II 

113TH CONGRESS 

1ST SESSION S. 821 

To amend the Department of Agriculture Reorganization Act of 1994 to 

establish in the Department of Agriculture a Healthy Food Financing 

Initiative. 

IN THE SENATE OF THE UNITED STATES 

APRIL 25, 2013 

Mrs. GILLIBRAND (for herself, Mr. BROWN, Mr. COWAN, Mr. CASEY, Mr. 

SANDERS, Mr. SCHUMER, Mr. HARKIN, and Mr. FRANKEN) introduced 

the following bill; which was read twice and referred to the Committee 

on Agriculture, Nutrition, and Forestry 

A BILL 

To amend the Department of Agriculture Reorganization 

Act of 1994 to establish in the Department of Agriculture a Healthy Food Financing Initiative. 

1 Be it enacted by the Senate and House of Representa2 tives of the United States of America in Congress assembled, 

3 SECTION 1. SHORT TITLE. 

4 This Act may be cited as the ‘‘Healthy Food Financ5 ing Initiative’’. 

6 SEC. 2. FINDINGS. 

7 Congress finds that— 


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1 (1)(A) developing high-quality fresh food retail 

2 outlets creates jobs, expands markets for agricul3 tural producers in the United States, advances 

4 health, and supports economic vitality in under5 served communities; 

6 (B) model programs in several States and cities 

7 (including the States of California, Illinois, New 

8 York, and Pennsylvania and the city of New Orle9 ans) have shown success in creating public/private 

10 partnerships that leverage millions in private capital 

11 and grant funds to establish successful retail outlets 

12 in low-income underserved communities; 

13 (C) as a result of those programs, thousands of 

14 jobs have been developed, hundreds of thousands of 

15 people are gaining access to healthy food, and sus16 tainable businesses have been developed; 

17 (D) despite those successes, more than 

18 25,000,000 people in the United States live in low19 income communities with very limited access to su20 permarkets, grocery stores, and healthy food; 

21 (2)(A) with an increasing demand for fresh 

22 local foods, regional food hubs are rapidly expand23 ing, with well over 200 food hubs operating in the 

24 United States as of the date of enactment of this 

25 Act; 


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1 (B) regional food hubs are part of a growing 

2 local food system that strengthens rural economies 

3 by lowering entry barriers and improving infrastruc4 ture to establish, as well as expand, regional food 

5 markets; and 

6 (C) many food hubs are designed to move lo7 cally produced food into underserved communities; 

8 (3)(A) supermarkets and grocery stores often 

9 face barriers to opening stores in communities with 

10 very limited access to healthy food, also known as 

11 food deserts; 

12 (B) the supermarket industry operates on a his13 torically thin profit margin; 

14 (C) according to the 2011 National Grocers As15 sociation Independent Grocers Survey, the average 

16 net profit margin before taxes for independent gro17 cers in 2010 was 1.08 percent; 

18 (D) urban operators face barriers, including— 

19 (i) increased real estate costs or limited 

20 availability of suitable commercial real estate in 

21 the community; 

22 (ii) increased employee training needs and 

23 costs; 

24 (iii) elevated security expenses; and 

25 (iv) often zoning restrictions; and 


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1 (E) supermarkets and grocery stores in rural 

2 food deserts also face barriers, including increased 

3 food delivery costs due to distance from distributers, 

4 dispersed customer base, and low volume; 

5 (4)(A) the United States faces an obesity epi6 demic in which 30.5 percent of children ages 10 

7 through 17 are overweight or obese; 

8 (B) the obesity epidemic contributes to increas9 ing rates of chronic illness, including diabetes, heart 

10 disease, and cancer; and 

11 (C) the obesity epidemic cost the United States 

12 $147,000,000 in medical expenses in 2008, and this 

13 cost is expected to rise in the future; 

14 (5) more than 170 studies show that— 

15 (A) access to healthy food is particularly a 

16 problem in hundreds of low-income, rural, and 

17 urban communities, as well as communities of 

18 color in the United States; and 

19 (B) the opportunity to access healthy food 

20 is linked to lower levels of obesity, diabetes, and 

21 other food-related chronic illnesses, leading to 

22 better health outcomes; 

23 (6)(A) children from low-income families are 

24 twice as likely to be overweight as children from 

25 higher income families; and 


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1 (B) African-American and Hispanic children 

2 are more likely than Caucasian children to be obese; 

3 (7) studies show that when healthy foods are 

4 available, people will increase consumption of fruits 

5 and vegetables; 

6 (8) leading public health experts, including the 

7 Centers for Disease Control and Prevention, the 

8 American Heart Association, the Institute of Medi9 cine, and the American Public Health Association, 

10 agree that providing improved access to super11 markets and grocery stores is needed to improve 

12 public health and prevent obesity; 

13 (9) access to affordable capital is a significant 

14 problem for rural and urban supermarkets, grocery 

15 stores, regional food hubs, farmers markets, and 

16 healthy food retail business enterprises; 

17 (10) by providing seed capital and technical as18 sistance, the Federal Government, through time-lim19 ited investments, can— 

20 (A) attract private sector investment to 

21 create and retain much-needed jobs; and 

22 (B) provide long-term, sustainable solu23 tions to the decades-old problem of limited ac24 cess to healthy food in underserved, low-income 

25 urban and rural communities; and 


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1 (11) legislation establishing a national fund 

2 modeled on successful programs in Pennsylvania and 

3 other States and localities will help create much4 needed jobs and economic revitalization, address an 

5 important part of the obesity epidemic, and solve the 

6 healthy food access problem in hundreds of commu7 nities across the United States. 

