Delaware WIC Program Vendor Handbook DELAWARE HEALTH AND SOCIAL SERVICES DIVISION OF PUBLIC HEALTH SPECIAL SUPPLEMENTAL NUTRITION PROGRAM FOR WOMEN, INFANTS, AND CHILDREN Table of Contents Vendor Limitation and Participant Access A1 Bid Application Periods and Waiting Lists A3 Vendor Eligibility Criteria A5 Vendor Bid (Application) Process A7 Vendor Training B1 Routine Monitoring and Compliance Investigations C1 Violations and Sanctions D1 Civil Money Penalty E1 Vendor Claims F1 Change of Ownership or Location, Store Closure/Cessation of Operations G1 Administrative Reviews/Vendor Appeals H1 WIC/Food Stamp Information Sharing I1 Confidential Vendor Information J1 Violation Chart (Appendix) Y Vendor Limitation and Participant Access Policy and Procedure Contents • What does the term vendor limitation criteria mean? • How does the State agency limit the number of vendors it authorizes? • How is the ratio applied? • What does the term geographic area mean? • Are there any exceptions to the limitation of vendors? • What happens when a geographic area has less than 400 participants? • How does the State agency review participant access? • Federal Reference What does the term vendor limitation criteria mean? This term refers to criteria established by the State agency to determine the maximum number and distribution of vendors it authorizes. How does the State agency limit the number of vendors it authorizes? The State agency uses a participant-to-vendor ratio (300:1) to determine the number of vendors authorized in each geographic area. How is the ratio applied? This ratio is applied to geographic areas within the State to distribute the authorized vendors in accordance with the participant population densities. The State agency will round up for .5 or greater and round down for .49 or less. If geographic area has… …then… …means the number of vendors authorized is… 900 participants 900 divided by 300 = 3 3 1000 participants 1000 divided by 300 = 3.33 3 1125 participants 1125 divided by 300 = 3.75 4 What does the term geographic area mean? For purposes of authorization, geographic area is defined as the area in which participants reside. Geographic area boundaries are determined through Zip code analysis. Are there any exceptions to the limitation of vendors? Yes, the State agency may authorize extra vendors in an area if one of the following exceptions exists: • geographic area has less than 500 participants, or • participant access. What happens when a geographic area has less than 500 participants? For geographic areas with populations below 500 participants, no less than 2 vendors are selected. This allows for participant choice and vendor competition. How does the State agency review participant access? Participant access is not defined as participant convenience or preference. Inadequate participant access would cause a hardship, not just an inconvenience, to participants. Hardship will be determined if one of the following conditions exists: • Fifty (50) or more participants would be required to travel in excess of five miles to reach an authorized vendor. • Constant or permanent physical barriers or conditions that would make normal travel to another authorized vendor impossible (e.g., frequent road closings due to bad weather). • Fifty (50) or more participants whose specific nationality can only be properly served by a specific vendor due to a language barrier. • Fifty (50) or more participants whose specific dietary needs can only be properly served by a specific vendor due to religious mandates. The State agency reviews participant access on a statewide basis during the authorization process and on a case-by-case basis during an agreement period. Federal Reference 7 CFR 246.12(g)(2) Last revised: May 20, 2008 Bid Application Periods and Waiting Lists Policy and Procedure Contents • How often does the State agency accept and process bid applications? • What does the term “agreement period” mean? • Can a vendor request a bid application during an agreement period? • Is there any advantage to being on a waiting list? • Who is on the primary waiting list? • Who is on the secondary waiting list? • How does the State agency authorize vendors during an agreement period? • Federal Reference How often does the State agency accept and process bid applications? Once every year, the State agency accepts and processes bid applications to authorize WIC vendors. The State agency utilizes a competitive vendor bidding process for the mass authorization of applicant vendors. What does the term “agreement period” mean? The State agency awards Vendor Participation Agreements (hereafter referred to as agreements) for a specific period of calendar years. All agreements run concurrent with this specified timeframe. (Example: Vendors are authorized for 2009 agreement period. Thus, agreements can start no sooner than January 1, 2009 and must expire no later than December 31, 2009.) Can a vendor request a bid application during an agreement period? No, but a vendor can inform the State agency that he or she wishes to be added to a waiting list. Is there any advantage to being on a waiting list? Yes, the State agency uses waiting list vendors to: • replace an authorized vendor who is terminated from the program for any reason (change of ownership, disqualification, store closure, etc.); and • select vendors to review for authorization if any additional vendors are required to maintain adequate participant access. The State agency notifies waiting list vendors when the next competitive vendor bid process takes place and invites them to the pre-bid meeting. Who is on the primary waiting list? The State agency places applicant vendors who pass eligibility criteria (except training), but did not rank high enough to attain authorization, on the primary waiting list. Applicant vendors are listed in the order of their bid results for their geographic area. Applicant vendors failing to meet any of the authorization criteria are denied authorization and placement on the primary waiting list. During the agreement period, these vendors may request to be added to secondary waiting list. Who is on the secondary waiting list? This is a list of vendors who did not participate in or were denied during the competitive bid process. Grocery vendors requesting authorization after the bids have been awarded or during an agreement period are sent a letter explaining how the Delaware WIC Program selects their vendors and a Waiting List Information Sheet. This information sheet is not an application for authorization. It is merely a request to be added to the secondary waiting list. How does the State agency authorize vendors during an agreement period? If an authorized vendor is terminated/disqualified or any additional vendors are required to maintain adequate participant access, the State agency will: 1 Review the waiting lists for the geographic area in conjunction with the participant access determination. 2 Select vendors that will achieve the greatest participant access and utilize the same competitive vendor bid process used for mass authorization. Federal Reference 7 CFR 246.12(g)(8) Last revised: May 20, 2008 Vendor Eligibility Criteria Policy and Procedure Contents • What eligibility criteria must all applicant and authorized vendors meet? • How does this apply to applicant vendors? • How does this apply to authorized vendors? • What does the term “serving a disqualification period” mean? • Federal Reference What eligibility criteria must all applicant and authorized vendors meet? All vendors must: • Have a permanent, fixed, retail establishment physically located in Delaware. • Have a valid State of Delaware business license (codes 396, 404). • Have a valid Public Health permit and maintain the store in a clean and sanitary condition per the State of Delaware Food Code. • Have Food Stamp authorization and a valid Food Stamp identification number. • Have the minimum mandatory WIC stock on the shelves. • Have authorized representatives attend mandatory training sessions, as scheduled by the State agency. • Have paid back in full all overcharges and/or overages in the period stipulated by the State agency. No overdue balances may exist. • Have an adequate history of compliance during previous agreement periods or successful completion of a probationary agreement period. • Not be serving a disqualification period from the Food Stamp Program. • Not be serving a disqualification period from the Delaware WIC Program. • Not have a conviction or civil judgment entered against the vendor or any of its’ current owners, officers or managers for fraud, antitrust violations, embezzlement, theft, forgery, bribery, falsification or destruction of records, making false statements, receiving stolen property, making false claims, and obstruction of justice. • Not have a conflict of interest with the Delaware WIC Program. • Be open at least 10 hours a day, 6 days a week. • Be located in a geographic area where there are WIC participants. • Submit the vendor bid application with legitimate information. • Submit and abide by competitive prices on the vendor bid application. • Not derive more than 50% of their annual revenue from