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Michelle Obama unveils $200M California Endowment fresh food financing plan

WASHINGTON, D.C. – First Lady Michelle Obama unveiled a healthy food financing initiative — the California FreshWorks Fund.

A project of The California Endowment and a team of partners, FreshWorks is a $200 million public-private partnership loan fund created to increase access to healthy, affordable food in underserved communities, spur economic development and inspire innovation in healthy food retailing, according to a news release from the endowment.

The California FreshWorks Fund (CAFWF) is modeled after the Pennsylvania Fresh Food Financing Initiative and has been developed to align with the National Healthy Food Financing Initiative. The fund will try to make communities across California healthier by working directly with grocers on developing new and improved places to buy nutritious food. The new stores are expected to create or retain around 6,000 jobs in California, according to the news release.

“Health happens in our neighborhoods. Families can’t eat healthier food if they can’t buy it where they live,” said Robert K Ross, M.D., president and CEO of The California Endowment. “The sheer number of banks and other investors involved proves that this is not only the right thing to do to improve the health of our communities, but it’s financially attractive.”

“Independent grocers by nature are entrepreneurial and opportunistic and, as a group, have always been willing to open neighborhood-oriented grocery stores in underserved communities that have been passed over by the large chains,” said Al Plamann, chief executive officer of Unified Grocers, a retailer-owned wholesale grocery distributor that supplies independent retailers throughout the western U.S.

The FreshWorks coalition includes grocers, major banks, health care entities, research experts and other partners. The complete list: The California Endowment, NCB Capital Impact, NCB, Unified Grocers, California Grocers Association, Kaiser Permanente, Catholic Healthcare West, Calvert Foundation, Social Compact, Emerging Markets, PolicyLink, JP Morgan Chase, Morgan Stanley, Bank of America, U.S. Bank, Community Health Councils, the Reinvestment Fund and Community Redevelopment Agency of the city of Los Angeles.

The fund will provide financing to grocery stores and other healthy food retailers and distributors who meet a subset of skillfully developed program guidelines designed to move healthy food retailing forward in an affordable and accessible way and prioritize healthy choices from top to bottom, the news release said.

Kaiser Permanente, another partner, announced its contribution of $1 million in grant funding to California FreshWorks Fund. “Kaiser Permanente is committed to improving the total health of the communities where our members, physicians and employees live and work,” said Raymond J. Baxter, senior vice president for Community Benefit, Research and Healthy Policy at Kaiser Permanente. “Our grant to the California FreshWorks Fund supports our philosophy of making the healthy choice the easy choice by changing the environment and supporting healthy behavior.”

CAFWF program guidelines note that projects will get priority points if they don't sell cigarettes, have a higher proportion of healthy food for retail sale, eliminate junk food aisles and other factors.

Seed-stage financing from endowment included a $30 million mission-related investment on the debt side and a $3 million grant. In a matter of months the fund grew to $200 million committed from investors such as NCB, Kaiser Permanente, JP Morgan Chase and others, the news release said.

“It's ironic that some communities have an overwhelming need for access to healthy foods in a state that is one of the largest agricultural producers in the country", said Terry Simonette, president & CEO of NCB Capital Impact, the nonprofit community development financial institution that serves as the program administrator of the California FreshWorks project.

Other participants include Marion Standish, director, Community Health at the endowment; Lark Galloway-Gilliam, executive director, Community Health Councils; Ron Fong, president and CEO, California Grocers Association; and Annie Donovan, chief operating officer, NCB Capital Impact.

The California Endowment, a private, statewide health foundation, was established in 1996 to expand access to affordable, quality health care for underserved individuals and communities, and to promote fundamental improvements in the health status of all Californians. Headquartered in Los Angeles, the endowment has regional offices in San Francisco, Sacramento, Fresno and San Diego, with program staff working throughout the state. From 2010-2020, the endowment is focusing the majority of its resources on its 10-year strategic plan Building Healthy Communities. For more information, visit the endowment’s website at www.calendow.org.

The endowment also has given the Sun-Star a grant for its health care reporter.--Sun-Star Staff

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