8 SEC. 3. HEALTHY FOOD FINANCING INITIATIVE. 

9 (a) IN GENERAL.—Subtitle D of the Department of 

10 Agriculture Reorganization Act of 1994 (7 U.S.C. 6951) 

11 is amended by adding at the end the following: 

12 ‘‘SEC. 242. HEALTHY FOOD FINANCING INITIATIVE. 

13 ‘‘(a) PURPOSE.—The purpose of this section is to es14 tablish a program to improve access to healthy foods in 

15 underserved areas, to create and preserve quality jobs, and 

16 to revitalize low-income communities by providing loans 

17 and grants to eligible healthy food retailers to overcome 

18 the higher costs and initial barriers to entry in under19 served, urban, suburban, and rural areas. 

20 ‘‘(b) DEFINITIONS.—In this section: 

21 ‘‘(1) COMMUNITY DEVELOPMENT FINANCIAL IN22 STITUTION.—The term ‘community development fi23 nancial institution’ has the meaning given the term 

24 in section 103 of the Community Development 


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1 Banking and Financial Institutions Act of 1994 (12 

2 U.S.C. 4702). 

3 ‘‘(2) FARMERS MARKET.—The term ‘farmers 

4 market’ means a common facility or area where sev5 eral agricultural producers gather on a regular, re6 curring basis to sell a variety of fresh fruits and 

7 vegetables and other locally grown farm products di8 rectly to consumers. 

9 ‘‘(3) FOOD ACCESS ORGANIZATION.—The term 

10 ‘food access organization’ means a nonprofit organi11 zation with expertise in improving access to healthy 

12 food in underserved communities. 

13 ‘‘(4) HEALTHY FOOD RETAILER.—The term 

14 ‘healthy food retailer’ means a commercial, coopera15 tive, and nonprofit seller of fresh or healthy food, in16 cluding a grocery store, mobile healthy food retailer, 

17 farmers market, cooperative, corner store, bodega, or 

18 other store that sells other food and non-food op19 tions along with a full range of fresh or healthy 

20 foods. 

21 ‘‘(5) INITIATIVE.—The term ‘Initiative’ means 

22 the Healthy Food Financing Initiative established in 

23 the Department by subsection (c)(1). 

24 ‘‘(6) LOCAL FUNDS.—The term ‘local funds’ 

25 means the allocation of national funds and any other 


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1 forms of financial assistance (including grants, 

2 loans, and equity investments) that are raised by 

3 partnerships to carry out the purposes of this sec4 tion. 

5 ‘‘(7) NATIONAL FUNDS.—The term ‘national 

6 funds’ means any Federal appropriation made to 

7 carry out this section and any other forms of finan8 cial assistance (including grants, loans, and equity 

9 investments) that are raised by the national fund 

10 manager to carry out the purposes of this section. 

11 ‘‘(8) NATIONAL FUND MANAGER.—The term 

12 ‘national fund manager’ means a community devel13 opment financial institution in existence as of the 

14 date of enactment of this section and certified by the 

15 Community Development Financial Institutions 

16 Fund of the Department of the Treasury that is des17 ignated by the Secretary to manage the Initiative for 

18 purposes of— 

19 ‘‘(A) raising private capital; 

20 ‘‘(B) providing financial and technical as21 sistance to partnerships; and 

22 ‘‘(C) funding eligible projects directly at 

23 the request of partnerships to attract healthy 

24 food retailers to underserved urban, suburban, 

25 and rural areas, in accordance with this section. 


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1 ‘‘(9) PARTNERSHIP.— 

2 ‘‘(A) IN GENERAL.—The term ‘partner3 ship’ means a regional, State, or local public 

4 and private partnership that is organized to im5 prove access to fresh, healthy foods by pro6 viding financial and technical assistance to eli7 gible projects. 

8 ‘‘(B) INCLUSIONS.—The term ‘partnership’ 

9 includes— 

10 ‘‘(i) an unit of State, local, or tribal 

11 government or a quasi-public State or local 

12 government agency; 

13 ‘‘(ii) a food access or community 

14 health organization committed to improv15 ing access to healthy foods; 

16 ‘‘(iii) a community development finan17 cial institution or other organization that 

18 is capable of administering a loan and 

19 grant program in accordance with this sec20 tion; and 

21 ‘‘(iv) other organizations interested in 

22 improving access to healthy foods in under23 served areas. 

24 ‘‘(10) REGIONAL FOOD HUB.—The term ‘re25 gional food hub’ means a business or organization 


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1 that actively manages the aggregation, distribution, 

2 and marketing of source-identified food products pri3 marily from local and regional producers to 

4 strengthen the ability of the producers to satisfy 

5 wholesale, retail, and institutional demand. 

6 ‘‘(c) ESTABLISHMENT.— 

7 ‘‘(1) IN GENERAL.—There is established in the 

8 Department a Healthy Food Financing Initiative. 

9 ‘‘(2) MANAGEMENT.—Not later than 1 year 

10 after the date of enactment of this section, the Sec11 retary shall select and enter into a grant agreement 

12 with a national fund manager who shall be respon13 sible for the management of the Initiative nationally. 

