Existing law creates the Office of Farm to Fork within the Department of Food and Agriculture, and requires the office, to the extent that resources are available, to work with various entities, as prescribed, to increase the amount of agricultural products available to underserved communities and schools in the state. Existing law requires the office, among other things, to identify distribution barriers that affect limited food access and work to overcome those barriers through various actions and to coordinate with school districts and representatives to increase the nutritional profile of foods provided in schools.

This bill would create the Food Desert Elimination Grant Program under the administration of the department for the purpose of expanding access to healthy foods in food deserts, as defined, in the state, and areas at risk of becoming food deserts, by providing grants to grocery store operators, as specified. The bill would create the Food Desert Elimination Fund in the General Fund and would authorize the fund to be expended by the department, upon appropriation by the Legislature, for purposes of the program. The bill would authorize the department to collect nonstate, federal, and private funds, require those funds to be deposited into the California Equitable Food Access Account within the Food Desert Elimination Fund, and continuously appropriate moneys in the account to the department for purposes of the program, thereby making an appropriation. The bill would authorize the department to award grants to grocery store operators seeking to locate grocery stores in food deserts and to award grants, totaling no more than 20% of the total program funding, to grocery store operators for equipment upgrades for grocery stores located in food deserts to expand or provide healthy foods for sale. The bill would authorize the department to adopt guidelines to implement these provisions. The bill would make the implementation of these provisions contingent upon an appropriation by the Legislature. The bill would repeal these provisions on December 31, 2030.

Existing law creates the Office of Farm to Fork within the Department of Food and Agriculture, and requires the office, to the extent that resources are available, to work with various entities, as prescribed, to increase the amount of agricultural products available to underserved communities and schools in the state. Existing law requires the office, among other things, to identify distribution barriers that affect limited food access and work to overcome those barriers through various action, actions and to coordinate with school districts and representatives to, among other things, to increase the nutritional profile of foods provided in schools.

This bill would create the Food Desert Elimination Grant Program under the administration of the department for the purpose of expanding access to healthy foods in food deserts, as defined, in the state, and areas at risk of becoming food deserts, by providing grants to grocery store operators, as specified. The bill would create the Food Desert Elimination Fund in the General Fund and would authorize the fund to be expended by the department, upon appropriation, appropriation by the Legislature, for purposes of the program. The bill would authorize the department to collect nonstate, federal, and private funds, would require those funds to be deposited into the California Equitable Food Access Account within the Food Desert Elimination Fund, and would continuously appropriate moneys in the account to the department for purposes of the program, thereby making an appropriation. The bill would authorize the department to award grants to grocery store operators seeking to locate grocery stores in food deserts and to award grants, totaling no more than 20% of the total program funding, to grocery store operators for equipment upgrades for grocery stores located in food deserts to expand or provide healthy foods for sale. The bill would authorize the department to adopt guidelines to implement these provisions. The bill would make the implementation of these provisions contingent on upon an appropriation by the Legislature. The bill would repeal these provisions on December 31, 2030.

Existing law creates the Office of Farm to Fork within the Department of Food and Agriculture, and requires the office, to the extent that resources are available, to work with various entities, as prescribed, to increase the amount of agricultural products available to underserved communities and schools in the state. Existing law requires the office, among other things, to identify distribution barriers that affect limited food access and work to overcome those barriers through various actions action, and to coordinate with school districts and representatives to, among other things, increase the nutritional profile of foods provided in schools.

This bill would create the Food Desert Elimination Grant Program under the administration of the department for the purpose of expanding access to healthy foods in food deserts, as defined, in the state, and areas at risk of becoming food deserts, by providing grants to grocery store operators, as specified. The bill would create the Food Desert Elimination Fund in the General Fund and would authorize the fund to be expended by the department, upon appropriation, for purposes of the program. The bill would authorize the department to collect nonstate, federal, and private funds, would require those funds to be deposited into the California Equitable Food Access Account within the Food Desert Elimination Fund, and would continuously appropriate moneys in the account to the department for purposes of the program, thereby making an appropriation. The bill would authorize the department to award grants to grocery store operators seeking to locate grocery stores in food deserts and to award grants, totaling no more than 20% of the total program funding, for equipment upgrades for grocery stores located in food deserts to expand or provide healthy foods for sale. The bill would require, no later than January 1, 2026, the authorize the department to adopt regulations guidelines to implement these provisions. The bill would make the implementation of these provisions contingent on an appropriation by the Legislature. The bill would repeal these provisions on December 31, 2030.

Existing law generally establishes various programs to decrease hunger and promote good nutrition throughout the state. Existing law specifically establishes the Office of Farm to Fork to work with various agencies, groups, and organizations, including the agricultural industry, to increase the amount of agricultural products available to underserved communities and schools in this state. The duties of the office include, among others, promoting greater retail sale of healthy food in underserved communities and working with stakeholders to identify urban and rural communities that lack access to healthy food, determine current barriers to food access, and share information to encourage best practices.

This bill would state the intent of the Legislature to enact legislation to decrease food deserts in underserved communities.

 VETO 

Bill No: SB 1419

Author: Rubio (D), et al.

Enrolled: 9/5/24

Vote: 27

SENATE AGRICULTURE COMMITTEE: 3-0, 4/16/24

AYES: Hurtado, Cortese, Padilla

NO VOTE RECORDED: Grove, Alvarado-Gil

SENATE APPROPRIATIONS COMMITTEE: 7-0, 5/16/24

AYES: Caballero, Jones, Ashby, Becker, Bradford, Seyarto, Wahab

SENATE FLOOR: 37-0, 5/23/24

AYES: Alvarado-Gil, Ashby, Atkins, Becker, Blakespear, Bradford, Caballero, Cortese, Dahle, Dodd, Durazo, Eggman, Glazer, Gonzalez, Grove, Hurtado, Jones, Laird, Limón, McGuire, Menjivar, Min, Nguyen, Niello, Ochoa Bogh, Padilla, Portantino, Roth, Rubio, Seyarto, Skinner, Smallwood-Cuevas, Stern, Umberg, Wahab, Wiener, Wilk

NO VOTE RECORDED: Allen, Archuleta, Newman

SENATE FLOOR: 40-0, 8/31/24

AYES: Allen, Alvarado-Gil, Archuleta, Ashby, Atkins, Becker, Blakespear, Bradford, Caballero, Cortese, Dahle, Dodd, Durazo, Eggman, Glazer, Gonzalez, Grove, Hurtado, Jones, Laird, Limón, McGuire, Menjivar, Min, Newman, Nguyen, Niello, Ochoa Bogh, Padilla, Portantino, Roth, Rubio, Seyarto, Skinner, Smallwood-Cuevas, Stern, Umberg, Wahab, Wiener, Wilk

ASSEMBLY FLOOR: 77-0, 8/30/24 - See last page for vote

SUBJECT: Food Desert Elimination Grant Program

SOURCE: Author

DIGEST:

This bill establishes the Food Desert Elimination Grant Program which would provide grants to grocery store operators that open stores in areas defined as a food desert. This bill authorizes the California Department of Food and Agriculture (CDFA) to collect non-state, federal, and private funds, and would require those funds to be deposited into the California Equitable Food Access Account within the Food Desert Elimination Fund and would continuously appropriate moneys in the account to the department for purposes of the program. This bill establishes the Food Desert Elimination Fund in the General Fund and authorizes monies from the fund to be used, upon appropriation, to run the program. Finally, this bill repeals these provisions on December 31, 2030.

ANALYSIS:

Existing federal law:

1. Defines food deserts as both low-income areas and ones in which more than a third of the population lives over a mile from a grocery store/supermarket.
2. Establishes under federal law the “Supplemental Nutrition Assistance Program” (SNAP) pursuant to the Food Stamp Act of 1964. (7 United States Code Section 2011).

Existing state law:

1. Establishes the Office of Farm to Fork within the CDFA and requires the office to work with various entities to increase the amount of agricultural products available to underserved communities and schools in California. (Food and Agricultural Code Section 49001)
2. Establishes the “CalFresh” program to administer the provision of federal SNAP benefits to families and individuals meeting certain criteria, as specified. (Welfare and Institutions Code Section 18900)
3. Requires the California Healthy Food Financing Initiative Council to implement an initiative to expand access to nutritious food in underserved, urban, and rural communities and to eliminate food deserts in California. (Health and Safety Code 104660)

This bill:

1. Establishes the Food Desert Elimination Grant Program (program), to be administered by the CDFA.
2. Establishes criteria under which CDFA may award grants to a grocery store seeking to locate in a food desert. These include:
   1. A market and site feasibility study.
   2. Salaries and benefits to grocery store employees.
   3. Rents or down payments to acquire a facility located in a food desert.
   4. Capital improvements, planning, renovations, land acquisition, demolition, and durable and nondurable equipment purchases.
   5. Other costs determined by CDFA.
   6. Sunsets these provisions on December 31, 2030.
3. Authorizes the department to award grants to grocery store operators seeking to locate grocery stores in food deserts and to award grants, totaling no more than 20% of the program funding to grocery store operators for equipment upgrades for grocery stores located in food deserts to expand or provide healthy food for sale.
4. Makes the program contingent upon appropriation by the Legislature.

