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Tax Breaks Proposed for ‘Food Desert’ Grocers

Government

Grocery Store Isle | Image by Tooykrub/Shutterstock

Data from 2015 revealed that the number of Dallas residents living over 5 miles away from a grocery store stood in the hundreds of thousands.

According to State Representative Shawn Thierry (D-Houston), this issue is statewide: “Texas has the largest ‘grocery gap’ in the nation, which means that our state has the lowest number of supermarkets per capita of any state.”

A newly proposed bill aims to reduce that gap by incentivizing grocers through tax breaks to open locations in these communities.

While exact definitions vary widely, the United States Department of Agriculture (USDA) defines a “food desert” in a metro area as a low-income community where over a third of the residents live at least one mile from a supermarket or large grocery store.

Anga Sanders, a resident of South Oak Cliff, a Dallas neighborhood considered a food desert, said she has to travel 13 miles to access a fresh salad bar at an Albertson’s location.

One day, several years ago, Sanders said that it dawned on her that nothing similar existed in her neighborhood or “south of Interstate 30 in the city of Dallas.”

Later posting her realization as well as several photos of the salad bar on social media, she was quickly met with dozens of responses from other frustrated Dallas residents.

Recognizing that it was affecting more than just her, Sanders held a community meeting to discuss the problem and ultimately launched the nonprofit Feed Oak Cliff.

“Our goal was to recruit mainstream, quality grocery stores to this area,” said Sanders.

Sanders, who initially believed grocers were unaware of the problem, quickly learned that a lack of awareness was not the issue. Instead, according to some of the chains that operate in the city, an insufficient number of customers in the neighborhood and often higher crime rates kept grocers from establishing new locations.

“The bottom line is there’s got to be some thought that at some point the store is going to be profitable. … We want to serve the community, but it’s still got to make a profit,” explained Gary Huddleston, a consultant for the Texas Retailers Association.

Huddleston said that alternative models are needed to address the challenge. Lower fees might also help to incentivize new stores to open, he suggested.

Now, Rep. Thierry is hoping her bill can help.

House Bill 1118 is a proposal to offer tax credits to grocery stores that open in areas considered food deserts in the state. If the bill is passed, the subsidies will take effect starting January 1, 2024.

The new grocers, or “healthy corner stores,” will be required to operate for a minimum of one year and must accept payment from the Special Supplemental Nutrition Program for Women, Infants, and Children (WIC) to obtain the credit.

Two-thirds of the location’s shelf space would also need to be reserved for selling food products. Of that portion, half must be non-prepared foods. In addition, 30% of the location’s designated food space must be used for perishable foods, like fresh produce, meat, or dairy.

Should all these requirements be met, the store would be eligible for a 5% tax credit on operating expenses.

Where similar bills have been passed in other states, such as New Jersey, critics have pointed to studies suggesting that they often go toward “incentivizing” actions that the business receiving them would have taken anyway. They also argue that the problem is more about how much money a household has to spend on healthier food options.

“The primary factors are economic and time constraints that are affecting people, not geographic barriers, in wealthy countries,” said Nathan Rosenberg, adjunct professor at the University of Iowa College of Law.

On the other hand, according to Rep. Thierry, living in food deserts means that “people have to travel further” or simply opt for “unhealthy, processed food” if they do not have access to transportation.

Ultimately, experts like dietitian Isabella Ferrari have noted choosing an unhealthy diet drives obesity, which is one of the most significant health problems facing Dallas-Fort Worth, Texas, and the nation.

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T H H
T H H
26 days ago

There is a reason there are no stores.

RiverKing
RiverKing
Reply to  T H H
26 days ago

This is a fine idea UNLESS there were grocery stores in these neighborhoods and those stores were chased away by crime. Otherwise, what we would really be doing would be subsidizing crime.

Bill
Bill
26 days ago

Other than trying to race a car for a living there are fewer ways to go broke in business that are faster than opening a grocery store in the hood.

David
David
26 days ago

Not a grocery problem but a moral societal situation.

Frank Hayes
Frank Hayes
26 days ago

Move to where the stores are. How did these people not notice they moved to a shop hostile area? I have no empathy for this level of stupid.

Donna
Donna
26 days ago

Stores have closed due to the high crime, shoplifting, theft.

athinkingwoman
athinkingwoman
26 days ago

As long as “let um go” Creuzot is DA, it is a wonder we have any retail stores in Dallas. I know of a drug store in N Dallas where at least one woman comes in every day and shoplifts less than $750 and does not get arrested. The store now locks up some very inexpensive items which must be very popular in the criminal resale market. Sometimes the manager is able to stop her but not enough to keep her out.

Joe Z
Joe Z
26 days ago

first, ask the owners of the grocery stores that were in the area – on why they moved out.. fix those issues, then the grocery stores will return..