the sale of WIC food items. • Carry authorized WIC food items, dairy, meat, fresh fruit and vegetable produce and household items. • WIC only stores and mobile stores are specifically ineligible. How does this apply to applicant vendors? APPLICANT VENDORS must meet these criteria to be eligible to be an authorized WIC vendor. Meeting the eligibility criteria does not guarantee authorization. The State agency will reject bid applications from any applicant vendor that does not meet the eligibility criteria. How does this apply to authorized vendors? AUTHORIZED VENDORS must maintain compliance with these criteria, at all times. The State agency will give an authorized vendor, who is out of compliance, an opportunity to take corrective action. If corrective action does not occur within the time period specified by the State agency, the Vendor Participation Agreement may be terminated for cause of ineligibility. What does the term “serving a disqualification period” mean? This term refers to either: . The period of time a vendor has been disqualified; or . The period of time a vendor would have been disqualified but has been remained active by paying a civil money penalty in lieu of the disqualification. Federal Reference 7 CFR 246.12(g)(3) Last revised: May 20, 2008 Vendor Bid (Application) Process Policy and Procedure Contents • What are the authorization criteria for the vendor bid (application) process? • Does the State agency have to visit a store before authorization? • What happens if the applicant vendor bought the store from a vendor who is trying to avoid having a WIC sanction levied against him/her? • Federal Reference What are the authorization criteria for the vendor bid (application) process? 1. All interested vendors MUST attend the pre-bid application meeting and receive a bid application package. The State agency will not mail bid applications to interested vendors. Only vendors attending the pre-bid application meeting may submit a sealed bid to the State agency for review. 2. All bid application submissions must be proper and timely. The State agency will reject any bid application received after the deadline. Any bid application submitted using a means of delivery other than the approved methods of delivery, as stated in the bid application package, will be rejected upon receipt. All bid applications, no matter how transmitted, must be sealed in an envelope and the envelope must be no smaller than 8½” x 11” in dimension. All envelopes should be marked with SEALED BID. 3. All bid application submissions must be filled out in entirety. Any bid application received that is incomplete (does not have all the necessary information, missing necessary signatures, etc.) will be rejected. The State agency is not responsible for following up with vendors to complete missing information on bid applications. 4. All applicant vendors are reviewed in accordance with the Vendor Eligibility Criteria. All applicants must meet the conditions of the eligibility criteria before an agreement will be signed (see next page for criteria). The State agency will perform onsite reviews to verify bid application information and compliance with the eligibility criteria. Any vendor not meeting the eligibility criteria will be rejected. 5. A comparative analysis of all applicant vendor bid sheets is performed. Bids, combined with shelf prices, are reviewed and ranked in accordance with their competitive nature for each geographic area. 6. Potential vendors are selected and notified. All potential vendors are selected and notified that participation agreements will not be signed until after the vendor attends a mandatory training session, as scheduled by the State agency. If the potential vendor does not attend the mandatory training session, the absence will be considered a violation of the eligibility criteria and the bid application will be rejected. 7. Vendors not selected shall be notified and receive instruction on the Administrative Review process. Applicant vendors who are eligible, but did not rank high enough to gain a slot, will be placed on the primary waiting list and notified of their right to appeal the State agency’s decision. Applicant vendors failing to meet any of the criteria will be rejected and denied placement on the primary waiting list. During the agreement period, these vendors may request to be placed on the secondary waiting list. Does the State agency have to visit a store before authorization? The State agency must conduct an onsite monitoring visit before an applicant vendor’s authorization. During this visit, the State agency will verify information submitted on application, review for compliance with eligibility criteria, and collect shelf prices. What happens if the applicant vendor bought the store from a vendor who is trying to avoid having a WIC sanction levied against him/her? The State agency may not authorize an applicant vendor if the State agency determines its previous owner has sold the store in an attempt to circumvent a WIC sanction. The State agency may consider such factors as whether the store was sold to a relative by blood or marriage of the previous owner(s) or sold to any individual or organization for less than its fair market value. Federal Reference 7 CFR 246.12(g) Last revised: May 20, 2008 Vendor Training Policy and Procedure Contents • What is the purpose of vendor training? • How often do vendors have to attend training? • What are the State agency’s responsibilities? • What are the vendors’ responsibilities? • How does the State agency document the content of and vendor participation in vendor training? • What are acceptable methods of training? • What does mandatory prior authorization and annual interactive training include? • What happens if a vendor fails to attend a training session? • Federal Reference What is the purpose of vendor training? All vendor training is designed to prevent program errors and noncompliance and improve program service. How often do vendors have to attend training? All vendors must attend mandatory training prior to authorization and mandatory annual interactive training sessions during their authorization. (Annual refers to a Federal fiscal year, not on a calendar year. FFY= Oct. 1st-Sept. 30th) The State agency will also schedule corrective action training for noncompliant or problematic authorized vendors on an as needed basis. What are the State agency’s responsibilities? • Provide training annually to at least one representative of each vendor. • Determine the method of vendor training used, regardless of reason for training. • Provide interactive training prior to a vendor’s authorization. • Designate the date, time, and location of the interactive training and the audience (e.g. managers, cashiers, etc.) to which the training is directed. • Document the content of and vendor participation in all forms of vendor training. • Provide vendors with at least one alternative date on which to attend interactive training. • Terminate any vendor that does not attend training, as scheduled. What are the vendors’ responsibilities? The vendors must: • Attend vendor training, as scheduled by the State agency. • Train cashiers and other staff on program requirements. How does the State agency document the content of and vendor participation in vendor training? All vendors are required to sign a Verification of Training form. What are acceptable methods of training? Examples of acceptable methods of vendor training include: • Off-site classroom-style train-the-trainer or manager training, • On-site cashier training, • Training videos, and • Training newsletters. What does mandatory prior authorization and annual interactive training include? Prior authorization and annual vendor training will include: • Instruction on the purpose of the WIC Program; • The supplemental foods authorized by the State agency; • The minimum varieties and quantities of authorized supplemental foods that must be stocked by vendors; • The procedures for transacting food instruments and cash-value vouchers; • The procedures for redeeming food instruments and cash-value vouchers; • The vendor sanction system; • The vendor complaint process; • The claims procedure; and • Any changes to program requirements that have occurred since the last annual training session. What happens if a vendor fails to attend a training session? If it is… …then the State agency will… prior authorization training allow the vendor to attend training on an or alternative date. mandatory annual training or corrective action training an alternative date for prior deny the vendor WIC authorization for authorization training failure to meet vendor eligibility criteria. an alternative date for mandatory annual terminate the vendor for failure to remain in training compliance with vendor eligibility criteria. an alternative date for corrective action terminate the vendor for failure to remain in training compliance with vendor eligibility criteria. Federal Reference 7 CFR 246.12(i) Last revised: May 20, 2008 Routine Monitoring and Compliance Investigations Policy and Procedure Contents • Who is responsible for monitoring vendors? • What is a routine monitoring