SHB 2297
In CommitteeHouse
Grocery store incentives
Incentivizing grocery stores located in underserved communities.
This status may be delayed. See Action History below for the latest updates.
How does a bill become law?
- Introduced: The bill is filed and assigned a number.
- Committee: A subject-matter committee holds hearings, takes public testimony, and decides whether to advance the bill.
- Floor Vote: The full chamber (House or Senate) debates and votes on the bill.
- Opposite Chamber: The bill repeats the committee and floor vote process in the other chamber.
- Governor: The Governor reviews the bill and decides whether to sign or veto it.
- Signed: The bill has been signed into law.
AI Analysis
This bill establishes tax incentives—including property tax exemptions and B&O tax credits or exemptions—for grocery stores operating in designated underserved community zones to improve food access and support local jobs. It authorizes cities and counties to create local programs, define qualifying zones, and issue tax exemptions, while also creating state-level tax benefits for eligible stores.
- Creates a new property tax exemption program allowing cities and counties to exempt from property taxation up to 30 years the value of new construction or improvements for qualifying grocery stores in designated 'underserved community zones'.
- Authorizes cities and counties to designate 'underserved community zones' based on low-income, low-access, or low-transportation criteria, with limits on the number of zones per county.
- Adds a new B&O tax credit equal to 0.029% of gross income for grocery stores operating in underserved community zones, capped at $5 million statewide annually.
- Exempts from B&O tax certain grocery stores—specifically locally owned, employee-owned, union-run, or cultural grocery stores (those selling at least 40% culturally relevant food)—operating in underserved community zones.
- Requires annual reporting by cities/ counties to the Department of Commerce and Department of Revenue on exemptions granted, zones designated, and program outcomes (e.g., jobs, food access).
- Sets a 30-year sunset date for the property tax exemption and B&O tax credit/exemption provisions (January 1, 2037).
Who is affected
- Grocery store owners and operators — Grocery stores (including small, mid-sized, and large supermarkets) located in designated underserved community zones may receive property tax exemptions and business and occupation (B&O) tax credits or exemptions, depending on store type and location.
- City and county governments — Local governments (cities and counties) gain authority to establish property tax exemption programs and must administer applications, issue certificates, and report annually to the state.
- Residents of underserved communities — Residents of designated underserved community zones may benefit from improved access to affordable, nutritious food and new local jobs if new or existing grocery stores open or remain open due to the incentives.
- State agencies (Commerce and Revenue) — The state Department of Commerce and Department of Revenue gain responsibilities for oversight, data collection, and annual reporting on the program's implementation and outcomes.
Pro/Con Analysis
Stronger case for benefits
Potential Benefits (5)
By incentivizing grocery stores in underserved zones, the bill directly improves access to affordable, nutritious food — a key social determinant of health — potentially reducing diet-related chronic diseases and lowering public health costs over time, especially for low-income residents and communities of color.
HealthcarePeopleRef: Sec. 303, 306, 401, 501The combination of property tax exemptions, B&O tax credits (0.029% of gross income, capped at $5M), and full B&O exemption for culturally/union/employee-owned stores creates strong financial incentives to open or retain grocery stores in underserved areas, supporting local jobs — especially for small and mission-driven retailers.
Business & EmploymentPeopleRef: Sec. 303, 306, 401, 501By targeting “low-access” and “low-transportation-access” census tracts (Sec. 305(1)(b), (c)), the bill helps stabilize essential services in neighborhoods where residents face food deserts and transportation barriers, reducing household transportation and health costs — particularly benefiting seniors, disabled residents, and car-limited households.
HousingPeopleRef: Sec. 305(1), 305(8)The requirement for annual reporting to the Department of Commerce and Department of Revenue (Sec. 311) creates a framework for evidence-based evaluation and potential program adjustments, supporting long-term accountability and data-driven policy improvements.
Local GovernmentPeopleRef: Sec. 306(10), 311(2)(e)The B&O tax exemption for culturally, employee-, or union-owned grocery stores (Sec. 501) directly supports small, community-based businesses that are more likely to reinvest locally — strengthening local economic resilience and job quality in underserved areas.
Business & EmploymentPeopleRef: Sec. 501(1), 501(2)
Potential Concerns (5)
Local governments lose property tax revenue on exempted grocery store improvements for up to 30 years, and the exemption excludes school district levies — shifting part of the funding burden to other property owners or forcing budget cuts to public services like schools, libraries, and emergency services. This is particularly impactful in districts already under fiscal stress due to Initiative 773 and other constraints.
Local GovernmentPeopleRef: Sec. 303, 306(9)The exclusion of school district property taxes (Sec. 306(9)) and the requirement for local governments to report program outcomes without additional funding may strain municipal budgets, potentially reducing resources available for public safety services like police, fire, and EMS — especially in smaller or fiscally constrained jurisdictions.
Public SafetyPeopleRef: Sec. 306(9), Sec. 311(2)(e)The exemption applies only to building improvements, not land value, and only to qualifying grocery stores in designated zones — meaning most residential property owners and renters see no direct benefit or cost shift, though neighborhood revitalization could indirectly affect housing values and displacement risk.
HousingRef: Sec. 306(5), Sec. 306(7)Because school districts are excluded from the property tax exemption (Sec. 306(9)), the bill does not directly harm school funding, but the broader reduction in local revenue may pressure districts to seek alternative funding sources, potentially increasing local levies on residents.
EducationRef: Sec. 306(9), Sec. 311(2)(e)While the bill creates tax incentives for grocery stores, the $5M annual cap on the B&O credit (Sec. 401(5)) and the 30-year sunset (Sec. 313) limit long-term predictability for business planning and may disproportionately benefit larger chains with more resources to navigate application processes.
Business & EmploymentRef: Sec. 306(9), Sec. 311(2)(e)
Who Is Most Affected
Grocery store owners in underserved zones may benefit significantly from property tax exemptions and B&O tax relief, especially large chains that can meet application thresholds and scale operations to capture the $5M credit cap; however, smaller operators may face administrative burdens and may not qualify if they don’t meet size or ownership criteria.
Local governments gain authority to design and implement programs but bear administrative costs and revenue losses; they may recover some costs via application fees, but net fiscal impact is negative — especially in rural or frontier counties with fewer qualifying sites.
Residents of underserved zones benefit from improved food access and potential job creation, but gains depend on store viability and retention; without配套 services (e.g., transit, wages), benefits may be limited or uneven.
State agencies gain oversight responsibilities but minimal new costs; the program’s success hinges on interagency coordination and data quality, with no direct fiscal benefit to the state.