This chapter specifies the policies and procedures for the Special Supplemental Nutrition Program for Women, Infants, and Children (WIC) to authorize vendors to redeem WIC food instruments and provide foods to WIC participants. In this chapter, the following documents are incorporated by reference: 42 U.S.C. §1786, as amended; and 7 CFR 15-15b and 246, as amended. In this chapter, the following terms have the meanings indicated. Terms Defined. “Above 50 percent vendor” means a vendor that derives or will derive after commencement of business more than 50 percent of the vendor's annual eligible food sales revenue from WIC food instruments. “Accounting records” means: Legible records that show actual numbers of eligible food sales from the vendor and not an estimated number or percentage of eligible food sales; and Actual WIC sales for each individual day. “Approved foods” means the types and brands of foods: Approved by the State agency for use by Program participants; Included on the Maryland WIC Authorized Foods List; and Included in the Approved Product List (APL). “Approved Product List (APL)” means the electronic list of approved foods maintained by the State agency. “Authorization” means approval by the State agency for a food store, pharmacy only, food store/pharmacy combination, or a military commissary to redeem WIC food instruments as a vendor. “Benefits” means the foods prescribed and services provided to a participant by the Program. “Change in ownership” means the transfer of majority control or ownership of a store. “Compliance buy” means a covert, on-site investigation in which a representative of the Program: Poses as a: Participant; Parent, guardian, or caretaker of an infant or child participant; or Proxy; Presents one or more food instruments to be redeemed for food; and Does not reveal during the visit that the individual is a Program representative. “Day” means a calendar day. “Disqualification” means revocation of a vendor's WIC authorization for a specified period of time as prescribed in Regulation .16 of this chapter. “Excess charges” means the amount above the maximum price payable for the food benefits charged by a vendor to the Program. “Exempt infant formulas” means those infant formulas available, which are not categorized as either contract or noncontract, standard infant formulas. “Food instrument” means an electronic benefits issuance card or other document that is used to obtain supplemental foods. “Food package” means a grouping of specified types and amounts of foods, as set forth in Regulation .06A of this chapter, used for the purpose of evaluating vendor prices. “Food sales” means sales of all SNAP eligible foods intended for home preparation and consumption, as set forth in 7 CFR §246.2. “Food store” means a grocery or supermarket licensed under COMAR 10.15.03 that ordinarily has, for sale to the public, authorized foods and does not have a pharmacy under the same ownership on its premises. “Food store/pharmacy combination” means a food store and a pharmacy under the same ownership on the same premises. “High risk” means a vendor has been determined by the State agency to have a high probability of violating program requirements. “Inventory audit” means an audit conducted over a specific period of time in order to determine whether a vendor’s claimed reimbursement for the sale of an amount of a specific food item exceeds the vendor’s documented inventory of that item. “Inventory invoices” mean sales receipts for WIC food purchased by the vendor for resale by the vendor, from a supplier which can be a wholesaler, distributor, manufacturer, or other retailer. “Maximum price payable” means the maximum amount of money the Program will pay a vendor for the WIC food items on the food instrument. “Medical foods” means WIC-eligible formula authorized for children and women with special dietary needs. “Minimum required stock” means the specific types and amounts of WIC-authorized foods that shall be in a vendor's store during business hours. “Monitoring” means assessing vendor compliance with program requirements. “Nonprofit entity” means a vendor applicant or vendor whose business has been granted a 26 U.S.C. §501(c)(3) federal income tax exemption by the United States Internal Revenue Service. “On-site review” means an inspection of a vendor applicant's premises by a Program representative to ensure that requirements for authorization are met. “Participant” means a pregnant woman, a breastfeeding woman, a postpartum woman, an infant, a breastfed infant of a participant breastfeeding woman, or a child receiving supplemental foods or food benefits from the Program. “Pattern” means two or more vendor violations of the same provision. “Peer group” means a grouping of stores with similar characteristics and business practices that correlate to food costs. “Peer group average” means the arithmetic mean of prices charged by vendors within a peer group for food items. “Pharmacy only” means an establishment that: Has been issued a permit to operate by the State Board of Pharmacy; and Does not have a food store under the same ownership on its premises. “PIN” means a personal identification number used to securely access benefits on the food instrument. “Program” means the Special Supplemental Nutrition Program for Women, Infants, and Children (WIC) authorized by 42 U.S.C. §1786, the Child Nutrition Act of 1966, as amended, including the local, State, and federal entities that administer it. “Proxy” means an individual who is designated by a participant or a child, or infant participant’s parent, guardian, or caretaker to receive food instruments and to redeem food benefits for the participant and whose name is on file at a local agency. “Region” means a designated area of the State for administration of the WIC Program including vendor selection and peer group designation. “Standard infant formulas” means nutritionally complete infant formulas which do not require the addition of any ingredient other than water before being served in a liquid state and which supply at least 10 milligrams of iron per liter at standard dilution and approximately 20 kilocalories per fluid ounce at standard dilution. “State agency” means the Maryland Department of Health's WIC Program. “Store” means a food store, pharmacy, food store/pharmacy combination, or military commissary. “Supplemental Nutrition Assistance Program (SNAP)” means the federal program administered by the United States Department of Agriculture that provides financial assistance for purchasing food. “Traffic” means to buy or sell a food instrument or benefits for cash. “Universal Product Code (UPC)” means a unique barcode assigned to a trade item and used to track items for sale in stores, such as food. “USDA” means the United States Department of Agriculture. “Vendor” means a sole