[32 Pa.B. 4585]
[Continued from previous Web Page]
CHAPTER 1105. REQUIREMENTS OF WIC AUTHORIZED STORES § 1105.1. Training.
(a) Initial training. Following [certification] authorization, the local agency shall provide initial training for the personnel [a certified] the WIC authorized store designates. The training shall be mandatory and shall occur within 30 days after the date of [certification] authorization. A store receiving [certification] authorization may not accept WIC checks prior to having its designated personnel attend the initial mandatory training.
(b) Annual training. The Department will provide for WIC authorized stores annual training which is designed to prevent WIC Program errors and abuses and to improve WIC Program services. The following apply to annual training:
* * * * * (5) Failure to have at least one representative attend training shall result in the Department imposing sanctions against the WIC authorized store [as in] under § 1107.1a(d)(16) (relating to disqualifications).
(c) Corrective training. The Department will provide corrective training as set forth in §§ 1103.2 and 1105.6 (relating to probationary [certification] authorization; and monitoring of WIC authorized stores). Attendance is mandatory.
§ 1105.2. [Overcharge recovery system] Price adjustment.
(a) [Quarterly price reports. A WIC authorized store shall provide to the Department, in a format prescribed by the Department, the highest prices the store charged for allowable foods during the previous quarter for which the Department collects prices. The report shall be known as the Quarterly Price Report. A store may submit its Quarterly Price Report by mail or fax. If submitted by mail, the Quarterly Price Report shall be postmarked no later than the 15th of the month following the end of the calendar quarter. If submitted by fax, the Quarterly Price Report must be received by the Department by the 15th of the month following the end of the calendar quarter.
(b) Department review. The Department will review WIC check amounts redeemed by a WIC authorized store against the prices reported on the store's Quarterly Price Report to determine and collect overcharges owed to the Department.
(c) Determination of maximum redemption amount of each WIC check. For each WIC check redeemed for which the store was reimbursed for the sale of foods for which the Department collects prices, the Department will determine the maximum amount for which the WIC authorized store could have redeemed the check based upon prices provided in the Quarterly Price Reports supplied by the store.
(d)] Determination of [overcharges] overpayment. [The] In each calendar quarter, the Department will compare the maximum amount for which a WIC authorized store could have redeemed a WIC check based upon [the prices in the store's Quarterly Price Report,] the maximum allowable prices for foods authorized for purchase on the check against the actual amount for which [each] the WIC check [accepted by the store during a reporting quarter] was redeemed, to determine [any overcharge owed to the Department] whether there was an overpayment.
[(e)] (b) Pursuit of reimbursement. The Department will seek reimbursements from a WIC authorized store [for the store's overcharges totaling $10 or more for] when the price comparison reveals overpayments to the store in excess of $10 in a calendar quarter.
[(f)] (c) Reimbursement of [overcharges] overpayments. A WIC authorized store shall [submit reimbursement of overcharges to] reimburse the Department for overpayments within 20-calendar days of the date on the Department's [billing] notice [for the overcharge] of the overpayment, unless the WIC authorized store disputes the [overcharge] determination of overpayment.
[(g) Overcharge disputes] (d) Dispute of overpayments. A WIC authorized store that disputes [an overcharge billing] a determination of overpayment shall submit the basis for its dispute in writing to the Department, postmarked within 15-calendar days of the date on the Department's [billing] notice. [Upon resolution of an overcharge dispute, any overcharge] Reimbursement the Department determines to be owing shall be due within 15-calendar days of the mailing date [on] of the Department's notification of its resolution of the dispute. The Department's resolution of a dispute regarding overpayments is not an adverse action that may be appealed.
[(h)] (e) Sanctions. The Department will impose a sanction against a WIC authorized store under § 1107.1a(d)[(14)](12) (relating to disqualifications) if the store fails to [pay overcharges due] reimburse the Department for an overpayment within the time required under subsections [(f)] (c) and [(g)] (d).
[(i) Disqualification. The Department may disqualify a WIC authorized store if the store's reported prices on the Quarterly Price Report exceed the current maximum allowable cost as published by the Department for Food Prescription One or Food Prescription Two, set forth in § 1103.4(a)(6)(i) and (ii) (relating to selection and limitation criteria; authorization process).]
§ 1105.3. Terms and conditions of participation.
(a) General terms and conditions. A WIC authorized store shall adhere to this subsection. Failure to do so shall result in the imposition of sanctions [as in] under § 1107.1 (relating to imposition of sanctions). A WIC authorized store shall:
* * * * * (3) [Monitor, supervise and be] Be accountable for the actions of owners, officers, managers, agents and [employes] employees in the handling of WIC checks, the selling of allowable foods, and the performance of other conduct related to the WIC Program.
(4) [Maintain the minimum inventory of allowable foods on the premises] Comply with the selection criteria in § 1103.4 (relating to selection criteria for authorization and reauthorization) throughout the authorization period.
[(5) Ensure that allowable foods are properly stored and refrigerated.
(6) Ensure that there are no stale dated allowable foods on the sales floor.
