June 26, 2010 in Business

Rural stores pinched

Many closing, leaving towns as ‘food deserts’ without gathering place, tax revenue
Betsy Blaney Associated Press
 
Associated Press photo

A man walks past the Turkey General Store in Turkey, Texas, which closed in November. The store’s closure in West Texas is being repeated across the country as rural stores struggle to survive amid competition from superstores and meeting delivery minimums.
(Full-size photo)

TURKEY, Texas – Craig Chancellor tried everything he could, but last November he finally closed the Turkey General Store, leaving the small Texas Panhandle town without a grocery.

Although Chancellor tried to trim overhead and relocated a small cafe he owned into the store, he couldn’t make it work. He paid more for salaries and utilities than he made in sales, and finally, he lost more than he could afford.

“It didn’t play the way we wanted it to,” the 48-year-old Chancellor said. “People understand why we had to do it, but they hate it.”

Researchers said Chancellor’s story is being repeated across the country as rural stores struggle to survive amid competition from distant supercenters and relatively high operating costs. The grocery industry and government don’t keep statistics on rural store closures, but experts said a long-running trend seems to be picking up speed.

It isn’t just a store that goes when groceries close, said David Proctor, who studies rural communities at Kansas State University. Such closures rob towns of their vitality, with the loss of gathering places and sales tax revenue.

Once such businesses begin closing, small communities can find themselves in downward spirals, said Kathie Starkweather of the Lyon, Neb.-based Center for Rural Affairs.

“If you start to lose something key like a grocery store, people aren’t likely to move there if they don’t have access to food,” she said.

But Lois Wright Morton, of Iowa State University, said one reason local markets fail is because residents often prefer to drive to bigger cities with a Walmart, Target or other large store. Shoppers are attracted by generally lower prices and larger inventories.

Closures of rural stores can be particularly hard for elderly and other people who can’t drive long distances.

The U.S. Department of Agriculture calls areas with little access to affordable and nutritious groceries “food deserts.”

Thirteen percent of the nation’s more than 3,100 counties qualified as food deserts 10 years ago, with most of them in a band of rural areas stretching from Montana to North Dakota and then south to West Texas.

Farmers markets can help, but crops grown in those communities are often commodities like cotton, not fruits and vegetables, Proctor said.

The federal government is trying to ease the situation with the Healthy Food Financing Initiative. The departments of Treasury, Agriculture and Health and Human Services have proposed spending $400 million a year to bring grocery stores and other healthy food retailers to underserved urban and rural communities to eliminate food deserts within seven years.

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