14 ‘‘(3) ELIGIBLE PROJECTS.— 

15 ‘‘(A) IN GENERAL.—Subject to the re16 quirements of this paragraph, the national fund 

17 manager shall establish the eligibility criteria 

18 for projects to be assisted by the Initiative. 

19 ‘‘(B) REQUIREMENTS.—To be eligible to 

20 receive assistance through the Initiative, a 

21 project shall— 

22 ‘‘(i) include a supermarket, grocery 

23 store, regional food hub, farmers market, 

24 or other healthy food retailer; 


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1 ‘‘(ii) consist of a for-profit business 

2 enterprise, a member- or worker-owned co3 operative, or a nonprofit organization; 

4 ‘‘(iii) meet the eligibility criteria es5 tablished under this section; 

6 ‘‘(iv) continue to be a viable business 

7 enterprise with a financial viability plan; 

8 ‘‘(v) require an investment of public 

9 funding to move forward and be competi10 tive; 

11 ‘‘(vi) operate on a self-service basis; 

12 ‘‘(vii) in accordance with subpara13 graph (C), expand or preserve the avail14 ability of healthy, fresh, high quality un15 prepared foods, particularly fresh fruits 

16 and vegetables, in underserved areas; and 

17 ‘‘(viii)(I) agree to accept benefits 

18 under the supplemental nutrition assist19 ance program established under the Food 

20 and Nutrition Act of 2008 (7 U.S.C. 2011 

21 et seq.); or 

22 ‘‘(II) in the case of a regional food 

23 hub, serve those retailers that accept sup24 plemental nutrition assistance program 

25 benefits. 


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1 ‘‘(C) REQUIREMENTS.— 

2 ‘‘(i) DEFINITIONS.—In this subpara3 graph: 

4 ‘‘(I) PERISHABLE FOOD.— 

5 ‘‘(aa) IN GENERAL.—The 

6 term ‘perishable food’ means food 

7 that is fresh, refrigerated, or fro8 zen. 

9 ‘‘(bb) EXCLUSION.—The 

10 term ‘perishable food’ does not 

11 include canned goods. 

12 ‘‘(II) STAPLE FOOD.— 

13 ‘‘(aa) IN GENERAL.—The 

14 term ‘staple food’ means food 

15 that is a basic dietary item, in16 cluding bread, flour, fruits, vege17 tables, and meat. 

18 ‘‘(bb) EXCLUSIONS.—The 

19 term ‘staple food’ does not in20 clude snack or accessory food 

21 (such as chips, soda, coffee, con22 diments, and spices) or ready-to23 eat, prepared food. 


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1 ‘‘(III) VARIETY.—The term ‘vari2 ety’ means an assortment of different 

3 types of food items. 

4 ‘‘(ii) AVAILABILITY OF FRESH FRUITS

5 AND VEGETABLES.—For purposes of sub6 paragraph (B)(vii), to expand or preserve 

7 the availability of fresh fruits and vegeta8 bles in underserved areas shall mean that 

9 the project— 

10 ‘‘(I) carries a variety of fresh 

11 produce, as defined by the national 

12 fund manager to reflect differences in 

13 project size and type; 

14 ‘‘(II) sells food for home prepara15 tion and consumption; and 

16 ‘‘(III) at a minimum— 

17 ‘‘(aa) offers for sale at least 

18 3 different varieties of food in 

19 each of the 4 staple food groups 

20 (bread and grains, dairy, fruits 

21 and vegetables, and meat, poul22 try, and fish), with perishable 

23 food in at least 2 categories, on 

24 a daily basis; or 


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1 ‘‘(bb) has a store at which 

2 at least 50 percent of the total 

3 sales of the store (including food 

4 and nonfood items or services) 

5 are from the sale of eligible sta6 ple food. 

7 ‘‘(iii) REGIONAL FOOD HUBS.—For 

8 purposes of subparagraph (B)(vii), to ex9 pand or preserve the availability of fresh 

10 fruits and vegetables in underserved areas 

11 shall mean that the project supplies a vari12 ety of fresh produce to a healthy food re13 tailer that is— 

14 ‘‘(I) located in an underserved, 

15 low and moderate income area; and 

16 ‘‘(II) participating in the supple17 mental nutrition assistance program 

18 established under the Food and Nutri19 tion Act of 2008 (7 U.S.C. 2011 et 

20 seq.). 

21 ‘‘(D) INCOME CRITERIA.—Each eligible 

22 project shall be located in or, in the case of a 

23 regional food hub, serve— 


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1 ‘‘(i) a low- or moderate-income census 

2 tract, as determined by the Bureau of the 

3 Census of the Department of Commerce; 

4 ‘‘(ii) a population census tract that is 

5 treated as a low-income community under 

6 section 45D(e) of the Internal Revenue 

7 Code of 1986; or 

8 ‘‘(iii) an area that significantly serves 

9 an adjacent area that meets the criteria 

10 described in clause (i) or (ii), as approved 

11 by the national fund manager. 

12 ‘‘(E) UNDERSERVED CRITERIA.— 

13 ‘‘(i) IN GENERAL.—Each eligible 

14 project shall be located in or, in the case 

15 of a regional food hub, serve an under16 served area, as determined by the partner17 ships according to criteria established by 

18 the national fund manager. 

19 ‘‘(ii) FACTORS.—In determining 

20 whether an area is an underserved area, 

21 the following factors shall be taken into 

22 consideration: 

23 ‘‘(I) Population density. 