review? • What does the State agency do during a routine monitoring review? • How does the State agency determine who gets a routine monitoring review? • What are compliance investigations? • How does the State agency select vendors for compliance investigations? • What documentation is required? • Federal Reference Who is responsible for monitoring vendors? The State agency is responsible for monitoring vendors to determine their compliance with Program regulations and vendor participation agreements. Investigations may remain open from a period of thirty days to one year. State agency investigations include, but are not limited to: • compliance buys; • inventory audits; • eligibility criteria reviews; • cashed voucher reviews; and • educational visits. What is a routine monitoring review? A routine monitoring review is an overt, on-site monitoring visit during which State agency staff identifies themselves to vendor personnel. What does the State agency do during a routine monitoring review? Routine monitoring activities include, but are not limited to: • verifying vendor meets the minimum stock requirement; • collecting/verifying shelf prices of authorized foods; • reviewing food instruments and cash-value vouchers in the vendor’s possession; • observing food instrument and cash-value voucher transactions; • interviewing vendor staff; • validating authorized foods have “WIC Approved” shelf labels; and • compliance with various eligibility criteria. How does the State agency determine who gets a routine monitoring review? All retail grocery vendors will receive, at least, one routine monitoring review in a Federal fiscal year. Some vendors may receive more than one visit. The State agency selects vendors by means of random sampling, periodic/scheduled reviews, or due to complaints filed against the vendor. What are compliance investigations? Compliance investigations consist of: • Compliance buys - covert, on-site investigations in which a representative of the Program poses as a participant, parent or caretaker of an infant or child participant, or proxy, transacts one or more vouchers, and does not reveal during the visit that he or she is a program representative. • Inventory audits - examination of food invoices or other proofs of purchase to determine whether a vendor has purchased sufficient quantities of supplemental foods to provide participants the quantities specified on vouchers redeemed by the vendor during a given period of time. How does the State agency select vendors for compliance investigations? The State agency is required to perform compliance investigations on a minimum of 5% of its vendors. This requirement is a minimum and does not preclude the State agency from performing compliance investigations on more than 5% of its vendors. If… …then the State agency will… greater than 5% of the vendors have a high-risk review the high-risk vendors who have the status greatest potential for noncompliance and/or loss of funds. less than 5% of the vendors have a high-risk review all high-risk vendors and randomly status select non-risk vendors. exactly 5% of the vendors have a high-risk review all high-risk vendors. status What documentation is required? The State agency must document the following information for all monitoring visits, including routine monitoring visits and inventory audits: • the date of the monitoring visit or inventory audit; • the name(s) and signature(s) of the reviewer(s); and • the nature of any problem(s) detected. For compliance buys, the State agency must document: • the date of the compliance buy; • the name(s) and signature(s) of the reviewer(s); • the nature of any problem(s) detected; • a description of the cashier involved in each transaction; • the types and quantities of items purchased, current shelf prices or prices charged other customers, and price charged for each item purchased, if available. Price information may be obtained prior to, during, or subsequent to the compliance buy; and • the final disposition of all items as destroyed, donated, provided to other authorities, or kept as evidence. Federal Reference 7CFR 246.12(j) Last revised: May 20, 2008 Violations and Sanctions Policy and Procedure Contents • Does the State agency have to warn a vendor before giving him/her a sanction? • Class A Violations • Class D Violations • Class E Violations • Class M Violations • Class P Violations • What happens when there are multiple violations during a single investigation? • Are there any actions in addition to sanctions? • Disqualified Vendors • Terminated Vendors • What are the notification procedures for disqualifying or terminating a vendor? • When is a vendor not permitted to voluntarily withdrawal from the WIC Program? • WIC Disqualification Based on a Food Stamp Program Disqualification • Food Stamp Disqualification Based on a WIC Program Disqualification • FNS Notification of Disqualifications • Civil Money Penalty Does the State agency have to warn a vendor before giving him/her a sanction? Not always. If the State Agency finds that a vendor has committed a violation that requires a pattern of occurrences in order to impose a sanction, the State agency shall send a written warning to the vendor, unless the State agency determines that notifying the vendor would compromise the compliance investigation. (7 CFR 246.12(l)(3) & Reauthorization Act) Class A Violations • 1st documented incident - Warning letter • 2nd documented incident - Warning letter, training materials sent to store • 3rd/>3rd documented incident - Warning letter, mandatory training scheduled by WIC State agency office These are determined to be minimal violations. Sanctions for class A violations include warning letters, technical assistance, and mandatory training. These sanctions are based on an incident. It should be noted that repeated warnings for class A violations may trigger other investigations. For example: A vendor who is repeatedly warned about failures to request or check WIC ID folders may be investigated to determine if the vendor has a pattern of redeeming vouchers for unauthorized persons. If such a pattern is found, a class M sanction will be imposed and the vendor will be disqualified from WIC and Food Stamps for a period of no less than three years. Class D Violations • 1st documented pattern or incident (dependent upon violation, see appendix Y) – 6 month to one year disqualification These are determined to be serious violations that constitute Program fraud or abuse. The sanctions for class D violations range from a six month disqualification to a one year disqualification. Sanctions may be based on pattern of abuse or an incident of abuse. Class E Violations • 1st documented incident – Termination of agreement These are violations of the Delaware WIC Program’s Vendor Eligibility Criteria. AUTHORIZED VENDORS must maintain compliance with these criteria to remain authorized during an agreement period. Any vendor not in compliance with eligibility criteria shall be notified and given an opportunity to correct the noncompliance. If corrective action does not occur within the time period specified by the WIC State agency office, the Vendor Participation Agreement may be terminated for cause of ineligibility. TERMINATIONS are not reported to the Food Stamp Program. Class M Violations • 1st documented pattern or incident (dependent upon violation, see appendix Y) - one year disqualification to permanent disqualification. • 2nd documented pattern or incident (dependent upon violation, see appendix Y) – two years disqualification to permanent disqualification • 3rd documented pattern or incident (dependent upon violation, see appendix Y) – two years disqualification to permanent disqualification • >3rd documented pattern or incident (dependent upon violation, see appendix Y) – two years disqualification to permanent disqualification These violations requiring mandatory sanctions as specified in 7 CFR 246.12 of the Federal regulations. Mandatory sanctions range from a one year disqualification to permanent disqualification. These are reciprocal WIC/FS violations. Sanction may be based on pattern of abuse or an incident of abuse. Class P Violations • 1st documented incident - Warning letter • 2nd documented incident - Warning letter, training materials sent to store • 3rd documented incident - Warning letter, mandatory training scheduled by WIC office • >3rd documented incident - Warning letter, nonpayment of voucher(s) These are determined to be errors in the transacting of WIC vouchers that have monetary significance and the potential to impact Program integrity. These are based on an incident, no pattern is necessary. (It should be noted that repeated warnings for class P violations may trigger other investigations.) After the third documented incident, the WIC Program reserves the right to deny payment/reimbursement for incorrectly transacted or invalid vouchers. ALL food instruments and cash-value vouchers must be submitted for payment using the Altered Check Approval form. Vouchers submitted for payment without this form will be rejected. The State agency office will supply the forms to the vendors. In the cases where it is determined that