(7) Provide the Department, on the Quarterly Price Report Form provided by the Department, the highest prices of allowable foods specified on the report form.
(8) Maintain a clean and sanitary store.]
[(9)] (5) * * *
[(10)] (6) * * *
[(11)] (7) * * *
[(12)] (8) * * *
[(13)] (9) * * *
[(14)] (10) * * *
[(15)] (11) Provide Federal, State, Department and local agency representatives who are involved in monitoring the store's compliance with statutes and regulations governing the WIC Program, access, which includes providing copies if requested by the Department, to [price and inventory] purchase records [during an onsite review] used for Federal tax reporting purposes and other records as requested to determine compliance with WIC Program requirements
[(16)] (12) Agree that authorization does not constitute a license or a property interest, that the store must reapply for authorization in accordance with § 1103.1(c) (relating to authorization and reauthorization process and requirements), and that neither the Department nor the WIC authorized store has an obligation to renew the store's authorization to participate in the WIC Program.
[(17)] (13) * * *
[(18)] (14) * * *
[(19)] (15) Not transfer or assign its WIC [certification or recertification] authorization or reauthorization to another person or entity.
[(20) Reimburse the Department for funds received through transactions involving WIC checks which were not conducted in accordance with this part.
(21)] (16) Maintain [price and inventory] purchase records and records used for Federal tax reporting purposes for allowable foods for a minimum [period] of [6 months from the date of receipt of the inventory] 2 years.
(b) Terms and conditions of participation with regard to participants. A WIC authorized store shall serve participants and authorized representatives as set forth in this subsection. The Department will impose sanctions against a WIC authorized store that fails to do so, as set forth in § 1107.1. A WIC authorized store shall:
(1) Provide allowable foods to [participants] a participant or authorized representative only as authorized on the WIC food list and as specified on the WIC check.
(2) Not encourage or discourage a participant or authorized representative from purchasing an allowable [foods] food specified on the WIC check.
(3) Provide an allowable [foods] food to [participants] a participant or authorized representative at or below the current price the store charges other customers, and at or below the maximum allowable price.
(4) Not seek restitution or payment from [participants] a participant or authorized representative for a WIC [checks] check not reimbursed by the Department, or contact [participants] a participant or authorized representative concerning a WIC [transactions] transaction that [occur] occurs in the store.
(5) Not seek restitution or payment from [participants] a participant or authorized representative for an allowable [foods when the price the store charges for the allowable foods exceeds the ''Not to Exceed'' amount on the WIC check] food authorized for purchase on the WIC check tendered by the participant or authorized representative.
(6) Not request the personal [addresses] address, telephone [numbers] number or other personal identification of [participants] a participant or authorized representative.
(7) Offer [participants] each participant or authorized representative the same courtesies offered other customers, and not distinguish or identify [participants] a participant or authorized representative from other customers, if no other terms and conditions of participation are violated in doing so.
(8) Provide services to [participants] each participant or authorized representative without regard to race, color, age, sex, religion, national origin or disability.
(9) [Give trading stamps to participants] Provide the same promotional incentive for [purchases] a purchase made with a WIC [checks] check [if trading stamps are] as given for a cash [purchases] purchase.
(10) Accept cents-off coupons, a store discount card or other discounts from [participants] a participant or authorized representative for an allowable [foods] food, and deduct the savings in calculating the total purchase price entered into the ''Pay Exactly'' amount on WIC checks.
(11) Accept ''buy one get one free'' coupons and manufacturers' promotional free product offers from [participants] a participant or authorized representative.
(12) Provide a promotional incentive for use of a WIC check only if the same incentive is offered for a cash purchase.
(c) Terms and conditions of participation with regard to WIC check processing and redemption. A WIC authorized store shall adhere to the requirements of this subsection with regard to WIC check processing and redemption. The Department will impose sanctions against a WIC authorized store that fails to do so, as set forth in § 1107.1. A WIC authorized store shall:
(1) Treat the acceptance of a WIC check as a financial transaction between [only the Department and] the WIC authorized store and the Department, not the participant.
* * * * * (3) Accept a WIC check only if the participant[, endorser or proxy] or authorized representative presents the WIC check on or between the ''First Day to Use'' and the ''Last Day to Use'' designations on the WIC check.
(4) Accept a WIC check only if a valid WIC identification card is presented at the time of [redemption] the WIC transaction.
(5) Accept a WIC check only if the signature of the participant[, endorser or proxy] or authorized representative is obtained[,] on the WIC check at the time of [purchase,] the WIC transaction [on the WIC check,] and the [signature on the WIC check matches the signature on the WIC identification card] family identification number on the WIC check matches the family identification number on the identification card.
* * * * * (7) Charge the WIC Program only for the types and quantities of allowable foods specified on the WIC check and selected for purchase by the participant[, endorser or the participant's proxy] or authorized representative.
(8) Record in ink, on each WIC check immediately after completion of the WIC transaction and prior to the participant[, endorser or proxy] or authorized representative signing the WIC check, the actual purchase amount of the transaction net of any cents-off coupons or other discounts.