24 ‘‘(II) Below average supermarket 

25 density or sales. 


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1 ‘‘(III) Car ownership. 

2 ‘‘(IV) Geographical or physical 

3 barriers, such as highways, moun4 tains, major parks, or bodies of water. 

5 ‘‘(iii) LOCATIONS.—On an annual 

6 basis, the national fund manager shall col7 lect data and publish maps that show the 

8 location of underserved areas. 

9 ‘‘(F) SERVING AN UNDERSERVED AREA.— 

10 For the purposes of subparagraphs (D) and 

11 (E), to serve an underserved area shall mean 

12 that the project to which the regional food hub 

13 supplies fresh produce or other healthy foods 

14 includes— 

15 ‘‘(i) healthy food retailers that partici16 pate in the supplemental nutrition assist17 ance program established under the Food 

18 and Nutrition Act of 2008 (7 U.S.C. 2011 

19 et seq.); 

20 ‘‘(ii) healthy food retailers that are lo21 cated in low and moderate income areas 

22 described in subparagraph (D); and 

23 ‘‘(iii) institutions such as hospitals, 

24 schools, and food banks that largely serve 


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1 low and moderate income areas as so de2 scribed. 

3 ‘‘(4) PRIORITY PROJECTS.— 

4 ‘‘(A) IN GENERAL.—Priority shall be given 

5 to projects that— 

6 ‘‘(i) are located in severely distressed 

7 low-income communities, as defined by the 

8 Community Development Financial Insti9 tutions Fund of the Department of the 

10 Treasury; and 

11 ‘‘(ii) include 1 or more of the fol12 lowing characteristics: 

13 ‘‘(I) The project will create or re14 tain quality jobs in the community, as 

15 determined in accordance with sub16 paragraph (B). 

17 ‘‘(II) The project has community 

18 support in terms of store quality, af19 fordability, site location, and coordina20 tion with local community plans or 

21 other programs promoting community 

22 and economic development. 

23 ‘‘(III) The project supports re24 gional food systems and locally grown 

25 foods, to the extent available. 


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1 ‘‘(IV) In major metropolitan 

2 areas, the project is associated with a 

3 transit-oriented development project. 

4 ‘‘(V) In areas with public transit, 

5 the project is accessible by public 

6 transit. 

7 ‘‘(VI) The project involves the 

8 reuse of a building that is listed in or 

9 eligible for the National Register of 

10 Historic Places. 

11 ‘‘(VII) The project involves a 

12 brownfield or grayfield (as those 

13 terms are used in the Comprehensive 

14 Environmental Response, Compensa15 tion, and Liability Act of 1980 (42 

16 U.S.C. 9601 et seq.)). 

17 ‘‘(VIII) The estimated energy 

18 consumption of the project, calculated 

19 using building energy software ap20 proved by the Department of Energy, 

21 will qualify the project for designation 

22 under the Energy Star program estab23 lished by section 324A of the Energy 

24 Policy and Conservation Act (42 

25 U.S.C. 6294a). 


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1 ‘‘(IX) The project involves 

2 women- and minority-owned busi3 nesses. 

4 ‘‘(B) QUALITY JOBS.—For purposes of 

5 subparagraph (A)(ii)(I), a quality job is a job 

6 that— 

7 ‘‘(i) provides wages that are com8 parable to or better than similar positions 

9 in existing businesses of similar size in 

10 similar local economies; 

11 ‘‘(ii) offers benefits that are com12 parable to or better than what is offered 

13 for similar positions in existing local busi14 nesses of similar size in similar local econo15 mies; and 

16 ‘‘(iii) is targeted for residents of 

17 neighborhoods with a high proportion of 

18 persons of low income (as that term is de19 fined in section 102(a) of the Housing and 

20 Community Development Act of 1974 (42 

21 U.S.C. 5302(a))) through local targeted 

22 hiring programs. 

23 ‘‘(d) DUTIES OF THE SECRETARY.— 

24 ‘‘(1) IN GENERAL.—The Secretary shall— 


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1 ‘‘(A) designate a national fund manager to 

2 manage national funds; 

3 ‘‘(B) oversee the Initiative nationally; 

4 ‘‘(C) work closely with the designated na5 tional fund manager— 

6 ‘‘(i) to ensure that funds are used ap7 propriately and in the most effective man8 ner practicable; and 

9 ‘‘(ii) to develop the program strategy 

10 into a detailed work plan, program, and 

11 operating budget; 

12 ‘‘(D) review and approve the operating 

13 budget for the national fund manager to ensure 

14 that the administrative costs are— 

15 ‘‘(i) reasonable (not more than 5 per16 cent of the total budget); 

17 ‘‘(ii) connected to the costs of oper18 ations; and 

19 ‘‘(iii) reflect efficient operations by the 

20 national fund manager; and 

21 ‘‘(E) make available to the public an an22 nual report, using data obtained from the De23 partment of Agriculture, the Department of 

24 Health and Human Services, and the Commu25 nity Development Financial Institutions, that 


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1 describes the impacts of the Initiative, including 

2 tracking health and economic development indi3 cators at the local, State, and national levels to 

4 determine the impacts of individual projects 

5 and the collective impact in local areas and 

6 statewide of funded projects and the Initiative 

7 overall. 