proprietorship, partnership, cooperative association, corporation, or other business entity operating one or more stores authorized by the State agency to provide authorized supplemental foods to participants under a retail food delivery system. “Vendor agreement” means a written agreement between the State agency and a vendor concerning the duties and responsibilities of the vendor and the State agency with respect to a vendor's participation in the WIC Program. “Vendor applicant” means a sole proprietorship, partnership, cooperative association, corporation, or other business entity operating one or more stores that has applied to the State agency for WIC authorization. “Vendor price list form” means the form used by the State agency to collect a vendor's shelf prices for WIC food items. “Vendor’s price” means the cost of a food package listed in Regulation .06A of this chapter as calculated from actual lowest shelf prices collected by the State agency during an on-site visit. “WIC” means the Special Supplemental Nutrition Program for Women, Infants, and Children (WIC) as authorized by 42 U.S.C. §1786, the Child Nutrition Act of 1966, as amended. “WIC-authorized foods list” means a list of foods authorized by the Maryland WIC program for purchase by Maryland WIC participants. “WIC Management Information System” means the WIC Program's software application, which provides: Client services; Financial management; and Vendor compliance oversight. A store shall obtain authorization to operate as a WIC vendor from the State agency before redeeming food benefits. A store: May not redeem WIC food benefits unless the store is authorized as a WIC vendor by the State agency; Constitutes a separate vendor and shall be authorized separately from other stores operated by the same business entity; and Shall have a single, fixed location. In order to receive authorization from the State agency, a vendor shall: Submit a completed vendor application package as set forth in Regulation .07 of this chapter to the State agency; Have in its store from the time of application the minimum required stock as set forth in Regulation .14 of this chapter; Post shelf prices for all WIC-approved foods at, on, or near the food items; Comply with applicable federal and State laws and regulations; Maintain the store premises in a sanitary condition with no evidence of: Excess trash; Vermin; or General lack of cleanliness; Be accessible to persons with disabilities; Successfully complete an on-site review as set forth in Regulation .08 of this chapter; Have a management representative attend a training session offered by the State agency; Be authorized by SNAP; and Be in good standing with SNAP and have not: Been disqualified; Been suspended; Been issued a charge or adverse action letter; Filed an appeal; or Been assessed a civil money penalty within the 24 months prior to the date of application. In order to receive authorization from the State agency, a vendor applicant may not: Have owners, officers, or managers that have been indicted for, convicted of, or have had a civil judgment entered against them for any activity indicating a lack of business integrity; Currently be under disqualification by the State agency; Owe money to the State agency; or Derive or derive after commencement of business more than 50 percent of the vendor’s or applicant’s annual eligible food sales revenue from food purchased with WIC food instruments, with the exception of: A nonprofit entity; or An above 50 percent vendor the State agency has authorized for participant access reasons. Pursuant to Regulation .19 of this chapter, if the State agency determines that a participant hardship exists, where access to special infant formula and WIC-eligible medical foods are not available through a food/pharmacy combination store, the State agency, at its sole discretion, may authorize a pharmacy only vendor that shall: Adhere to the requirements set forth in §C(1) and (3)—(8) of this regulation; Hold a current permit to operate as a pharmacy issued by the State Board of Pharmacy; Only accept WIC food instruments prescribing exempt infant formula and WIC-eligible medical foods; and Upon request by a participant, provide exempt infant formulas and WIC-eligible medical foods within 48 hours, excluding weekends and holidays. Except for a pharmacy only or military commissary, a vendor applicant shall have actual lowest current shelf prices that are less than or equal to 125 percent of the peer group average in the vendor applicant’s region during the month of application, as determined by the State agency for each of the food packages set forth in Regulation .06A of this chapter. A vendor applicant may not apply for authorization in order to circumvent sanctions imposed by SNAP or the State agency on a previous vendor. The vendor applicant shall provide to the State agency documents that demonstrate the vendor applicant has submitted the application in good faith including but not limited to: A copy of the sales agreement including but not limited to the sales price; Names and addresses of the owners, directors, managers, and other decision makers of the store, including whether any of these people are related to the vendor who has been sanctioned; and A copy of the lease or deed for the store. In order to determine whether the vendor applicant seeks authorization in order to circumvent sanctions imposed on a vendor by the State agency, the State agency shall review the totality of the circumstances and may consider whether the: Vendor applicant is related to the former vendor; Former vendor or a relative of the former vendor is involved in the operation of the store; Former vendor or a relative of the former vendor is a director, officer, or otherwise part of the entity that will own the store; and Business was sold for fair market value. A store can be reassessed at any time during the authorization period to ensure that it meets the current vendor authorization requirements as set forth in this regulation. A vendor applicant denied authorization three times in a 12-month period may not reapply until after 12 months have passed since the last denial date. The State agency shall authorize a military commissary vendor applicant that complies with the requirements of §B of this regulation. To become an authorized WIC vendor, a military commissary shall complete and sign a vendor agreement based on the memorandum of understanding jointly prepared by the USDA and the United States Department of Defense, in place of the vendor agreement defined in Regulation .03B of this chapter. The State agency shall group the food items on the vendor price list form into the following food packages: Foods for an infant 4 months old or older but younger than 13 months old: 31 13-fluid-ounce cans of concentrated liquid infant formula