FISCAL EFFECT: Appropriation: Yes Fiscal Com.: Yes Local: No

According to the Assembly Appropriations Committee:

CDFA reports General Fund costs of $358,000 in year one and $352,000 annually ongoing for two permanent full-time positions – a Research Data Specialist to lead the new program and develop grant policies and procedures, and an Associate Governmental Program Analyst to provide program support, including invoicing and grant implementation.

This bill also creates cost pressure to provide grant funding for the program in an unknown amount but likely in the millions of dollars (General Fund).

According to the Legislative Analyst’s Office, the General Fund faces a structural deficit in the tens of billions of dollars over the next several fiscal years.

SUPPORT: (Verified 9/24/24)

California Grocers Association

American Diabetes Association

OPPOSITION: (Verified 9/24/24)

None received

ARGUMENTS IN SUPPORT:

According to the author:

Currently in California, there is not a financing mechanism to assist healthy food retail outlets to expand offerings to food insecure residents in food desert areas. This critical bill will create the Food Desert Elimination Act of 2024 which would establish a fund and a tax credit for grocery store operators within a designated food desert to help address food insecurity and poverty issues for our most vulnerable or at risk communities across the state. It is imperative to ensure our underserved communities receive access to healthy food options, especially those who live in food deserts. Research suggests that establishing a grocery store in low-income neighborhoods will have positive impacts on community health and well-being and will benefit our local economies. The fund, when paired with the state’s existing supplemental benefits, will help eliminate food deserts and increase affordability and access to fresh groceries in underserved areas.

The California Grocers Association write in support stating:

SB 1419 offers a promising solution by incentivizing the establishment and continuation of grocery stores in food desert areas. This builds upon successful models in California and other states. By providing grants to cover startup costs and offering employment tax credits for the first five years of operation, this legislation encourages grocery operators to invest in underserved communities, thereby increasing access to nutritious food options.

GOVERNOR'S VETO MESSAGE:

To the Members of the California State Senate:

I am returning Senate Bill 1419 without my signature.

This bill would create, upon appropriation, the Food Desert Elimination Grant Program to provide grants to large and small-scale grocery store operators in food deserts.

While I support the author's goal to increase access to healthy foods in underserved communities, this bill creates a new, unfunded grant program and should be considered in the annual budget process.

In partnership with the Legislature this year, my Administration has enacted a balanced budget that avoids deep program cuts to vital services and protected investments in education, health care, climate, public safety, housing, and social service programs that millions of Californians rely on. It is important to remain disciplined when considering bills with significant fiscal implications that are not included in the budget, such as this measure.

For this reason, I cannot sign this bill.

ASSEMBLY FLOOR: 77-0, 8/30/24

AYES: Addis, Aguiar-Curry, Alanis, Alvarez, Arambula, Bains, Bauer-Kahan, Bennett, Berman, Boerner, Bonta, Bryan, Calderon, Juan Carrillo, Wendy Carrillo, Chen, Connolly, Megan Dahle, Davies, Dixon, Essayli, Flora, Mike Fong, Friedman, Gabriel, Gallagher, Garcia, Gipson, Grayson, Haney, Hart, Holden, Hoover, Irwin, Jackson, Jones-Sawyer, Kalra, Lackey, Lee, Low, Lowenthal, Maienschein, Mathis, McCarty, McKinnor, Muratsuchi, Stephanie Nguyen, Pacheco, Papan, Jim Patterson, Joe Patterson, Pellerin, Petrie-Norris, Quirk-Silva, Ramos, Rendon, Reyes, Luz Rivas, Rodriguez, Blanca Rubio, Sanchez, Santiago, Schiavo, Soria, Ta, Ting, Valencia, Villapudua, Waldron, Wallis, Ward, Weber, Wicks, Wilson, Wood, Zbur, Robert Rivas

NO VOTE RECORDED: Cervantes, Ortega

Prepared by: Reichel Everhart / Agriculture / (916) 651-1508

10/16/24 14:26:31

**** END ****

 VETO  

Bill No: SB 1419

Author: Rubio (D), et al.

Enrolled: 9/5/24

Vote: 27

SENATE AGRICULTURE COMMITTEE: 3-0, 4/16/24

AYES: Hurtado, Cortese, Padilla

NO VOTE RECORDED: Grove, Alvarado-Gil

SENATE APPROPRIATIONS COMMITTEE: 7-0, 5/16/24

AYES: Caballero, Jones, Ashby, Becker, Bradford, Seyarto, Wahab

SENATE FLOOR: 37-0, 5/23/24

AYES: Alvarado-Gil, Ashby, Atkins, Becker, Blakespear, Bradford, Caballero, Cortese, Dahle, Dodd, Durazo, Eggman, Glazer, Gonzalez, Grove, Hurtado, Jones, Laird, Limón, McGuire, Menjivar, Min, Nguyen, Niello, Ochoa Bogh, Padilla, Portantino, Roth, Rubio, Seyarto, Skinner, Smallwood-Cuevas, Stern, Umberg, Wahab, Wiener, Wilk

NO VOTE RECORDED: Allen, Archuleta, Newman

SENATE FLOOR: 40-0, 8/31/24

AYES: Allen, Alvarado-Gil, Archuleta, Ashby, Atkins, Becker, Blakespear, Bradford, Caballero, Cortese, Dahle, Dodd, Durazo, Eggman, Glazer, Gonzalez, Grove, Hurtado, Jones, Laird, Limón, McGuire, Menjivar, Min, Newman, Nguyen, Niello, Ochoa Bogh, Padilla, Portantino, Roth, Rubio, Seyarto, Skinner, Smallwood-Cuevas, Stern, Umberg, Wahab, Wiener, Wilk

ASSEMBLY FLOOR: 77-0, 8/30/24 - See last page for vote

SUBJECT: Food Desert Elimination Grant Program

SOURCE: Author

DIGEST:

This bill establishes the Food Desert Elimination Grant Program which would provide grants to grocery store operators that open stores in areas defined as a food desert. This bill authorizes the California Department of Food and Agriculture to collect non-state, federal, and private funds, and would require those funds to be deposited into the California Equitable Food Access Account within the Food Desert Elimination Fund and would continuously appropriate moneys in the account to the department for purposes of the program. This bill establishes the Food Desert Elimination Fund in the General Fund and would authorize monies from the fund to be used, upon appropriation, to run the program. Finally, this bill repeals these provisions on December 31, 2030.

ANALYSIS:

Existing federal law:

1. Defines food deserts as both low-income areas and ones in which more than a third of the population lives over a mile from a grocery store/supermarket.
2. Establishes under federal law the “Supplemental Nutrition Assistance Program” (SNAP) pursuant to the Food Stamp Act of 1964. (7 United States Code Section 2011).

Existing state law:

1. Establishes the Office of Farm to Fork within the California Department of Food and Agriculture (CDFA) and requires the office to work with various entities to increase the amount of agricultural products available to underserved communities and schools in California. (Food and Agricultural Code Section 49001)
2. Establishes the “CalFresh” program to administer the provision of federal SNAP benefits to families and individuals meeting certain criteria, as specified. (Welfare and Institutions Code Section 18900)
3. Requires the California Healthy Food Financing Initiative Council to implement an initiative to expand access to nutritious food in underserved, urban, and rural communities and to eliminate food deserts in California. (Health and Safety Code 104660)

This bill:

1. Establishes the Food Desert Elimination Grant Program (program), to be administered by the California Department of Food and Agriculture (CDFA).
2. Establishes criteria under which CDFA may award grants to a grocery store seeking to locate in a food desert. These include:
   1. A market and site feasibility study.
   2. Salaries and benefits to grocery store employees.
   3. Rents or down payments to acquire a facility located in a food desert.
   4. Capital improvements, planning, renovations, land acquisition, demolition, and durable and nondurable equipment purchases.
   5. Other costs determined by CDFA.
   6. Sunsets these provisions on December 31, 2030.
3. Authorizes the department to award grants to grocery store operators seeking to locate grocery stores in food deserts and to award grants, totaling no more than 20% of the program funding to grocery store operators for equipment upgrades for grocery stores located in food deserts to expand or provide healthy food for sale.
4. Makes the program contingent upon appropriation by the Legislature.

