La. Admin. Code tit. 48 § V-4509

Current through Register Vol. 50, No. 11, November 20, 2024

Section V-4509 - Vendor Sanctions for Violations

A. Pattern of Incidences.

1. WIC federal regulations at 7 CFR § 246.12(I)(2)(i) mandate that state agency sanction(s) must be based on a pattern of violative incidences.

2. Federal guidance from the USDA WIC Vendor Management and Food Delivery Handbook (Sept. 2017, section 9.1.2, pg. 35) mandates that LA WIC must develop a definition of a pattern of violations. Some federal mandatory vendor sanctions and all state agency vendor sanctions must be based on a pattern of violations [See 7 CFR § 246.12(l)(1) and 7 CFR §246 12(l)(2)(i)]. The definition of a pattern of violations may be different for different types of violations (e.g., to account for severity). The definition of a pattern of violations is stated in the vendor rules and regulations.

3. WIC federal regulations at 7 CFR § 246.12(h)(3)(xix) mandate that LA WIC must notify a vendor in writing when an investigation reveals an initial incidence of a violation for which a pattern of incidences must be established in order to impose a sanction, before another such incidence is documented, unless LA WIC determines, in its discretion, on a case-by-case basis, that notifying the vendor would compromise an investigation. Notification shall not be provided for a pattern of claiming reimbursement for the sale of an amount of a WIC approved food item at the category level that exceeds documented inventory. See 7 CFR § 246.12(l)(3).

4. Unaddressed violations will carry from one agreement period to the next.

B. Federal Mandatory Vendor Sanctions. LA WIC shall impose sanctions for federal mandatory vendor sanction violations. The federal mandatory sanction violations are found in the vendor guide and policy manual. Federal mandatory vendor sanctions shall include disqualification and/or civil money penalties (CMP) assessed in lieu of disqualification. WIC federal regulations mandate that when, during the course of a single investigation, LA WIC determines a vendor has committed multiple violations (which may include violations subject to state agency sanctions), LA WIC must disqualify the vendor for the period corresponding to the most serious (i.e., longest) federal mandatory sanction violation. LA WIC must include all violations in the notice of adverse action and enter all such violations into the vendor record. LA WIC shall impose any sanctions that are not overturned in an (abbreviated or full) administrative review. The federal mandatory vendor sanction violations are as follows:

1. LA WIC shall permanently disqualify a vendor convicted of trafficking in WIC benefits or selling firearms, ammunition, explosives, or controlled substances [as defined in section 102 of the Controlled Substances Act of 1970 (21 U.S.C. 802), as amended] in exchange for WIC benefits.

2. LA WIC shall disqualify a vendor for six years for:

a. one incidence of buying or selling WIC benefits benefits for cash (trafficking);

b. one incidence of selling firearms, ammunition, explosives, or controlled substances as defined in 21 U.S.C. 802, as amended, in exchange for WIC benefits.

3. LA WIC shall disqualify a vendor for three years for:

a. one incidence of the sale of alcohol, alcoholic beverages, or tobacco products in exchange for WIC benefits;

b. a pattern of claiming reimbursement for the sale of an amount of a specific WIC approved food item that exceeds the store's documented inventory of that WIC approved food item at the WIC approved food category level for a specific period of time;

c. a pattern of vendor overcharges;

d. a pattern of receiving, transacting and/or redeeming WIC benefits outside of authorized channels, including the use of an unauthorized vendor and/or an unauthorized person;

e. a pattern of charging for WIC approved food items not received by the WIC participant (WIC transaction for food not received);

f. a pattern of providing credit or non-food items (not including alcohol, alcoholic beverages, tobacco products, cash, firearms, ammunition, explosives, or controlled substances as defined in 21 U.S.C. 802, as amended) in exchange for WIC benefits.