with iron as specified in the WIC infant formula rebate contract; 24 ounces of dry infant cereal; and 128 ounces of infant vegetables and fruit; Foods for a child 1 year old or older but younger than 5 years old: 3 gallons and 1 quart of fluid milk; 1 dozen large eggs; 36 ounces of dry cereal; 128 fluid ounces of single-strength canned juice; 18 ounces of peanut butter; 1 pound of cheese; and 2 pounds of whole wheat bread, brown rice, or soft corn tortillas; Foods for a breastfeeding woman: 5 gallons and 1 quart of fluid milk; 2 dozen large eggs; 36 ounces of dry cereal; 36 ounces frozen juice concentrate; 18 ounces of peanut butter; 2 pounds of cheese; 30 ounces of tuna, salmon, or sardines; and 16 ounces of dried beans; and Foods for a nonbreastfeeding, postpartum woman: 3 gallons and 1 quart of fluid milk; 1 dozen large eggs; 36 ounces of dry cereal; 24 fluid ounces of single-strength frozen juice concentrate; and 1 pound of cheese. The State agency shall calculate monthly the peer group average in Peer Groups 1—18 for each food package set forth in §A of this regulation by adding together the average food instrument price and average cost of food items that make up a food package and dividing that sum by the total number of food store and food store/pharmacy combination vendors in the region. The State agency shall provide, upon request, the current peer group average in Peer Groups 1—19 for each food package in §A of this regulation. The State agency shall compile the peer group averages for the food packages in §A of this regulation based upon redemption data provided by the WIC Management Information System. The State agency shall provide an application package to a vendor that requests it. The application package shall consist of the following: An overview of the WIC Program; The minimum requirements for authorization; The WIC Authorized Foods List; The Minimum Required Stock List; The Application Checklist; The eWIC Readiness Assessment; The Vendor Application Price List; The Authorized Infant Formula and Medical Foods Supplier Directory; Instructions for completing the application for vendor authorization; An application for vendor authorization; and Two vendor agreements. A military commissary is exempt from State on-site reviews. Except as provided in §A of this regulation, the State agency shall conduct an unscheduled on-site review of a vendor applicant’s store within 60 days of receipt of an application to ensure that the store meets the requirements for authorization as set forth in Regulation .04C(1)—(6) and .04D of this chapter. The State agency shall grant or deny authorization to a vendor applicant within 60 days of receipt of an application. Authorization Granted. The State agency shall grant authorization if the vendor applicant's store meets the requirements for authorization as set forth in Regulation .04 of this chapter. Authorization Retained. A vendor retains its authorization until the: Vendor’s authorization is terminated as a sanction for a Program violation in accordance with this chapter; State agency terminates the vendor's authorization in accordance with the provisions of the vendor agreement; Vendor notifies the State agency it wishes to cease operation as a WIC vendor; Authorization period as contained in the vendor agreement has expired; or Vendor is determined, in accordance with Regulation .10H of this chapter, to derive more than 50 percent of its eligible food sales from the redemption of WIC food benefits. Authorization Denied. The State agency shall deny authorization if a vendor applicant's store does not meet the minimum requirements for authorization as set forth in Regulation .04 of this chapter. Upon denial of an application, the State agency shall notify a vendor applicant: In writing of the reason for denial of its application; and Of its right to request a hearing on the denial as set forth in Regulation .18 of this chapter. Authorization Period. The State agency, in accordance with 7 CFR 246.12, may not authorize a vendor for a period exceeding 3 years. The State Agency, at its discretion, may authorize a vendor for a period less than 3 years. The WIC Program shall calculate peer group averages according to the peer groups set forth in Regulation .03B(33)—(38) of this chapter. The WIC Program may implement price determinations that are applicable statewide, or to specific peer groups, provided that vendors receive 30 days notice of the intended determination. After authorization, a vendor, other than a pharmacy only or military commissary, shall maintain prices for each of the food packages set forth in Regulation .06A of this chapter that are less than or equal to 125 percent of the peer group average for each food package. Upon request of the State agency, a vendor, other than a pharmacy or military commissary, shall submit on the vendor price list form its lowest shelf prices for WIC-authorized foods to the State agency. The State agency shall notify a vendor, other than a pharmacy only or a military commissary, that fails to submit its prices on the vendor price list form when requested to do so that, if the price list form is not received by the Program within 10 business days of the State agency’s request, the vendor’s authorization shall be terminated for 12 months from the date of disqualification. If a vendor, other than a military commissary, submits prices on the vendor price list form that make its food package price more than 125 percent of the peer group average for that food package, or the food package prices are determined by the WIC Management Information System calculation to exceed 125 percent of the peer group average, the State agency shall notify the vendor that: Its price submission or food package price calculation is unacceptable; It shall lower its actual lowest shelf prices for the WIC foods and resubmit the vendor price list form to the State agency within 10 days following the notification; and If the vendor’s resubmitted prices indicate that a food package will cost the Program more than 125 percent of the peer group average for that food package, the State agency may disqualify the vendor for 12 months from the date of disqualification. If, at any time, a vendor, other than a military commissary, has actual lowest shelf prices that make any food package price more than 125 percent of the peer group average, the State agency shall notify the vendor that: The vendor shall lower its actual lowest shelf prices for the WIC foods within 10 days; and If the vendor’s prices remain so that a food package will cost the Program more than 125 percent of the peer group average, the vendor’s authorization shall be terminated for 12 months from the date of disqualification. If, in 2 consecutive reporting months, a vendor, other than a pharmacy only or a military commissary, is