the vendor will be reimbursed, this will be done by adjusting (crediting) the monthly vendor overage billing. What happens when there are multiple violations during a single investigation? During the course of a single investigation if a vendor has committed multiple violations (which may include violations subject to State agency sanctions), the State agency shall disqualify the vendor for the period corresponding to the most serious mandatory violation. However, the State agency shall include all violations in the notice of administration action. If a mandatory sanction is not upheld on appeal, then the State agency may impose a State agency-established sanction. (7 CFR 246.12(l)(1)(xii)) Are there any actions in addition to sanctions? The State agency shall refer food vendors and participants who abuse the Program to Federal, State or local authorities for prosecution under applicable statutes, where appropriate. Under 7CFR 246.23(d) of the Federal Regulations, whoever embezzles, willfully misapplies, steals or obtains by fraud any funds, assets or property provided under section 17 of the Child Nutrition Act of 1966, as amended, whether received directly or indirectly from USDA, or whoever receives, conceals or retains such funds, assets or property for his or her own interest, knowing such funds, assets or property have been embezzled, willfully misapplied, stolen, or obtained by fraud shall, if such funds, assets or property are of the value of $100 or more, be fined not more than $25,000 or imprisoned not more than five years, or both, or if such funds, assets or property are of a value of less than $100, shall be fined not more than $1,000 or imprisoned for not more than one year, or both. (7 CFR 246.12(l)(7)) Sanctions and violations are subject to periodic revisions by State agency office. Disqualified Vendors Vendors disqualified from the Delaware WIC Program may not accept Delaware WIC food instruments and cash-value vouchers during the period of disqualification. Disqualified vendors do not have automatic reinstatement rights to the Program at the end of the disqualification period. After the disqualification period is completed, the vendor may request to be placed on a waiting list or apply for authorization during the next authorization process. Application does not ensure authorization. The Delaware WIC Program reserves the right to deny authorization to any applicant who was previously disqualified from the WIC Program. Terminated Vendors Vendors terminated from the Delaware WIC Program may not accept Delaware WIC food instruments and cash-value vouchers after termination. Terminated vendors do not have automatic reinstatement rights to the Program, but may request to be placed on a waiting list or apply for authorization during the next authorization process. Application does not ensure authorization. The Delaware WIC Program reserves the right to deny authorization to any applicant who was previously terminated from the WIC Program. What are the notification procedures for disqualifying or terminating a vendor? When the State agency office has determined a vendor will be disqualified or terminated: 1. A letter will be sent outlining the cause for disqualification or termination, the beginning and ending date of the disqualification or termination period, the vendor's right to appeal the decision, and the procedures for an administrative review. 2. The letter will be signed by the Vendor Coordinator and sent certified mail, return receipt requested, at least 30 calendar days prior to the disqualification/termination start date. 3. After receiving the return receipt, 15 calendar days (from the date on the return receipt) will be allowed as a waiting period for the vendor to appeal the decision. When is a vendor not permitted to voluntarily withdrawal from the WIC Program? The State agency shall not accept voluntary withdrawal of the vendor from the Program as an alternative to disqualification for class M violations. All disqualifications for class M violations shall be entered on record and reported to the Food Stamp Program. (7 CFR 246.12(l)(1)(viii)) WIC Disqualification Based on a Food Stamp Program Disqualification The State agency shall disqualify a vendor who has been disqualified from the Food Stamp Program. The disqualification shall be for the same length of time as the Food Stamp Program disqualification. It may begin later than the Food Stamp Program disqualification. WIC disqualification based on a FSP disqualification shall not be subject to administrative or judicial review under the WIC Program. (7 CFR 246.12(l)(vii)) Food Stamp Disqualification Based on a WIC Program Disqualification The Food Stamp Program may disqualify a vendor who has been disqualified from the WIC Program. The disqualification shall be for the same length of time as the WIC Program disqualification. A Food Stamp disqualification based on a WIC disqualification is not subject to administrative or judicial review under the Food Stamp WIC Program. (7 CFR 246.12(h)(3)(xxv)) FNS Notification of Disqualifications The State agency shall provide the appropriate FNS office with the following information: 1. Vendor name 2. Vendor address 3. Vendor ID 4. Type of violation(s) 5. Length of disqualification OR length of disqualification corresponding to civil money penalty assessment This information shall be forwarded within 15 days after the vendor’s opportunity to file for a WIC administrative review has expired or all of the vendor’s WIC administrative reviews have been completed. (7 CFR 246.12(l)(1)(xi)) Civil Money Penalty A “Civil Money Penalty” may be assessed against vendors in lieu of disqualification, in order to emphasize the seriousness of Program compliance and to allow the vendor to continue to serve an otherwise uncovered participant group. A civil money penalty does not, however, relieve the vendor of financial liability for previous compliance issues, such as outstanding overage and/or overcharge reimbursements, or payments due for sale of unauthorized foods. Such outstanding liabilities must be paid in addition to the Civil Money Penalty. Last revised: May 20, 2008 Civil Money Penalty Policy and Procedure Contents • What is a civil money penalty? • When does the State agency use a civil money penalty? • How does the State agency define participant access? • Does the State agency always impose a civil money penalty? • What happens when the State agency decides to impose a civil money penalty? • How does the State agency calculate a civil money penalty? • Payment of Civil Money Penalties • What happens if a vendor is fails to pay his/her civil money penalty? • Can a vendor request a civil money penalty in lieu of disqualification? • Does the State agency notify FNS of civil money penalties? • Federal Reference What is a civil money penalty? As an alternate sanction, the State agency may assess a "Money Penalty" against such vendors in lieu of disqualification in order to emphasize the seriousness of Program compliance and to allow the vendor to continue to serve an otherwise uncovered participant group. A civil money penalty does not, however, relieve the vendor of financial liability for previous compliance issues such as outstanding overage and/or overcharge reimbursements or payments due for sale of unauthorized foods. Vendors must pay these outstanding liabilities in addition to the civil money penalty. When does the State agency use a civil money penalty? Under special circumstances, the State Agency may choose to waive disqualification of an abusive vendor or non-compliant vendor. The State agency uses civil money penalties where the disqualification of the vendor would cause a hardship, not just an inconvenience, to participants. Participant hardship is not the same as participant inconvenience or preference. Vendors may not appeal or protest State agency decisions based on participant access or preference. How does the State agency define participant access? Participant access shall not be taken to mean participant inconvenience or preference and shall be determined to exist if one of the following conditions is indicated: 1. A significant number of WIC participants (50 or more) would be required to travel in excess of an additional five miles to reach an authorized vendor. 2. Constant or permanent physical barriers or conditions that would make normal travel to another authorized vendor impossible (e.g., frequent road closings due to bad weather). 3. Fifty (50) or more WIC participants whose specific nationality can only be properly served by a specific vendor due to a language barrier. 4. Fifty (50) or more WIC participants whose specific dietary needs can only be properly served by a specific vendor due to religious mandates. Does the State agency always impose a civil money penalty? Regardless of participant hardship, the State agency will not offer a civil money penalty if the disqualification is based on: 1. "Trafficking" vouchers. 2. Overcharging the program, with the intent to defraud. 3. Vendor's refusal to be monitored or refusal to supply the program with supplier's invoices. 4. Vendor's refusal to accept mandatory training. 