House File 1032 - Reprinted HOUSE FILE 1032 BY COMMITTEE ON APPROPRIATIONS (SUCCESSOR TO HF 550) (SUCCESSOR TO HF 59) (As Amended and Passed by the House April 24, 2025 ) A BILL FOR An Act creating a grocer reinvestment program, a local produce 1 processing grant program, and a grocer reinvestment and 2 local food processing fund under the purview of the economic 3 development authority, and modifying the local food and farm 4 program. 5 BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF IOWA: 6 HF 1032 (5) 91 nls/ko/md

H.F. 1032 DIVISION I 1 GROCER REINVESTMENT AND LOCAL PRODUCE PROCESSING 2 Section 1. NEW SECTION . 15.413 Grocer reinvestment program. 3 1. As used in this section: 4 a. “Financial assistance” means assistance, in the form 5 of grants, provided only from the funds and assets legally 6 available to the authority pursuant to this section. 7 b. “Grocery store” means an establishment also known as a 8 supermarket that primarily engages in retailing a general line 9 of food including canned and frozen food; fresh fruits and 10 vegetables; and fresh and prepared meat, fish, and poultry, and 11 the establishment meets either of the following requirements: 12 (1) A minimum of fifty percent of the retail space in the 13 establishment is dedicated to retailing a general line of food. 14 (2) A minimum of thirty percent of the establishment’s 15 revenue derives from retailing a general line of food. 16 c. “Program” means the grocer reinvestment program. 17 2. The authority shall establish and administer the program 18 for the purpose of awarding financial assistance to eligible 19 grocery stores for the following projects at existing grocery 20 stores, or new grocery stores to be located in this state: 21 a. Capital improvements to establish or expand capacity, 22 including expansions and modifications. 23 b. Upgrades to utilities, including water, electric, heat, 24 refrigeration, and freezing units. 25 c. Purchases of equipment and furnishings. 26 d. Expenditures for professional services. 27 e. Technology that allows increased capacity or business 28 resilience, including software and hardware related to business 29 functions, logistics, inventory management, temperature 30 monitoring controls, cybersecurity, and internet site design 31 that enables electronic commerce. 32 3. The authority shall establish eligibility criteria for 33 the program by rule. The eligibility criteria must include all 34 of the following: 35 -1- HF 1032 (5) 91 nls/ko/md 1/ 5

H.F. 1032 a. The grocery store has filed all required documents with 1 the secretary of state under the relevant filing statute as 2 described in section 9.11. 3 b. The grocery store is organized as a sole proprietorship, 4 partnership, limited liability company, corporation, 5 cooperative, nonprofit organization, or nonprofit community 6 development entity. 7 c. The grocery store owns ten or fewer grocery stores. 8 d. The grocery store has the capacity to successfully 9 implement or complete the project, and demonstrates a plan for 10 sustainability. 11 4. In order to be awarded financial assistance under the 12 program, a grocery store must provide matching funds for the 13 project equal to the amount of the financial assistance award. 14 Financial assistance awarded under the program shall not exceed 15 one hundred thousand dollars. 16 5. The authority shall evaluate applications, and priority 17 shall be given to the grocery stores that commit to all of the 18 following: 19 a. Accepting benefits under the United States department 20 of agriculture supplemental nutrition assistance program and 21 the special supplemental nutrition program for women, infants, 22 and children. 23 b. Creating or retaining jobs for local residents. 24 c. Making efforts to procure and offer local foods for sale. 25 d. Other criteria determined by the authority. 26 6. The authority shall prioritize eligible grocery stores 27 based on the population size of the community in which the 28 eligible grocery store is located. Priority shall be given 29 to eligible grocery stores located in the least-populated 30 communities. 31 7. By November 1, 2026, and each November 1 thereafter, 32 if financial assistance has been provided in the immediately 33 preceding fiscal year, the director shall submit a report to 34 the general assembly describing the activities of the program 35 -2- HF 1032 (5) 91 nls/ko/md 2/ 5

