Thoughts on food deserts and grocery stores in NM
30% of NM residents live within a federally-designated food desert - zoning codes and tax loopholes aren't helping
How many of you can reliably access healthy food day to day? If you live in New Mexico, it’s probably about 70% of you.
Between closures of independent grocery stores, the sprawling nature of cities in the American West, historic poverty, a large rural population, and tax and zoning codes that enable the whole setup, New Mexico has one of the worst food desert situations in the US.
A reporter at The Shelby Report (a news outlet for grocery news and insight) reached out to ask me about the state of grocery stores and food deserts in New Mexico, and they asked me how I think the state should fix the situation. They also mentioned that the New Mexico Grocers Association decided not to participate in the story - so I felt obliged to give a thought-out response. I’m not an expert on the grocery industry, but as a former grocery worker, economist, and supermarket shopper in New Mexico, I have a few notes.
The Shelby Report asked me to comment on the following questions:
Do many people live below the poverty line and walk to the grocery store because they don’t have transportation?
Are people shopping at grocery stores for food or do they access many smaller retailers to complete their shopping list?
Is there an obvious divide between those who can afford to shop and those who can’t?
Are you seeing new grocery stores being built or existing ones remodeled?
Is anything being done to curb these issues?
Is the governor’s office aware and helping?
Why is this a challenging market for retailers to operate in?
Is the grocery scene different in urban vs. rural markets?
My response is below - edited for brevity.
I'm sorry the New Mexico Grocers Association took a pass on commenting, but I'm happy you reached out to me. I had time today to put some thought and research into the subject. As I got going, I realized I had a lot to share about the state of supermarkets in New Mexico.
Overall, the only grocery stores I see opening these days are big chain stores like Whole Foods, and that's just in the wealthy urban areas. Like the rest of the country, smaller grocery stores in New Mexico have been losing to the big box stores and national chains for a while, and the stories are a little different depending on where the market is located.
I'll first talk about the rural situation.
My grandfather owned a grocery store in rural New Mexico, Moriarty to be exact (population 1,800 today) which I had the pleasure of working at through high school. He operated the small store for over 60 years, and in 2011 he retired and the store closed. There is now just one independent grocery store in Moriarty. Nobody was willing to take over my grandfather’s store since several dollar stores had moved into town and Walmart opened in the neighboring, slightly larger town of Edgewood. At the time it opened, I believe it was the largest Walmart in North America. Needless to say, that changed the economic landscape of the Estancia Valley. Over the 60 years he operated the small business, the economics of grocery stores had shifted in favor of large national chains that are often in car-dependent and/or wealthier locations.
Independent stores today are based largely in small rural areas, except for a few in more historic urban neighborhoods, but many of them have died out. Survival for the independent grocer has been dependent on coop-type distributorships. For example, Mike's Friendly Store, my grandfather's store, was a member of Affiliated Foods Inc. (AFI) out of Amarillo, TX. AFI services many of New Mexico's independent grocers. It costs tens of thousands of dollars every year to participate, so members of AFI are typically medium-sized stores that have the volume to support the co-op membership fee. As a member, Mike's could tap into the buying power of AFI and he'd receive a portion of the coop's profits at the end of the year as part owner of the coop. This setup allowed him to compete with the big chain stores.
There is still another independent grocery store in Moriarty, thanks to AFI, but smaller stores in towns like Estancia (15 miles south of Moriarty) didn’t have the volume to participate within a coop, so they died out. According to my grandpa, most independents around the state have gone out of business.
Dollar General and Family Dollar have stepped in to replace many of the independents, but food selection is limited to canned and frozen food - they do not have anything fresh. Whatever rural folks can't buy at the local dollar store, they have to drive to the city to purchase - typically at Walmart or Smiths. The rumor is some of the dollar stores are looking to bring fresh products to market, but I can't say if that's legitimate.
Being the 5th largest state by area and 36th largest by population, New Mexico is among the most rural states in the US. And outside of the Permian basin and a couple of other areas, people are leaving rural towns in search of better-paying jobs in Albuquerque, Santa Fe, and Las Cruces. This population drop is making it even harder for grocery stores to operate in small towns. Furthermore, the population of New Mexico has been stagnant for the past 10 years or so, which is in contrast to all of our neighboring states which are growing rapidly. For more information on the population situation, I wrote an essay about it in September you can find here.
