United Natural Foods, Inc. (UNFI), the largest national wholesaler of organic goods, is expanding. The $5-billion company’s expansion bodes well for the growth of organics. But UNFI’s decision to turn farmland and wetlands into 33 acres of warehouse and parking lot has raised the ire of environmental and consumer groups, including New York-based Riverkeeper and the Organic Consumers Association (OCA), a national advocacy organization representing more than a million consumers.
Local union, business and citizens groups weren’t too happy with UNFI’s decision either, especially when it shut out unions and negotiated a plan to evade local taxes.
UNFI built its $58-million, 600,000-sq.-ft. warehouse and distribution center in Montgomery, N.Y. Company officials tout the fact that UNFI pursues LEED (Leadership in Energy and Environmental Design) certification for all construction projects, and they proudly point to the company’s Providence, R.I.-based headquarters, which is sited within two historic industrial buildings, as evidence of the company’s commitment to sustainability.
Yet rather than locate the Montgomery building in one of the town’s many vacant warehouses available for revitalization, UNFI chose prime farmland, in an area that includes wetlands and is ringed by the Beaverdam Brook River.
Not exactly what shareholders and consumers expect of a “green” building.
Representatives of Riverkeeper, a N.Y.-based nonprofit whose work includes protecting New York waterways, submitted a list of concerns about UNFI’s project to the Montgomery planning board. The group wrote:
“Utilizing a previously developed building or disturbed site is always preferable to new construction on an undisturbed property, particularly when the chosen property contains wetlands, protected streams and other valuable natural features. In this case . . . the site is active agricultural land that supports a variety of wildlife and natural vegetation. It is clear that building a very large industrial facility in close proximity to federal and state designated wetlands, and to the Beaverdam Brook, a protected stream, could have long-term impacts on these resources.”
UNFI officials never responded to Riverkeeper’s concerns, concerns that were reiterated by a representative of OCA who attended the company’s recent shareholders meeting. Also attending that meeting were Adrian Huff, secretary-treasurer of the Teamsters Local 445 in Rock Tavern, N.Y., and Tim Brown, president of the Valley Central Teacher’s Association.
Huff wanted to know why UNFI shut out local unions and used out-of-state workers to build its warehouse. He echoed Hudson Valley Building & Construction Trades President Todd DiIorio’s comments to the press:
“This project could have been built entirely with local union construction workers. But instead, UNFI brought in an out-of-state contractor and plenty of out-of-state materials, which could also have been easily sourced right here in New York, Not only are qualified and unemployed local people losing out on these jobs, but less money will be circulated in the local economy, making the larger community lose out on the economic benefits of new construction.”
UNFI has a history of threatening, intimidating and firing its employees at locations across the country.
Brown spoke at the meeting on behalf of Montgomery’s schools and taxpayers. He asked UNFI Chairman Michael Funk how UNFI could take $18 million in public subsidies while watching local schools close, and town taxes on homeowners increase by 16.58 percent.
“I ask that UNFI demonstrate its sincerity with regard to its stated Core Value of Community by reevaluating what it considers to be its fair share of taxes owed to our children. Kids starting kindergarten today will graduate high school before UNFI pays its full share of taxes. That’s just unsustainable.”
Hudson Valley community advocates filed a complaint against UNFI and the Montgomery Industrial Development Agency (IDA), the local agency that approved the tax breaks, with the New York State Authorities Budget Office (ABO), the agency charged with overseeing public authorities.
The complaint detailed problems with the subsidy deal, including inadequate public notice and an incomplete application for financial assistance.
Just last week, the ABO responded with a report finding against the UNFI and Montgomery IDA deal. The ABO investigation found that the Town of Montgomery IDA gave away money to UNFI without following a transparent process, and in violation of the IDA’s own Uniform Tax Exemption Policy, the New York Public Officers Law (known as the Freedom of Information Law or FOIL) and the New York Public Authorities Law.
The ABO report states that:
The project application submitted by UNFI was materially incomplete. It is clear that significant and critical information was omitted from the project application. Further, it is questionable how the IDA board could adequately evaluate the project without knowing the type and value of the financial assistance being requested. In addition, by approving the project without having the required information in the project application, the board acted in violation of its uniform tax exemption policy.
The ABO also reported that, “IDA officials admit that no formal records exist indicating that a cost-benefit analysis of the project was done.”
It’s time for UNFI to commit to paying its full and fair share of taxes. In the meantime, the nation’s largest distributor of organic products has been inducted into the Corporate Tax Dodgers Hall of Shame.
UNFI should also stop wasting farmland to build its new warehouses, focus on brownfield redevelopment and establish a land trust to remediate its current greenfield developments.
Will UNFI live up to organic principles? Or is the company becoming another Walmart?
Alexis Baden-Mayer is political director for the Organic Consumers Association.