8 ‘‘(2) NATIONAL FUND MANAGER.—The Sec9 retary shall— 

10 ‘‘(A) select the national fund manager 

11 through a competitive process from among com12 munity development financial institutions that 

13 have a proven and recent track record of suc14 cess and effectiveness in— 

15 ‘‘(i) attracting private capital; 

16 ‘‘(ii) developing and managing pro17 grams that provide grants and loans to 

18 support supermarkets and other healthy 

19 food retailer business enterprises in low20 and moderate-income communities, includ21 ing the development of grocery stores, 

22 farmers markets, and other healthy food 

23 retailer models; 

24 ‘‘(iii) making and servicing loans that 

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1 tive or having a record of otherwise suc2 cessfully investing in healthy food retailer 

3 development projects; 

4 ‘‘(iv) effectively managing multiple 

5 contracts and subcontractors; 

6 ‘‘(v) effectively managing large capital 

7 pools, of at least $100,000,000; and 

8 ‘‘(vi) providing or contracting for the 

9 provision of technical assistance; and 

10 ‘‘(B) administer the Initiative by approving 

11 the disbursement of funds to the national fund 

12 manager in a manner that facilitates the imple13 mentation of the overall Initiative. 

14 ‘‘(3) COORDINATION.— 

15 ‘‘(A) IN GENERAL.—Not later than 45 

16 days after the date of receipt of an award, the 

17 national fund manager shall develop, with guid18 ance from and in consultation with the Sec19 retary, and submit to the Secretary, a detailed 

20 work plan. 

21 ‘‘(B) APPROVAL REQUIRED.—The Sec22 retary shall review and approve the work plan, 

23 program budget, and administrative costs under 

24 subsection (e)(4)(C) prior to entering into an 


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1 agreement with the national fund manager to 

2 administer the Initiative. 

3 ‘‘(4) PERFORMANCE TARGETS.— 

4 ‘‘(A) IN GENERAL.—The Secretary shall 

5 conduct financial audits of, and establish per6 formance targets for, the national fund man7 ager, which shall include, at a minimum, the re8 quirements described in this paragraph. 

9 ‘‘(B) GEOGRAPHIC SPREAD.—Partnerships 

10 funded by the Initiative shall be geographically 

11 diverse and representative of the underserved 

12 areas across the United States. 

13 ‘‘(C) FOCUS ON LOW-INCOME COMMU14 NITIES.—A substantial portion of the projects 

15 funded by partnerships shall serve very low16 and low-income communities, as defined by the 

17 Bureau of the Census of the Department of 

18 Commerce. 

19 ‘‘(D) FINANCIAL EFFECTIVENESS OF THE

20 NATIONAL FUND MANAGER.—The national fund 

21 manager and any local financial institution in22 volved in a partnership shall demonstrate on23 going capacity and timeliness in raising private 

24 capital and disbursing funds as required under 

25 the Initiative. 


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1 ‘‘(E) TECHNICAL ASSISTANCE EFFECTIVE2 NESS OF THE NATIONAL FUND MANAGER.—The 

3 provision of technical assistance by the national 

4 fund manager shall be evaluated based on— 

5 ‘‘(i) the responsiveness of the national 

6 fund manager to requests for assistance; 

7 and 

8 ‘‘(ii) the ability of the national fund 

9 manager to craft programs that develop 

10 needed new capacities in partnerships. 

11 ‘‘(F) IMPACT.—Performance targets shall 

12 address the allocation of funds by the national 

13 fund manager to partnerships and the tracking 

14 and reporting of the impacts of the funds in im15 proving access to fresh, healthy foods and in 

16 achieving other related impacts. 

17 ‘‘(e) DUTIES OF THE NATIONAL FUND MANAGER.— 

18 ‘‘(1) ALLOCATION OF FUNDS.— 

19 ‘‘(A) IN GENERAL.—The national fund 

20 manager shall— 

21 ‘‘(i) allocate at least 70 percent of any 

22 Federal appropriation made to carry out 

23 this section to partnerships that are se24 lected based on the criteria described in 

25 paragraph (3); 


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1 ‘‘(ii) retain not more than 30 percent 

2 of any Federal appropriation made to 

3 carry out this section to undertake financ4 ing activities described in subparagraph 

5 (C), including a reasonable amount for ad6 ministrative costs (not to exceed 5 percent) 

7 approved by the Secretary in accordance 

8 with paragraph (4)(C); 

9 ‘‘(iii) use not more than 25 percent of 

10 any Federal appropriation made to carry 

11 out this section to establish regional food 

12 hubs. 

13 ‘‘(B) USE OF THE NATIONAL FUNDS BY

14 PARTNERSHIP PROGRAMS.— 

15 ‘‘(i) IN GENERAL.—As a condition on 

16 the receipt of funds, each partnership shall 

17 use— 

18 ‘‘(I) the national funds received 

19 from the national fund manager under 

20 subparagraph (A)(i) to create 1 or 

21 more revolving loan programs or other 

22 revolving pools of capital or other 

23 products to facilitate financing of local 

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1 ment between the partnership and the 

2 national fund manager; and 

3 ‘‘(II) any remaining funds for 

4 grants, or, as approved, for innovative 

5 financing mechanisms. 