(9) Properly correct an error made in recording the ''Pay Exactly'' amount of a WIC check by drawing a single line through the incorrect amount and writing the correct amount above or below the error and having the participant[, endorser or proxy] or authorized representative initial next to the corrected amount. No other corrections are permissible.
(10) Not alter any information on the WIC check as presented by the participant[, endorser or proxy] or authorized representative.
(11) Not provide a substitute [items, rainchecks] item, raincheck or cash reimbursement for an allowable [foods] food that [are] is unavailable.
* * * * * (13) Not provide change for [the difference between the ''Not to Exceed'' and the ''Pay Exactly'' amounts on the WIC check nor for any coupons] a coupon tendered during the WIC transaction.
(14) Not [refund money or] provide [exchanges] an exchange to replace an allowable [foods] food returned by [participants, endorsers or proxies] a participant or authorized representative unless the exchange is to replace an identical product that was found to be damaged or otherwise unusable.
(15) Not refund money for an allowable food purchased in a WIC transaction that is returned by a participant or authorized representative.
(16) Not accept a WIC check as payment for [items] an item other than an allowable [foods] food specified on the WIC check.
[(16)] (17) Not charge the WIC Program for an allowable [foods] food not received by the [WIC] participant or authorized representative or for an allowable [foods provided] food in excess of [those listed] the quantity prescribed on the WIC check.
[(17)] (18) * * *
[(18)] (19) Deposit a WIC [checks] check accepted by it directly to its bank account no later than 45 days after the ''First Day to Use'' date on the WIC check.
[(19)] (20) Not receive, transact, redeem or otherwise dispose of a WIC check [outside] in violation of check redemption procedures set forth in this section.
[(20)] (21) Not use a WIC check for the purchase of any [commodity] item other than an allowable food or for the payment of any debt.
[(21)] (22) Not collect sales tax [on allowable food purchases] in connection with a WIC transaction.
[(22) Reimburse the Department for payments the store has received for improperly executed WIC checks.]
(d) [The Department will deny payment to a WIC authorized store for WIC checks which the store did not process under subsection (c).] When the Department determines, prior to payment of a check submitted for redemption, that the store has committed a violation of this section that affects the payment to the store, the Department will deny payment. If payment already has been made, Department will establish a claim for reimbursement by sending the store a written notice of the overcharge or other improper charge. The store may dispute the Department's claim and shall submit the basis for its dispute in writing within 15 calendar days of the date of the Department's written notice. The Department will notify the store of the resolution of the claim dispute. The Department's resolution of a claim dispute is not an adverse action that may be appealed.
§ 1105.4. Change of ownership of a WIC authorized store.
(a) [A certification or recertification] A store's status as a WIC authorized store is void when a change of ownership of [a WIC authorized] the store occurs.
(b) To allow uninterrupted service to participants subsequent to a change of ownership of a WIC authorized store, the Department may accept an application for [certification] authorization from the prospective new owner of [a WIC authorized] the store prior to a change of ownership.
(c) [When a change of ownership occurs and inadequate participant access as defined in § 1103.7(c)(8) (relating to inadequate participant access) would result, the store under the new ownership may receive probationary certification for a period not to exceed 6 months if the State conducts an immediate onsite visit followed by a complete certification visit at the store. Until the immediate onsite visit is conducted, the new owner may not accept WIC checks. As soon as possible within the 6-month probationary period or during the next recertification process, whichever occurs first, the store under the new ownership shall compete with stores on the waiting list in the trade area for the store slot.
(d) The Department will not accept an application for certification from a store that has been provided notice of disqualification or is serving a disqualification if an individual who had at least a 10% ownership interest in the store has at least a 10% ownership interest in the applicant or such ownership interest has been transferred or sold to immediate family members of the individual.]
The Department will not accept a store's application for authorization if the Department determines that the store submitting the application, either under prior ownership or in a previous location, was disqualified and the purpose of the relocation or sale of the store was to avoid a disqualification.
§ 1105.5. Changes in availability or location of WIC authorized stores.
(a) Notification of store closing. A WIC authorized store shall notify the Department at least 15 days prior to a temporary or permanent closing of the store, and [of] provide the reason for closing and the expected duration of a temporary closing, if it has at least 15 days prior knowledge. Otherwise, it shall provide this information to the Department immediately after it acquires the information.
(b) Temporary store closing. The Department may permit a WIC authorized store to temporarily close for reasons such as a natural disaster, death in immediate family or personal illness, without imposing a sanction against the store. In making a determination to permit a temporary closure, as well as the length of time of the closure, the Department will consider circumstances such as the nature of the disaster, number of WIC authorized stores affected by the disaster, nature and expected duration of illness, length of closing anticipated by the WIC authorized store, number of and distance to other WIC authorized stores, number of participants served by the store, [number of stores on the waiting list] or any other information that the Department may determine to be relevant.
(c) Store closing for remodeling.
(1) A WIC authorized store that closes for [more than 24 hours but] less than [3] 15 days for remodeling [will not lose its certification, provided] shall continue as a WIC authorized store if it notifies the Department at least 15-calendar days prior to the day the store closes for remodeling.
