Senate Study Bill 1054 - Introduced SENATE FILE _____ BY (PROPOSED COMMITTEE ON AGRICULTURE BILL BY CHAIRPERSON DRISCOLL) A BILL FOR An Act creating a grocer reinvestment program, a local produce 1 processing grant program, and a grocer reinvestment and 2 local food processing fund under the purview of the economic 3 development authority, modifying the local food and farm 4 program, and making appropriations. 5 BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF IOWA: 6 TLSB 1325XC (1) 91 nls/ko
S.F. _____ DIVISION I 1 GROCER REINVESTMENT AND LOCAL PRODUCE PROCESSING 2 Section 1. NEW SECTION . 15.413 Grocer reinvestment program. 3 1. As used in this section: 4 a. Financial assistance means assistance, in the form 5 of grants, provided only from the funds and assets legally 6 available to the authority pursuant to this section. 7 b. Grocery store means an establishment also known as a 8 supermarket that primarily engages in retailing a general line 9 of food including canned and frozen food; fresh fruits and 10 vegetables; and fresh and prepared meat, fish, and poultry. 11 c. Low or moderate income community means a census tract, 12 as reported by the most recent federal decennial census, in 13 which fifty-one percent of the persons residing in the census 14 tract are at or below eighty percent of the area median income 15 as determined by the United States department of housing and 16 urban development. 17 d. Program means the grocer reinvestment program. 18 e. Underserved community means a census tract, as reported 19 in the most recent federal decennial census, determined to 20 be an area with low grocery store access as identified in 21 the food access research atlas prepared by the United States 22 department of agriculture, or by a methodology adopted by 23 another governmental healthy food initiative. 24 2. The authority shall establish and administer the program 25 for the purpose of awarding financial assistance to eligible 26 grocery stores for the following projects at existing grocery 27 stores, or new grocery stores to be located in this state: 28 a. Capital improvements to establish or expand capacity, 29 including expansions and modifications. 30 b. Upgrades to utilities, including water, electric, heat, 31 refrigeration, and freezing units. 32 c. Purchases of equipment and furnishings. 33 d. Expenditures for professional services. 34 e. Technology that allows increased capacity or business 35 -1- LSB 1325XC (1) 91 nls/ko 1/ 8
S.F. _____ resilience, including software and hardware related to business 1 functions, logistics, inventory management, temperature 2 monitoring controls, cybersecurity, and internet site design 3 that enables electronic commerce. 4 3. The authority shall establish eligibility criteria for 5 the program by rule. The eligibility criteria must include all 6 of the following: 7 a. The grocery store has filed all required documents with 8 the secretary of state under the relevant filing statute as 9 described in section 9.11. 10 b. The grocery store is organized as a sole proprietorship, 11 partnership, limited liability company, corporation, 12 cooperative, nonprofit organization, or nonprofit community 13 development entity. 14 c. The grocery store owns five or fewer grocery stores. 15 d. The grocery store has the capacity to successfully 16 implement or complete the project, and demonstrates a plan for 17 sustainability. 18 4. In order to be awarded financial assistance under the 19 program, a grocery store must provide matching funds for the 20 project equal to the amount of the financial assistance award. 21 Financial assistance awarded under the program shall not exceed 22 two hundred thousand dollars. 23 5. The authority shall evaluate applications, and priority 24 shall be given to the grocery stores that commit to all of the 25 following: 26 a. Locating the project in an underserved community that 27 primarily serves the residents of low or moderate income 28 communities. 29 b. Accepting benefits under the United States department 30 of agriculture supplemental nutrition assistance program and 31 the special supplemental nutrition program for women, infants, 32 and children. 33 c. Creating or retaining jobs for local residents. 34 d. Making efforts to procure and offer local foods for sale. 35 -2- LSB 1325XC (1) 91 nls/ko 2/ 8
