Few Options for Chelsea WIC Participants; Petition Demands Change

Gristedes, which has three stores in the neighborhood (including this one on Eighth Ave.), withdrew from the WIC program due to fees from bounced WIC checks and inadequate reimbursement. Photo by Scott Stiffler.

BY DUSICA SUE MALESEVIC | More than 150 Chelsea residents — and some elected officials — have signed a petition urging grocery store chain Gristedes to once again accept WIC vouchers at its stores.

Italo Medelius is spearheading the effort to get the chain to take WIC, which stands for women, infants and children. It is a supplemental nutrition program that helps provide food — such as baby formula, milk, and fruits and vegetables — for low-income pregnant women, mothers, and children up to the age of five. It is a federally funded program that is administered through the state’s Department of Health (DOH). 

“The reason that it seems we’re singling out Gristedes is that they have a large market share in our community,” Medelius said by phone. “As a community, we find it a little insulting… Gristedes isn’t pulling its weight with social responsibility.”

Gristedes has three stores in Chelsea — located at 307 W. 26th St., 221 Eighth Ave. and 225 Ninth Ave. — and stopped accepting WIC vouchers in August 2016. Only two stores in the area — Ideal Marketplace at 317 Ninth Ave. and Western Beef at 431 W. 16th St. — accept WIC checks, according to the DOH’s website.

“They [should] petition the state to do the right thing. Petition the state to pay the right price,” John Catsimatidis, owner of Gristedes, said when asked about the petition.

Catsimatidis, a billionaire businessman who has run for mayor, points to the DOH for no longer participating in the program. “We went out of our way to accommodate,” he said by phone. “They bulldozed us all the way.”

He added that the state is “paying us the same prices as people in Buffalo, where the rent is one-tenth” what it is in New York City. Catsimatidis is referring to how the DOH reimburses vendors that accept WIC checks.

The DOH established peer groups after extensive research by the department’s evaluation, research and surveillance unit, Erin Silk, DOH spokesperson, said in an email. There are currently 17 peer groups that were based on the business model — whether it was a chain or independent store, for example — the store size, and geography — whether it is an urban or non-urban area, she said.

The state set what it terms “maximum allowable reimbursement levels” for each vendor peer group for each food item primarily based on historical redemption data. The state evaluates each food item, compare the item’s prices within the peer group, and then sets the reimbursement level, Silk said.

“Supermarkets in Albany and Gristedes in Manhattan get the same amount of money,” Emily Pankow, assistant general counsel for Catsimatidis’ Red Apple Group, said by phone.

“They are ripping off New York grocers. We are one of the few left,” said Catsimatidis, calling himself “the lone ranger” of the grocery business.

Silk said the DOH worked closely with Catsimatidis and his staff to listen to his concerns and ensure all parties had a clear understanding of the WIC program requirements. Despite these ongoing communications, Gristedes voluntarily withdrew from the program, she said.

Another issue for the chain is the blank paper checks that the state issues as WIC vouchers. “The banks were giving us a hard time because the checks we were depositing were bouncing,” Pankow said. Over 700 checks were bounced a month, according to Gristedes’ Aug. 19, 2016 press release.

WIC checks used to have a “not to exceed” amount, but that figure was removed in April 2015 to comply with USDA requirements regarding cost containment and business integrity, Silk said.

Pankow noted it was this two-fold issue — not adequate reimbursement and fees for bounced checks — that was costing the grocer money to be part of the program, and led to the chain pulling out of it.

Medelius said that the reason the checks bounced is because Gristedes prices are too high.

When asked about this, Pankow referred Chelsea Now to the release from last year: “We are running full service union stores in some of the most expensive retail space in the United States. Included in the ‘urban chain store’ reimbursement group that the state WIC administrator is using to determine appropriate reimbursement are operators in places like Rochester and Buffalo, NY.”

Medelius has focused on food access — and the dwindling number of affordable grocery stores — in the neighborhood through a subcommittee of the Hudson Guild Neighborhood Advisory Committee.

In March, the Community Access subcommittee launched an online “Chelsea Grocery Affordability” survey. The majority of the around 300 responses to that survey were about Gristedes — prices were too high, the quality of the products is not good, and they no longer accepted WIC, Medelius said.

The petition was something the subcommittee had been thinking about for some time, and around mid-July, they decided to start this grassroots campaign, he said.

This petition urging Gristedes to accept WIC vouchers characterizes its three-store presence in Chelsea as a “virtual monopoly.” Photo courtesy Italo Medelius.

WIC is “very needed over here. It’s needed in every store. Prices are so high it’s ridiculous. People need to get food for their families — that is what WIC is all about,” Darlene Waters, president of the Elliott-Chelsea Houses Tenants’ Association, said by phone.

Waters said she knew many people that go out of the neighborhood to go grocery shopping. “This area, right here, has gotten really expensive. The stores are not catering to people who have lower income,” she said.

Fern Gilford started using WIC in late 2014 after her son was born. “I can’t use it in the neighborhood,” Gilford said by phone. “The local supermarket Gristedes does not participate in the program.”

Gilford said she mostly shops at Stop & Shop locations in Brooklyn, but it is “super inconvenient when you have a small child without a car,” Gilford, who has lived at the Elliott-Chelsea Houses since 2007, said. “To have a stroller and a shopping cart with you is almost impossible.”

Her son, who is now three, has lactose and feeding issues, and having the options for different kinds of soy milk available at Stop & Shop is a plus.

She said WIC is “pretty easy to use,” and it was easy to get a WIC card at one of the program’s centers. “The people were very nice,” she said. “They assisted me very well.”

Gilford added, “The WIC system is a great, great option for a single mother with children. Or any mother. It’s great to have that assistance.”