(2) A WIC authorized store that closes in excess of [3] 15 store operation days for remodeling, shall automatically lose its [WIC authorization] status as a WIC authorized store and shall [reapply] apply for and secure [certification] authorization before it may again serve as a WIC authorized store.
(d) Store relocations.
(1) A WIC authorized store that relocates 1 mile or less from its current location or within the same geographical area assigned to the local agency, and reopens within [3-] 15-calendar days at its new location, shall provide the Department with written notification of its new address. The store will [not lose its certification, provided] continue as a WIC authorized store if it notifies the Department at least 15-calendar days prior to the day the store closes for relocating.
(2) A WIC authorized store [relocating] that relocates in excess of 1 mile of its current location and to a geographical area assigned to another local agency shall [lose its WIC authorization and shall reapply for certification] automatically lose its status as a WIC authorized store and shall apply for authorization at its new location to again serve as a WIC authorized store.
(3) A WIC authorized store that closes in excess of 3 store operation days for relocating[, without applying for and securing permission from] shall notify the Department [to do] before doing so, or shall automatically lose its status as a WIC [authorization] authorized store and shall [reapply] apply for [certification] authorization to again serve as a WIC authorized store.
* * * * * § 1105.6. Monitoring of WIC authorized stores.
(a) Purpose and types of monitoring of WIC authorized stores. Federal, State or local representatives will conduct announced and unannounced onsite reviews of WIC authorized stores to determine compliance with applicable Federal and State regulations, and to investigate complaints regarding a store. The types of onsite reviews that may be conducted for monitoring purposes are [high risk reviews] compliance investigations, inventory audits, routine reviews and [training buys] WIC transaction reviews. The monitoring process, to determine compliance with applicable Federal and State regulations, operates independently of the authorization process and may overlap more than one authorization period.
(b) [High risk reviews] Compliance investigations. [The Department will monitor all high risk stores. The Department will use either compliance investigations or inventory audits as methods to monitor high risk stores. The Department also may conduct compliance buys and inventory audits on stores that have not been identified as high risk stores.
(1) Compliance investigations.] The following standards apply:
[(i)] (1) * * *
[(ii)] (2) * * *
[(iii)] (3) The Department will provide written notification to the WIC authorized store of the results of each compliance buy, including the store's violation of a statute or regulation governing its participation in the WIC Program, unless [subparagraph (viii)] paragraph (8) applies.
[(iv)] (4) The Department will provide to the personnel of the WIC authorized store mandatory corrective training after two compliance buys detect violations of [statutes or regulations] a statute or regulation governing the store's participation in the WIC Program, unless paragraph (8) applies.
[(v)] (5) [The] If paragraph 8 does not apply, the Department will [conduct a third compliance buy at] continue a compliance investigation of the WIC authorized store after store personnel have attended mandatory corrective training.
[(vi)] (6) The Department will impose a sanction in accordance with § 1107.1 (relating to imposition of sanctions) [against the store] if three compliance buys detect violations of [statutes or regulations] a statute or regulation governing the store's participation in the WIC Program. If multiple violations are found during the compliance investigation, the Department will impose the sanction against the store for the term corresponding to the most serious violation.
[(vii)] (7) The Department will close the compliance investigation on a WIC authorized store if the Department discovers no [violations] violation of a statute or regulation governing the store's participation in the WIC Program [are discovered] after two consecutive compliance buys.
[(viii)] (8) The Department may withhold notification of compliance buy results, and may withhold providing training or conducting further compliance investigations, when fraudulent [activities] activity by the WIC authorized store [are] is indicated during a compliance investigation or by local agency or participant complaint.
[(2)] (c) Inventory audits. The Department will disqualify [the] a WIC authorized store when an inventory audit establishes [the claim of reimbursement for authorized] that the store has redeemed or attempted to redeem WIC checks for the purported sale of an allowable food in excess of documented inventory. No warning [letters] letter will be issued.
[(c)] (d) Routine reviews. The Department will use routine reviews as follows to determine whether a WIC authorized store is in compliance with the [selection and limitation criteria in § 1103.4(a) and (b) (relating to selection and limitation criteria; authorization process) and] terms and conditions of participation in § 1105.3 (relating to terms and conditions of participation):
* * * * * (6) The Department will impose a sanction in accordance with § 1107.1 against a store if a third routine review detects violations of a statute or regulation governing the store's participation in the WIC Program. If multiple violations are found during the routine reviews, the Department will impose [the sanction] against the store [for the term corresponding to the most serious violation] the most severe sanction the Department may impose for any one of the violations committed by the store.
[(d) Training buys] (e) WIC transaction reviews. The Department will use [training buys] WIC transaction reviews to monitor WIC [check] transaction procedures and compliance with statutes and regulations governing the store's participation in the WIC Program. The following standards [shall] apply:
(1) The Department will not notify the WIC authorized store that a [training buy] WIC transaction review is scheduled.
(2) The Department will provide written notification to the WIC authorized store of the results of each [training buy] WIC transaction review, including violations of a statute or regulation governing the store's participation in the WIC Program.
