The New Jersey Economic Development Authority (NJEDA) will open applications for the Food Desert Relief Supermarket Tax Credit Program tomorrow, Wednesday, December 20, 2023.

The Food Desert Relief Supermarket Tax Credit Program addresses the food security needs of New Jersey’s 50 Food Desert Communities (FDCs) by providing up to $40 million per year in tax credits to develop and sustain new supermarkets and grocery stores in food deserts. No more than two grocery stores in each FDC can receive tax credits through the program.

The program is comprised of two tax credits: the Financing Cap Tax Credit, applied for by a store’s developer, and the Initial Operating Costs Tax Credit, applied for by a store’s operator. For a single store to receive both credits, the applications must be reviewed and approved at the same time. Tax credits may be resold for a minimum of 85% of the transferred credit amount.

To receive tax credits through the Food Desert Relief Supermarket Tax Credit Program, supermarkets or grocery stores must:

• Be the first or second newly constructed or rehabilitated supermarket or grocery store in a designated Food Desert Community to be approved under this program. (Please consult the map of FDCs.)
• To qualify, the rehabilitation work done must affect at least 75% of the square footage of the supermarket or grocery store and must include repair or replacement of two or more major systems, including, but not limited to: (a) roof, (b) plumbing, (c) heating and cooling (including refrigeration), (d) electrical, (e) load bearing structural systems, or (f) weatherization (e.g. solar panels, siding, replacement windows, and doors). The cost of this repair or replacement, not including soft costs that are over 20% of the total cost, must be at least 60% of the fair market value of the supermarket or grocery store after the rehabilitation.
• Be a retail outlet with at least 16,000 square feet where at least 80% of square footage is occupied by food and related products.
• Devote at least 10% of retail space to fresh and/or frozen fruits and vegetables.
• Open the supermarket or grocery store for business to the public within 6 months of the receipt of a temporary certificate of occupancy or within three years of executing the incentive award agreement corresponding to the project (subject to possible extensions approved by the NJEDA).
• Commit to accept benefits from federal nutrition assistance programs, including SNAP and WIC.
• Demonstrate that the store would not be economically feasible without the tax credit award, but with the tax credit award, it would operate on a full-time basis for seven years after opening and be economically and commercially viable by the end of that period.
• Hold a public listening session in the Food Desert Community at least once a year.

Questions may be submitted to FoodDesertRelief@njeda.gov. Any answers provided will also be shared publicly so that all bidders have the same information.

For more information, click here.