No food reduction, plus a +1 hammer, better city defense, and better terrain advantage from aggressors. Only thing you lose is the windmill.
Keep in mind a city always by default start with +2 food and +1 production. That includes settling on a desert, tundra, snow, hill, etc. The hill though will grant you an additional +1 hammer, while a river tile (I think) should give +1 gold, strategic resources also give +1 hammer, while most luxury resources will give +1 gold and considered automatically improved provided you have the tech researched.