determined by the WIC Management Information System calculation to have food package prices that exceed 125 percent of the peer group average, the vendor’s authorization shall be terminated for 12 months from the date of disqualification. The State agency may request that a vendor, other than a pharmacy only or a military commissary, submit semi-annual price lists at the State agency’s sole discretion and may use these price lists and the WIC Management Information System for calculation of excess charges if it is determined that excess charges have occurred. For the purpose of cost containment, the State agency shall assign to an above 50 percent vendor peer group a vendor that is determined by the State agency, through a comparison of the vendor's gross annual sales, SNAP eligible sales, and WIC redemptions, to derive more than 50 percent of the vendor's eligible food sales revenue from the redemption of WIC food instruments. A vendor that has been determined to derive more than 50 percent of its eligible food sales revenue from the redemption of WIC food instruments will only be paid at the statewide average of all other non-above 50 percent vendors. For the purpose of cost containment, the State agency: Shall use the methodology provided by the U.S. Department of Agriculture, Food Nutrition Service to ascertain whether or not the vendor derives more than 50 percent of the vendor’s eligible food sales revenue from the redemption of WIC food instruments; and May reject information submitted by a vendor to demonstrate that it does not derive more than 50 percent of the vendor’s eligible food sales revenue from the redemption of WIC food instruments. Food Store, Food Store/Pharmacy Combination, and Pharmacy Only Vendors. The State agency shall establish a maximum price payable for each WIC-approved food item, which shall be calculated as follows: Based on the WIC Management Information System calculation, the State agency shall determine every month the peer group average for each WIC-approved food item; and Except as provided in §C of this regulation, the maximum price payable for a food instrument prescribing infant formula shall be: Equal to 125 percent of the peer group averages as determined by the WIC Management Information System calculation for the individual food items on the food instrument; or Limited to an amount determined by the Program. Military Commissaries. The maximum price payable by the State agency for a food item redeemed by a military commissary is the price charged by the military commissary. The maximum price payable to vendors that are determined to derive more than 50 percent of their annual sales revenue from the redemption of WIC food benefits may not exceed the Statewide average price per food item paid to all other vendors. The State agency, through prepayment and post payment edit review of WIC redemptions, shall ensure that excess charges do not occur. If the State agency determines that excess charges have occurred as a result of software, bank, or other error, the State agency reserves the right to bill a vendor for excess charges. The State agency may not bill a vendor if the vendor's excess charges total $25 or less. The State agency shall: Maintain the WIC-authorized foods list; Make the list available to all participants and authorized WIC vendors; and Maintain the APL. A vendor shall keep a copy of the Program’s current WIC-authorized foods list: At each cash register where WIC transactions are handled; and On-site at the authorized vendor location along with the vendor manual. The WIC-authorized foods list shall be used in conjunction with the APL to identify foods items that are eligible for purchase using WIC food instruments. Food instruments may require that program participants purchase specific manufacturers or brands that are not included in the WIC-authorized foods list. Authorized vendors shall sell WIC-approved brands for food categories identified in the WIC-authorized foods list and the APL. A food store or food store/pharmacy combination vendor with four or more cash registers shall maintain on the store premises, available for immediate purchase by a WIC participant during regular business hours, the following minimum required stock: Fluid milk: 4 gallons whole; and 6 gallons 1-percent or fat-free; 6 dozen medium or large white or brown eggs; Domestic cheese: Four varieties; A total of 6 pounds; 8 or 16-ounce packages only; and Block, shredded, stick, string, cubed, cracker cuts, or sliced; Unsweetened 100-percent juice: Two varieties; and Six 64-ounce containers; Frozen concentrate unsweetened 100-percent fruit juice: Two varieties; and Six 11.5—12-ounce cans or 48-ounce containers; 32 total infant fruits and vegetables: Two varieties of each; 16 4-ounce containers of each; and Plain, a combination of fruits, a combination of vegetables, or a combination of fruits and vegetables; Infant meats: Six 2.5-ounce jars; and One variety of plain meat; Dry cereal: Corn, wheat, oats, or rice: Six 12-ounce or larger containers; and Two varieties; Whole grain wheat or oats: Six 12-ounce or larger containers; and Two varieties; and At least one hot cereal in an 11.8-ounce container or larger; Infant cereal: Six 8-ounce or 16-ounce containers dry; Two varieties; and At least one variety of rice; Peanut butter: One brand; and Six 16—18-ounce containers; Beans: Three 1-pound bags dry type in two varieties; and 12 15—16-ounce packed in water cans in three varieties; Canned fish: 30-ounces total and packed in water; and Two varieties of: Canned chunk light tuna in 5—6-ounce cans; Pink salmon in 5—7.5-ounce or 14.75-ounce cans; and Sardines in 3.75-ounce cans; Fruits and vegetables: A total value of $32; Two varieties of fruits, fresh, whole or cut, loose or prepackaged, frozen or canned; and Two varieties of vegetables, fresh, whole or cut, loose or prepackaged, frozen or canned; Bread, rolls, tortillas, pasta, rice, and oats in two varieties and a total of 4 pounds: 100 percent whole grain or whole wheat bread, 16-ounce packages; 100 percent whole grain or whole wheat rolls, 15—16-ounce packages; Dry, plain brown rice, 16-ounce packages; Soft corn or whole wheat tortillas, 16-ounce packages; Whole grain or whole wheat pasta, 16-ounce packages; or 100-percent oats, 16-ounce packages; and Infant formula: 15 12.4-ounce containers, or containers of the currently authorized size, of powdered infant formula as specified by the WIC infant formula rebate contract; and Four 12.4-ounce containers, or containers of the currently authorized size, of soy-based powdered infant formula as specified by the WIC infant formula rebate contract. A food store or food store/pharmacy combination vendor with one to three cash registers shall maintain on the store premises, available for immediate purchase by a WIC participant during regular