Credit Unions Help Farmers Replenish Food Deserts
Rows of fresh turnips, okra and watermelons were the images Helen Godfrey Smith had in mind when she visualized the rich, farm land throughout the Mississippi Delta region.
“While the Delta has been a vibrant community that’s not the case anymore,” said Godfrey Smith, president/CEO of the $102 million Shreveport Federal Credit Union in Shreveport, La. “What’s happening is casinos are moving in, the older people who have farms – the younger people are just not interested in farming. With that in mind, we began to look at what we can do.”
The maximum amount for the microloans is $50,000 with up to five-year terms. Shreveport FCU ensures that the payments are reasonable and the farmers provide some sort of collateral to cover any risks.
Defaults have been minimal. The credit union recently had to charge off loans for $989 and less than $2,000, Godfrey Smith said. Two or three loan payments were 60 days late and had much to do with seasonal changes that had an impact on crops, she added.
Meanwhile, the South Carolina Community Loan Fund in North Charleston, S.C., has seen firsthand the need to replenish food deserts. Since its launch in 2004, the fund has infused more than $19.2 million in loans into the community, resulting in the development of over $163 million in community development projects.
One of SCCLF’s loan programs involves healthy food projects, said Anna Hamilton, the organization’s strategic initiatives director. The fund provides loans up to $500,000 to finance acquisition, predevelopment, infrastructure, construction, renovation, leasehold improvements, machinery and equipment, working capital, and permanent financing of business costs. Some of the outlets include grocery stores, corner stores, farmer’s markets, food hubs and mobile markets within South Carolina’s underserved communities.