FISCAL EFFECT: Appropriation: Yes Fiscal Com.: Yes Local: No

According to the Assembly Appropriations Committee:

CDFA reports General Fund costs of $358,000 in year one and $352,000 annually ongoing for two permanent full-time positions – a Research Data Specialist to lead the new program and develop grant policies and procedures, and an Associate Governmental Program Analyst to provide program support, including invoicing and grant implementation.

This bill also creates cost pressure to provide grant funding for the program in an unknown amount but likely in the millions of dollars (General Fund).

According to the Legislative Analyst’s Office, the General Fund faces a structural deficit in the tens of billions of dollars over the next several fiscal years. 

SUPPORT: (Verified 9/24/24)

California Grocers Association

American Diabetes Association

OPPOSITION: (Verified 9/24/24)

None received

ARGUMENTS IN SUPPORT: According to the author:

“Currently in California, there is not a financing mechanism to assist healthy food retail outlets to expand offerings to food insecure residents in food desert areas. This critical bill will create the Food Desert Elimination Act of 2024 which would establish a fund and a tax credit for grocery store operators within a designated food desert to help address food insecurity and poverty issues for our most vulnerable or at risk communities across the state. It is imperative to ensure our underserved communities receive access to healthy food options, especially those who live in food deserts. Research suggests that establishing a grocery store in low-income neighborhoods will have positive impacts on community health and well-being and will benefit our local economies. The fund, when paired with the state’s existing supplemental benefits, will help eliminate food deserts and increase affordability and access to fresh groceries in underserved areas.”

The California Grocers Association write in support stating:

“SB 1419 offers a promising solution by incentivizing the establishment and continuation of grocery stores in food desert areas. This builds upon successful models in California and other states. By providing grants to cover startup costs and offering employment tax credits for the first five years of operation, this legislation encourages grocery operators to invest in underserved communities, thereby increasing access to nutritious food options.”

GOVERNOR'S VETO MESSAGE:

“To the Members of the California State Senate:

I am returning Senate Bill 1419 without my signature.

This bill would create, upon appropriation, the Food Desert Elimination Grant Program to provide grants to large and small-scale grocery store operators in food deserts.

While I support the author's goal to increase access to healthy foods in underserved communities, this bill creates a new, unfunded grant program and should be considered in the annual budget process.

In partnership with the Legislature this year, my Administration has enacted a balanced budget that avoids deep program cuts to vital services and protected investments in education, health care, climate, public safety, housing, and social service programs that millions of Californians rely on. It is important to remain disciplined when considering bills with significant fiscal implications that are not included in the budget, such as this measure.

For this reason, I cannot sign this bill.”

ASSEMBLY FLOOR: 77-0, 8/30/24

AYES: Addis, Aguiar-Curry, Alanis, Alvarez, Arambula, Bains, Bauer-Kahan, Bennett, Berman, Boerner, Bonta, Bryan, Calderon, Juan Carrillo, Wendy Carrillo, Chen, Connolly, Megan Dahle, Davies, Dixon, Essayli, Flora, Mike Fong, Friedman, Gabriel, Gallagher, Garcia, Gipson, Grayson, Haney, Hart, Holden, Hoover, Irwin, Jackson, Jones-Sawyer, Kalra, Lackey, Lee, Low, Lowenthal, Maienschein, Mathis, McCarty, McKinnor, Muratsuchi, Stephanie Nguyen, Pacheco, Papan, Jim Patterson, Joe Patterson, Pellerin, Petrie-Norris, Quirk-Silva, Ramos, Rendon, Reyes, Luz Rivas, Rodriguez, Blanca Rubio, Sanchez, Santiago, Schiavo, Soria, Ta, Ting, Valencia, Villapudua, Waldron, Wallis, Ward, Weber, Wicks, Wilson, Wood, Zbur, Robert Rivas

NO VOTE RECORDED: Cervantes, Ortega

Prepared by: Reichel Everhart / AGRI. / (916) 651-1508

10/16/24 14:27:56

**** END ****

 UNFINISHED BUSINESS  

Bill No: SB 1419

Author: Rubio (D), et al.

Amended: 8/19/24

Vote: 21

SENATE AGRICULTURE COMMITTEE: 3-0, 4/16/24

AYES: Hurtado, Cortese, Padilla

NO VOTE RECORDED: Grove, Alvarado-Gil

SENATE APPROPRIATIONS COMMITTEE: 7-0, 5/16/24

AYES: Caballero, Jones, Ashby, Becker, Bradford, Seyarto, Wahab

SENATE FLOOR: 37-0, 5/23/24

AYES: Alvarado-Gil, Ashby, Atkins, Becker, Blakespear, Bradford, Caballero, Cortese, Dahle, Dodd, Durazo, Eggman, Glazer, Gonzalez, Grove, Hurtado, Jones, Laird, Limón, McGuire, Menjivar, Min, Nguyen, Niello, Ochoa Bogh, Padilla, Portantino, Roth, Rubio, Seyarto, Skinner, Smallwood-Cuevas, Stern, Umberg, Wahab, Wiener, Wilk

NO VOTE RECORDED: Allen, Archuleta, Newman

ASSEMBLY FLOOR: 56-0, 8/30/24 – Roll call not available

SUBJECT: Food Desert Elimination Grant Program

SOURCE: Author

DIGEST:

This bill establishes the Food Desert Elimination Grant Program which would provide grants to grocery store operators that open stores in areas defined as a food desert. This bill authorizes the California Department of Food and Agriculture to collect non-state, federal, and private funds, and would require those funds to be deposited into the California Equitable Food Access Account within the Food Desert Elimination Fund and would continuously appropriate moneys in the account to the department for purposes of the program. This bill establishes the Food Desert Elimination Fund in the General Fund and would authorize monies from the fund to be used, upon appropriation, to run the program. Finally, this bill repeals these provisions on December 31, 2030.

Assembly Amendments

make the program contingent upon appropriation by the Legislature and authorize the department to award grants to grocery store operators seeking to locate grocery stores in food deserts and to award grants, totaling no more than 20% of the program funding to grocery store operators for equipment upgrades for grocery stores located in food deserts to expand or provide healthy food for sale.

ANALYSIS:

Existing federal law:

1. Defines food deserts as both low-income areas and ones in which more than a third of the population lives over a mile from a grocery store/supermarket (https://www.ers.usda.gov/data-products/food-access-research-atlas/documentation/).
2. Establishes under federal law the “Supplemental Nutrition Assistance Program” (SNAP) pursuant to the Food Stamp Act of 1964. (7 United States Code Section 2011).

Existing state law:

1. Establishes the Office of Farm to Fork within the California Department of Food and Agriculture (CDFA) and requires the office to work with various entities to increase the amount of agricultural products available to underserved communities and schools in California (Food and Agricultural Code Section 49001).
2. Establishes the “CalFresh” program to administer the provision of federal SNAP benefits to families and individuals meeting certain criteria, as specified. (Welfare and Institutions Code Section 18900).
3. Requires the California Healthy Food Financing Initiative Council to implement an initiative to expand access to nutritious food in underserved, urban, and rural communities and to eliminate food deserts in California. (Health and Safety Code 104660).

This bill:

1. Establishes the Food Desert Elimination Grant Program (program), to be administered by the California Department of Food and Agriculture (CDFA).
2. Establishes criteria under which CDFA may award grants to a grocery store seeking to locate in a food desert. These include:
   1. A market and site feasibility study.
   2. Salaries and benefits to grocery store employees.
   3. Rents or down payments to acquire a facility located in a food desert.
   4. Capital improvements, planning, renovations, land acquisition, demolition, and durable and nondurable equipment purchases.
   5. Other costs determined by CDFA.
   6. Sunsets these provisions on December 31, 2030.
3. Authorizes the department to award grants to grocery store operators seeking to locate grocery stores in food deserts and to award grants, totaling no more than 20% of the program funding to grocery store operators for equipment upgrades for grocery stores located in food deserts to expand or provide healthy food for sale.
4. Makes the program contingent upon appropriation by the Legislature.

FISCAL EFFECT: Appropriation: Yes Fiscal Com.: Yes Local: No

According to the Senate Committee on Appropriations:

• This bill would result in a cost pressure to provide grant funding. The magnitude is unknown, but at a minimum would be in the millions of dollars (General Fund)
• The California Department of Food and Agriculture (CDFA) would incur first-year costs of $358,000, and $352,000 annually thereafter, to administer the grant program (General Fund).

Amendments were taken on 8/19/24 to make the program contingent upon funding appropriated by the Legislature.

