Keep calm and grow on.
Principals behind the West Louisville FoodPort tell IL their financing remains on track despite the fact that Metro Bank, which helps finance major development projects in economically underserved areas, failed last week to obtain federal funding that was slated to go toward the 24-acre lifecycle urban agriculture project in Louisville’s West End. The funding, in the form of federal New Market Tax Credits, would provide almost one-third of the $24 million the group is working to raise to fund the FoodPort, an urban agriculture business park of sorts that would combine processing and distribution of local food with other production elements, including an anaerobic digester to turn organic waste produced at the facility into energy that helps fuel it.
As IL reported Monday, Metro Bank — the city’s Community Development Financial Institution — missed the federal allocation for at least a fifth straight year. New Market Tax Credits are designed to help offset development costs of major projects intended to draw private capital into underserved areas.
Stephen Reily, cofounder of Seed Capital Kentucky, the group behind the FoodPort, said in an email that Metro Bank was only one of several CDFIs and national banks through which his organization is seeking that portion of funding. He said five of the institutions were approved for federal New Market Tax Credit allocations during the round announced last week, among them national banks and CDFIs.
“While Seed Capital Kentucky was proud to be included in Metro Bank’s application for 2015 New Market Tax Credits for the West Louisville FoodPort — and continues to work productively with Metro Bank on other forms of financial support for the project — it was only one of eight such applications that included our project,” Reily said. “Five of those applications (from national banks and CDFIs) resulted in successful NMTC allocations, and we are moving forward in our conversations with them (and another national bank that received an allocation and has expressed strong interest in the FoodPort) to determine (based on timing and other factors) the best fit.”
With 31 percent of the project’s diverse funding stream set to come from New Market Tax Credits, the local miss is disappointing in part because a Louisville-based source for federal pass-through funding would ensure a more direct connection to the project.
“For projects like ours, certainly to be able to look to a local CDFI for a dedicated allocation would be very, very important,” said Caroline Heine, project director for the FoodPort. She did not respond to a request to name the banks and CDFIs with whom Seed Capital is also working.
Still, Metro Bank’s setback won’t threaten the project’s timeline, Heine said. Seed Capital expects the final schematic design — from renowned architect OMA — to arrive in the next month and is hoping to break ground in April or May 2016, with an open date 12 to 15 months later.
“It doesn’t change anything,” she said. “It just reduces our options.”
A number of local foundations have contributed funding to the project during its design phase, including the James Graham Brown Foundation, which awarded Seed Capital a $1 million grant earlier this year. Metro government donated the 24-acre plot at 30th Street between Market and Muhammad Ali, formerly the home of the National Tobacco Company and valued at $1.2 million, to the project.
Theresa Zawacki, senior policy adviser to Louisville Forward, the city’s economic development agency, has worked closely with Seed Capital during the formative stages of the FoodPort.
“This project hits so many targets in the investment community in terms of the social impact, the economic impact, the return on investment, in bringing together an aggregation of existing businesses with an opportunity for development of new businesses at the property,” she said. “We see this as a potential New Market Tax Credit (project) that a lot of people are going to be interested in and are showing an interest in.”
The FoodPort would be located in Russell, at present the focus of a federally funded process to determine how best to replace the Beecher Terrace public housing complex and attract more investment to the neighborhood. The nearly $50 million project — including $24 million from Seed Capital and $20 million from Nature’s Methane, the company seeking to build the anaerobic digester — could be a major contributor to that effort. Seed Capital has said the FoodPort would create 250 permanent jobs in a neighborhood where unemployment is higher than 23 percent and nearly two-thirds of residents live below the poverty line.
West Louisville is also a food desert, with extremely limited access to affordable fresh foods.
“My vision for the WLFP is that it serves as an illustration for what regional, sustainable food systems should be,” said Cassia Herron, an urban planner and community development consultant. “Central for success is that it has to address the food access needs for west Louisville residents and market needs for medium-sized farmers. The challenge with our existing food system is that both these populations — west Louisville residents and farmers — are losing. If we can address their needs simultaneously as a priority of the development, we win.”
But Herron said recent controversy over the proposed construction of the onsite digester — as well as another close by — suggests Seed Capital and the Indiana-based Nature’s Methane still have some residents to win over. The digesters have generated pushback from residents who fear they could bring odorous emissions and heavy truck traffic to the neighborhood, as well as 40-foot-tall tanks looming in the skyline, as WFPL reported on Tuesday. Metro Councilwoman Mary Woolridge has vowed to oppose both projects.
Heine said the digester is safe and is an integral part of the FoodPort’s design and concept.
“We really like the idea of having an anaerobic digester on the site because it makes us a full-circle lifecycle, seed-to-energy project,” she said. “On these 24 acres at the FoodPort, there will be food grown, processed, sold, eaten, and then digested and (used) as energy. We think that is a really beautiful story.”
In November, Seed Capital led a bus trip of stakeholders to tour an anaerobic digester just outside Fort Wayne, Ind. Heine said the recent opposition to the projects in the West End shows Seed Capital needs to share their message more broadly, which she said they’ll do in the coming weeks and months.