By Steven Cohen, Ph.D., Director of the M.S. in Sustainability Management program, School of Professional Studies
In the spring of 2010, a workshop capstone group I advised in Columbia’s MPA in Environmental Science and Policy program did a study for the NYC Mayor’s Office of Long-Term Planning and Sustainability about where New York City gets its food. We learned a great deal about the incredibly resilient and complex supply chains and the competitive market that brings food to our city. New York City’s food system is a remarkable example of the power of the free market, and the fact that if customers are willing to pay a high enough price, they can purchase any food they want in any season. In addition, one point we learned from that study was that a vast amount of that food, especially fresh produce, came through the single distribution center at Hunts Point in the South Bronx. This distribution center is owned by the city and leased to private vendors. This market should be seen as a critical piece of urban infrastructure, like a port or a bridge. The Hunts Point market opened in 1967. It is managed by the Hunts Point Terminal Produce Cooperative, which includes about 25 wholesale businesses. The market:
- Distributes more than 2.5 billion pounds of produce annually.
- Supplies approximately 25% of New York City’s fresh produce.
- Is part of the larger Hunts Point Food Distribution Center, through which about 12% of all food consumed in New York City passes.
There is an urgent need to modernize the facility, and funding for reconstruction should include user fees, as well as a public subsidy due to the low margin of profit in food distribution and sales. We also need to keep the cost of food from rapidly rising in our complex and congested city. A modernization project was proposed at a cost of about $650 million that would replace the nearly 60-year-old wholesale produce market. The four current warehouses would be replaced by two all-electric buildings with increased refrigerator storage, improved traffic patterns, improved rail loading facilities, and electric vehicle charging stations. It would eliminate nearly 1,000 diesel-powered refrigerated trailers that pollute the air and, in these days of diesel fuel price inflation, are increasingly expensive to run. In late August, NY 1 reporter Kelly Mena reported that:
“A redevelopment project at the Hunts Point Produce Market that was intended to improve air quality in the South Bronx has stalled after the cooperative that operates the market and the city failed to reach an agreement. The project is intended to transform the Hunts Point Produce Market into a state-of-the-art, all-electric distribution center. The goal was to reduce pollution for an estimated 13,000 Bronx residents while preserving the market and jobs in the community.”
By late September, the collapse of the reconstruction project had become a major political issue in the Bronx. According to Elizabeth Kim of the Gothamist:
“For decades, Hunts Point Produce Market in the South Bronx has fed the city while serving as a symbol of environmental injustice. Many of the fruits and vegetables New Yorkers eat are first stored in refrigerated trailers that spew diesel fumes into the poorest, most unhealthy neighborhood in the five boroughs… What was supposed to have been a major economic development achievement for Mayor Zohran Mamdani has instead led to frustration from Bronx officials who are scrambling to try to salvage a transformative project.”
The project is now stalled because the city and the cooperative never completed the long-term lease on which the entire financing structure depended. The immediate disagreements concern a proposed rent increase—from about $4 million to $14 million annually—and, even more importantly, whether the market could maintain its critical daily operation during construction and then operate effectively in the proposed two-building, more vertical layout. The project is needed and should be a priority of the mayor. The air pollution from trucks and refrigeration harms workers and the community in the South Bronx. The aging facility is a risk to the city’s food supply, and its inefficiencies could cause it to lose business to more modern suburban food distribution centers. A modern facility could reduce operating costs by reducing the time needed to load and unload freight carriers and lowering the cost of refrigeration. The original plan was funded by city, state, and federal governments with both grants and loans. Some of the costs of repaying loans were reflected in higher rental charges to vendors.
The plan stalled in part due to the change in mayors. Mayor Adams claimed premature credit for a deal not yet complete, and Mayor Mamdani took many months to appoint a head of the city’s Economic Development Corporation (EDC). The Gothamist piece reported that some believed that the deal came close to completion because veteran City Hall operatives like Randy Mastro and the late Sid Davidoff were known to Hunts Point Cooperative leaders who trusted them. It then collapsed during the Mayoral transition when EDC was left leaderless. Mayor Mamdani, like all Mayors in their first year, is getting lots of on-the-job training. Certainly, his inattention to EDC was a mistake. Nevertheless, the deal negotiated by the Adams administration created several issues that were never really resolved. The increased rent payment by vendors to the city that rose from $4 million to $14 million was one issue. Efficiencies from the improved facility would reduce costs, but the specific amount of cost reductions was uncertain, while the rent increase was fixed. Although cost was a problem, the key issue was that the proposed construction sequence and final layout could interfere with the ability of vendors to receive and transport produce during the construction and afterward. The plan would replace horizontal with vertical storage. That might create unanticipated logistical problems. In addition, unless carefully designed, the process of construction could interfere with the facility’s operations. In any case, the Hunts Point Cooperative refused to sign the deal, and currently it is in limbo.
I think the project is worth reviving because the facility is truly outmoded. There are five key elements to reviving the project: The first is to appoint a single person to represent the city and take charge of the negotiations and overall project management. The second is a temporary agreement that would retain the federal share of project funding. The third issue is a realistic plan that preserves operations during construction. Fourth, the rent payment must be connected to operating savings and should be increased gradually as savings are demonstrated. That may require a larger city and state subsidy. Finally, the negotiations to revive the deal must include active stakeholder involvement, including the union, the cooperative, the community, as well as state and federal governments.
If the reconstruction proves infeasible, perhaps incremental improvements could be pursued, starting with replacing the diesel refrigerators with electric refrigerators connected to the power grid or to a microgrid built for Hunts Point. Other incremental improvements might include improving rail access and redesigning truck traffic patterns.
Hunts Point is a symptom of a larger disease that has infected American government. We seem to have lost the ability to finance and build infrastructure. This is due in part to the anti-government and anti-tax ideology of the right and is also due to the left’s lack of understanding of the innovative and dynamic advantages of the private sector and the necessity of public-private partnerships. These partnerships cannot thrive if businesses are vilified by members of the mayor’s team. They also can’t even make the agenda if ideologues refuse to generate the tax revenues needed to invest in infrastructure.
It may seem incongruous that a market-dominated process like food distribution requires a public distribution facility leased to private vendors. But the cost of land in New York City and the city’s congestion created the need for a publicly owned and privately operated distribution center. The private and public sector cannot and should not be completely distinct. They should seek opportunities to cooperate in part because they depend on each other. As I often say, Henry Ford may have built the Model T, but he never built any roads. Without government-constructed highways, there would be no auto industry. The Mamdani administration should roll up its sleeves and get to work with the Hunts Point Cooperative and figure out a way to shut down those 1,000 diesel-spewing refrigerators.
Views and opinions expressed here are those of the authors, and do not necessarily reflect the official position of Columbia School of Professional Studies or Columbia University.
About the Program
The Columbia University M.S. in Sustainability Management program offered by the School of Professional Studies in partnership with the Climate School provides students cutting-edge policy and management tools they can use to help public and private organizations and governments address environmental impacts and risks, pollution control, and remediation to achieve sustainability. The program is customized for working professionals and is offered as both a full- and part-time course of study.