(3) The Department will conduct a second [training buy] WIC transaction review at the WIC authorized store if the first [training buy] WIC transaction review detects [violations] a violation of a statute or regulation governing the store's participation in the WIC Program.
(4) The Department will provide the personnel of the WIC authorized store mandatory corrective training after two [training buys] WIC transaction reviews detect violations of a statute or regulation governing the store's participation in the WIC Program.
(5) The Department will conduct a third [training buy] WIC transaction review at the WIC authorized store after store personnel have attended the mandatory corrective training.
(6) The Department will impose a sanction in accordance with § 1107.1 [against a store] if a third [training buy] WIC transaction review detects [violations] a violation of a statute or regulation governing the store's participation in the WIC Program. If multiple violations are found during the [training buys] WIC transaction reviews, the Department will impose [the sanction] against the store [for the term corresponding with the most serious violation] the most severe sanction the Department may impose for any one of the violations committed by the store.
[(e)] (f) * * *
[(f)] (g) Reimbursement. The Department will seek reimbursement from a WIC authorized store that received funds improperly due to a violation of regulations governing the store's participation in the WIC Program discovered during monitoring reviews. The Department will send notice to the store of the amount of money to be reimbursed to the WIC Program. The store shall make payment within 20 days from the date [of] on the notice.
CHAPTER 1107. SANCTIONS § 1107.1. Imposition of sanctions.
(a) The Department may disqualify a WIC authorized store or impose a civil money penalty in lieu of disqualification for reasons of [program] WIC Program abuse. In the case of fraud, trafficking, sale of alcohol or alcoholic beverages or tobacco products the Department will not provide the store with a prior warning that violations were occurring before imposing the sanctions. For other serious program violations or offenses, the Department may choose to not provide the store with prior warning that violations were occurring before imposing the sanctions. The store may appeal a Department decision pertaining to disqualification, denial of [application to participate] authorization or reauthorization, or other adverse [actions] action that [affect participation during the agreement performance period] affects the store's status as a WIC authorized store in accordance with § 1113.1 (relating to right to administrative appeal). Expiration of [an agreement with a store] authorization, disqualification of a store as a result of disqualification from the Food Stamp Program, and the Department's determination regarding inadequate participant access are not subject to review.
(b) The Department will disqualify a store which has been disqualified from the Food Stamp Program unless the Department determines that the disqualification of the store would result in inadequate participant access under § 1103.7 (relating to inadequate participant access). If the Department determines that disqualification of the store would result in inadequate participant access under § 1103.7, the Department will give the store the option of paying a civil money penalty in lieu of [WIC] disqualification.
(c) The Department will disqualify a store that has been assessed a civil money penalty in lieu of disqualification under the Food Stamp Program unless disqualification of the store from the WIC Program would result in inadequate participant access or would otherwise adversely affect the interest of participants. If the Department disqualifies a store under this subsection, the length of the disqualification will correspond to the period for which the store would otherwise have been disqualified from participating in the Food Stamp Program.
(d) The Department will disqualify a store for WIC Program violations in § 1107.1a (relating to disqualifications) unless the Department determines that disqualification of the store under § 1107.1a(b)--(d) would result in inadequate participant access. In that case, the Department will give the store the option of paying a civil money penalty in lieu of disqualification. The Department will not [impose] give the store the option of paying a civil money penalty in lieu of disqualification for third or subsequent [sanctions for] violations. A violation committed during a prior authorization period will support a disqualification.
[(d)] (e) Disqualification from the WIC Program may result in disqualification as a retailer in the Food Stamp Program under regulations governing the Food Stamp Program. [The disqualification may not be subject to administrative or judicial review under the Food Stamp Program.] Applicable Federal regulations may prohibit administrative or judicial review of a disqualification from the Food Stamp Program based upon a disqualification from the WIC Program.
[(e)] (f) In addition to imposing a sanction against a WIC authorized store that commits fraud or abuse of the WIC Program, the Department may prosecute or make a referral [for prosecution] of the WIC authorized store to a criminal prosecution agency for prosecution under applicable Federal, State or local laws.
[(f)] (g) A WIC authorized store that has a sanction imposed against it by the Department for accepting a WIC check for [items] an item other than those specified on the WIC check shall also reimburse the Department for [monies received for the purchase of these items with the] moneys it receives through the WIC check redemption process after accepting a WIC check for the purchase of the item.
[(g)] (h) The Department may impose a sanction against a WIC authorized store for failing to remit any amount demanded due to violations of statutes or regulations governing its participation in the WIC Program within the time frame [in § 1105.2(f) and (g) (relating to reimbursement of overcharges)] imposed by regulation or in the notice given to the store by the Department [under § 1105.6(f) (relating to monitoring of WIC authorized stores)] of the store's obligation to reimburse the Department.
§ 1107.1a. Disqualifications.