SUPPORT: (Verified 8/27/24)

California Grocers Association

American Diabetes Association

OPPOSITION: (Verified 8/27/24)

None received

ARGUMENTS IN SUPPORT:

According to the author:

“Currently in California, there is not a financing mechanism to assist healthy food retail outlets to expand offerings to food insecure residents in food desert areas. This critical bill will create the Food Desert Elimination Act of 2024 which would establish a fund and a tax credit for grocery store operators within a designated food desert to help address food insecurity and poverty issues for our most vulnerable or at risk communities across the state. It is imperative to ensure our underserved communities receive access to healthy food options, especially those who live in food deserts. Research suggests that establishing a grocery store in low-income neighborhoods will have positive impacts on community health and well-being and will benefit our local economies. The fund, when paired with the state’s existing supplemental benefits, will help eliminate food deserts and increase affordability and access to fresh groceries in underserved areas.”

The California Grocers Association write in support stating:

“SB 1419 offers a promising solution by incentivizing the establishment and continuation of grocery stores in food desert areas. This builds upon successful models in California and other states. By providing grants to cover startup costs and offering employment tax credits for the first five years of operation, this legislation encourages grocery operators to invest in underserved communities, thereby increasing access to nutritious food options.”

Click here to enter text.

Prepared by: Reichel Everhart / AGRI. / (916) 651-1508

8/30/24 17:27:12

**** END ****

SENATE THIRD READING

STR Bill Id:SB 1419

Author:(Rubio)

As Amended Ver:August 19, 2024

Majority vote

SUMMARY

This bill establishes the Food Desert Elimination (FDE) Grant Program to expand access to healthy foods in food deserts and areas at risk of becoming food deserts.

Major Provisions

1. Establishes the Food Desert Elimination Fund in the General Fund through December 31, 2030, and authorizes collection of any public or private funding to be used for the FDE Grant Program.
2. Authorizes CDFA to award a grant to a grocery store seeking to locate in a food desert to cover the costs of a market and site feasibility study, salaries and benefits to grocery store employees, rents or down payments to acquire a facility located in a food desert, capital improvements, planning, renovations, land acquisition, demolition, and durable and nondurable equipment purchases, and other costs.
3. Authorizes up to 20% of total program funding for grants to grocery stores already located in a food desert for upgrades and expanding healthy food options and up to 10% of total program funding for technical assistance.
4. Defines "food desert" to mean a food desert as determined by the Economic Research Service within the United States Department of Agriculture (USDA), typically low-income communities without a grocery store offering fresh produce and healthy food options.

COMMENTS

California has implemented several strategies over the years to address the critical need to improve access to healthy food in food deserts. AB 581 (Perez), Chapter 505, Statutes of 2011, established the California Healthy Food Financing Initiative Fund in the State Treasury, to be comprised of federal, state, philanthropic, and private funds, for the purpose of expanding access to healthy foods in underserved communities upon recommendations of the Secretary of Food and Agriculture. Although CDFA established an advisory council and issued a report as required to implement a new California Healthy Food Financing Initiative, the program was never funded. It was repealed in 2017.

California FreshWorks, not a government program, is a network of community-based and nonprofit lenders created to (1) increase access to healthy food in underserved communities; (2) spur economic development that supports healthy communities; and (3) inspire innovation in healthy food retailing. The $264 million fund provides financing for grocery stores and other forms of healthy food retail and distribution by providing flexible capital to eligible applicants. Some loans can be packaged with companion grants.

According to the Author

California lacks a financing mechanism to assist healthy food retail outlets to expand offerings to food insecure residents in food desert areas. This critical bill will create the Food Desert Elimination Act of 2024, which would establish a fund for grocery store operators who want to open a store in a designated food desert to help address food insecurity and poverty issues for our most vulnerable or at risk communities across the state. It is imperative to ensure our underserved communities receive access to healthy food options, especially those who live in food deserts. Research suggests that establishing a grocery store in low-income neighborhoods will have positive impacts on community health and well-being and will benefit our local economies. The fund, which will be able to leverage federal dollars, will help eliminate food deserts and increase affordability and access to fresh groceries in underserved areas.

Arguments in Support

This bill presents a critical opportunity to alleviate food insecurity and improve the lives of millions of Californians. In April of 2023, following a rescinding of the supplemental SNAP allotments, food insecurity resurged and by October 2023, more than 1 in 5 families became food insecure. Over 3 million households, including more than 1 million households with children, now face food insecurity in California, as reported by the California Association of Food Banks. Despite California's status as a major producer of fruits and vegetables, many communities still lack access to fresh and affordable food. The existence of food deserts, where residents have limited or no access to supermarkets or grocery stores, is a glaring issue that demands immediate attention. In 2016, the California Endowment worked on a grant project to bring grocery stores to food desert areas. Three grocery stores were awarded $7 million each for the startup costs to open a grocery store. To this day, with the help of tax credits and grants, all three grocery stores are still operating. This bill offers a promising solution by incentivizing the establishment and continuation of grocery stores in food desert areas.

Arguments in Opposition

None on file.

FISCAL COMMENTS

According to the Assembly Committee on Appropriations, CDFA reports General Fund costs of $358,000 in year one and $352,000 annually ongoing for two permanent full-time positions – a Research Data Specialist to lead the new program and develop grant policies and procedures, and an Associate Governmental Program Analyst to provide program support, including invoicing and grant implementation.

This bill also creates cost pressure to provide grant funding for the program in an unknown amount but likely in the millions of dollars (General Fund).

According to the Legislative Analyst's Office, the General Fund faces a structural deficit in the tens of billions of dollars over the next several fiscal years.

VOTES

SENATE FLOOR: 37-0-3

YES: Alvarado-Gil, Ashby, Atkins, Becker, Blakespear, Bradford, Caballero, Cortese, Dahle, Dodd, Durazo, Eggman, Glazer, Gonzalez, Grove, Hurtado, Jones, Laird, Limón, McGuire, Menjivar, Min, Nguyen, Niello, Ochoa Bogh, Padilla, Portantino, Roth, Rubio, Seyarto, Skinner, Smallwood-Cuevas, Stern, Umberg, Wahab, Wiener, Wilk

ABS, ABST OR NV: Allen, Archuleta, Newman

ASM AGRICULTURE: 8-0-2

YES: Soria, Alanis, Aguiar-Curry, Connolly, Irwin, Sanchez, Ta, Villapudua

ABS, ABST OR NV: Jones-Sawyer, Wood

ASM APPROPRIATIONS: 11-0-4

YES: Wicks, Arambula, Bryan, Calderon, Wendy Carrillo, Mike Fong, Grayson, Haney, Hart, Pellerin, Villapudua

ABS, ABST OR NV: Sanchez, Dixon, Jim Patterson, Ta

UPDATED

VERSION: August 19, 2024

CONSULTANT: Victor Francovich / AGRI. / (916) 319-2084 FN: 0003940

Date of Hearing: August 7, 2024

ASSEMBLY COMMITTEE ON APPROPRIATIONS

Buffy Wicks, Chair

SBPCA Bill Id:SB 1419

Author:(Rubio) – As Amended Ver:April 23, 2024

Urgency: No State Mandated Local Program: No Reimbursable: No

SUMMARY:

This bill establishes the Food Desert Elimination (FDE) Grant Program to expand access to healthy foods in food deserts and areas at risk of becoming food deserts.

Specifically, this bill:

1. Establishes the Food Desert Elimination Fund in the General Fund through December 31, 2030, and authorizes collection of any public or private funding to be used for the FDE Grant Program.
2. Authorizes CDFA to award a grant to a grocery store seeking to locate in a food desert to cover the costs of a market and site feasibility study, salaries and benefits to grocery store employees, rents or down payments to acquire a facility located in a food desert, capital improvements, planning, renovations, land acquisition, demolition, and durable and nondurable equipment purchases, and other costs.
3. Authorizes up to 20% of total program funding for grants to grocery stores already located in a food desert for upgrades and expanding healthy food options and up to 10% of total program funding for technical assistance.
4. Defines “food desert” to mean a food desert as determined by the Economic Research Service within the United States Department of Agriculture (USDA), typically low-income communities without a grocery store offering fresh produce and healthy food options.

FISCAL EFFECT:

CDFA reports General Fund costs of $358,000 in year one and $352,000 annually ongoing for two permanent full-time positions – a Research Data Specialist to lead the new program and develop grant policies and procedures, and an Associate Governmental Program Analyst to provide program support, including invoicing and grant implementation.

This bill also creates cost pressure to provide grant funding for the program in an unknown amount but likely in the millions of dollars (General Fund).

According to the Legislative Analyst’s Office, the General Fund faces a structural deficit in the tens of billions of dollars over the next several fiscal years. 