business hours, the following minimum required stock: Fluid milk: 2 gallons whole; and 3 gallons 1-percent or fat-free; 6 dozen medium or large white or brown eggs; Domestic cheese: Two varieties; A total of 3 pounds; 8 or 16-ounce packages only; and Block, shredded, stick, string, cubed, cracker cuts, or sliced; Unsweetened 100-percent fruit juice: Two varieties; and Three 64-ounce containers; Frozen concentrate unsweetened 100-percent juice: One variety; and Three 11.5—12-ounce cans or three 48-ounce containers; 20 total infant fruits and vegetables: Two varieties of each; 10 4-ounce containers of each; and Plain, a combination of fruits, a combination of vegetables, or a combination of fruits and vegetables; Dry cereal: Corn, wheat, oats, or rice: Three 12-ounce or larger containers; and One variety; Whole grain wheat or oats: Three 12-ounce or larger containers; and One variety; Infant cereal: Three 8-ounce or 16-ounce containers dry; and One variety; Peanut butter: One brand; and Three 16—18-ounce containers; Beans. Two varieties of five 15—16-ounce cans packed in water; Canned fish: 15 ounces total and packed in water; and One variety of: Canned chunk light tuna in 5—6-ounce cans; Pink salmon in 5—7.5-ounce or 14.75-ounce cans; and Sardines in 3.75-ounce cans; Fruits and vegetables: A total value of $16; One variety of fruits, fresh, whole or cut, loose or prepackaged, frozen or canned; and One variety of vegetables, fresh, whole or cut, loose or prepackaged, frozen or canned; Bread, rolls, tortillas, pasta, rice and oats in two varieties and a total of two pounds: 100-percent whole grain or whole wheat bread, 16-ounce packages; 100-percent whole grain or whole wheat rolls, 15—16-ounce packages; Dry, plain brown rice, 16-ounce packages; Soft corn or whole wheat tortillas, 16-ounce packages; Whole grain or whole wheat pasta, 16-ounce packages; or 100-percent oats, 16-ounce packages; and Infant Formula. Seven 12.4-ounce containers, or containers of the currently authorized size, of powdered infant formula as specified by the WIC infant formula rebate contract. A pharmacy only or food store/pharmacy combination vendor shall provide exempt formulas, or WIC-eligible medical foods within 48 hours, excluding weekends and holidays, for a request by a participant or the Program. The State agency or its representative shall conduct inventory audits, compliance buys, and monitoring to ensure that authorized vendors comply with required vendor practices. General Requirements. A vendor shall: Maintain on the store premises, available for immediate purchase by a WIC participant during regular business hours, the minimum required stock; Post the State agency’s WIC sign at the front of the store or in a conspicuous place on the store premises and use other materials provided or approved by the WIC program; Maintain the vendor premises in a sanitary condition with no evidence of: Excess trash; Vermin; or General lack of cleanliness; Display a current food service facility license, issued by the local health department or department of environment, or if a pharmacy only or a food store/pharmacy combination, a pharmacy permit issued by the State Board of Pharmacy, in a location visible to Program representatives; Train vendor personnel in WIC policies and procedures; Display the shelf price of a WIC food at, on, or near the item; Treat individuals redeeming food instruments the same as other customers; Submit information requested by the State agency by the date requested; Attend a WIC training that has been required by the Program for a vendor with a high rate of: Errors; Rejected transactions; Complaints; or Other minor violations; Provide WIC foods in a store at a fixed location; If a pharmacy only or a food store/pharmacy combination: Upon request by a participant or the Program, provide infant formulas and medical foods within 48 hours, excluding weekends and holidays; Only accept the food instrument after obtaining the requested formula; and If a pharmacy only vendor, only accept food instruments prescribing infant formula and WIC-eligible medical foods; Maintain accounting records that are relevant to the vendor’s performance under the vendor agreement for 3 years, for review at reasonable times by State agency representatives or other authorized State or federal officials; If a SNAP vendor, remain in good standing and not: Be disqualified; Be suspended; Have been issued a charge or adverse action letter; Have filed an appeal; or Have been assessed a civil money penalty; Give 30 days notice to the State agency of the store's closing, relocation, or change in ownership; Pay, by the date due, money penalties imposed by the State agency and overcharges; Submit the vendor price list form when requested to do so by the State agency; For the food packages set forth in Regulation .06A of this chapter, maintain prices that are less than or equal to 125 percent of the peer group average as determined by the WIC Management Information System calculation for each food package; Have a representative attend and participate in an annual vendor training session once every 12 months, if the State agency: Gives the vendor 14 days notice of a scheduled training session; and Holds the training session in the vendor’s region or offers the training session virtually; If more than 30 days are needed to reopen the vendor’s business in the same location, reapply for authorization and be approved as a WIC vendor in order to obtain authorization to operate as a WIC Vendor; and Maintain an active email account that is monitored no less than once a week. A vendor may not: Charge WIC participants a higher price for food than other customers; Violate the nondiscrimination provisions of federal regulations in 7 CFR 15, 15a, and 15b, as incorporated by reference in Regulation .02 of this chapter; Provide false information to the Program; Except for a pharmacy or military commissary, process fewer than 25 WIC transactions in a consecutive 3-month period; Intentionally submit false prices on the vendor price list form; Use the WIC acronym or WIC logo, or close facsimiles, in the name of the vendor or in advertising or other promotional materials; Apply stickers, tags, or labels that have the WIC acronym or logo on WIC-approved foods; Use manufacturer supplied shelf tags, talkers, or labels that make unauthorized use of the WIC acronym or logo; Apply WIC-approved shelf tags to nonapproved foods; or Derive more than 50 percent of its annual SNAP eligible foods sales from WIC food benefits. Accounting Records. Accounting records shall include, but are not limited to: Sales and use tax returns; U.S. individual or business tax returns; Daily sales journals or daily ledgers; Sales receipts or register tape; Inventory invoices; and A breakdown of sales between SNAP eligible foods and non-eligible