Cook’s Grocery Fund Sits Outside The Treasury

The text as introduced · 1,254 words

89R3454 SCF-D

By: Cook
S.B. No. 1305

A BILL TO BE ENTITLED

AN ACT

relating to the establishment of a grocery access investment fund

program.

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:

SECTION 1. Title 2, Agriculture Code, is amended by adding

Chapter 26 to read as follows:

CHAPTER 26. TEXAS GROCERY ACCESS INVESTMENT FUND

Sec. 26.001. DEFINITIONS. In this chapter:

(1) "Community development financial institution" has

the meaning assigned by 12 U.S.C. Section 4702.

(2) "Financing" means a loan, grant, or forgivable

loan.

(3) "Fund" means the Texas grocery access investment

fund established by this chapter.

(4) "Grocery store" means a self-service retail store

that primarily sells meat, seafood, fruits, vegetables, dairy

products, dry groceries, household products, and sundries.

(5) "Low-income area" means a census tract, based on

the most recent information published by the United States Bureau

of the Census, in which the poverty rate is 20 percent or higher or

the median family income is at or below 81 percent of the median

family income for the state or the metropolitan statistical area.

(6) "Moderate-income area" means a census tract, based

on the most recent information published by the United States

Bureau of the Census, in which the median family income is above 81

percent and at or below 95 percent of the median family income for

the state or the metropolitan statistical area.

(7) "Program" means the Texas grocery access

investment fund program authorized by this chapter.

(8) "Supplemental nutrition assistance program" means

the nutritional assistance program operated under Chapter 33, Human

Resources Code, and formerly referred to as the food stamp program.

(9) "Underserved area" means a census tract, based on

the most recent information published by the United States Bureau

of the Census, that has been determined to be an area with low

supermarket access by:

(A) the United States Department of Agriculture,

as identified in the Food Access Research Atlas published by that

department; or

(B) another governmental or philanthropic

healthy food initiative.

(10) "WIC program" means the federal special

supplemental nutrition program for women, infants, and children

authorized by 42 U.S.C. Section 1786.

Sec. 26.002. TEXAS GROCERY ACCESS INVESTMENT FUND PROGRAM.

(a) The department, in cooperation with public and private sector

partners, shall establish the Texas grocery access investment fund

program to provide financing to construct, rehabilitate, or expand

grocery stores in underserved low-income and moderate-income areas

in this state.

(b) The fund is a trust fund outside the treasury with the

comptroller and administered by the department.

(c) The fund is composed of:

(1) money appropriated to the fund by the legislature;

(2) federal, state, or private grants or loans

deposited to the credit of the fund;

(3) money received as a result of federal tax credits

deposited to the credit of the fund;

(4) other money deposited to the credit of the fund, as

provided by law; and

(5) any other type of financial assistance.

(d) The department may use money appropriated to the

department for the purposes of establishing the program authorized

by this chapter. Not less than 25 percent of the money in the fund

shall be used to provide grants or forgivable loans distributed

under the program. Not more than 10 percent of the money in the fund

may be reserved for administrative or operational costs of

operating the program, unless the costs are covered by another

budget or in-kind contributions.

(e) The department may deposit to the credit of the fund any

money available to the department for the purpose of the program,

including appropriated money.

Sec. 26.003. ADMINISTRATION OF TEXAS GROCERY ACCESS

INVESTMENT FUND PROGRAM. (a) The department shall contract with

one or more qualified nonprofit organizations or community

development financial institutions to administer the program

through a public-private partnership.

(b) A nonprofit organization or community development

financial institution contracted under Subsection (a) shall

establish program guidelines, raise matching funds, promote the

program statewide, evaluate applicants, underwrite and disburse

grants and loans, and monitor compliance with and the impact of the

program.

(c) The department shall establish rules or other

procedures as necessary to administer this chapter.

(d) The department shall establish monitoring and

accountability mechanisms for projects receiving financing under

the program and shall report annually to the legislature. The

report must include information regarding the projects that are

funded, the geographic distribution of the projects, the costs of

start-up and administration of the program, and the outcomes of the

projects, including the number and types of jobs created as a result

of the program and the health impact of the program.

(e) The department shall create project eligibility

guidelines and provide financing through an application process.

Projects must be located in an underserved area and primarily serve

low-income or moderate-income areas. Projects eligible for

financing include:

(1) constructing a new grocery store; and

(2) improving an existing grocery store, including

upgrading the store's infrastructure, renovating the store, or

expanding the store to improve the availability and quality of

fresh produce and other healthy food.

(f) An applicant for financing may be a for-profit or

nonprofit entity, including a sole proprietorship, partnership,

limited liability company, corporation, cooperative, nonprofit

organization, nonprofit community development entity, university,

or government entity. An applicant for financing must:

(1) demonstrate the capacity to successfully

implement the project and the likelihood that the project will be

economically self-sustaining;

(2) demonstrate the ability to repay any loan required

to be repaid; and

(3) agree, for a period of five years, to:

(A) accept benefits under the WIC program and the

supplemental nutrition assistance program;

(B) allocate 30 percent of the retail space for

the sale of perishable foods, which may include whole grains, fresh

produce, meat, poultry, seafood, and fresh or frozen dairy

products;

(C) comply with all data collection and reporting

requirements established by the department;

(D) promote the sale of fresh produce, including

Texas-grown fruits and vegetables, and fresh Texas-raised meat,

poultry, and seafood products; and

(E) promote the hiring of local residents.

(g) In determining which qualified projects to finance, the

department shall consider:

(1) the level of need in the area to be served;

(2) the amount of public funding required to make the

project move forward, create impact, or be competitive;

(3) the degree to which the project will have a

positive economic impact on the underserved area, including by

creating or retaining jobs for local residents;

(4) the degree to which the project will participate

in state and local health initiatives to educate consumers on

nutrition and promote healthy eating, including Texas A&M AgriLife

Extension Service initiatives; and

(5) any other criteria the department considers

necessary or appropriate.

(h) A recipient of financing may use funds received for the

following purposes:

(1) site acquisition and preparation;

(2) construction and build-out costs;

(3) equipment and furnishings;

(4) employee training and security;

(5) predevelopment costs, including market studies

and appraisals;

(6) energy efficiency measures; and

(7) working capital for initial inventory and start-up

costs.

SECTION 2. Not later than December 1, 2025, the Department

of Agriculture shall adopt rules to administer Chapter 26,

Agriculture Code, as added by this Act.

SECTION 3. Not later than December 15, 2025, the Department

of Agriculture shall contract with one or more nonprofit

organizations or community development financial institutions as

provided by Section 26.003, Agriculture Code, as added by this Act.

SECTION 4. Not later than January 15, 2026, the Department

of Agriculture shall transfer money to the Texas grocery access

investment fund.

SECTION 5. This Act takes effect September 1, 2025.