However, it does feel as if the options for what she can get are sometimes limited, she said. For instance, according to the list of current WIC acceptable foods on the DOH’s website, she cannot get organic milk. “You can’t get many organic products, you can’t get organic cheese,” she said.

Also, the check for the fruits and vegetables is $8, she said (a paper WIC check can only be used for specific items for specific amounts).“It’s extremely small. In our neighborhood, you might get one vegetable or one fruit — it’s very expensive,” she said. “If the goal is to eat healthy, why is that the smallest check?”

Fern Gilford, who uses WIC, makes the long trip to Brooklyn Stop & Shop locations partly because their product options are better suited to her son’s lactose and feeding issues. Photo by Scott Stiffler.

Gilford said she has stopped going to Ideal’s Ninth Ave. Chelsea location because there were two instances when she got milk that was outdated.

When asked about expired foods, Santo Fernandez, manager of Ideal, disputed the claim, saying, “If there is one thing we stay on top of, it is the expiration dates.”

Fernandez said the store has been taking WIC since it opened about 10 years ago, and about 85 to 100 customers a week use WIC. “We do not have any issue with the WIC program. Our money gets reimbursed,” he said by phone.

It is a “little bit inconvenient” and it requires a “little bit more work” for the WIC checks — they have someone in the office that makes sure the checks are stamped, taken to the bank and deposited, he said.

“We welcome the WIC check,” he said. “We are a business and we are serving the community and we don’t have a problem with it.”

Santo Fernandez, manager of Ideal Marketplace on Ninth Ave., disputed a claim about expired food and noted the store has about 85-100 WIC customers a week. Photo by Scott Stiffler.

“We support our neighborhood with fresh food at affordable prices and stand by the WIC program. We love WIC and any supplemental programs that help serve the community,” Dawn Addabbo, chief administrative officer for Cactus Holdings, Inc., the parent company of Western Beef, said by phone.

Western Beef has a compliance administer for WIC, and an estimated 28 percent of its customers at 431 W. 16th St. use WIC, she said. The store was originally located at 401 W. 14th St., which opened in 1998, and moved to its current location in September 2006, according to Addabbo. It has accepted WIC since 1998.

WIC serves an average of 259,750 participants in the five boroughs and an average of 507 participants per month in Chelsea, according to Silk, the DOH spokesperson.

The total federal funding for New York State is over $351.7 million for its food grant and $137.3 million for local agency administration, according to Silk. For New York City, $78 million is allocated for local agency contracts. From March 2016 to February this year, $364 million in benefits were issued and $245 million of those benefits were redeemed, according to Silk.

Miguel Acevedo, president of the Fulton Houses Tenants’ Association, said that most of the families from the complex go to Western Beef because it is closer, and “Gristedes prices are a lot more expensive than Western Beef.”

“They depend on WIC,” he said by phone. “We got a pretty good percentage of families that do use WIC.”

Acevedo said he wants to plan a protest with the petition’s organizers outside of the Gristedes store on 221 Eighth Ave. (btw. W. 21st & W. 22nd Sts.) because the public needs to be aware of what “Gristedes is doing to low-income families.”

He added that other stores in the area, like Whole Foods and Trader Joe’s, “need to be made aware how necessary [it is] for these families to have these vouchers.”

Italo Medelius of Hudson Guild’s Community Access Committee, seen here in March at Western Beef on W. 16th St. An estimated 28 percent of the store’s customers use WIC. File photo by Jordan Rathkopf.

Whole Foods at 250 Seventh Ave. does not accept WIC. The WIC program has a lot of requirements to participate, Ted Kwong, spokesperson for Whole Foods, said by phone.

Whole Foods only carries all-natural and organic foods and items, he said. In order to participate in the program, the store would have to stock its shelves with items that don’t meet its quality standards, he said. As mentioned before, WIC checks cannot be used for organic milk and cheese.

Trader Joe’s, located at 675 Sixth Ave., referred Chelsea Now to its corporate office, which declined to comment for this story.

All the stores mentioned in this article do accept food stamps, also known SNAP, the supplemental nutrition assistance program, through EBT cards, which are used like a debit card (EBT stands for electronic benefit transfer).

Silk said that WIC will move to a similar system called eWIC by 2019. “The eWIC card will work like a debit card at the store,” according to the DOH’s website.

Asked if Gristedes would take WIC again when it moves to eWIC, Pankow, the lawyer with Red Apple Group, said, “We are always happy to reconsider taking WIC. John wanted to offer it to his customers.”

State Senator Brad Hoylman said he was surprised that the program is still using paper checks, saying, “We have to move this into the 21st century.”

“The WIC program is crucial to families to get nutritional food and fresh vegetables for their children,” Hoylman said by phone. “I’m extremely disappointed Gristedes pulled out of the program and no longer accepts WIC checks.”

Hoylman, who — along with Councilmember Corey Johnson and Manhattan Borough President Gale Brewer — has signed the petition, said there is “no question that the supermarket shouldn’t lose money, but we need to feed our vulnerable. [Gristedes has] a responsibility as a good corporate citizen to serve everyone. I question Gristedes’ motives given that Ideal and Western Beef are accepting WIC.”

Supermarkets need to be serving everyone regardless of income level, Hoylman said, adding, “I’m very concerned that opportunities to use WIC are drying up in Manhattan. I’m not singling out Gristedes. I think any supermarket that opts out of WIC needs to reevaluate their commitment to the community. At the end of the day, New York needs to find a way to get these supermarkets into the WIC program.”

Whole Foods, with a Chelsea location on Seventh Ave. and W. 24th St., does not accept WIC (neither does the nearby Trader Joe’s, on Sixth Ave. at W. 21st St.). File photo by Jordan Rathkopf.