foods. Inventory Invoices. Inventory invoices shall include the: Name and address of the supplier; Date of purchase; Description of the exact food items purchased, including size, stock number, and UPC code if available; Unit price of the food items; Total quantity purchased; and If inventory invoices do not completely describe the actual food item, verifiable computer codes for the item. Inventory invoices or purchase receipts for infant formula shall only be accepted from those wholesalers, distributors, and manufacturers listed on Maryland’s Authorized Infant Formula and Medical Foods Supplier Directory. A vendor who violates the provisions set forth in this section is subject to the sanctions in Regulation .16 of this chapter. Transactional Requirements. A vendor shall: Provide authorized foods to an individual redeeming food benefits only upon presentation of a valid food instrument; Accept the WIC food instrument with a valid PIN as identification without requiring another form of identification; At the time of purchase, give a participant a receipt indicating the store name, date of transaction, and total dollar amount for items purchased with a food instrument and that the sale was a WIC transaction; Provide the WIC participant with a shopping list of remaining benefits upon request; Accept a food instrument only for authorized food brands, quantities, and types and as prescribed on the food instrument; Accept cents-off coupons from an individual redeeming WIC food instruments for prescribed approved foods and deduct savings from the purchase price; Allow the use of bonus or club cards, buy one, get one free, and any other promotion offered to store customers that does not involve cash back; Accept a valid food instrument as payment in full for the prescribed WIC foods purchased; Allow participants and proxies authorized to redeem food benefits a choice of the WIC-approved foods in the participant’s benefits balance; Allow the purchase of the full amount or less than the full amount of food on a food instrument; Redeem valid food instruments presented by a participant or proxy; Scan the actual UPC code that is affixed to the item being purchased by the WIC participant; Allow the participant to pay the difference when a fruit and vegetable purchase exceeds the value of the cash value benefit; and Obtain infant formula only from manufacturers, distributors, and wholesalers listed on Maryland’s Authorized Infant Formula and Medical Foods Supplier Directory, as available on the Program’s website. A vendor may not: Ask a participant or proxy for the PIN securing their food instrument; Redeem food benefits for spoiled or out-of-date food; Redeem food benefits in whole or in part for a non-food item or credit; Issue a rain check that would allow an individual redeeming a food benefit to get, at a later date, an item the vendor does not have at the time the food instrument is presented; Transfer cash in the form of change from the food benefit to an individual redeeming a food instrument; Collect sales tax on WIC food purchases; Traffic in WIC food instruments or benefits; Sell alcohol, alcoholic beverages, or tobacco products in exchange for a food instrument or benefits; Accept a food instrument or benefits in exchange for: Ammunition; A firearm; An explosive; or A controlled substance as defined by 21 U.S.C. §802; Manually key in a food instrument number without an actual food instrument being presented; or Scan UPC codes from: Codebooks; Reference sheets; or Lists. A vendor may not provide solely to participants incentive items or other free merchandise, including food. A vendor who violates the provisions of this section is subject to the sanctions in Regulation .16 of this chapter. Post-Transactional Requirements. A vendor shall: Notify the Program of attempted or actual misuse of WIC food instruments by a participant or other individual; Receive reimbursement only for approved benefits redeemed at the vendor’s store; Charge the State agency only for approved food received by a participant; Reimburse the Program for the loss sustained by the Program due to theft, fraud, or improper handling of food instruments by vendor personnel or agents; and Surrender lost or stolen food instruments to WIC representatives upon request. A vendor may not: Permit the return of food purchased with a food instrument in exchange for cash or another item; Claim reimbursement for the sale of an amount of a specific food item that exceeds the vendor’s documented inventory of that item for a specific period of time; or Claim reimbursement for vendor bank fees. A vendor who violates the provisions of this section is subject to the sanctions in Regulation .16 of this chapter. The Program may sanction a vendor that fails to comply with a required practice in Regulation .15B(1)(a)—(l), (n)—(q), and (t) and (2)(b) and (e)—(i), C(1)(a)—(n), (2)(a), (b), (d)—(f), (j), and (k), and (3), and D(1)(a) and (e) and (2)(a) and (c) of this chapter as follows: Written warning following each violation; and Disqualification for 1 year for a pattern of violations of the same provisions within a 12-month period. The Program shall sanction a vendor that fails to comply with a required practice in Regulation .15C(2)(h) of this chapter by disqualifying the vendor for 3 years. The Program shall sanction a vendor that fails to comply with a required practice in Regulation .15C(2)(g) or(i) of this chapter by disqualifying the vendor for 6 years. The Program shall sanction a vendor that fails to comply with a required practice in Regulation .15C(2)(g) or(i) of this chapter by permanent disqualification if the vendor is convicted in a criminal court of charges stemming from those violations. The Program shall sanction a vendor that fails to comply with a required practice in Regulation .15B(2)(a), C(2)(c) or (f), or D(1)(b) or (c) or (2)(b) of this chapter by: A written warning if one violation is detected in any 12-month period; or Disqualifying the vendor for 3 years for two or more violations of the same provision in any 12-month period. When a vendor that has previously received a sanction for violation of the provisions of Regulation .15B(2)(a), C(2)(c) or (f), or D(1)(b) or (c) or (2)(b) of this chapter, the Program shall impose a 6-year disqualification for violation of the same provision. Disqualification. Except in circumstances described in §G(2) of this regulation, the Program shall disqualify a vendor that has been disqualified by SNAP in violation of Regulation .15B(1)(m) of this chapter for the same length of time as SNAP disqualification. If disqualification of the vendor will result in inadequate participant access in accordance with Regulation .19 of this chapter, the State agency shall impose a civil money penalty in lieu of disqualification. Except in circumstances described