COMMENTS:

1. Purpose. According to the author:

California lacks a financing mechanism to assist healthy food retail outlets to expand offerings to food insecure residents in food desert areas. This critical bill will create the Food Desert Elimination Act of 2024, which would establish a fund for grocery store operators who want to open a store in a designated food desert to help address food insecurity and poverty issues for our most vulnerable or at risk communities across the state. It is imperative to ensure our underserved communities receive access to healthy food options, especially those who live in food deserts. Research suggests that establishing a grocery store in low-income neighborhoods will have positive impacts on community health and well-being and will benefit our local economies. The fund, which will be able to leverage federal dollars, will help eliminate food deserts and increase affordability and access to fresh groceries in underserved areas.

1. Background. California has implemented several strategies over the years to address the critical need to improve access to healthy food in food deserts. AB 581 (Perez), Chapter 505, Statutes of 2011, established the California Healthy Food Financing Initiative Fund in the State Treasury, to be comprised of federal, state, philanthropic, and private funds, for the purpose of expanding access to healthy foods in underserved communities upon recommendations of the Secretary of Food and Agriculture. Although CDFA established an advisory council and issued a report as required to implement a new California Healthy Food Financing Initiative, the program was never funded. It was repealed in 2017.

California FreshWorks, not a government program, is a network of community-based and nonprofit lenders created to (1) increase access to healthy food in underserved communities; (2) spur economic development that supports healthy communities; and (3) inspire innovation in healthy food retailing. The $264 million fund provides financing for grocery stores and other forms of healthy food retail and distribution by providing flexible capital to eligible applicants. Some loans can be packaged with companion grants.

This bill seeks to build on and complement these prior public and private efforts to address food deserts. The 2024-25 state budget does not include funding for the program created by this bill. CDFA reports there is a possibility to obtain federal funds for this program if the bill is enacted, including from the Food Access and Retail Expansion Initiative announced by USDA June 24, 2024.

1. Related Legislation. AB 1961 (Wicks), of the current legislative session, requires the Strategic Growth Council to appoint and convene the End Hunger in California Master Plan Task Force to recommend strategies to improve access to healthy food for all, including locating retailers in food deserts. AB 1419 is pending in the Senate Appropriations Committee.

Analysis Prepared by: Jacqueline Kinney / APPR. / (916) 319-2081

Date of Hearing: June 26, 2024

ASSEMBLY COMMITTEE ON AGRICULTURE

Esmeralda Soria, Chair

SBPCA Bill Id:SB 1419

Author:(Rubio) – As Amended Ver:April 23, 2024

SENATE VOTE: 37-0

SUBJECT: Food deserts: grants

SUMMARY: This bill would establish the Food Desert Elimination (FDE) Grant Program; which would allow the Department of Food and Agriculture (CDFA) for the purpose of expanding access to healthy foods in food deserts in the state, and areas at risk of becoming food deserts, by providing grants to grocery store operators. This bill would also establish the Food Desert Elimination Fund in the General Fund and would authorize monies from the fund be used, upon appropriation, to run the program. Specifically, this bill:

1. Establishes the FDE Grant Program, to be administered by CDFA.
2. Establishes criteria under which CDFA may award grants to a grocery store seeking to locate in a food desert. These include:
   1. A market and site feasibility study.
   2. Salaries and benefits to grocery store employees.
   3. Rents or down payments to acquire a facility located in a food desert.
   4. Capital improvements, planning, renovations, land acquisition, demolition, and durable and nondurable equipment purchases.
   5. Other costs determined by CDFA.
3. Creates the FDE Fund in the General Fund to provide monies to CDFA for the promulgation of the program.
4. Requires CDFA to adopt regulations to implement the program no later than January 1, 2026.
5. Defines the following:
   1. “Food desert” to mean a food desert as determined by the Economic Research Service within the United States Department of Agriculture.
   2. “Grocery store” to mean a retail store in California of over 15,000 square feet that is a retail seller of groceries, as described in Code 445110 of the North American Industry Classification System published by the United States Office of Management and Budget, 2022 edition.
   3. “Small-scale grocery store” means a retail store in this state of under 15,000 square feet that is a retail seller of groceries, as specified above.

EXISTING LAW:

1. Establishes the Office of Farm to Fork within the CDFA and requires the office to work with various entities to increase the amount of agricultural products available to underserved communities and schools in California (Food and Agricultural Code Section 49001).
2. Establishes the CalFresh program to administer the provision of federal SNAP benefits to families and individuals meeting certain criteria, as specified (Welfare and Institutions Code Section 18900).
3. Requires the California Healthy Food Financing Initiative Council to implement an initiative to expand access to nutritious food in underserved, urban, and rural communities and to eliminate food deserts in California (Health and Safety Code 104660).
4. Defines food deserts as both low-income areas and ones in which more than a third of the population lives over a mile from a grocery store/supermarket.
5. Establishes under federal law the “Supplemental Nutrition Assistance Program” (SNAP) pursuant to the Food Stamp Act of 1964. (7 United States Code Section 2011).

FISCAL EFFECT: This bill would result in a cost pressure to provide grant funding. The magnitude is unknown, but at a minimum would be in the millions of dollars (General Fund). The California Department of Food and Agriculture (CDFA) would incur first-year costs of $358,000, and $352,000 annually thereafter, to administer the grant program (General Fund).

COMMENTS: According to Northwestern’s Institute for Policy Research, one in five Californians are food insecure despite living in the state that produces nearly half of the country’s fruits and vegetables. On August 8, 2023, Cal Matters published a report titled “How hungry is California? Millions struggle to eat well in an abundant state.” Among other issues, the report discusses the possible outcomes of not having consistent access to healthy food options including, but not limited to, developmental delays in children, obesity, chronic illness, anxiety, and depression. All of these results will affect a child’s ability to perform well in school or an adult to be able to contribute to the community in a healthy, positive way.

The USDA Economic Research Service states that there are many ways to measure food store access for individuals and for neighborhoods, and many ways to define which areas are low-income and low access—neighborhoods that lack healthy food sources. Their website provides the following:

“Most measures and definitions consider at least some of the following indicators of access:

• Accessibility to sources of healthy food, as measured by distance to a store or by the number of stores in an area;
• Individual-level resources that may affect accessibility, such as family income or vehicle availability; and
• Neighborhood-level indicators of resources, such as the average income of the neighborhood and the availability of public transportation.”

“In the Food Access Research Atlas, several indicators are available to measure food access along these dimensions. For example, users can choose alternative distance markers to measure low access in a neighborhood, such as the number and share of people more than one-half mile to a supermarket or 1 mile to a supermarket. Users can also view other census-tract-level characteristics that provide context on food access in neighborhoods, such as whether the tract has a high percentage of households far from supermarkets and without vehicles, individuals with low income, or people residing in group quarters.”

The California FreshWorks Fund (CAFWF) is a public-private partnership loan fund created to (1) increase access to healthy food in underserved communities; (2) spur economic development that supports healthy communities; and (3) inspire innovation in healthy food retailing. The $264 million fund provides financing for grocery stores and other forms of healthy food retail and distribution by providing flexible capital to eligible applicants. Some loans can be packaged with companion grants.

According to the author, Currently in California, there is not a financing mechanism to assist healthy food retail outlets to expand offerings to food insecure residents in food desert areas. This critical bill will create the Food Desert Elimination Act of 2024, which would establish a fund for grocery store operators who want to open a store in a designated food desert to help address food insecurity and poverty issues for our most vulnerable or at risk communities across the state. It is imperative to ensure our underserved communities receive access to healthy food options, especially those who live in food deserts. Research suggests that establishing a grocery store in low-income neighborhoods will have positive impacts on community health and well-being and will benefit our local economies. The fund, which will be able to leverage federal dollars, will help eliminate food deserts and increase affordability and access to fresh groceries in underserved areas.

Supporters state, this bill presents a critical opportunity to alleviate food insecurity and improve the lives of millions of Californians. In April of 2023, following a rescinding of the supplemental SNAP allotments, food insecurity resurged and by October 2023, more than 1 in 5 families became food insecure. Over 3 million households, including more than 1 million households with children, now face food insecurity in California, as reported by the California Association of Food Banks. Despite California's status as a major producer of fruits and vegetables, many communities still lack access to fresh and affordable food. The existence of food deserts, where residents have limited or no access to supermarkets or grocery stores, is a glaring issue that demands immediate attention. In 2016, the California Endowment worked on a grant project to bring grocery stores to food desert areas. Three grocery stores were awarded $7 million each for the startup costs to open a grocery store. To this day, with the help of tax credits and grants, all three grocery stores are still operating. This bill offers a promising solution by incentivizing the establishment and continuation of grocery stores in food desert areas.

REGISTERED SUPPORT / OPPOSITION:

Support

American Diabetes Association
California Grocers Association
City of Long Beach
City of Riverside
City of San Jose

Opposition

None on file.