6 ‘‘(ii) LIMITATIONS.— 

7 ‘‘(I) IN GENERAL.—Use of funds 

8 for administrative costs and other 

9 purposes shall be— 

10 ‘‘(aa) limited in accordance 

11 with the terms of the agreement 

12 negotiated between the national 

13 fund manager and partnerships; 

14 ‘‘(bb) based on whether ad15 ministrative costs are reasonable, 

16 connected to the costs of oper17 ation, and reflect efficient oper18 ations by the partnership; and 

19 ‘‘(cc) determined using cri20 teria including geographic cov21 erage, program duration, and 

22 total funding amount. 

23 ‘‘(II) GOAL.—The goal of this 

24 clause to limit administrative costs to 

25 the maximum extent practicable, but 


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1 in no case may the amount used for 

2 administrative costs exceed 10 percent 

3 of the Federal funds allocated. 

4 ‘‘(C) USE OF THE NATIONAL FUNDS BY

5 THE NATIONAL FUND MANAGER.—The national 

6 fund manager shall use national funds de7 scribed in subparagraph (A)(ii) to undertake fi8 nancing and other activities to enhance and 

9 maximize the effectiveness of the Initiative, as 

10 determined by the agreement with the Sec11 retary, including— 

12 ‘‘(i) attracting other forms of financial 

13 assistance to match or leverage the na14 tional funds; 

15 ‘‘(ii) awarding national funds to part16 nerships in accordance with paragraph (3); 

17 ‘‘(iii) creating and managing pools of 

18 grant or loan capital that blend or leverage 

19 national funds with other forms of finan20 cial assistance, including capital in the 

21 form of tax credits under section 45D of 

22 the Internal Revenue Code of 1986, for the 

23 benefit of partnerships; 

24 ‘‘(iv) creating and managing pools of 

25 grant or loan capital that blend or leverage 


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1 the national funds with other forms of fi2 nancial assistance, including capital in the 

3 form of tax credits under section 45D of 

4 the Internal Revenue Code of 1986, to fi5 nance eligible local projects identified by 

6 partnerships or the national fund manager 

7 that have special or unique characteristics; 

8 ‘‘(v) providing loans or grants directly 

9 to eligible local projects as matching funds 

10 if requested by a partnership; 

11 ‘‘(vi) providing credit enhancement or 

12 other financial products and instruments 

13 for the benefit of partnerships or eligible 

14 local projects; 

15 ‘‘(vii) providing technical assistance; 

16 and 

17 ‘‘(viii) funding reasonable administra18 tive costs approved by the Secretary in ac19 cordance with paragraph (4)(C). 

20 ‘‘(2) RESPONSIBILITIES OF THE NATIONAL

21 FUND MANAGER.—The designated national fund 

22 manager shall— 

23 ‘‘(A) raise other forms of financial assist24 ance to match or leverage the national funds; 


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1 ‘‘(B) use administrative funds to develop 

2 appropriate training programs and offer tech3 nical assistance services to— 

4 ‘‘(i) partnerships; 

5 ‘‘(ii) State, local, and tribal govern6 ments; 

7 ‘‘(iii) the food retail industry; and 

8 ‘‘(iv) food access and health advocacy 

9 organizations to augment local capacities; 

10 ‘‘(C) develop financial products such as 

11 loans, grants, and credit enhancement tools 

12 that can be used by partnerships to incentivize 

13 and support the development and retention of 

14 supermarkets and other healthy food retailers 

15 in underserved areas; 

16 ‘‘(D) award Initiative funds to eligible 

17 partnerships through an annual competitive 

18 process in accordance with paragraph (3); 

19 ‘‘(E) contract with a national food access 

20 organization to assist in the review of applica21 tions from partnerships and to provide technical 

22 assistance to local food access organizations in 

23 the proposed partnerships; 


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1 ‘‘(F) award and disburse funds to partner2 ships or eligible local projects in a timely man3 ner; 

4 ‘‘(G) create and meet performance bench5 marks and reporting guidelines, as approved by 

6 the Secretary, including for— 

7 ‘‘(i) the amount of capital raised and 

8 leveraged from financial institutions, part9 nerships, and other resources; 

10 ‘‘(ii) the geographic diversity of part11 nerships; and 

12 ‘‘(iii) the proportion of projects fund13 ed by the partnership that are in severely 

14 distressed low-income communities; 

15 ‘‘(H) develop program guidelines and oper16 ating procedures for the Initiative, including— 

17 ‘‘(i) maximum grant and loan 

18 amounts for projects; 

19 ‘‘(ii) eligible uses of funds; 

20 ‘‘(iii) prudent underwriting criteria; 

21 ‘‘(iv) performance targets; 

22 ‘‘(v) reporting guidelines; 

23 ‘‘(vi) limits on administrative costs; 

24 and 

25 ‘‘(vii) implementation milestones; 


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1 ‘‘(I) monitor the performance of partner2 ships; and 

3 ‘‘(J) collect data, compile information, and 

4 conduct such research studies as the national 

5 fund manager determines to be relevant to the 

6 successful implementation of the Initiative, in7 cluding— 

8 ‘‘(i) to assess national and local mar9 ket conditions; 

10 ‘‘(ii) to determine barriers to market 

11 entry; and 

12 ‘‘(iii) to identify opportunities for the 

13 development or retention of supermarkets 

14 and other healthy food retailers in under15 served communities. 

16 ‘‘(3) CRITERIA FOR AWARDING NATIONAL

17 FUNDS TO PARTNERSHIPS.— 

18 ‘‘(A) IN GENERAL.—The national fund 

19 manager shall award national funds to partner20 ships through a competitive process on an an21 nual basis. 