* * * * * (c) Three-year disqualification. The Department will disqualify a WIC authorized store for 3 years for any of the following violations:
* * * * * (2) A pattern of claiming reimbursement for the sale of an amount of a specific allowable food, which exceeds the store's documented inventory of that specific allowable food [item] for a specific period of time. A pattern may be established during a single inventory audit encompassing a 2-month period when a WIC authorized store's records indicate that the WIC authorized store's WIC check redemptions for a specific allowable food exceed the WIC authorized store's documented inventory for that allowable food.
(3) Two or more incidences of [charging participants more for an allowable food than non-WIC customers or charging participants more than the current shelf price] overcharges.
(4) Two or more incidences of receiving, transacting or redeeming [WIC checks outside of authorized channels, including the use of an unauthorized store or an unauthorized person, or both] a WIC check that the store is not authorized to receive, transact or redeem.
* * * * * (d) One-year disqualification. The Department will disqualify a WIC authorized store for 1 year for any of the following violations:
(1) Two or more incidences of providing [unauthorized food items] a food item other than an allowable food in exchange for WIC checks[, including charging for allowable food provided in excess of those listed on the WIC check].
(2) Providing an allowable food in excess of the amount authorized for purchase on the WIC check.
(3) Having a stale-dated allowable food on the sales floor.
[(3)] (4) Failing to maintain on the premises at all times minimum inventory requirements of an allowable food at or below the current maximum allowable price for that food.
[(4)] (5) Failing to request [the participant's] a WIC identification card prior to accepting a WIC check.
[(5)] (6) * * *
[(6)] (7) * * *
[(7)] (8) Failing to properly store [and] or refrigerate an allowable [foods] food.
[(8)] (9) * * *
[(9)] (10) Charging or demanding that a participant or authorized representative pay for an allowable food with [the participant's own] money or with another WIC check for purchases made with a WIC check.
[(10)] (11) Securing the signature of the participant[, endorser or proxy] or authorized representative prior to completing the ''Pay Exactly'' box on the WIC check.
[(11)] (12) [Overcharging] Charging the WIC Program [by charging] sales tax.
[(12) Having or charging prices which exceed the current maximum allowable costs established by the Department and published in the Pennsylvania Bulletin for either Food Prescription One or Food Prescription Two set forth in § 1103.4(a)(6)(i) and (ii) (relating to selection and limitation criteria; authorization process).]
(13) Giving monetary change to [an authorized individual] the person who tenders a WIC check.
(14) Failing to [remit payment for an overcharge] reimburse the Department for overpayments, overcharges or other improper charges within the specified time frame [under either §§ 1105.2(f) and (g) or 1105.6(f) (relating to overcharge recovery system; monitoring of WIC authorized stores)].
* * * * * (17) Providing false information on the application for authorization or reauthorization.
(e) Second mandatory sanction. [When] If a WIC authorized store, which previously has been assessed a sanction for any of the violations in subsections (b)--(d), receives another sanction for any of these violations, the Department will double the second sanction. The Department will double civil money penalties up to the limits allowed under § 1107.2(c) (relating to civil money penalties).
(f) Third or subsequent mandatory sanction. [When] If a WIC authorized store, which previously has been assessed two or more sanctions for any of the violations listed in subsections (b)--(d), receives another sanction for any of these violations, the Department will double the third sanction and all subsequent sanctions. The Department will not [impose] permit the store to pay a civil money [penalties] penalty in lieu of disqualification for third or subsequent [sanctions for] violations listed in subsections (b)--(d).
(g) Multiple violations during a single investigation. When during the course of a single investigation the Department determines a WIC authorized store has committed multiple violations, the Department will disqualify the WIC authorized store for the period corresponding to the most serious violation. However, the Department will include all violations in the notice of disqualification [action].
(h) Disqualification based on a Food Stamp Program disqualification. The Department will disqualify a WIC authorized store which has been disqualified from the Food Stamp Program. The disqualification shall be for the same length of time as the Food Stamp Program disqualification, but may begin at a later date than the Food Stamp Program disqualification. Under 7 CFR 246.12(k)(1)(vii) and § 1113.1(b)(3) (relating to right to administrative appeal), the WIC [program] Program disqualification is not subject to administrative or judicial review [under the WIC Program].
(i) Voluntary withdrawal or nonrenewal of agreement. The Department will not accept voluntary withdrawal of the WIC authorized store from the WIC Program as an alternative to disqualification for the violations listed in subsections (a)--(d), but will enter the disqualification on the record. The Department will not permit the store to use [nonrenewal of a store agreement] expiration of authorization as an alternative to disqualification.
(j) Other violations. For [any] a violation of a statute or regulation governing the store's participation in the WIC Program which is not specifically classified in subsections (a)--(d), the Department will determine the appropriate type and level of sanction to be imposed upon the store based upon the nature and severity of the violation. A disqualification imposed under this subsection will not exceed 1 year.
(k) Advance notice. The Department will provide a WIC authorized store at least 30 days advance notice of the effective date of [any disqualifications and, if appropriate, an opportunity to appeal the disqualification under § 1113.1] a disqualification. The notice will include the store's appeal rights, if applicable.