Analysis Prepared by: Victor Francovich / AGRI. / (916) 319-2084

Date of Hearing: June 26, 2024

ASSEMBLY COMMITTEE ON AGRICULTURE

Esmeralda Soria, Chair

SBPCA Bill Id:SB 1419

Author:(Rubio) – As Amended Ver:April 23, 2024

SENATE VOTE: 37-0

SUBJECT: Food deserts: grants

SUMMARY: This bill would establish the Food Desert Elimination (FDE) Grant Program; which would provide a tax credit incentive for grocery stores to open in areas defined as a food desert. This bill would also establish the Food Desert Elimination Fund in the General Fund and would authorize monies from the fund be used, upon appropriation, to run the program.

Specifically, this bill:

1. Establishes the FDE Grant Program, to be administered by the California Department of Food and Agriculture (CDFA).
2. Establishes criteria under which CDFA may award grants to a grocery store seeking to locate in a food desert. These include:
   1. A market and site feasibility study.
   2. Salaries and benefits to grocery store employees.
   3. Rents or down payments to acquire a facility located in a food desert.
   4. Capital improvements, planning, renovations, land acquisition, demolition, and durable and nondurable equipment purchases.
   5. Other costs determined by CDFA.
3. Creates the FDE Fund in the General Fund to provide monies to CDFA for the promulgation of the program.
4. Requires CDFA to adopt regulations to implement the program no later than January 1, 2026.
5. Defines the following:
   1. “Food desert” to mean a food desert as determined by the Economic Research Service within the United States Department of Agriculture.
   2. “Grocery store” to mean a retail store in California of over 15,000 square feet that is a retail seller of groceries, as described in Code 445110 of the North American Industry Classification System published by the United States Office of Management and Budget, 2022 edition.
6. Allows a qualified taxpayer that hires a qualified full-time employee and pays or incurs qualified wages attributable to work performed by the qualified full-time employee, a credit against the net tax, as defined in Section 17039 of the Revenue and Taxation Code.
   1. Establishes definitions pertaining to this section.

EXISTING LAW:

1. Establishes the Office of Farm to Fork within the CDFA and requires the office to work with various entities to increase the amount of agricultural products available to underserved communities and schools in California (Food and Agricultural Code Section 49001).
2. Establishes the CalFresh program to administer the provision of federal SNAP benefits to families and individuals meeting certain criteria, as specified (Welfare and Institutions Code Section 18900).
3. Requires the California Healthy Food Financing Initiative Council to implement an initiative to expand access to nutritious food in underserved, urban, and rural communities and to eliminate food deserts in California (Health and Safety Code 104660).
4. Defines food deserts as both low-income areas and ones in which more than a third of the population lives over a mile from a grocery store/supermarket.
5. Establishes under federal law the “Supplemental Nutrition Assistance Program” (SNAP) pursuant to the Food Stamp Act of 1964. (7 United States Code Section 2011).

FISCAL EFFECT: This bill would result in a cost pressure to provide grant funding. The magnitude is unknown, but at a minimum would be in the millions of dollars (General Fund). The California Department of Food and Agriculture (CDFA) would incur first-year costs of $358,000, and $352,000 annually thereafter, to administer the grant program (General Fund).

COMMENTS: According to Northwestern’s Institute for Policy Research, one in five Californians are food insecure despite living in the state that produces nearly half of the country’s fruits and vegetables. On August 8, 2023, Cal Matters published a report titled “How hungry is California? Millions struggle to eat well in an abundant state.” Among other issues, the report discusses the possible outcomes of not having consistent access to healthy food options including, but not limited to, developmental delays in children, obesity, chronic illness, anxiety, and depression. All of these results will affect a child’s ability to perform well in school or an adult to be able to contribute to the community in a healthy, positive way.

The USDA Economic Research Service states that there are many ways to measure food store access for individuals and for neighborhoods, and many ways to define which areas are low-income and low access—neighborhoods that lack healthy food sources. Their website provides the following:

“Most measures and definitions consider at least some of the following indicators of access:

• Accessibility to sources of healthy food, as measured by distance to a store or by the number of stores in an area;
• Individual-level resources that may affect accessibility, such as family income or vehicle availability; and
• Neighborhood-level indicators of resources, such as the average income of the neighborhood and the availability of public transportation.”

“In the Food Access Research Atlas, several indicators are available to measure food access along these dimensions. For example, users can choose alternative distance markers to measure low access in a neighborhood, such as the number and share of people more than one-half mile to a supermarket or 1 mile to a supermarket. Users can also view other census-tract-level characteristics that provide context on food access in neighborhoods, such as whether the tract has a high percentage of households far from supermarkets and without vehicles, individuals with low income, or people residing in group quarters.”

The California FreshWorks Fund (CAFWF) is a public-private partnership loan fund created to (1) increase access to healthy food in underserved communities; (2) spur economic development that supports healthy communities; and (3) inspire innovation in healthy food retailing. The $264 million fund provides financing for grocery stores and other forms of healthy food retail and distribution by providing flexible capital to eligible applicants. Some loans can be packaged with companion grants.

According to the author, Currently in California, there is not a financing mechanism to assist healthy food retail outlets to expand offerings to food insecure residents in food desert areas. This critical bill will create the Food Desert Elimination Act of 2024, which would establish a fund for grocery store operators who want to open a store in a designated food desert to help address food insecurity and poverty issues for our most vulnerable or at risk communities across the state. It is imperative to ensure our underserved communities receive access to healthy food options, especially those who live in food deserts. Research suggests that establishing a grocery store in low-income neighborhoods will have positive impacts on community health and well-being and will benefit our local economies. The fund, which will be able to leverage federal dollars, will help eliminate food deserts and increase affordability and access to fresh groceries in underserved areas.

Supporters state, this bill presents a critical opportunity to alleviate food insecurity and improve the lives of millions of Californians. In April of 2023, following a rescinding of the supplemental SNAP allotments, food insecurity resurged and by October 2023, more than 1 in 5 families became food insecure. Over 3 million households, including more than 1 million households with children, now face food insecurity in California, as reported by the California Association of Food Banks. Despite California's status as a major producer of fruits and vegetables, many communities still lack access to fresh and affordable food. The existence of food deserts, where residents have limited or no access to supermarkets or grocery stores, is a glaring issue that demands immediate attention. In 2016, the California Endowment worked on a grant project to bring grocery stores to food desert areas. Three grocery stores were awarded $7 million each for the startup costs to open a grocery store. To this day, with the help of tax credits and grants, all three grocery stores are still operating. This bill offers a promising solution by incentivizing the establishment and continuation of grocery stores in food desert areas.

REGISTERED SUPPORT / OPPOSITION:

Support

American Diabetes Association
California Grocers Association
City of Long Beach
City of Riverside
City of San Jose

Opposition

None on file.

Analysis Prepared by: Victor Francovich / AGRI. / (916) 319-2084

 THIRD READING  

Bill No: SB 1419

Author: Rubio (D)

Amended: 4/23/24

Vote: 21

SENATE AGRICULTURE COMMITTEE: 3-0, 4/16/24

AYES: Hurtado, Cortese, Padilla

NO VOTE RECORDED: Grove, Alvarado-Gil

SENATE APPROPRIATIONS COMMITTEE: 7-0, 5/16/24

AYES: Caballero, Jones, Ashby, Becker, Bradford, Seyarto, Wahab

SUBJECT: Food deserts: grants

SOURCE: Author

DIGEST:

This bill establishes the Food Desert Elimination Grant Program which would provide grants to grocery store operators that open stores in areas defined as a food desert. This bill authorizes the California Department of Food and Agriculture to collect non-state, federal, and private funds, and would require those funds to be deposited into the California Equitable Food Access Account within the Food Desert Elimination Fund and would continuously appropriate moneys in the account to the department for purposes of the program. This bill establishes the Food Desert Elimination Fund in the General Fund and would authorize monies from the fund to be used, upon appropriation, to run the program. Finally, this bill repeals these provisions on December 31, 2030.

ANALYSIS:

Existing federal law:

1. Defines food deserts as both low-income areas and ones in which more than a third of the population lives over a mile from a grocery store/supermarket (https://www.ers.usda.gov/data-products/food-access-research-atlas/documentation/).
2. Establishes under federal law the “Supplemental Nutrition Assistance Program” (SNAP) pursuant to the Food Stamp Act of 1964. (7 United States Code Section 2011).

