70 percent of CDBG funds must be used for activities that benefit low- and moderate-income persons. In addition, each activity must meet one of the following national objectives for the program: benefit low- and moderate-income persons, prevention or elimination of slums or blight, or address community development needs having a particular urgency because existing conditions pose a serious and immediate threat to the health or welfare of the community for which other funding is not available.

Now Gadfly would assume that BFC’s grant application, which was not made public and therefore not known to Dana, would have addressed this criteria, and BFC’s Kathy Fox said in her comments (yet also provided in Wednesday’s post) that the application “did an excellent job of outlining the local economic, social continuing benefits of food cooperatives,” so she indeed did not specifically address at the meeting the criteria to which Dana referred. Presumably all that was done in the application, which, if Dana had seen, might have made him feel more comfortable.

Bruce Haines — again without rancor, without hostility, and with respect for the BFCers — objected that the market should determine the need for such a food business, that the city-supported BFC would be competing with other private businesses, that BFC members should be footing the bill, and that an important City program — the blight program — was being slighted, receiving only $5000.

Now you can imagine that Haines was not the most popular fellow in the room populated with BFCers for voicing these positions. And the BFC has an army 660 strong! He’d have had trouble getting a “bless you” for a sneeze. He knew what he was in the eyes of that audience, however, the skunk at the garden party. Great image!

  • I hate to be a skunk at the garden party here tonight.
  • I thoroughly support any grants that go to the social service agencies in the City the help the low income and the children that need help.
  • We were funding a business that was essentially a viable private enterprise business.
  • The market place will determine whether there is a need for a grocery store, food service in a certain location.
  • If the demand is so strong the private market for the food and grocery business is a very, very viable market with adequate funding, adequate capital, adequate equity.
  • I don’t think the City of Bethlehem should be in the business for allocating funds to an entity that competes with the private economy.
  • This is really, I think, a misuse of the funds and a misallocation of the funds, and every effort should be made to allocating the funds to the social services and the needs of the needy.
  • To take $105,000 out of blight remediation and blight administration . . . this doesn’t make sense.
  • We need to put money toward the blight program to clean up the City.
  • We shouldn’t be funding a business that’s going to complete with a very healthy, private, vibrant business, and the government doesn’t belong in that business.
  • If the community wants it, then the equity for the construction should come from the community members not the public taxpayer.
  • I’m not here to denigrate any person, I just think philosophically we’re on the wrong path.

But Gadfly felt that, unpleasant and unexpected as it was to this BFC member, Haines’s position was a reasonable one — actually a classic philosophical position — and thus deserving of reasonable answer.

What do you think? Of course, BFC does (will do) good work. But is it ok to fund it this way? How would you lean?

Gadfly always likes to play Councilperson. It helps us understand the responsibility that comes with that job. And the nature of the people we have elected

Councilman Reynolds did respond. We’ll go there next.

One thought on “Funding the Bethlehem Food Co-Op: “Philosophically, we’re on the wrong path”

  1. An interesting point about subsidizing a private (cooperative) business ā€” especially when we think about the millions of dollars local government spends to subsidize private, for-profit development. CDBG is different than general tax funds, of course ā€” but not every CDBG dollar has to benefit *only* low-income residents.

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