In Albuquerque, many small corner stores have met the same fate. Last month, a grocery store closed in Albuquerque's inner-city, South Broadway neighborhood - leaving behind a food desert. This neighborhood also relies heavily on the ill-equipped dollar stores.
I was in a South Broadway dollar store the other day and, while I was checking out, a man ran out of the store with a few bags of dog food he hadn't paid for. The cashier hopped the counter and got the dog food back. The struggle is apparent in South Broadway. Albuquerque's International District and South Valley appear to be the worst food deserts in Albuquerque, and around 30% of New Mexico lives in federally designated food deserts.
Most food deserts are in areas that are rural, poor, minority-majority, or all of the above. Meanwhile, if you go to the wealthier areas of the state like Albuquerque's NE Heights, most of Santa Fe, or Los Alamos, you will find a Trader Joe's, Whole Foods, Smith's, Walmart, or Target nearby. So, yes, I think there is an obvious divide between those who can afford to shop and those who can't, and I presume Whole Foods knows where their ideal customers are located.
There are some bright spots to point to. Downtown Albuquerque got a small grocery store called Silver Street Market in 2016. Without this store, the situation would be much worse for Albuquerque's greater downtown area. There are also local advocate groups and politicians looking to alleviate the situation, but it's an uphill battle.
Governor Michelle Lujan-Grisham last year signed into law SB4 which provides free school lunches to all K-12 public schools in New Mexico - relieving food insecurity, but at the same time, pandemic-era relief is coming to an end. Because the issue is largely competition-driven, there isn't much the state or local government can (or would) do to intervene in the grocery market at the micro level. In other words, I doubt a politician would go as far as banning certain grocery companies from entering the market, but they could create stronger welfare programs that deliver food to food deserts. In my opinion, a much larger structural change is needed at the macro level.
To reduce food deserts in rural and urban areas, governments need to create a business environment where small independent grocers can compete again. It doesn't matter which industry you're looking at - grocery, farming, housing, retail, etc., the big are getting bigger and the small are going by the wayside. There was a time when you could operate a farm of a couple hundred acres and run a sustainable business, but today you need hundreds of thousands of acres to compete with the big ag companies. It will take a larger structural change to tax and land use policies to change the business environment for the betterment of food security.
Regarding corporate taxes, we need to level the playing field to make it possible for small businesses to compete with the large chains that often don't pay their fair share.
Regarding zoning codes and land-use priorities, we need to legalize cities that foster food accessibility. Eliminating parking mandates, legalizing mixed-used developments and dense housing, and investing in public transit would allow people to live within reach of the grocery store. It would also give independent neighborhood grocery stores the customer volume to participate in coops like AFI.
I think the reason Silver Street Market has stayed open while other independent grocers are closing is because the City of Albuquerque has focused on increasing housing density Downtown. It’s been proven that customers will choose small businesses over big box stores (even if the prices are slightly higher) because they're accessible and within walking distance, but you need the density to support that.
The current tax and land use system, in New Mexico and nationally, subsidizes a few large car-dependent supermarkets over locally-owned "mom and pop" stores that would traditionally be within walking distance of all communities.
In summary, the economic environment has changed over the past 70 years in favor of large corporations, and the built environment has become car-dependent and sprawling, further exacerbating New Mexico's already rural, disadvantaged nature. And for rural communities that are losing population, the situation may continue to get worse. It's become a perfect storm resulting in continued food insecurity. A holistic approach focused on corporate tax and land use reform is most likely the best long-term solution - in my humble opinion.
I hope this was helpful to you. Please let me know if you have any further questions. Also, let me know when the piece is published - I would love to learn more about your findings on the matter.
The Shelby Report has not yet published its report on the state of grocers in New Mexico, but I’ll be sure to share it with you if they do.
In other news
The Clean Transportation Fuel Standard passed the New Mexico House and Senate Conservation Committee within the past week. With only five days left in the session, the bill will head to the Senate Finance Committee, and then, hopefully, the Senate floor. The NM Senate voted in favor of the bill in 2021 but then lost in the House on a tie vote.
The Opportunity Enterprise Act is a step closer to becoming the Opportunity Enterprise and Housing Act as HB195 makes it’s way through the New Mexico House. The bill would appropriate $250 million to the existing fund to build housing that’s affordable to the average New Mexican.