S.F. _____ e. Other criteria determined by the authority. 1 6. By November 1, 2026, and each November 1 thereafter, 2 if financial assistance has been provided in the immediately 3 preceding fiscal year, the director shall submit a report to 4 the general assembly describing the activities of the program 5 including the geographic distribution of the projects, the 6 identity of the applicants, and the new investments or new jobs 7 created as a result of the financial assistance provided under 8 the program. 9 Sec. 2. NEW SECTION . 15.414 Local produce processing grant 10 program. 11 1. As used in this section: 12 a. Local produce means fruits and vegetables grown in this 13 state. 14 b. Local produce and processing means the preparation of 15 local produce for human consumption. 16 2. a. The authority shall establish and administer 17 the local produce processing grant program for the purpose 18 of awarding grants to Iowa-based entities to increase the 19 availability of local produce processing. In administering the 20 program, the authority shall prioritize grants to Iowa-based 21 entities that will increase any of the following as it relates 22 to local produce processing: 23 (1) Availability. 24 (2) Access. 25 (3) Efficiency. 26 (4) Capacity. 27 b. A grant shall not be awarded to an entity unless the 28 local produce processing includes local produce from multiple 29 Iowa-based farms. 30 3. The authority may adopt rules pursuant to chapter 17A to 31 administer this section. 32 Sec. 3. NEW SECTION . 15.415 Grocer reinvestment and local 33 food processing fund. 34 1. a. A grocer reinvestment and local food processing 35 -3- LSB 1325XC (1) 91 nls/ko 3/ 8
S.F. _____ fund is created in the state treasury under the control of 1 the authority. The fund shall consist of moneys appropriated 2 to the authority and any other moneys available to, obtained 3 by, or accepted by the authority for placement in the fund. 4 The fund shall be used to award financial assistance as 5 provided under the grocer reinvestment program established in 6 section 15.413 and the local produce processing grant program 7 established in section 15.414. 8 b. Commencing with the fiscal year beginning July 1, 2025, 9 and each fiscal year thereafter, one hundred thousand dollars 10 of the annual appropriation to the fund, or ten percent of the 11 moneys in the fund available on July 1, whichever is less, 12 shall be allocated to the local produce processing grant 13 program established in section 15.414. 14 c. The authority may use not more than five percent of 15 the moneys in the fund at the beginning of the fiscal year 16 for purposes of administrative costs, marketing, technical 17 assistance, and other program support. 18 2. Notwithstanding section 8.33, moneys in the fund 19 that remain unencumbered or unobligated at the close of the 20 fiscal year shall not revert but shall remain available for 21 expenditure for the purposes designated until the close of 22 the succeeding fiscal year. Notwithstanding section 12C.7, 23 interest or earnings on moneys in the fund shall be credited 24 to the fund. 25 DIVISION II 26 LOCAL FOOD AND FARM PROGRAM GROCERY STORES 27 Sec. 4. Section 267A.1, subsection 1, Code 2025, is amended 28 to read as follows: 29 1. The purpose of this chapter is to empower farmers , and 30 food entrepreneurs , and grocery stores to provide for strong 31 local food economies that promote self-sufficiency and job 32 growth in the agricultural sector and allied sectors of the 33 economy. 34 Sec. 5. Section 267A.1, subsection 2, paragraph d, Code 35 -4- LSB 1325XC (1) 91 nls/ko 4/ 8
S.F. _____ 2025, is amended to read as follows: 1 d. Increase the number of jobs in this states farm and 2 business economies associated with producing, processing, 3 distributing, retailing, and marketing local food. 4 Sec. 6. Section 267A.1, subsection 2, Code 2025, is amended 5 by adding the following new paragraph: 6 NEW PARAGRAPH . e. Increase the availability and viability 7 of grocery stores in this state. 8 Sec. 7. Section 267A.2, Code 2025, is amended by adding the 9 following new subsection: 10 NEW SUBSECTION . 4A. Grocery store means the same as 11 defined in section 15.413. 12 Sec. 8. Section 267A.6, subsection 2, paragraphs a and c, 13 Code 2025, are amended to read as follows: 14 a. Improve communication and cooperation between and among 15 farmers, food entrepreneurs, grocers, and consumers. 16 c. Demonstrate the value of processing, distributing, 17 retailing, and marketing local foods. A demonstration project 18 must be capable of being replicated on a statewide basis. 19 DIVISION III 20 APPROPRIATIONS 21 Sec. 9. GROCER REINVESTMENT FUND FY 2025-2026. There 22 is appropriated from the general fund of the state to the 23 economic development authority for the fiscal year beginning 24 July 1, 2025, and ending June 30, 2026, the following amount, 25 or so much thereof as is necessary, to be used for the purposes 26 designated: 27 For deposit in the grocer reinvestment and local food 28 processing fund created in section 15.415: 29 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 2,000,000 30 Sec. 10. GROCER REINVESTMENT FUND FY 2026-2027. There 31 is appropriated from the general fund of the state to the 32 economic development authority for the fiscal year beginning 33 July 1, 2026, and ending June 30, 2027, the following amount, 34 or so much thereof as is necessary, to be used for the purposes 35 -5- LSB 1325XC (1) 91 nls/ko 5/ 8