(l) [Certification] Authorization following expiration of disqualification period. A store that has been disqualified from the WIC Program may apply for [certification] authorization following expiration of the disqualification period. If the store chooses to apply for [certification] authorization after expiration of the disqualification, the Department will not consider the prior disqualification [from the WIC Program] when determining eligibility. The [store will be considered] Department will consider the store's application in accordance with § 1103.4 (relating to selection [and limitation] criteria [;] for authorization [process] and reauthorization) [or placed on a waiting list in accordance with § 1103.6 (relating to waiting list)].
§ 1107.2. Civil money penalties.
(a) Option available in lieu of a disqualification or denial of reauthorization. The Department may offer to a WIC authorized store the option of paying a civil money penalty in lieu of a denial of [recertification] reauthorization or a disqualification required under § 1107.1 (relating to imposition of sanctions), only if the Department finds inadequate participant access as set forth in § 1103.7 (relating to inadequate participant access). The Department will not provide this option for third or subsequent violations [in] under § 1107.1a(b)--(d) (relating to disqualifications).
(b) Calculation of civil money penalty.
(1) For a civil money [penalties] penalty in lieu of [disqualifications] a disqualification under § 1107.1a(b), (c) [and] or (d)(1) and (2), the Department will calculate the civil money penalty for each violation identified by multiplying 10% of the average monthly total value of WIC checks redeemed for the most recent 6-month period by the number of months the store would be disqualified under § 1107.1. If 6 months of information relating to the monthly value of WIC checks redeemed is not available, the Department will calculate the monthly average based upon the number of months for which information is available.
(2) For [disqualifications identified in § 1107.1a(d)(2)--(16)] a civil money penalty in lieu of disqualification under § 1107.1a(d)(3)--(16), the Department will calculate the civil money penalty for each violation identified by multiplying 5% of the average monthly total value of WIC checks redeemed for the most recent 6-month period by the number of months the store would be disqualified under § 1107.1. For [stores which are denied recertification] a store to which the Department may deny reauthorization and for which this option is available, the Department will multiply 5% of the average monthly total value of WIC checks for the most recent 6-month period by 6 months to determine the civil money penalty to be paid. If 6 months of information relating to the monthly value of WIC checks redeemed is not available, the Department will calculate the monthly average based upon the number of months for which information is available.
(c) Limitation of [Penalties] penalties. The amount of the civil money penalty will not exceed $10,000 for each violation. [When] If, during the course of a single investigation, the Department determines a store has committed multiple violations, the Department will impose a civil money penalty for each violation. The total [amount of] civil money [penalties imposed] penalty for all violations investigated as part of a single investigation will not exceed $40,000.
* * * * * (e) Payment of the civil money penalty. If a WIC authorized store does not pay, only partially pays, or fails to timely pay a civil money penalty assessed in lieu of disqualification, the Department will disqualify the WIC authorized store for the length of the disqualification [corresponding to] authorized for the violation for which the civil money penalty was assessed. If a civil money penalty is assessed for more than one violation, the Department will impose the disqualification for the period [corresponding to] authorized for the most serious violation. The Department may permit payment of a civil money [penalties] penalty by installments.
(f) Outstanding financial liabilities. Payment of the civil money penalty, unless specifically provided for in a written agreement between the Department and the store, does not relieve the store of any other past or future financial liability incurred by the store by reason of its participation in the WIC Program. This includes, by way of example, [payment] reimbursement to the Department of [outstanding overcharges for the acceptance of WIC checks for the sale of unauthorized foods] overpayments.
CHAPTER 1109. ADMINISTRATIVE APPEALS § 1109.2. Scope and purpose.
Chapters 1111 and 1113 (relating to applicant and participant appeals; and [local agency and] store appeals) apply to hearings held under 42 U.S.C.A. § 1786(f)(9), relating to the WIC Program. Those chapters supplement the Federal regulations, 7 CFR Part 246 (relating to special supplemental nutrition program for women, infants, and children) governing hearings afforded under this part to applicants, participants, and stores [denied certification or recertification and local agencies], and supplement or supersede regulations in 1 Pa. Code Part II (relating to General Rules of Administrative Practice and Procedure) when their application would be inappropriate or inadequate.
CHAPTER 1113. [LOCAL AGENCY AND] STORE APPEALS § 1113.1. Right to administrative appeal.
(a) A store [or local agency adversely affected by a Division of WIC action] has the right to appeal an adverse action of the Division of WIC that affects the store's participation in the WIC Program as a WIC authorized store. [The right of appeal shall be granted when a local agency's or store's application to participate in the WIC Program is denied; or during the course of an agreement or period of authorization, when a local agency or store is disqualified; or when any other adverse action during the period of authorization which affects participation is taken against the store or local agency by the Division of WIC] Adverse actions include:
(1) Termination of authorization or reauthorization in accordance with § 1103.1(d) (relating to authorization and reauthorization process and requirements).
(2) Denial of an application for authorization or reauthorization.
(3) Refusal to accept an application for authorization or reauthorization.
(b) [The following actions are not subject to appeal] A store may not appeal the following:
(1) The expiration of [a WIC] authorization or reauthorization.