Existing state law:

1. Establishes the Office of Farm to Fork within the California Department of Food and Agriculture (CDFA) and requires the office to work with various entities to increase the amount of agricultural products available to underserved communities and schools in California (Food and Agricultural Code Section 49001).
2. Establishes the “CalFresh” program to administer the provision of federal SNAP benefits to families and individuals meeting certain criteria, as specified. (Welfare and Institutions Code Section 18900).
3. Requires the California Healthy Food Financing Initiative Council to implement an initiative to expand access to nutritious food in underserved, urban, and rural communities and to eliminate food deserts in California. (Health and Safety Code 104660).

This bill:

1. Establishes the Food Desert Elimination Grant Program (program), to be administered by the California Department of Food and Agriculture (CDFA).
2. Establishes criteria under which CDFA may award grants to a grocery store seeking to locate in a food desert. These include:
   1. A market and site feasibility study.
   2. Salaries and benefits to grocery store employees.
   3. Rents or down payments to acquire a facility located in a food desert.
   4. Capital improvements, planning, renovations, land acquisition, demolition, and durable and nondurable equipment purchases.
   5. Other costs determined by CDFA.
   6. Sunsets these provisions on December 31, 2030.
3. Creates the Food Desert Elimination Fund in the General Fund to provide monies to CDFA for the promulgation of the program.
4. Requires CDFA to adopt regulations to implement the program no later than January 1, 2026.
5. Defines the following:
   1. “Food desert” to mean a food desert as determined by the Economic Research Service within the United States Department of Agriculture.
   2. “Grocery store” to mean a retail store in California of over 15,000 square feet that is a retail seller of groceries, as described in Code 445110 of the North American Industry Classification System published by the United States Office of Management and Budget, 2022 edition.
   3. “Small-scale grocery store” to mean a retail store in this state of under 15,000 square feet that is a retail seller of groceries, as described in Code 445110 of the North American Industry Classification System (NAICS) published by the United States Office of Management and Budget, 2022 edition.
6. Allows a qualified taxpayer that hires a qualified full-time employee and pays or incurs qualified wages attributable to work performed by the qualified full-time employee, a credit against the “net tax,” as defined in Section 17039 of the Revenue and Taxation Code.
   1. Establishes definitions pertaining to this section.

FISCAL EFFECT: Appropriation: Yes Fiscal Com.: Yes Local: No

According to the Senate Appropriations Committee:

• This bill would result in a cost pressure to provide grant funding. The magnitude is unknown, but at a minimum would be in the millions of dollars (General Fund)
• The California Department of Food and Agriculture (CDFA) would incur first-year costs of $358,000, and $352,000 annually thereafter, to administer the grant program (General Fund).

SUPPORT: (Verified 5/16/24)

American Diabetes Association

California Grocer’s Association

OPPOSITION: (Verified 5/16/24)

None received

ARGUMENTS IN SUPPORT: According to the author:

“Currently in California, there is not a financing mechanism to assist healthy food retail outlets to expand offerings to food insecure residents in food desert areas. This critical bill will create the Food Desert Elimination Act of 2024 which would establish a fund and a tax credit for grocery store operators within a designated food desert to help address food insecurity and poverty issues for our most vulnerable or at risk communities across the state. It is imperative to ensure our underserved communities receive access to healthy food options, especially those who live in food deserts. Research suggests that establishing a grocery store in low-income neighborhoods will have positive impacts on community health and well-being and will benefit our local economies. The fund, when paired with the state’s existing supplemental benefits, will help eliminate food deserts and increase affordability and access to fresh groceries in underserved areas.”

The California Grocer’s Association write in support stating:

“SB 1419 offers a promising solution by incentivizing the establishment and continuation of grocery stores in food desert areas. This builds upon successful models in California and other states. By providing grants to cover startup costs and offering employment tax credits for the first five years of operation, this legislation encourages grocery operators to invest in underserved communities, thereby increasing access to nutritious food options.”

Prepared by: Reichel Everhart / AGRI. / (916) 651-1508

5/17/24 10:18:34

**** END ****

SENATE COMMITTEE ON APPROPRIATIONS

Senator Anna Caballero, Chair

2023 - 2024 Regular Session

SB 1419 (Rubio) - Food deserts: grants

Bill Summary:

SB 1419 would, upon an appropriation by the Legislature, create the Food Desert Elimination Grant Program, as specified.

Fiscal Impact:

• This bill would result in a cost pressure to provide grant funding. The magnitude is unknown, but at a minimum would be in the millions of dollars (General Fund)
• The California Department of Food and Agriculture (CDFA) would incur first-year costs of $358,000, and $352,000 annually thereafter, to administer the grant program (General Fund).

Background:

The United States Department of Agriculture’s Economic Research Service indicates that there are many ways to measure food store access for individuals and for neighborhoods, and many ways to define which areas are low-income and low access—neighborhoods that lack healthy food sources. Examples include (1) accessibility to sources of healthy food, as measured by distance to a store or by the number of stores in an area, (2) individual-level resources that may affect accessibility, such as family income or vehicle availability, and (3) neighborhood-level indicators of resources, such as the average income of the neighborhood and the availability of public transportation.

According to USDA, “In the Food Access Research Atlas, several indicators are available to measure food access along these dimensions. For example, users can choose alternative distance markers to measure low access in a neighborhood, such as the number and share of people more than one-half mile to a supermarket or 1 mile to a supermarket. Users can also view other census-tract-level characteristics that provide context on food access in neighborhoods, such as whether the tract has a high percentage of households far from supermarkets and without vehicles, individuals with low income, or people residing in group quarters.”

Proposed Law:

This bill would, contingent upon an appropriation by the Legislature, do the following until December 31, 2030:

• Create the Food Desert Elimination Grant Program under the administration of CDFA for the purpose of expanding access to healthy foods in food deserts, as defined, in the state, and areas at risk of becoming food deserts, by providing grants to grocery store operators, as specified.
• Create the Food Desert Elimination Fund in the General Fund and would authorize the Fund to be expended by CDFA, upon appropriation, for purposes of the program. 
• Authorize CDFA to collect nonstate, federal, and private funds, would require those funds to be deposited into the California Equitable Food Access Account within the Food Desert Elimination Fund, and would continuously appropriate moneys in the account to CDFA for purposes of the program
• Authorize CDFA to award grants to grocery store operators seeking to locate grocery stores in food deserts and to award grants, totaling no more than 20 percent of the total program funding, for equipment upgrades for grocery stores located in food deserts to expand or provide healthy foods for sale.

Related Legislation:

• AB 581 (Liu, Chapter 505, Statutes of 2011) established the California Healthy Food Financing Initiative and created the California Healthy Food Financing Fund, which consists of federal, state and private dollars to be used for increasing access to healthy foods in underserved communities. The legislation also created the California Healthy Food Financing Council, as specified.
• AB 2090 (Wicks) would require the California Department of Food and Agriculture’s (CDFA) Office of Farm to Fork (OF2F) to work with transportation agencies to increase the amount of agricultural products available to underserved communities and schools in the state, and to prioritize the department’s efforts in food deserts, as defined, throughout the state, as specified. The bill is currently pending in the in Assembly Appropriations Committee.
• AB 1961(Wicks) would, subject to appropriation from the Legislature, require the Strategic Growth Council, in consultation with specified agencies, to convene the “End Hunger in California Master Plan Task Force” to develop strategies for ensuring access to healthy and culturally relevant food for all Californians. The bill is currently pending in the in Assembly Appropriations Committee).
• AB 1967 (Jackson): This bill would create, within the Government Operations Agency, a Food Insecurity Officer, to be appointed by, and serve at the pleasure of, the Governor. The Food Insecurity Officer would be required to report to the Secretary, or the Secretary’s designee, of the Government Operations Agency. The bill would require the Food Insecurity Officer to coordinate and address food insecurity throughout state government operations and would authorize the Food Insecurity Officer to engage with state entities for these purposes, as specified. The bill is currently pending in the in Assembly Appropriations Committee.

Staff Comments:

CDFA would require a minimum of two positions to administer the grant program. The Department notes that, because the size of the grant program is unclear, its workload could be greater and therefore its resulting costs could be higher.

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SENATE COMMITTEE ON AGRICULTURE

Senator Melissa Hurtado, Chair

2023 - 2024 Regular

Bill No: SB 1419 Hearing Date: 4/16/24

Subject: Food deserts: grants: personal income tax and corporation tax credits

SUMMARY

:

This bill would establish the Food Desert Elimination Grant Program which would provide a tax credit incentive for grocery stores to open in areas defined as a food desert. This bill would also establish the Food Desert Elimination Fund in the General Fund and would authorize monies from the fund to be used, upon appropriation, to run the program.