in §G(4) of this regulation, the Program shall disqualify a vendor that has been assessed a civil money penalty for hardship by SNAP instead of disqualification by SNAP in violation of Regulation .15B(1)(m) of this chapter, for the same period for which the vendor would otherwise have been disqualified by SNAP. If disqualification of a vendor that has been assessed a civil money penalty for hardship by SNAP instead of disqualification by SNAP would result in inadequate participant access in accordance with Regulation .19 of this chapter, the Department may not: Disqualify the vendor; or Impose a civil money penalty in lieu of disqualification. The Program may not accept a vendor's voluntary cancellation of the vendor's authorization in lieu of a disqualification. The Program shall sanction a vendor that fails to comply with a required practice in Regulation .15B(1)(r) or (s) or (2)(c), (d), or (j) or D(1)(d) of this chapter by terminating the vendor agreement. The State agency shall notify the USDA of a disqualification or money penalty: Within 15 days after the vendor's opportunity to request an administrative appeal has expired; or After the vendor's administrative appeals have been exhausted. If a vendor is disqualified or has been assessed a money penalty because of multiple violations in a single investigation, the Program shall: Sanction the vendor for the single most serious violation; and Include the following in its notice to USDA: The vendor's: Name; Address; and Identification number; The length of any disqualification; The specific violations charged; and The amount of any money penalty. Upon completion of the period of disqualification a vendor shall regain authorization after successfully completing the authorization process as set forth in Regulation .04 of this chapter. Military Commissaries. The Program: May not sanction military commissaries for Program violations; and Shall report a sanctionable offense committed by a military commissary to the commanding officer of the installation and, if the commanding officer takes no action to ensure the violation does not recur, to the USDA. Any adverse action taken by SNAP will be reciprocated by the Program to include disqualification and if applicable, imposing a civil money penalty. In addition to the State agency sanctions set forth in Regulation .16 of this chapter, and pursuant to 7 CFR §§246.12(f)(xiv) and 246.23(d), a vendor that commits fraud and abuse of the Program may be liable to prosecution under federal, State, and local laws. Except as otherwise provided in this regulation, the procedures set forth in COMAR 10.01.03, and not the procedures set forth in COMAR 10.01.06, govern appeals by vendors and vendor applicants. Notice. Not less than 15 days in advance of the effective date of the proposed Program action, the Program shall provide notice to a vendor applicant, or vendor whose application is proposed to be denied or authorization is proposed to be disqualified, on the right to a hearing on the proposed denial or disqualification. The Program shall provide notice that complies with the requirements set forth in COMAR 10.01.03. Request for Hearing. A vendor or vendor applicant shall preserve the right to a hearing, if a hearing is desired, by filing a written request for a hearing with the Director of the Program within 10 days of the receipt of the notice of proposed disqualification or denial. The Program shall consider a request for a hearing filed on the earlier of the dates it is: Received by the Program; or Postmarked by the United States Postal Service. Hearings. The Office of Administrative Hearings shall have jurisdiction over the hearings provided in this regulation. If a hearing is requested, the agency shall hold the hearing pursuant to: Health-General Article, §§18-107(a) and 18-108, Annotated Code of Maryland; State Government Article, Title 10, Subtitle 2, Annotated Code of Maryland; COMAR 10.01.03; COMAR 28.02.01; and This chapter. A vendor may not appeal the following actions: Disqualification from WIC resulting from a violation of Regulation .15B(1)(m) of this chapter; The State agency's decision as to whether a participant hardship exists; The expiration of a vendor agreement; The State agency's determination to include or exclude an infant formula manufacturer, wholesaler, distributor, or retailer from the required list of infant formula suppliers; The validity or appropriateness of the State agency’s prohibition of incentive items and the State agency’s denial of an above 50 percent vendor’s request to provide an incentive item; The State agency's determination whether to notify a vendor in writing when an investigation reveals an initial violation for which a pattern of violations must be established in order to impose a sanction; The validity or appropriateness of the State agency’s selection criteria for competitive price, including, but not limited to, vendor peer group criteria and the criteria used to identify vendors that are above 50 percent vendors or comparable to above 50 percent vendors; 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; Disputes regarding payments and vendor claims, not including the opportunity to justify or correct a vendor overcharge or other error; or The validity or appropriateness of the State agency's vendor selection criteria. Except for the sanction prescribed in Regulation .16D of this chapter, the State agency may determine that a participant hardship would exist if a vendor is disqualified and one of the following conditions would result: At least ten participants have to travel more than 2 miles to reach a vendor; A physical barrier or condition exists that would make normal travel to another vendor impossible; or Ten or more participants can only be served properly by a particular vendor because of a language barrier, religious dietary needs, access to exempt infant formula, or access to WIC-eligible medical foods. If the State agency determines that a participant hardship would exist if a vendor is disqualified, the State agency, in its sole discretion, may impose a money penalty instead of disqualification if the vendor: Provides to the State agency documentation that the violations that led to the sanction have been corrected; and Owes no payments to the State agency. If the State agency determines to impose a money penalty, the State agency shall calculate the amount of the money penalty for each violation by multiplying 10 percent of the vendor's average monthly food instrument redemptions by the number of months the disqualification would have been in effect. The State agency shall calculate the average monthly redemption by using: The 6 months immediately preceding notice to the vendor of the disqualification; or Up to 6 months' data if the vendor has not redeemed food instruments for a full 6 