(2) [The Division of WIC's determination regarding participant access] The validity or appropriateness of selection criteria.
(3) [Disqualification from the WIC Program of a store as a result of disqualification from the Food Stamp Program] The validity or appropriateness of the Department's participant access criteria and the Division of WIC's participant access determination.
(4) Disqualification from the WIC Program as a result of disqualification from the Food Stamp Program.
(5) The resolution of an overpayment dispute under § 1105.2(d) (relating to price adjustment) or the resolution of an overcharge dispute under § 1105.3(d) (relating to terms and conditions of participation).
(c) [The appeal process is designed to secure and protect the interest of both the store or local agency and the Division of WIC and to ensure equitable treatment for all involved.] A denial of authorization under § 1103.1(b)(6) and a disqualification imposed under § 1107.1a(a) (relating to disqualifications) shall be effective on the date of the store's receipt of notice of the adverse action. All other adverse actions shall be effective on the date set forth in the written notice.
[(d) Except for permanent disqualifications assessed under § 1107.1a(a) (relating to disqualifications), the Department may take adverse action against a store after 30 days advance notification.
(e) In the case of a disqualification of a local agency, the Department will provide at least 60 days advance notice.]
§ 1113.2. [Appeal] Administrative appeal procedures.
(a) Notification. [At the time the Division of WIC denies an application of a store, or disqualifies a WIC authorized store or takes an adverse action against a local agency or store during a period in which the local agency or store is authorized, the Division of WIC will notify the local agency or store of its right to an administrative appeal] The Division of WIC will provide to the store written notice of the adverse action, the procedures to follow to appeal the adverse action and the cause for and the effective date of the action.
(b) Form of administrative appeal. The appeal shall be made by the [local agency or] store or its authorized representative, in writing, stating the reasons for the appeal.
(c) Time for and effect of filing an administrative appeal. The appeal shall be filed with the Director of the Division of WIC within 30 days after [any final decision by the Division of WIC] the effective date of the adverse action. The filing of an appeal shall serve to stay the Department's adverse action pending issuance of an adjudication and order by the hearing examiner under § 1113.3 (relating to adjudication and order). The stay shall be lifted upon receipt of the hearing examiner's adjudication and order affirming the adverse action, or upon receipt of the store's written notice of withdrawal of the appeal.
(d) Scheduling the hearing.
* * * * * (3) The hearing examiner shall send notice to the [local agency or] store, or its authorized representative, at least 10 days in advance of the date of the hearing.
(4) The hearing examiner shall schedule the hearing to be held within 21 days after the date of receipt by the Division of WIC of the [local agency or] store appeal.
(5) The [Department] Division of WIC or the [appellant] store may request in writing that the hearing be rescheduled for another time or date and the hearing examiner shall consider the request.
(e) Hearing examiner. The Secretary will appoint a hearing examiner to preside over the appeal. The person shall be an impartial decision-maker, whose [decision as to the validity of the Department's action shall rest solely on the evidence presented at the hearing and the statutory and regulatory provisions governing the WIC program, and who may not have participated in the decision made by the Division of WIC or have any personal stake in the outcome] determination is based solely on whether the Division of WIC has correctly applied Federal and State statutes, regulations, policies and procedures governing the WIC Program, according to the evidence presented at the hearing.
(f) Hearing procedures.
(1) The [local agency or] store may be assisted or represented by an attorney or other authorized representative.
(2) The [local agency or] store, or its authorized representative, may examine, prior to and during the hearing, the documents and records considered by the Division of WIC in reaching its decision under appeal.
* * * * * § 1113.3. Adjudication and order.
* * * * * (b) The hearing examiner shall provide the Director of the Division of WIC and the [local agency or] store, or its authorized representative, with the adjudication and order within 60 days after the date of the receipt by the Division of WIC of the appeal, adjusted for any continuance of the hearing that causes it to be held more than 21 days after the date the appeal was filed.
(c) If the hearing examiner upholds the Department's adverse action, the adverse action shall be effective as of the date of the store's receipt of written notice of the hearing examiner's adjudication and order.
(d) The hearing examiner shall maintain a written record of the hearing. The record shall include a docket number and caption for the appeal, any documentary evidence submitted, the transcript of the testimony presented at the hearing, the adjudication and order of the hearing examiner, and a copy of the document transmitting the adjudication and order to the [local agency or] store, or its authorized representative.
[(d)] (e) * * *
§ 1113.4. Continuing responsibilities.
Appealing an action does not relieve the [local agency or] store from the responsibility of continued compliance with [the terms of any written agreement or contract with the Department or certification or recertification by the Department] regulations under this part applicable to a WIC authorized store.
§ 1113.5. Judicial review.
If the adjudication and order of the hearing examiner [is rendered against the local agency or store] upholds the Department's adverse action, the hearing examiner will inform the [local agency or] store within the adjudication and order, or by notice accompanying the adjudication and order, of the right to pursue judicial review of the adjudication and order.
[Pa.B. Doc. No. 02-1634. Filed for public inspection September 20, 2002, 9:00 a.m.]
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