BACKGROUND AND EXISTING LAW

:

Existing state law:

1. Establishes the Office of Farm to Fork within the California Department of Food and Agriculture (CDFA) and requires the office to work with varies entities to increase the amount of agricultural products available to underserved communities and schools in California (Food and Agricultural Code Section 49001).
2. Establishes the “CalFresh” program to administer the provision of federal SNAP benefits to families and individuals meeting certain criteria, as specified (Welfare and Institutions Code Section 18900).
3. Requires the California Healthy Food Financing Initiative Council to implement an initiative to expand access to nutritious food in underserved, urban, and rural communities and to eliminate food deserts in California (Health and Safety Code 104660).

Existing federal law:

1. Defines food deserts as both low-income areas and ones in which more than a third of the population lives over a mile from a grocery store/supermarket (https://www.ers.usda.gov/data-products/food-access-research-atlas/documentation/).
2. Establishes under federal law the “Supplemental Nutrition Assistance Program” (SNAP) pursuant to the Food Stamp Act of 1964. (7 United States Code Section 2011).

PROPOSED LAW

:

This bill:

1. Establishes the Food Desert Elimination Grant Program (program), to be administered by the California Department of Food and Agriculture (CDFA).
2. Establishes criteria under which CDFA may award grants to a grocery store seeking to locate in a food desert. These include:
   1. A market and site feasibility study.
   2. Salaries and benefits to grocery store employees.
   3. Rents or down payments to acquire a facility located in a food desert.
   4. Capital improvements, planning, renovations, land acquisition, demolition, and durable and nondurable equipment purchases.
   5. Other costs determined by CDFA.
3. Creates the Food Desert Elimination Fund in the General Fund to provide monies to CDFA for the promulgation of the program.
4. Requires CDFA to adopt regulations to implement the program no later than January 1, 2026.
5. Defines the following:
   1. “Food desert” to mean a food desert as determined by the Economic Research Service within the United States Department of Agriculture.
   2. “Grocery store” to mean a retail store in California of over 15,000 square feet that is a retail seller of groceries, as described in Code 445110 of the North American Industry Classification System published by the United States Office of Management and Budget, 2022 edition.
6. Allows a qualified taxpayer that hires a qualified full-time employee and pays or incurs qualified wages attributable to work performed by the qualified full-time employee, a credit against the “net tax,” as defined in Section 17039 of the Revenue and Taxation Code.
   1. Establishes definitions pertaining to this section.

ARGUMENTS IN SUPPORT:

According to the author:

“Currently in California, there is not a financing mechanism to assist healthy food retail outlets to expand offerings to food insecure residents in food desert areas. This critical bill will create the Food Desert Elimination Act of 2024 which would establish a fund and a tax credit for grocery store operators within a designated food desert to help address food insecurity and poverty issues for our most vulnerable or at risk communities across the state. It is imperative to ensure our underserved communities receive access to healthy food options, especially those who live in food deserts. Research suggests that establishing a grocery store in low-income neighborhoods will have positive impacts on community health and well-being and will benefit our local economies. The fund, when paired with the state’s existing supplemental benefits, will help eliminate food deserts and increase affordability and access to fresh groceries in underserved areas.”

The California Grocers Association write in support stating:

“SB 1419 offers a promising solution by incentivizing the establishment and continuation of grocery stores in food desert areas. This builds upon successful models in California and other states. By providing grants to cover startup costs and offering employment tax credits for the first five years of operation, this legislation encourages grocery operators to invest in underserved communities, thereby increasing access to nutritious food options.”

ARGUMENTS IN OPPOSITION:

The California Teachers Association writes in opposition stating:

“According to the Department of Finance, the state provided over $87.5 billion in General Fund tax expenditures in 2023-24 (including income, sales and use, corporate, and other taxes). This number continues to grow each year. This revenue would have otherwise gone to the General Fund, of which approximately 39 percent would have gone toward Proposition 98 for K-14 education. This means approximately $34 billion is redirected away from schools and community colleges each year due to existing tax expenditures.

“While we understand the bill is well intended, CTA does not support this approach, as it would reduce overall funding for education. CTA believes Proposition 98 must be protected from reductions through the creation of new or expanding existing tax expenditures, especially as the state is facing a budget deficit.”

COMMENTS

:

Dual referral.  This bill was referred to this Committee and the Senate Revenue and Taxation Committee. Please note elements of the bill under that Committee’s jurisdiction will be discussed before that Committee and are included here for completeness and context only.

According to Northwestern’s Institute for Policy Research, one in five Californians are food insecure despite living in the state that produces nearly half of the country’s fruits and vegetables^[1]. On August 8, 2023, Cal Matters published a report titled “How hungry is California? Millions struggle to eat well in an abundant state.” Among other issues, the report discusses the possible outcomes of not having consistent access to healthy food options including, but not limited to, developmental delays in children, obesity, chronic illness, anxiety, and depression.^[2] All of these results will affect a child’s ability to perform well in school or an adult to be able to contribute to the community in a healthy, positive way.

The USDA Economic Research Service states that there are many ways to measure food store access for individuals and for neighborhoods, and many ways to define which areas are low-income and low access—neighborhoods that lack healthy food sources. Their website provides the following:

“Most measures and definitions consider at least some of the following indicators of access:

• Accessibility to sources of healthy food, as measured by distance to a store or by the number of stores in an area;
• Individual-level resources that may affect accessibility, such as family income or vehicle availability; and
• Neighborhood-level indicators of resources, such as the average income of the neighborhood and the availability of public transportation.

“In the Food Access Research Atlas, several indicators are available to measure food access along these dimensions. For example, users can choose alternative distance markers to measure low access in a neighborhood, such as the number and share of people more than one-half mile to a supermarket or 1 mile to a supermarket. Users can also view other census-tract-level characteristics that provide context on food access in neighborhoods, such as whether the tract has a high percentage of households far from supermarkets and without vehicles, individuals with low income, or people residing in group quarters.”

The California FreshWorks Fund (CAFWF) is a public-private partnership loan fund created to (1) increase access to healthy food in underserved communities; (2) spur economic development that supports healthy communities; and (3) inspire innovation in healthy food retailing. The $264 million fund provides financing for grocery stores and other forms of healthy food retail and distribution by providing flexible capital to eligible applicants. Some loans can be packaged with companion grants. The CAFWF is modeled after the successful Pennsylvania Fresh Food Financing Initiative and was developed to align with the National Healthy Food Financing Initiative (HFFI). In his fiscal year 2012 budget proposal, President

Barack Obama called for a $345 million investment in HFFI.

Suggested Amendment: The rulemaking process for regulations to be adopted by CDFA can sometimes take over a year to implement. The author may wish to remove the January 1, 2026 deadline for the department to promulgate regulations for the running of the program.

Suggested Amendment: In some parts of the state, grocery stores that already exist in food deserts may wish to participate but they do not meet the requirement of being a minimum of 15,000 square feet. The author may wish to provide language in the bill to allow CDFA some flexibility to approve smaller-scaled grocery stores to participate in the program.

RELATED LEGISLATION

:

• AB581 (Chapter 505, Statutes of 2011): Established the California Healthy Food Financing Initiative and created the California Healthy Food Financing Fund, which consists of federal, state and private dollars to be used for increasing access to healthy foods in underserved communities. The legislation also created the California Healthy Food Financing Council, led by the Treasurer or their designee and includes the Secretary of Food and Agriculture or their designee, the Secretary of Health and Human Services or their designee, and the Secretary of Labor or their designee.
• AB 2090 (Wicks): This bill would require the California Department of Food and Agriculture’s (CDFA) Office of Farm to Fork (OF2F) to work with transportation agencies to increase the amount of agricultural products available to underserved communities and schools in the state, and to prioritize the department’s efforts in food deserts, as defined, throughout the state, as specified (Currently in Assembly Appropriations).
• AB 1961(Wicks): This bill would, subject to appropriation from the Legislature, require the Strategic Growth Council, in consultation with specified agencies, to convene the “End Hunger in California Master Plan Task Force” to develop strategies for ensuring access to healthy and culturally relevant food for all Californians (Currently set to be heard 4/24/24 in Asm. Agriculture Committee).
• AB 1967 (Jackson): This bill would create, within the Government Operations Agency, a Food Insecurity Officer, to be appointed by, and serve at the pleasure of, the Governor. The Food Insecurity Officer would be required to report to the Secretary, or the Secretary’s designee, of the Government Operations Agency. The bill would require the Food Insecurity Officer to coordinate and address food insecurity throughout state government operations and would authorize the Food Insecurity Officer to engage with state entities for these purposes, as specified (To be heard in Assembly Human Services Committee on 4/23/24).

SUPPORT

:

American Diabetes Association

California Grocers Association

OPPOSITION

:

California Teachers Association

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1. https://www.ipr.northwestern.edu/state-food-insecurity.html ↑

2. https://calmatters.org/explainers/california-hunger-crisis/ ↑