5. Vendor's failure to price WIC vouchers at time of transaction. 6. Vendor has been disqualified from or has been assessed a civil money penalty by the Food Stamp Program in the past two years. (Civil money penalties may be considered in situations where the FSP disqualification or civil money penalty resulted from abuses that have no bearing or impact on the WIC Program. 7. Third or subsequent mandatory sanctions, as listed in 7CFR246.12(l)(1)(vi) through 7CFR246.12(l)(1)(iv). What happens when the State agency decides to impose a civil money penalty? After having determined that an authorized vendor should be disqualified from the program, the State agency will review the case to determine participant hardship. This review will take place prior to notification of disqualification, so that the vendor will be made aware of any alternative at the time of notification. If the State agency determines that there is participant hardship and that a civil money penalty is an appropriate alternative, then the State agency will contact the vendor to schedule a conference. Prior to or at the time the vendor is contacted to schedule a conference, the vendor should be sent a written notice of the disqualification action. This notice should include cause(s) for the disqualification, the effective date of the action, the vendor's right to appeal, and the procedures to be followed to file an appeal. This notice could also notify the vendor that the State agency has decided to offer a CMP (Civil Money Penalty) in lieu of disqualification and that they will be contacted to schedule a conference to discuss the CMP offer. This conference will be used to offer the alternative of the money penalty in lieu of disqualification. The conference will cover the following: 1. The amount of the alternative money penalty (as determined by the following procedure for calculating money penalties); 2. The method of payment of the penalty available to the vendor; and 3. Discussion of all compliance issues, not just those that brought about the disqualification. In addition, at the conference, the vendor will be advised of the following: 1. Acceptance/payment of the money penalty settles all past compliance issues but does not relieve the vendor of its obligation to document the resolution of the identified problems or protect the vendor from future sanctions or disqualification for continued non-compliance; 2. Past violations settled by the civil money penalty may be considered, at the discretion of the State agency, if additional violations of the same nature occur in the future; 3. The vendor has fifteen days after the conference to accept the alternative money penalty in lieu of disqualification; 4. Money penalty settlement does not prohibit further WIC investigations; and 5. Receipt of a civil money penalty will be considered as "past history" during the next bid process. How does the State agency calculate a civil money penalty? The State agency calculates all civil money penalties with a standard formula. However, the penalty shall not exceed $11,000 per abuse and the total amount of civil money penalties shall not exceed $44,000 per investigation. The formula is as follows: Step 1 Multiply 10% (.10) times the average monthly redemptions for the most recent six (6) month period prior to the date of notification of charges. Step 2 Multiply the product of Step 1 by the number of months of the disqualification period. Example: September $4,650.00 $29,305 ÷ 6 = $4,884.17 August $4,075.00 July $5,120.00 $4,884.17 x 10% = $488.42 June $5,580.00 May $4,890.00 $488.42 x 24 months = $11,722.08 April $4,990.00 $29,305.00 $11,722.08 = civil money penalty Payment of Civil Money Penalties The payment of the money penalty must be made by one of the following methods, as determined by the State agency: 1. A lump sum payment of the penalty which must be received on or before the date of disqualification was to be effective; or 2. By installment payments that will be of equal amounts, the total number of which cannot exceed the number of months of the alternative disqualification. The first installment must be received by the State agency on or before the date the disqualification was to be effective. The subsequent payments must be received on the first day of the month for all subsequent months until final payment is received. All payments (either lump sum or installment) must be made by certified check or money order. All payments must: Be made payable to… And be mailed to… And include… Delaware WIC Program Delaware WIC Program . Store name Blue Hen Corporate Center . Vendor ID # 655 Bay Road, Suite 4B Dover, DE 19901 What happens if a vendor fails to pay his/her civil money penalty? If a vendor fails to make any scheduled installment payment by the due date, the State agency will notify the vendor. The notification will inform the vendor that he/she has 20 days to pay the balance of the civil money penalty or the remaining months of the disqualification action will be implemented. Can a vendor request a civil money penalty in lieu of disqualification? No. If the State agency has determined that a civil money penalty is not appropriate, a vendor does not have the option to pay a civil money penalty to avoid disqualification. Does the State agency notify FNS of civil money penalties? The State agency must provide the appropriate FNS office with a copy of the notice of administrative action and information on vendors it has either disqualified or imposed a civil money penalty in lieu of disqualification for any of the violations listed in paragraphs 246.12(l)(1)(i) through 246.12(l)(1)(iv). This information shall include the name of the vendor, address, identification number, the type of violation(s), and the length of disqualification or the length of the disqualification corresponding to the violation for which the civil money penalty was assessed, and shall be provided within 15 days after the vendor's opportunity to file for a WIC administrative review has expired or all of the vendor's WIC administrative reviews have been completed. Federal Reference 246.12(l) Last revised: May 20, 2008 Vendor Claims Policy and Procedure Contents • What is a vendor claim and how is it determined? • What is the difference between an “overcharge” and an “overage”? • What recourse does a vendor have if the State agency establishes a claim? • Does the State agency need approval from FNS for claim adjustments? • What timeframes are associated with vendor claims? • Federal Reference What is a vendor claim and how is it determined? When the State agency determines the vendor has committed a vendor violation that affects the payment to the vendor, the State agency must establish a claim. The State agency detects such vendor violations through compliance investigations, voucher reviews, or other reviews or investigations of a vendor's operations. The State agency may establish a claim for the full purchase price of each voucher that contained the vendor overcharge or other error. Other errors (violations) include but are not limited to: • Failure to endorse redeemed food instruments and cash-value vouchers; • Transacting or redeeming food instruments and cash-value vouchers outside the valid dates; • Redeeming unsigned food instruments and cash-value vouchers; and • Redeeming food instruments and cash-value vouchers with alterations in the date, food quantity, description, or participant information. What is the difference between an “overcharge” and an “overage”? Overcharges result from: • A vendor intentionally or unintentionally charging the State agency more for authorized supplemental foods than is permitted under the vendor agreement. • The vendor agreement states that a vendor will charge the WIC Program the current shelf price or less than shelf price (i.e. sale item or coupon item) charged to other customers. It is not an overcharge when a vendor submits a voucher for redemption and the State agency makes a price adjustment to the voucher. Overages result from: • Price adjustments made to vouchers where the shelf price/less than shelf price charged exceeds the bid price or statewide average. What recourse does a vendor have if the State agency establishes a claim? When a claim is established, the State agency must provide the vendor with an opportunity to justify or correct the vendor overcharge or other error. If satisfied with the justification or correction, the State agency must adjust the proposed claim accordingly. Does the State agency need approval from FNS for claim adjustments? The State agency must obtain the approval of the FNS Regional Office to adjust claims that exceed $500.00 for food instruments and cash-value vouchers redeemed after the expiration date. What timeframes are associated with vendor claims? 1 The State agency will assess a claim within 30 days of the conclusion of an investigation or review. 