S.F. _____ designated: 1 For deposit in the grocer reinvestment and local food 2 processing fund created in section 15.415: 3 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 2,000,000 4 EXPLANATION 5 The inclusion of this explanation does not constitute agreement with 6 the explanations substance by the members of the general assembly. 7 This bill creates a grocer reinvestment program (grocer 8 program), a local produce processing grant program (processing 9 program), a grocer reinvestment and local food processing fund 10 (fund), and makes appropriations. 11 DIVISION I. The bill defines grocery store to mean an 12 establishment also known as a supermarket that primarily 13 engages in retailing a general line of food including canned 14 and frozen food; fresh fruits and vegetables; and fresh and 15 prepared meat, fish, and poultry. 16 The bill defines financial assistance to mean assistance 17 provided in the form of a grant. 18 Under the bill, the economic development authority 19 (authority) shall administer the grocer program for the purpose 20 of awarding financial assistance to eligible grocery stores for 21 projects located in this state including capital improvements, 22 utility upgrades, equipment and furnishings, professional 23 services, and technology. 24 The bill allows the authority to establish the eligibility 25 criteria for the grocer program by rule. The eligibility 26 criteria must include compliance with any documents required 27 to be filed with the secretary of state; an organizational 28 structure that is either a sole proprietorship, partnership, 29 limited liability company, corporation, cooperative, nonprofit 30 organization, or nonprofit community development entity; 31 ownership of five or fewer grocery stores; and the capacity to 32 successfully complete the project and demonstrate a plan for 33 sustainability. 34 In order to be awarded financial assistance pursuant to 35 -6- LSB 1325XC (1) 91 nls/ko 6/ 8
S.F. _____ the bill, a grocery store must provide matching funds for the 1 project that equal the amount of the financial assistance 2 award. The bill specifies a financial assistance award shall 3 not exceed $200,000. 4 Under the bill, priority shall be given to projects located 5 in an underserved community that primarily serves residents of 6 low or moderate income communities; accepts benefits under the 7 United States department of agriculture supplemental nutrition 8 assistance program, and special supplemental nutrition program 9 for women, infants, and children; creates or retains jobs; 10 makes efforts to procure and offer local foods for sale; and 11 any other criteria determined by the authority. 12 The authority is required to submit a report to the 13 general assembly describing the activities of the grocer 14 program by November 1, 2026, and each November 1 thereafter, 15 if applicable. The report shall include the geographic 16 distribution of the projects, the identity of the applicants, 17 and new investments or new jobs created. 18 The bill also establishes the processing program. Under the 19 bill, the authority shall administer the processing program 20 for the purpose of awarding grants to Iowa-based entities to 21 increase the availability of local produce processing. The 22 bill defines both local produce and local produce and 23 processing. The bill requires the authority to prioritize 24 grants to entities that increase the availability, access, 25 efficiency, or capacity of local produce processing. The bill 26 prohibits grants to an entity unless the entity processes local 27 produce from multiple Iowa-based farms. 28 The bill establishes the fund under the control of the 29 authority for the purpose of awarding financial assistance to 30 eligible grocery stores under the grocer program and awarding 31 grants to entities that increase local produce processing 32 under the processing program. Commencing with the fiscal 33 year beginning July 1, 2025, and each fiscal year thereafter, 34 $100,000 of the annual appropriation, or 10 percent of the 35 -7- LSB 1325XC (1) 91 nls/ko 7/ 8
S.F. _____ moneys available in the fund on July 1, whichever is less, 1 shall be allocated to the processing program created in the 2 bill. 3 DIVISION II. The bill changes the purpose and goals of the 4 local food and farm program in Code chapter 267A to include the 5 retailing of local food, and increasing the availability and 6 viability of grocery stores in this state. 7 DIVISION III. The bill appropriates $2 million each of the 8 next two fiscal years (FY 2025-2026 and FY 2026-2027) from 9 the general fund of the state to the fund to award financial 10 assistance to eligible grocery stores under the grocer program, 11 and to award grants to entities that increase local produce 12 processing under the processing program. 13 -8- LSB 1325XC (1) 91 nls/ko 8/ 8