22 ‘‘(B) FIRST ROUND PRIORITY.—In the 

23 first round of funding, the national fund man24 ager shall give priority to a limited number of 

25 existing partnerships that have demonstrable 


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1 capacity to implement fresh food financing pro2 grams in underserved areas quickly, and for 

3 which there is demonstrable, significant need 

4 for improved access to healthy food. 

5 ‘‘(C) ADDITIONAL ROUNDS.—Additional 

6 rounds shall be designed to promote geographic 

7 diversity. 

8 ‘‘(D) CRITERIA.—In awarding national 

9 funds to partnerships, the national fund man10 ager shall consider— 

11 ‘‘(i) the amount of funds and other 

12 resources pledged by a partnership to 

13 match or leverage national funds; 

14 ‘‘(ii) the degree of State, local, or trib15 al government support of the partnership 

16 as evidenced by matching grant and loan 

17 funds or other types of support, such as al18 location of tax-exempt bonds, loan guaran19 tees, and coordination of resources from 

20 other State or local economic development 

21 programs; 

22 ‘‘(iii) the capacity of the partnership 

23 to successfully develop and manage loan 

24 and grant programs; 


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1 ‘‘(iv) the lack of supermarkets and 

2 other healthy food retailers in low- and 

3 moderate-income areas that would be 

4 served by the partnership; 

5 ‘‘(v) the experience of the food access 

6 or community health organization of the 

7 partnership in outreach about access to 

8 healthy foods and local healthy food access 

9 issues; 

10 ‘‘(vi) the degree of community engage11 ment and support in the development and 

12 retention of supermarkets and other 

13 healthy food retailers; and 

14 ‘‘(vii) the contribution of the program 

15 of the partnership to the overall geographic 

16 diversity of the Initiative. 

17 ‘‘(4) ADMINISTRATIVE COSTS.— 

18 ‘‘(A) IN GENERAL.—Not later than 45 

19 days after the date of receipt of an award, the 

20 national fund manager shall submit to the Sec21 retary for approval a 3-year program and oper22 ating budget and detailed work plan that shall 

23 include— 

24 ‘‘(i) costs for research and evaluation, 

25 technical assistance, and training; and 


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1 ‘‘(ii) program and operating costs. 

2 ‘‘(B) EARNED REVENUES.—Earned reve3 nues from loan fees and interest may be ex4 pended on program and operating costs in ac5 cordance with the budget approved by the Sec6 retary. 

7 ‘‘(C) BASIS OF REVIEW.—The Secretary 

8 shall base the review under subparagraph (A) 

9 on— 

10 ‘‘(i) the likelihood of the plan and ex11 penditures to further the purposes of this 

12 section; and 

13 ‘‘(ii) whether the administrative costs 

14 are reasonable, connected to the costs of 

15 operation, and reflect efficient operations 

16 by the national fund manager. 

17 ‘‘(f) PARTNERSHIPS.— 

18 ‘‘(1) IN GENERAL.—Each partnership that re19 ceives assistance through the Initiative shall provide 

20 financial and technical assistance to eligible healthy 

21 food retailer projects in underserved areas within the 

22 defined communities of the partnership. 

23 ‘‘(2) ADMINISTRATION.—Each partnership shall 

24 designate a community development financial instiVerDate Mar 15 2010 05:38 Apr 30, 2013 Jkt 029200 PO 00000 Frm 00034 Fmt 6652 Sfmt 6201 E:\BILLS\S821.IS S821

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1 tution or other organization that is capable of ad2 ministering a loan and grant program— 

3 ‘‘(A) to execute grant agreements with the 

4 national fund manager; and 

5 ‘‘(B) to serve as the manager of local 

6 funds. 

7 ‘‘(3) RESPONSIBILITIES OF PARTNERSHIPS.—A 

8 partnership shall— 

9 ‘‘(A) raise other forms of financial assist10 ance to match the national funds received by 

11 the partnership; 

12 ‘‘(B) provide marketing and outreach to 

13 communities, the supermarket industry, other 

14 healthy food retailers, State and local govern15 ment officials, and civic and public interest or16 ganizations— 

17 ‘‘(i) to solicit applications from under18 served areas from across the State or local19 ity to be served by the partnership; and 

20 ‘‘(ii) to inform the communities and 

21 other persons about the availability of 

22 grants, loans, training, and technical as23 sistance; 

24 ‘‘(C) review and underwrite projects to de25 termine whether— 


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1 ‘‘(i) a proposed project meets the cri2 teria for eligible projects under subsection 

3 (c)(3); and 

4 ‘‘(ii) a proposed project meets the cri5 teria for priority projects under subsection 

6 (c)(4); 

7 ‘‘(D) provide technical assistance services 

8 to eligible healthy food retail operators and de9 velopers; 

10 ‘‘(E) track and report outcomes, includ11 ing— 

12 ‘‘(i) the number of jobs created or re13 tained; 

14 ‘‘(ii) the quantity of healthy food re15 tail space created or retained and regional 

16 food hub capacity developed; and 

17 ‘‘(iii) such other health and economic 

18 indicators as are required by the national 

19 fund manager; 

20 ‘‘(F) monitor and audit funded projects to 

21 ensure compliance with the Initiative, the na22 tional fund manager, and partnership program 

23 requirements for a period of at least 3 years; 

24 ‘‘(G) submit an annual report to the na25 tional fund manager that describes— 


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1 ‘‘(i) the activities of the partnership; 

2 ‘‘(ii) the expenditure of local funds; 

3 and 

4 ‘‘(iii) success in meeting performance 

5 targets and satisfying such other terms 

6 and conditions as are specified in the 

7 agreement between the partnership and the 

8 national fund manager; and 

9 ‘‘(H) coordinate with the national fund 

10 manager for the smooth operation of the Initia11 tive. 