2 The vendor will be given 30 days to justify or correct the violations/errors; and 3 If a correction cannot be made or a justification is denied, the vendor will have 30 days to pay the claim. Federal Reference 7 CFR 246.12(k) Last revised: May 20, 2008 Change of Ownership or Location, Store Closure/Cessation of Operations Policy and Procedure Contents • Does a vendor need to notify the State agency if there is any change in ownership, store location, or cessation of operations? • Does a vendor need to notify the State agency if there is a temporary store closure? • Can a vendor sell his or her WIC authorization with the store? • What happens to the agreement if there is a cessation of operations? • What happens to the agreement if the store moves? Does a vendor need to notify the State agency if there is any change in ownership, store location, or cessation of operations? Yes. The vendor must notify the State agency, in writing, at least 15 calendar days before any change in vendor ownership, store location, or cessation of operations. If the vendor does not notify the State agency 15 calendar days before any change in ownership, store location, or cessation of operations, a fine of $10.00 per day may be imposed commencing 15 calendar days before the incident or termination and ending with written notification to the State agency. Does a vendor need to notify the State agency if there is a temporary store closure? Yes. The vendor must notify the State agency immediately, via telephone, and attain authorization from the State agency office in the event that a store will be closed for any days and times other than those specified on the application information sheet. Can a vendor sell his or her WIC authorization with the store? No, WIC authorization is not transferable. Agreements become null and void if ownership of the store changes. New owners must apply to the program on their own behalf. What happens to the agreement if there is a cessation of operations? The State agency is required to terminate the agreement. What happens to the agreement if the store moves? The State agency has the discretion to determine whether a change in location would necessitate a termination of the agreement. Factors that the State agency considers are miles moved, moving from one clinic area to another, moving closer or farther from other existing stores and how participant access will be affected. Federal Reference 7 CFR 246.12(h)(3)(xvii) Last revised: May 20, 2008 Administrative Reviews/Vendor Appeals Policy and Procedure Contents • What is an administrative review? • Full Administrative Review • Abbreviated Administrative Review • Can a vendor request an administrative review for any action? • Are there any other reasons that an administrative review will not be held? • What is the difference between a full and an abbreviated administrative review? • How will a vendor know whether to send a written request or a written response to the State agency? • How does a vendor request a full administrative review (F2 in chart)? • What is a written response (A2 in chart)? • Does appealing an action relieve a vendor from complying with the Vendor Participation Agreement? • When are the State agency decisions effective? • What happens if the State agency’s initial decision is overturned? • If an administrative review decision upholds the State agency decision, can a vendor seek a judicial review? • What is a pre-review meeting (informal administrative review)? • Does “day” refer to calendar days or working days? • How does the State agency determine when a vendor receives notifications? • What happens if the fifteenth calendar day is a on a holiday or weekend? • What happens if a vendor’s appeal request does not reach the State agency office within the proper timeline? • What documentation does the State agency keep on file? • How long is the documentation kept on file? • Where can I find administrative reviews of State agency actions mentioned in the federal regulations? What is an administrative review? An administrative review allows the vendor an opportunity to appeal a decision made by the State agency. A vendor can appeal when: • his or her application is denied; • he or she is disqualified during an agreement period; or • he or she is terminated during an agreement period. There are two kinds of administrative reviews: 1. Full administrative review 2. Abbreviated administrative review Full Administrative Review The State agency must provide a full administrative review for a: • denial of authorization based on: the vendor eligibility criteria for competitive price; the minimum mandatory stock requirements; a determination that the vendor is attempting to circumvent a sanction; • termination of an agreement not based on store closure, change of ownership or location; • disqualification not based on trafficking or Food Stamp Program penalties; and • imposition of a fine or a civil money penalty instead of disqualification. Abbreviated Administrative Review The State agency must provide an abbreviated administrative review for a: • denial of authorization based on: the vendor eligibility criteria for business integrity; a current Food Stamp Program disqualification or Food Stamp Program civil money penalty for hardship; a selection criterion established by the State agency, if the basis of the denial is a WIC vendor sanction or a Food Stamp Program withdrawal of authorization or disqualification; the State agency’s vendor limitation criteria; or a vendor’s submitting his or her application outside of the timeframes during which applications are being accepted and processed as established by the State agency; • termination of an agreement because the: store ownership has changed; store has moved to a different location; or store has closed. • disqualification based on: a trafficking (WIC food instruments or cash-value vouchers) conviction; or the imposition of a Food Stamp Program civil money penalty for hardship. Can a vendor request an administrative review for any action? No. Federal regulations say that vendors may not appeal: • the validity or appropriateness of the State agency’s: limitation criteria; selection (authorization) criteria; or criteria and determinations regarding participant access. • the State agency's determination whether a vendor had an effective policy and program in effect to prevent trafficking and that the ownership of the vendor was not aware of, did not approve of, and was not involved in the conduct of the violation; • denial of authorization if the State agency’s vendor authorization is subject to the procurement procedures applicable to the State agency. • the expiration of a vendor’s agreement. • disputes regarding voucher payments and vendor claims (other than the opportunity to justify or correct a vendor overcharge or other error); or • disqualification as a result of a Food Stamp Program disqualification. Are there any other reasons that an administrative review will not be held? Yes. An administrative review will not be held if: • the vendor does not request an administrative review; • the State agency does not receive a written request, from the vendor, within 15 days of the receipt of the written notification of adverse action; • the vendor withdraws the request; or • the vendor or the vendor’s representative fails to appear, without good cause, for the originally scheduled or rescheduled administrative review. What is the difference between a full and an abbreviated administrative review? The State agency must supply the vendor with: Full Administrative Review Abbreviated Administrative Review F1) Written notification of: A1) Written notification of: a. the adverse action1, a. the adverse action, b. the procedures to follow to obtain an b. the procedures to follow to obtain administrative review, an administrative review, c. the cause(s) of the adverse action, and c. the cause(s) of the adverse action, and d. the effective date of the adverse action. d. the effective date of the adverse action. F2) The opportunity to appeal the adverse A2) The opportunity to appeal the adverse action within 15 days of the receipt of the action with a written response. This written written notification of adverse action. response must be submitted within 25 days of the receipt of the written notification of the adverse action. F3) Adequate advance notice of the time and place of the administrative review. F4) One opportunity to reschedule the administrative review upon specific request. F5) The opportunity to present his or her case. A3) The opportunity to present his or her case with a written response only. See A2. F6) The opportunity to cross-examine adverse witnesses. When necessary to protect the identity of WIC Program investigators, such examination may be conducted behind a protective screen or other device. F7) The opportunity to be represented by counsel, if desired, at the vendor’s expense. F8) The opportunity to schedule a pre-review A4) The option to schedule a pre-review meeting. meeting and to examine, before the review, the evidence upon which the State agency's action is based. F9) An impartial decision-maker, whose A5) A decision-maker who is someone other than determination is based solely on whether the the person who rendered the initial decision on the State agency has correctly applied Federal and action and whose determination is based solely on State statutes, regulations, policies, and whether the State agency has correctly applied procedures governing the Program, according Federal and State statutes, regulations, policies, to the evidence presented at the review. and procedures governing the Program, according to the information provided to the vendor concerning the cause(s) for the adverse action and the vendor's response; and F10) Written notification of the review decision, A6) Written notification of the review decision, including including the basis for the decision, within 90 the basis for the decision, within 90 days of the date of days from the date of receipt of a vendor's request receipt of the request for an administrative review.2 for an administrative review.2 _________________________________ 1 If a vendor is disqualified due in whole or in part to violations in 246.12(l)(1), such notification must include the following statement: “This disqualification from WIC may result in disqualification as a retailer in the Food Stamp Program. Such disqualification is not subject to administrative or judicial review under the Food Stamp Program.” 