by Terrie Ellerbee/editor-Midwest & Southwest
There are two reasons why a program called Healthy Food For Ohio (HFFO) has been a huge success. First, it helps eliminate food deserts in Ohio. Second, though many municipalities offer financial incentives for new grocery stores—often for huge chains—they tend to leave existing operators out in the cold; this program doesn’t.
“It can be anybody that can show that they’ll be improving the quality of the store or putting one in a spot that doesn’t have one,” Kristin Mullins, president and CEO of the Ohio Grocers Association (OGA), told The Shelby Report.
Mullins said the OGA helped get the program off the ground. It started in 2016 with $2 million in the state budget, and then private funding added another $25 million. Mullins shared an example of how it can work for a small community. Vinton County has been without a grocery store since a Supervalu store closed in 2013. A Dollar General came in.
“We want those people in underserved areas to be able to go buy fresh, healthy food, and a lot of times you can’t find that in a corner store. You need a grocery store,” Mullins said. “We want fresh meat, fresh produce and things that people need to sustain life, not just snacks.”
The Supervalu store that was located there closed because it wasn’t profitable enough to remain open.
“It’s difficult to get a retailer to open a store if it isn’t going to work. If it would work, they would already be there,” Mullins said. “The funding helps take some of that risk off of the retailer. It will back real estate costs, inventory costs, equipment costs. Some of it is loaned money; some of it is grants, so it wouldn’t have to be paid back.”
The fund certainly is helping Vinton County. Fourth generation family-owned Campbell’s Market broke ground in March on what will be a full-service grocery store in McArthur. The Campbell family, who also operates stores in Zanesville and Duncan Falls, purchased two acres on West Main Street, and Vinton County contributed $50,000 for the project, The Columbus Dispatch reports. Campbell’s Market is expected to open in August.
As Mullins pointed out, the fund doesn’t just assist with new locations; it also can help boost stores already operating in areas that would be a food desert without them.
“This is something that we are really happy to support,” Mullins said. “I understand that they’re going to ask for money in the upcoming state budget. We are certainly supportive of that, and we do a lot to communicate with our members that this funding is out there and available for them to take advantage of, so it’s a good thing.”
There is some consternation in the state about that budget. The good news is the governor of Ohio wants to cut the income tax. That bad news is that Gov. John Kasich wants to make up the difference by targeting people who smoke cigarettes and drink alcohol. His budget would increase the cigarette tax from $1.65 to $2.25 per pack. It also would assess a penny on every glass of wine and beer.
“This is a big one for us,” Mullins said. “These are our two priorities. They’re talking about a penny a serving, which doesn’t sound like a lot, but by the time it gets through the system and gets to that retail shelf, it could be upward of a dollar difference (per case of beer).”
Grocery retailers who operate near the state’s borders will be the most impacted by those taxes.
“They’ve just lost a competitive advantage,” she said. “If you’ve got a store in Youngstown, they’re going to go across that border to Pennsylvania. If you’re Cincinnati, they’re going to go across the border into Kentucky. Same thing with Indiana. It’s happening now, and all that’s going to do is increase that.”
She said it ultimately would impact the economy of Ohio.
“If you raise this tax, and they go across the border to buy these products, we’ve lost the revenue we currently have. That’s our point,” she said.
In February, the state’s legislature introduced a bill that would add the photos of Supplemental Nutrition Assistance Program (SNAP) recipients to EBT cards. The bill is backed by State Auditor Dave Yost.
“We have concerns,” Mullins said. “I understand that Auditor Yost is very concerned about fraud in the SNAP program, and we are, too. As grocers, we see those people buying up products, going out to the parking lot and selling them for money. We see that. We see people selling their actual EBT cards. We understand there is an issue.”
She believes the intention behind the proposed legislation is good, but whether it’s practical is another question.
“What it does is it makes our members the police,” Mullins said. “Say I have a household of four, and as the head of household, my picture is on the ID card. But then my 17-year-old son needs to go to the store. Is he going to be able to use it, because his picture’s not on it? So we have a lot of concerns.”
In addition, it would be costly for the state to reissue all those IDs. In Ohio, more than 820,000 people received SNAP benefits in 2015.
Another issue that has cropped up might easily have been missed. The Ohio Criminal Justice Recodification Committee, made up of 22 people, reviews and sometimes rewrites portions of the state’s criminal code. There is talk in Ohio of sentencing reform to help reduce the number of people in prison—The Plain Dealer reports that prisons built to house 38,579 inmates now house about 50,200—and one way to do that would be to make changes to the criminal code. One suggestion was to raise the threshold for a felony charge to $2,500 from the current $1,000. That one little line could have huge implications for grocery retailers.
“I don’t think they can conceive—‘Well, who’s going to steal $1,000 from a grocery store?’ They’re picturing someone walking in and putting steaks down their pants. That’s not what we’re talking about,” Mullins said. “We’re talking about organized retail crime (ORC). For them, it is a job. They hit four or five stores in a row and either sell the products on the black market or at flea markets or whatever they do, but it is lucrative.”
If the law were to change, those who make their living through ORC would likely steal $2,499 per store rather than $999 worth of high-ticket items like baby formula and razors.
“We’re going to make sure that they understand those concerns,” Mullins said. “It might be an unintended consequence, but we’re going to voice what that means to our industry. I’m not sure they really thought about the details.”
Mullins and her staff update OGA members on issues like these each Thursday with the digital e-newsletter “The Weekly Checkout.” And for those who aren’t aware, Mullins does a weekly “Keeping Up With Kristin” video that is emailed to OGA members each Friday.
The question her fans want to ask: Will there be another “Keeping Up With Kristin” blooper reel this year?
“It’s funny you ask, because that blooper reel was the second most-watched ‘Keeping Up With Kristin’ the whole year,” she said. “So to answer your question, is it coming back next year? I make plenty of mistakes doing this, so of course it’s coming back.”
*Editor’s note: This is part of the Ohio Market Profile, which appears in the April 2017 print edition of The Shelby Report of the Midwest.