NJEDA – Subsidies to Adopt New Grocery Delivery Models to Aid Food Desert Community Residents

TRENTON, N.J (January 6, 2023) – The New Jersey Economic Development Authority (NJEDA) Board announced at its December meeting the approval of a new grant program targeted at strengthening food security in the state’s 50 Food Desert Communities (FDC), which are home to 1.5 million New Jersey residents across a diverse range of communities in all 21 counties. This spring, food retailers will be able to apply for the Food Retail Innovation in Delivery Grant (FRIDG) to assist in the purchase and installation of temperature-controlled lockers to expand food delivery options and improve food access for Food Desert Community residents. FRIDG will provide last mile solutions that help FDC residents tap into the exponential growth in online grocery shopping with delivery to a convenient location in their community.

The $2.5 million allocation appropriated through the Fiscal Year 2022 state budget is aligned with Governor Phil Murphy’s commitment to combating food insecurity, including Sustain & Serve NJ, the Food Security Planning Grant and the Food Desert Relief Act, which will provide up to $40 million per year to support a variety of programs that increase access to affordable, nutritious food through funding for supermarkets, small- and mid-size retailers, and other entities that support food security initiatives. NJEDA is also currently seeking public feedback on the Food Desert Relief Tax Credit Program, which aims to support the development and initial operations of new supermarkets and grocery stores in FDCs.

“The FRIDG program will build upon Governor Murphy’s vision and the work being done to uplift those in the state’s targeted Food Desert Communities,” said NJEDA Chief Executive Officer Tim Sullivan. “People should be able to benefit from the advancements in grocery delivery and access nutritious food regardless of their zip code. With this new program, we will make New Jersey a leader in pioneering a new approach to food access in partnership with food retailers.”

“The creation of crucial resources and programs, such as the FRIDG program, plays an important role in our work to stem food insecurity in households across New Jersey,” said Assembly Speaker Craig J. Coughlin (D-Middlesex). “This program will help bridge the gap in access to balanced, nutritional meals for working families living in food desert communities in our state, building on our efforts to put food on the table of all New Jerseyans. Meeting the most basic needs of our residents must be our priority and the FRIDG program helps us accomplish this by building on our existing hunger-fighting initiatives.”

Food retailers with at least one physical location in New Jersey can apply for up to $250,000 in funding to purchase and install self-contained, temperature-controlled lockers in one of New Jersey’s 50 designated FDCs. These companies must be authorized to accept online orders paid with Supplemental Nutrition Assistance Program (SNAP) benefits. As of September 2022, there were 789,276 New Jersey residents receiving SNAP benefits, including nearly 350,000 children. In 2020, the NJ Department of Human Services (NJDHS) launched a pilot program to allow SNAP recipients to use their benefits to purchase groceries online. This aligns with the broader growth in online grocery ordering, which now accounts for almost 10 percent of all grocery sales nationwide and is projected to surpass 20 percent by 2026. New Jersey SNAP recipients can now purchase groceries online from 16 retailers, but many FDC residents remain unable to receive groceries as they lack a reliable delivery location due to unpredictable work schedules, family obligations or housing insecurity. The FRIDG lockers are intended to provide FDC residents with a safe, convenient location where their grocery orders – including fresh produce and dairy – will stay fresh until they are retrieved at a convenient time. 

“Food assistance through SNAP puts food on the table for many New Jersey families. But for residents without ready access to fresh, nutritious food, this assistance is incomplete,” NJDHS Commissioner Sarah Adelman said. “The FRIDG program bridges the gap by allowing retailers who participate in the states’ online ordering flexibility to better serve customers where they live and work. This program, with the strong leadership and partnership of NJEDA, truly demonstrates the Murphy Administration’s whole-of-government approach to addressing food insecurity.”

Retailers must submit an application detailing their plan to purchase these lockers before actually buying one. The FRIDG grants will cover at least 30 percent of the initial costs, including the installation, which is subject to the state’s prevailing wages and affirmative action laws for installation costs above $2,000. Applicants may increase their grant award through bonuses to cover up to 50 percent of the project costs for commitments such as waiving delivery fees (including for SNAP recipients) and partnering with community-based organizations to host the lockers. The lockers must be installed in public places with easy general access to the public to allow residents to easily access to groceries. such as community centers or libraries, not lobbies of apartment complexes with keycards or locks or other sites with restricted access. The Authority will disburse funds to the purchasing companies following the installation, which will be the lower amount between the determined percentage or $250,000.

“There is no single solution to alleviating food deserts, and FRIDG is a vital element of Governor Murphy’s growing portfolio of food security initiatives,” said NJEDA Executive Vice President for Economic Security Tara Colton. “This program is pioneering a new approach to food access in partnership with food retailers. By meeting people where they are – literally – we aim to eliminate some of the structural and logistical barriers to fresh and nutritious food that should be the standard for all New Jersey residents, regardless of where they live.”

“True food security exists when all people, at all times, have physical, economic, and social access to safe, sufficient, and nutritious food,” said Mark Dinglasan, Director of the Office of the Food Security Advocate (OFSA). “The FRIDG program is an innovative approach to food security that encourages public/private partnerships, decreases stigma, leverages technology, and fulfills a good portion of the definition of food security. OFSA is proud to support the NJEDA in this effort and looks forward to continued innovation and collaboration that we can bring to bear when we all work together and push each other to think outside the box.”

Retailers can apply for multiple grants, providing they offer one locker unit per FDC and do not try to install one in a FDC that has already received approval.  The application window will be open for 18 months from the start date or until the funds are exhausted, whichever comes first. This is not a competitive application process, and all candidates will be evaluated separately as applications are received. Upon approval, grantees will have 12 months to install the lockers, with up to two six-month extensions available, pending Authority approval.

Article Courtesy of the NJEDA