2 This timeframe is only an administrative requirement for the State agency and does not provide a basis for overturning the State agency's adverse action if a decision is not made within the specified timeframe. How will a vendor know whether to send a written request or a written response to the State agency? The written notification from the State agency will include the: • adverse action (denial, termination, etc.), causes and effective date; • type of review that may be requested (full or abbreviated); and • procedures to follow to obtain an administrative review. How does a vendor request a full administrative review (F2 in chart)? For full administrative reviews, a vendor must submit a written request within 15 days of receiving the written notification from the State agency. (Example: If written notification is received by the vendor on September 1st, then the vendor’s request must reach the State agency office no later than the close of business on September 16th.) The written request must be sent to: Delaware WIC Program Blue Hen Corporate Center 655 Bay Road, Suite 4-B Dover, DE 19901 ATTN: Vendor Coordinator The written request should include the store name and clearly say that it is a request for an administrative review of the State agency’s decision. (Example: “I am requesting an administrative review of the State agency’s decision to deny STORE NAME WIC authorization.”) What is a written response (A2 in chart)? In the abbreviated administrative review process, meetings are not scheduled with a hearing officer. The vendor is given an opportunity to present his or her case with a written response only. The vendor’s written response should include the store name and contain all arguments that he or she would like the hearing officer to consider when reviewing the case file. A vendor must submit a written response within 25 days of receiving the written notification from the State agency. (Example: If written notification is received by the vendor on September 1st, then the vendor’s written response must reach the State agency office no later than the close of business on September 26th.) The written request must be sent to: Delaware WIC Program Blue Hen Corporate Center 655 Bay Road, Suite 4-B Dover, DE 19901 ATTN: Vendor Coordinator Does appealing an action relieve a vendor from complying with the Vendor Participation Agreement? No, appealing an action does not relieve a vendor, who is permitted to continue in the Program during the appeals process, from the responsibility of continued compliance with the terms of the Vendor Participation Agreement. The vendor will be sanctioned accordingly for any violations occurring during this period. When are the State agency decisions effective? If it is… …and the action is… …then the State agency action is… a denial of authorization appealed or not appealed effective as of the date the vendor or disqualification because by the vendor receives the initial written notification the vendor has been convicted of trafficking in vouchers or selling firearms, ammunition, explosives, or controlled substances any other action which is appealed by the vendor effective as of the date the vendor eligible for an administrative receives the administrative review review decision any other action which is not appealed by the vendor effective 30 days after the date of eligible for an administrative the initial written notification review What happens if the State agency’s initial decision is overturned? Whether the State agency’s initial decision is overturned or upheld, the administrative review decision (full or abbreviated) is considered the final State agency action. The State agency will take the action indicated in the written notification of the administrative review decision. If an administrative review decision upholds the State agency decision, can a vendor seek a judicial review? Federal regulations say that the State agency must inform vendors that they might be able to pursue a judicial review; however, in Delaware, there is no State statute that gives a vendor the right to appeal an administrative review decision. What is a pre-review meeting (informal administrative review)? A vendor can ask the State agency to hold a pre-review meeting to discuss the decision. (See F8 or A4) During this informal administrative review, the State agency Vendor Coordinator will explain the findings leading to the decision; thus, providing the vendor an opportunity to examine the case record before the administrative review. It will also provide the vendor with an opportunity to discuss the findings and present arguments for reversing the decision or commit to a mutually agreed upon outcome. As a result of the pre-review meeting, the State agency may opt to reverse the proposed action, modify the proposed action, or allow the proposed action to remain in effect unless it is reversed at the administrative review. Does “day” refer to calendar days or working days? Day refers to calendar days (in other words, including weekends.) How does the State agency determine when a vendor receives notifications? All written notifications are either hand-delivered or sent by certified mail. Both forms of delivery require the vendor’s (or his or her representative’s) signature and the date of receipt. What happens if the fifteenth calendar day is a on a holiday or weekend? Since no mail is delivered to the State agency office on holidays or weekends, administrative review requests will be accepted on the next business day. What happens if a vendor’s appeal request does not reach the State agency office within the proper timeline? No administrative review will be scheduled and the State agency will take action on the effective date listed in the initial written notification received by the vendor. What documentation does the State agency keep on file? A written report is prepared for each administrative review, this report includes: • the decision under appeal; • all documentary evidence submitted; • a summary of the testimony presented at the review; • the decision of the review officer with reasons for the decision; and • a copy of the letter to the vendor concerning the final decision. How long is the documentation kept on file? All documentation shall be retained for a period of no less than 3 years. Where can I find administrative reviews of State agency actions mentioned in the federal regulations? The regulations are in 7CFR 246.18. This section identifies what is eligible for appeal, types of reviews and State agency requirements. Last revised: May 20, 2008 WIC/Food Stamp Information Sharing Policy and Procedure Contents • Can the State agency share information with staff in the Food Stamp Program? • Does the State agency share information with the Food Stamp Program on a regular basis? • Does the State agency assist in Food Stamp investigations? Can the State agency share information with staff in the Food Stamp Program? Yes. The State agency may disclose confidential vendor information to persons directly connected with the administration or enforcement of the Food Stamp Program. The State agency will share any information necessary with persons investigating or prosecuting Food Stamp Program violations. Does the State agency share information with the Food Stamp Program on a regular basis? Yes. A list of authorized WIC vendors is sent to the Mid-Atlantic Regional office of USDA, no later than January 1st of every calendar year. The report contains the: • vendor name; • store address; • WIC vendor identification number; • name of the county the store is located in; and • store owner name. Does the State agency assist in Food Stamp investigations? Normally, WIC investigations and Food Stamp investigations are separate. Upon request, the State agency will coordinate investigative efforts with the Food Stamp Program. Last revised: May 20, 2008 Confidential Vendor Information Policy and Procedure Contents • What is considered confidential vendor information? • Who is permitted to access confidential vendor information? • Is aggregate data confidential? • Federal Reference What is considered confidential vendor information? Confidential vendor information is any information about