H.F. 1032 including the geographic distribution of the projects, the 1 identity of the applicants, and the new investments or new jobs 2 created as a result of the financial assistance provided under 3 the program. 4 Sec. 2. NEW SECTION . 15.415 Grocer reinvestment and local 5 food processing fund. 6 1. a. A grocer reinvestment and local food processing 7 fund is created in the state treasury under the control of the 8 authority. The fund shall consist of moneys appropriated by 9 the general assembly to the authority and any other moneys 10 available to, obtained by, or accepted by the authority 11 for placement in the fund. The fund shall be used to award 12 financial assistance as provided under the grocer reinvestment 13 program established in section 15.413 and the local produce 14 processing grant program established in section 187.331. 15 b. Commencing with the fiscal year beginning July 1, 2025, 16 and each fiscal year thereafter, one hundred thousand dollars 17 of the annual appropriation to the fund, or ten percent of the 18 moneys in the fund available on July 1, whichever is less, 19 shall be allocated to the local produce processing grant 20 program established in section 187.331. 21 c. The authority may use not more than five percent of 22 the moneys in the fund at the beginning of the fiscal year 23 for purposes of administrative costs, marketing, technical 24 assistance, and other program support. 25 2. Notwithstanding section 8.33, moneys in the fund 26 that remain unencumbered or unobligated at the close of the 27 fiscal year shall not revert but shall remain available for 28 expenditure for the purposes designated until the close of 29 the succeeding fiscal year. Notwithstanding section 12C.7, 30 interest or earnings on moneys in the fund shall be credited 31 to the fund. 32 Sec. 3. NEW SECTION . 187.331 Local produce processing grant 33 program. 34 1. As used in this section: 35 -3- HF 1032 (5) 91 nls/ko/md 3/ 5

H.F. 1032 a. “Local produce” means fruits and vegetables grown in this 1 state. 2 b. “Local produce processing” means the preparation of local 3 produce for human consumption. 4 2. The department shall establish and administer the local 5 produce processing grant program for the purpose of awarding 6 grants to Iowa-based entities to increase the availability of 7 local produce processing. In administering the program, the 8 department shall prioritize grants to all of the following: 9 a. Iowa-based entities that will increase any of the 10 following as it relates to local produce processing: 11 (1) Availability. 12 (2) Access. 13 (3) Efficiency. 14 (4) Capacity. 15 b. Iowa-based entities that process local produce from three 16 or more Iowa farms. 17 c. A person participating in the choose Iowa promotional 18 program under section 187.303. 19 d. Iowa-based entities whose local produce is sold or 20 distributed to a grocery store eligible for the grocer 21 reinvestment program under section 15.413. 22 3. An Iowa-based entity whose local produce processing 23 includes local produce from three or more Iowa farms shall be 24 eligible for a grant under the program in an amount that is two 25 times the maximum grant amount set by the department for the 26 value-added agricultural grant program under section 187.321. 27 Sec. 4. CODE EDITOR DIRECTIVE. The Code editor is directed 28 to designate section 187.331, as enacted in this division of 29 this Act, as part 4 of subchapter III, chapter 187, entitled 30 “Local Produce Processing Grant Program”. 31 DIVISION II 32 LOCAL FOOD AND FARM PROGRAM —— GROCERY STORES 33 Sec. 5. Section 267A.1, subsection 1, Code 2025, is amended 34 to read as follows: 35 -4- HF 1032 (5) 91 nls/ko/md 4/ 5

H.F. 1032 1. The purpose of this chapter is to empower farmers , and 1 food entrepreneurs , and grocery stores to provide for strong 2 local food economies that promote self-sufficiency and job 3 growth in the agricultural sector and allied sectors of the 4 economy. 5 Sec. 6. Section 267A.1, subsection 2, paragraph d, Code 6 2025, is amended to read as follows: 7 d. Increase the number of jobs in this state’s farm and 8 business economies associated with producing, processing, 9 distributing, retailing, and marketing local food. 10 Sec. 7. Section 267A.1, subsection 2, Code 2025, is amended 11 by adding the following new paragraph: 12 NEW PARAGRAPH . e. Increase the availability and viability 13 of grocery stores in this state. 14 Sec. 8. Section 267A.2, Code 2025, is amended by adding the 15 following new subsection: 16 NEW SUBSECTION . 4A. “Grocery store” means the same as 17 defined in section 15.413. 18 Sec. 9. Section 267A.6, subsection 2, paragraphs a and c, 19 Code 2025, are amended to read as follows: 20 a. Improve communication and cooperation between and among 21 farmers, food entrepreneurs, grocers, and consumers. 22 c. Demonstrate the value of processing, distributing, 23 retailing, and marketing local foods. A demonstration project 24 must be capable of being replicated on a statewide basis. 25 -5- HF 1032 (5) 91 nls/ko/md 5/ 5