Minneapolis healthy food rules prompt Dollar Tree to drop food stamp benefits

Minneapolis has begun enforcing tighter rules requiring corner shops and convenience stores to stock a variety of healthy foods — prompting one discount chain to announce it will no longer accept food stamp benefits so that it can avoid having to follow the city's ordinance.

Dollar Tree, which has four Minneapolis locations spread throughout the city, is so far the only business to look for a way around the Staple Foods Ordinance, which was passed in 2008 and updated in 2014. The first-in-the-nation law aims to combat obesity, diabetes and other health issues by providing more fresh foods in neighborhoods that lack grocery options.

In April, after working with businesses to ensure they were stocked with the required fresh produce, protein items, milk, juice and whole-grain breads, the city ended a more than yearlong grace period and began enforcing the stricter standards. The same month, Dollar Tree, which had previously accepted SNAP and WIC food stamp benefits, posted a notice to its customers: "Due to new city ordinance, we can no longer accept food stamps in this store." The memo goes on to say the city's ordinance "prevents you from using your food stamps in our stores," because " 'Everything's $1.00' in Dollar Tree stores."

Businesses that sell food are not required to accept food stamp benefits to operate, but they must comply with the ordinance if they want to be licensed to accept the benefits.

The move drew criticism from Council Member Blong Yang, whose North Side ward is home to one of the Dollar Tree stores, and Council Member Cam Gordon, who authored the ordinance. Yang said he's heard from residents who have been regular customers of the store and are concerned they'll have to travel outside the city to use their food stamps at the discount store.

"It just feels awful that somebody would do this," he said. "It looks bad and feels bad and is just bad in general in my view."

Gordon said he considers Dollar Tree's decision disappointing and will consider tweaking the ordinance to ensure businesses can't find a way around the rules.

"The idea with the ordinance is if you want to act like a grocery store, you should be a real grocery store, you should provide some options, some healthy foods," he said.

Randy Guiler, vice president of investor relations for Chesapeake, Va.-based Dollar Tree, said in a prepared statement that the chain's stores have kept a fixed price point of $1 per item for nearly three decades. To keep prices low, the stores typically receive shipments once per week — less than would likely be required to maintain the required supply of fresh foods.

"In accordance with the terms of the city ordinance, in order to retain our license to sell food, we were forced to discontinue acceptance of food stamps under the Supplemental Nutrition Assistance Program (SNAP) in our four Minneapolis stores," he wrote.

City health officials said three of the four affected stores — on West Broadway Avenue in north Minneapolis, near Lake Street and Hiawatha Avenue in south Minneapolis, and on Franklin Avenue in the Ventura Village neighborhood south of downtown — are located within two-tenths of a mile of full-service grocery stores that accept food benefits. The fourth, located at 46th Street and Nicollet Avenue S., in the Tangletown neighborhood, is about 1.5 miles from a full-service store.

Kristen Klingler, a senior public health specialist with the city, said each of the Dollar Tree locations is also located near other smaller corner stores that are participating in the city's ordinance.

All of the participating stores aren't necessarily in full compliance as the city begins enforcement of the ordinance. In 2015, the city conducted two rounds of compliance checks at 230 stores and found that about half were following the rules. But Klingler said those visits included a number of large chain stores, including Walgreens, CVS and Super­America, that were still working on their transition plans.

This summer, the city plans to send an intern to do another compliance check at all of the stores, and Klingler said the rates should be much higher. And this time around, the city could issue fines. So far, no businesses have been cited for failing to comply.

"We're expecting to find an 80 to 85 percent compliance rate," she said.

In the meantime, University of Minnesota researchers are analyzing the impact of the ordinance on food available in stores and if it's changing residents' shopping and eating habits. Results from that study are expected this fall.

Erin Golden • 612-673-4790