a vendor (whether it is obtained from the vendor or another source) that individually identifies the vendor, except for vendor's name, address, telephone number, Web site/email address, store type and authorization status. Who is permitted to access confidential vendor information? Except as otherwise permitted, the State agency must restrict the use or disclosure of confidential vendor information to: • Persons directly connected with the administration or enforcement of the WIC Program or the Food Stamp Program who the State agency determines have a need to know the information for purposes of these programs. These persons may include personnel from its local agencies and other WIC State and local agencies and persons investigating or prosecuting WIC or Food Stamp Program violations under Federal, State, or local law; • Persons directly connected with the administration or enforcement of any Federal or State law. Prior to releasing the information to one of these parties (other than a Federal agency), the State agency must enter into a written agreement with the requesting party specifying that such information may not be used or re-disclosed except for purposes directly connected to the administration or enforcement of a Federal, or State law; • A vendor that is subject to an adverse action, including a claim, to the extent that the confidential information concerns the vendor subject to the adverse action and is related to the adverse action; and • USDA and the Comptroller General of the United States, which are permitted access to all WIC Program records. Is aggregate data confidential? Aggregate data about vendors and other data that does not individually identify a vendor are not confidential information and may be disclosed by the State agency. Is Food Stamp information considered confidential? The state agency must restrict the use or disclosure of information about Food Stamp vendors obtained from the Food Stamp Program to persons directly connected with the administration or enforcement of the WIC Program. Federal Reference 7 CFR 246.26 Last revised: June 18, 2008 Violation Chart Violation Violation Violation Violation Class Sanction Reference Language A WL State Agency vendor redeems vouchers without witnessing signature (pre-signed vouchers) A WL State Agency vendor fails to record purchase price in ink on voucher, at time of sale A WL State Agency vendor fails to request or check participant's WIC identification folder when redeeming vouchers A WL State Agency vendor refuses to allow participant to use coupons A WL State Agency vendor records purchase amount on voucher(s) after obtaining signature(s) of WIC participant/proxy A WL State Agency vendor maintains a separate check-out line or separate check-out procedures for WIC participants A WL State Agency vendor fails to post the WIC sign conspicuously A WL State Agency WIC Program Authorized Food List is not posted or available for use by cashiers A WL State Agency vendor requires participants to provide identification other than WIC ID cards (e.g. driver's license, address) A WL State Agency vendor does not display a “WIC Authorized” or similar shelf label A WL State Agency vendor does not display shelf prices D 6 mo disqual State Agency a pattern of limiting the choices and quantities of authorized food items listed on a participants vouchers (not allowing client to utilize entire food package) D 1 yr disqual State Agency vendor knowingly allows the exchange of authorized WIC foods for unauthorized foods D 1 yr disqual State Agency vendor knowingly provides false information to the WIC Program D 1 yr disqual State Agency vendor threatens State/Federal staff D 1 yr disqual State Agency vendor refuses to permit State/Federal personnel to perform onsite compliance monitoring D 1 yr disqual State Agency vendor refuses to allow WIC State Agency Representatives the opportunity to review redeemed vouchers or pertinent records, or fails to provide evidence of proofs-of-purchase (invoices) of WIC foods during investigations D 1 yr disqual State Agency vendor violates participants’ civil rights D 1 yr disqual State Agency vendor knowingly provides cash for the return of items purchased with WIC vouchers E termination State Agency vendor fails to stock the mandatory required level of authorized foods E termination* State Agency vendor fails to remit payment for overcharges or bid differentials, as requested by the Program E termination State Agency vendor fails to have a valid Public health permit and maintain the store in clean and sanitary condition per the State of Delaware Food Code E termination State Agency vendor fails to have an adequate history of compliance during previous agreement periods or successful complete a probationary agreement period E termination* State Agency vendor's reimbursement check issued for payment to the WIC Program is returned by the bank for insufficient funds E termination State Agency vendor does not have a valid State of Delaware business license to operate as a food retailer in Delaware E termination State Agency vendor fails to be open for business at least 10 hours a day, 6 days a week, unless otherwise authorized by the State Agency office E termination State Agency vendor or authorized vendor representative fails to attend mandatory WIC training sessions as scheduled by the State Agency E termination* State Agency vendor submits the vendor bid application with false information E termination State Agency vendor fails to submit competitive prices on the vendor bid application E termination State Agency vendor fails to abide by competitive prices on the vendor bid application E termination* State Agency change of ownership or location or cessation of operations E termination State Agency conflict of interest exists between the vendor and the State Agency M perm disqual* 246.12(l)(i) vendor convicted of trafficking of food instruments and cash value vouchers or selling firearms, ammunition, explosives, or controlled substances (as defined in section 102 of the Controlled Substances Act (21 U.S.C. 802)) in exchange for food instruments and cash value vouchers M 6 yr disqual* 246.12(l)(ii)(A) one incident of buying or selling food instruments and cash value vouchers for cash (trafficking) M 6 yr disqual* 246.12(l)(ii)(B) one incident selling firearms, ammunition, explosives, or controlled substances as defined in 21 U.S.C. 802, in exchange for food instruments and cash value vouchers M 3 yr disqual* 246.12(l)(iii)(A) one incident of the sale of alcohol or alcoholic beverages or tobacco products in exchange for food instruments and cash value vouchers M 3 yr disqual* 246.12(l)(iii)(B) a pattern of claiming reimbursement for the sale of an amount of a specific supplemental food item which exceeds the store's documented inventory of that supplemental food item for a specific period of time M 3 yr disqual* 246.12(l)(iii)(C) a pattern of charging participants more for supplemental food than non-WIC customers or charging participants more than the current shelf price M 3 yr disqual* 246.12(l)(iii)(D) a pattern of receiving, transacting and/or redeeming food instruments and cash value vouchers outside of authorized channels, including the use of unauthorized vendor and/or an unauthorized person M 3 yr disqual* 246.12(l)(iii)(E) a pattern for charging for supplemental food not received by the participant M 3 yr disqual* 246.12(l)(iii)(F) a pattern of providing credit or non-food items, other than alcohol, alcoholic beverages, tobacco products, cash, firearms, ammunition, explosives, or controlled substances as defined in 21 U.S.C. 802, in exchange for food instruments and cash value vouchers M 1 yr disqual* 246.12(l)(iv) a pattern of providing unauthorized food items in exchange for food instrument and cash value vouchers, including charging for supplemental food provided in excess of those listed on the food instrument and cash value voucher M double* 246.12(l)(v) vendor previously assessed sanction for any violation listed in (l)(1)(ii) through (l)(1)(iv) receiving another sanction for any of violation listed in (l)(1)(ii) through (l)(1)(iv) - State shall double second sanction. Civil money penalties my be doubled up to the limites allowed under (l)(1)(x)(C) M double* 246.12(l)(vi) vendor previously assessed 2 or more sanctions for any violation listed in (l)(1)(ii) through (l)(1)(iv) receiving another sanction for any of violation listed in (l)(1)(ii) through (l)(1)(iv) - State must double third and subsequent sanctions, civil money penalty not permitted, disqualification is only option M same as FS 246.12(l)(vii) vendor is disqualified from Food Stamp Program P nonpayment or State Agency vendor fails to deposit vouchers within 60 calendar days from the date of issuance reimbursement P nonpayment or State Agency vendor redeems voucher(s) outside valid dates reimbursement P nonpayment or State Agency vendor redeems voucher(s) without obtaining client’s signature reimbursement P nonpayment or State Agency vendor redeems voucher(s) with alterations in date, food quantity, description, or reimbursement participant information * also subject to reimbursement Last Revised: February 21, 2008