12 ‘‘(4) ADMINISTRATIVE COSTS.— 

13 ‘‘(A) IN GENERAL.—As a condition on the 

14 receipt of assistance under this section, each 

15 partnership shall submit to the national fund 

16 manager for approval a 3-year budget and plan 

17 for all program and operating costs, includ18 ing— 

19 ‘‘(i) costs for research and evaluation, 

20 technical assistance, and training; and 

21 ‘‘(ii) administrative and operating 

22 costs. 

23 ‘‘(B) EARNED REVENUES.—Earned reve24 nues from loan fees and interest may be ex25 pended on program and operating costs in acVerDate Mar 15 2010 05:38 Apr 30, 2013 Jkt 029200 PO 00000 Frm 00037 Fmt 6652 Sfmt 6201 E:\BILLS\S821.IS S821

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1 cordance with the budget approved by the na2 tional fund manager. 

3 ‘‘(C) BASIS OF REVIEW.—The national 

4 fund manager shall base the review under sub5 paragraph (A) on the likelihood of the budget 

6 and plan to further the purposes of this section. 

7 ‘‘(g) EVALUATION AND MONITORING.— 

8 ‘‘(1) IN GENERAL.—Program evaluation and fi9 nancial audits shall occur at all levels of the Initia10 tive to ensure that— 

11 ‘‘(A) national and local funds are used 

12 properly; and 

13 ‘‘(B) the objectives of the Initiative are 

14 met. 

15 ‘‘(2) PROGRAM EVALUATION AND FINANCIAL

16 AUDITS.— 

17 ‘‘(A) IN GENERAL.—The Secretary shall— 

18 ‘‘(i) conduct periodic program evalua19 tions and financial audits of the national 

20 fund manager, partnerships, and projects 

21 funded by the Initiative; and 

22 ‘‘(ii) share with the national fund 

23 manager the results of the evaluations and 

24 audits. 


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1 ‘‘(B) FUNDED PROJECTS.—The Secretary 

2 or the national fund manager shall evaluate 

3 partnerships to assess the health and economic 

4 impacts of projects funded by the Initiative. 

5 ‘‘(C) OTHER IMPACTS.— 

6 ‘‘(i) SECRETARY OF HEALTH AND

7 HUMAN SERVICES.—The Secretary of 

8 Health and Human Services shall conduct 

9 research studies and evaluate the health 

10 impacts of the Initiative. 

11 ‘‘(ii) COMMUNITY DEVELOPMENT FI12 NANCIAL INSTITUTIONS.—Representatives 

13 of the Community Development Financial 

14 Institutions shall conduct research studies 

15 and evaluate the economic impacts of the 

16 Initiative. 

17 ‘‘(D) PARTNERSHIPS.— 

18 ‘‘(i) IN GENERAL.—Each partnership 

19 shall— 

20 ‘‘(I) conduct periodic administra21 tive and financial audits of projects 

22 funded by the Initiative; and 

23 ‘‘(II) share with the national 

24 fund manager the results of the au25 dits. 


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1 ‘‘(ii) FAILURE OF PARTNERSHIP.—In 

2 a case in which a partnership fails, the na3 tional fund manager shall take over the 

4 portfolio of the failed partnership. 

5 ‘‘(h) ADMINISTRATIVE PROVISIONS.— 

6 ‘‘(1) IN GENERAL.—Not later than 180 days 

7 after the date of enactment of this section, the Sec8 retary shall promulgate regulations— 

9 ‘‘(A) for the conduct of a rigorous per10 formance evaluation to determine the impact of 

11 the Initiative at the end of the initial 5-year pe12 riod, which the Secretary shall submit to Con13 gress; 

14 ‘‘(B) to establish metrics for evaluating the 

15 effectiveness of the Initiative; and 

16 ‘‘(C) under which the Secretary shall as17 sess whether the Initiative should be extended 

18 at the end of the initial 5-year period. 

19 ‘‘(2) TERMINATION OF CONTRACTS FOR

20 CAUSE.—The Secretary may promulgate regulations 

21 under which the Secretary may terminate contracts 

22 for cause if the Secretary determines that to be nec23 essary. 

24 ‘‘(i) AUTHORIZATION OF APPROPRIATIONS.—There is 

25 authorized to be appropriated to the Secretary to carry 


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1 out this section $125,000,000, to remain available until 

2 expended.’’. 

3 (b) CONFORMING AMENDMENT.—Section 296(b) of 

4 the Department of Agriculture Reorganization Act of 

5 1994 (7 U.S.C. 7014(b)) is amended— 

6 (1) in paragraph (6)(C), by striking ‘‘or’’ at the 

7 end; 

8 (2) in paragraph (7), by striking the period at 

9 the end and inserting ‘‘; or’’; and 

10 (3) by adding at the end the following: 

11 ‘‘(8) the authority of the Secretary to establish 

12 in the Department the Healthy Food Financing Ini13 tiative in accordance with section 242.’’. 

Æ 


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