months before notice of the disqualification. The maximum money penalty for each: Violation that would have resulted in a disqualification is $11,000; and Investigation that detected violations that would have resulted in disqualification is $49,000. Vendor Money Payment. A vendor that owes a money penalty pursuant to §C of this regulation shall pay the money penalty either in a lump sum within 1 month from the date of billing by the State agency, or in installments. The State agency shall calculate the number of installment payments by dividing the amount due by 1/2 the number of months the disqualification would have been in effect. The vendor shall pay the: First installment not later than the date the disqualification would have been effective had there been no participant hardship; and Remaining payments on the first day of each succeeding month. If a vendor fails to pay the money penalty in accordance with the payment schedule as provided in §F of this regulation, the State agency shall disqualify the vendor's authorization for the full period of the sanction and may not refund any partial payments. If the provisions of this chapter conflict with the WIC State plan or other policies of the Program, the provisions of this chapter prevail. If the provisions of this chapter conflict with federal statutes and regulations, including those incorporated by reference in Regulation .02 of this chapter, the federal statutes and regulations prevail. Health-General Article, §§2-104(b), 18-107(a), and 18-108, Annotated Code of Maryland Effective date: Regulations .01—.21 adopted as an emergency provision effective November 1, 1995 (22:22 Md. R. 1655 and 22:23 Md. R. 1796); emergency status expired May 1, 1996 Regulations .01—.21 adopted effective May 2, 1996 (23:6 Md. R. 476) Regulations .03, .04, .07, and .10—.16 amended as an emergency provision effective November 1, 1996 (23:24 Md. R. 1679); amended permanently effective February 24, 1997 (24:4 Md. R. 292) Regulation .13 amended as an emergency provision effective July 1, 1998 (25:14 Md. R. 1128); amended permanently effective October 5, 1998 (25:20 Md. R. 1532) Chapter revised effective September 18, 2000 (27:18 Md. R. 1665) Regulations .02—.04, .06, .07, .09, .10—.13, .15, .16, .18, and .19 amended as an emergency provision effective October 1, 2002 (29:23 Md. R. 1807); amended permanently effective March 31, 2003 (30:6 Md. R. 421) Regulations .02—.04, .06, .07, .10, .11, and .14—.16 amended as an emergency provision effective December 15, 2006 (34:1 Md. R. 29); amended permanently effective April 9, 2007 (34:7 Md. R. 699) Regulation .03B amended effective May 12, 2014 (41:9 Md. R. 521); March 13, 2017 (44:5 Md. R. 293); October 5, 2020 (47:20 Md. R. 875); June 13, 2022 (49:12 Md. R. 640) Regulations .03B, .04C, F, .06, .10, .11, .13, .14A, .15, and .16G amended as an emergency provision effective December 22, 2004 (32:1 Md. R. 25); amended permanently effective March 14, 2005 (32:5 Md. R. 581) Regulations .03B, .04G, .09, .09-1, .10H, .11A, C, .13, .14A, and .15B, C amended as an emergency provision effective November 3, 2008 (35:24 Md. R. 2069); amended permanently effective February 9, 2009 (36:3 Md. R. 209) Regulation .03B, .09-1, .10, .13, .14A, .15B, C, .16A, B amended as an emergency provision effective October 5, 2011 (38:23 Md. R. 1416); amended permanently effective December 26, 2011 (38:26 Md. R. 1697) Regulation .04 amended effective May 12, 2014 (41:9 Md. R. 521); March 13, 2017 (44:5 Md. R. 293); October 5, 2020 (47:20 Md. R. 875); June 13, 2022 (49:12 Md. R. 640) Regulations .04, .09-1, .10, .11A, .13, .14A, .15B, C, .16, and .19E amended as an emergency provision effective October 1, 2012 (39:22 Md. R. 1427); amended permanently effective March 4, 2013 (40:4 Md. R. 347) Regulation .04E, H amended effective April 13, 2015 (42:7 Md. R. 570) Regulation .05B amended effective May 12, 2014 (41:9 Md. R. 521) Regulation .06 amended effective October 5, 2020 (47:20 Md. R. 875) Regulations .06A, .13, .14A, .15B, C, .16B, .18E, and .19E amended as an emergency provision effective September 16, 2009 (36:21 Md. R. 1587); amended permanently effective December 14, 2009 (36:25 Md. R. 1955) Regulation .06E adopted effective May 12, 2014 (41:9 Md. R. 521) Regulation .07 amended effective October 5, 2020 (47:20 Md. R. 875) Regulation .07B, C amended effective March 13, 2017 (44:5 Md. R. 293) Regulation .07C amended effective May 12, 2014 (41:9 Md. R. 521) Regulation .08B amended effective March 13, 2017 (44:5 Md. R. 293); October 5, 2020 (47:20 Md. R. 875) Regulation .09C amended effective March 13, 2017 (44:5 Md. R. 293); October 5, 2020 (47:20 Md. R. 875) Regulation .09E adopted effective May 12, 2014 (41:9 Md. R. 521) Regulation .09-1 adopted as an emergency provision effective October 1, 2002 (29:23 Md. R. 1807); adopted permanently effective March 31, 2003 (30:6 Md. R. 421) Regulation .09-1A amended effective October 5, 2020 (47:20 Md. R. 875) Regulation .10 amended effective May 12, 2014 (41:9 Md. R. 521); March 13, 2017 (44:5 Md. R. 293); October 5, 2020 (47:20 Md. R. 875) Regulation .11 amended effective October 5, 2020 (47:20 Md. R. 875) Regulation .11A amended effective May 12, 2014 (41:9 Md. R. 521); March 13, 2017 (44:5 Md. R. 293); Regulation .12 repealed and new Regulation .12 adopted as an emergency provision effective December 22, 2004 (32:1 Md. R. 25); adopted permanently effective March 14, 2005 (32:5 Md. R. 581) Regulation .12A amended effective October 5, 2020 (47:20 Md. R. 875) Regulation .13 amended effective May 12, 2014 (41:9 Md. R. 521); April 13, 2015 (42:7 Md. R. 570) Regulation .13 repealed and new Regulation .13 adopted effective March 13, 2017 (44:5 Md. R. 293) Regulation .13 amended effective October 5, 2020 (47:20 Md. R. 875) Regulation .14 amended effective March 13, 2017 (44:5 Md. R. 293); June 13, 2022 (49:12 Md. R. 640) Regulation .14A amended effective May 12, 2014 (41:9 Md. R. 521); April 13, 2015 (42:7 Md. R. 570); October 5, 2020 (47:20 Md. October 5, 2020 (47:20 Md. R. 875) Regulation .15 amended effective March 13, 2017 (44:5 Md. R. 293); October 5, 2020 (47:20 Md. R. 875) Regulation .15B amended effective May 12, 2014 (41:9 Md. R. 521); June 13, 2022 (49:12 Md. R. 640) Regulation .15D amended effective June 13, 2022 (49:12 Md. R. 640) Regulation .16 amended effective May 12, 2014 (41:9 Md. R. 521); March 13, 2017 (44:5 Md. R. 293); October 5, 2020 (47:20 Md. R. 875); June 13, 2022 (49:12 Md. R. 640) Regulation .18B, E amended effective May 12, 2014 (41:9 Md. R. 521) Regulation .18C, E amended effective March 13, 2017 (44:5 Md. R. 293) Regulation .18E amended effective October 5, 2020 (47:20 Md. R. 875) Regulation .19 amended effective May 12, 2014 (41:9 Md. R. 521) Regulation .19A amended effective March 13, 2017 (44:5 Md. R. 293); June 13, 2022 (49:12 Md. R. 640)