4. LA WIC shall disqualify a vendor for one year for:

a. a pattern of providing unauthorized food items in exchange for WIC benefits, including charging for WIC approved food items provided in excess of those issued to a WIC EBT card;

b. a pattern of an above-50-percent (A-50) vendor providing prohibited incentive items to customers as set forth in WIC federal regulations at 7 CFR 246.12(I)(1)(iv)(B).

C. Second Federal Mandatory Vendor Sanction-CMP. When a vendor that has previously been assessed a CMP for any of the federal mandatory vendor sanctions receives a second CMP for any of the federal mandatory vendor sanctions, LA WIC shall double the second CMP. The total amount assessed in CMPs for a second sanction may not exceed the maximum limits allowed under WIC federal regulations.

D. Third or Subsequent Federal Mandatory Vendor Sanction-CMP. When a vendor who previously has been assessed two or more CMPs as a result of any of the federal mandatory vendor sanctions receives another CMP as a result of any of the federal mandatory vendor sanctions, LA WIC shall double the third CMP and all subsequent sanctions. LA WIC may not impose a CMP in lieu of disqualification for third or subsequent sanctions for federal mandatory vendor sanctions.

E. State Agency Vendor Sanction Violations. WIC federal regulations allow LA WIC to impose sanctions for non-federally mandated (State) vendor violations based on a pattern of violative incidences as long as such vendor violations and sanctions are included in the federally-required state agency sanction schedule. The LA WIC sanction schedule appears in the vendor guide and policy manual. State agency vendor sanctions will include disqualification and/or CMP assessed in lieu of disqualification. LA WIC will disqualify a vendor for the period of time specified in the LA WIC sanction schedule or issue a CMP for a pattern of any of the following state agency sanction violations:

1. failing to comply with WIC transaction procedures outlined in the vendor guide and policy manual;

2. failing to maintain or provide LA WIC or authorized parties with requested records and/or information by the due date identified;

3. failing to provide WIC participants or proxies the same courtesies as offered to other customers;

4. any other violation of the vendor rules and regulations except for the federal mandatory vendor sanctions, for which a longer disqualification period is required.

F. Selection Criteria. LA WIC shall develop and implement vendor selection criteria for WIC authorization, which must include, at a minimum, the federally-required categories and requirements, and may include criteria developed by LA WIC. The vendor selection criteria are found in the vendor guide and policy manual. LA WIC may reassess any vendor at any time during the agreement period for compliance with vendor selection criteria. A pattern is not required to establish a vendor's failure to meet selection criteria. One incidence of a failure to meet vendor selection criteria may warrant termination of the vendor agreement. A vendor that fails to meet vendor selection criteria may be terminated from LA WIC for up to one year.

G. Corrective Action Plan (CAP). At any time, LA WIC may require that a vendor implement a CAP.

H. Participant Access Determination(s). LA WIC shall develop participant access criteria and consider the availability of other authorized vendors and any geographic barriers to using such vendors when making participant access determinations. Participant access is determined at the sole discretion of LA WIC and the validity or appropriateness of LA WIC's participant access criteria and determinations are not subject to administrative review. Prior to disqualifying a vendor for certain federal mandatory vendor sanctions and/or state agency vendor sanctions, LA WIC may conduct a participant access determination. If LA WIC determines in its sole discretion that disqualification of a vendor would result in inadequate participant access, LA WIC shall impose a civil money penalty in lieu of disqualification. All vendors, including vendors determined necessary for participant access, are subject to reassessment at all times throughout the authorization period.

I. Civil Money Penalty (CMP). Except where prohibited by federal regulation or in those cases of permanent vendor disqualification, if LA WIC determines, in its sole discretion, that disqualification of the vendor would result in inadequate participant access, LA WIC shall impose a CMP in lieu of disqualification. Such CMP will be calculated in accordance with regulations for federal mandatory sanction violation(s) and/or in accordance with LA WIC vendor rules and regulations for state agency vendor sanction violation(s). If a vendor does not pay the CMP, only partially pays the CMP, or fails to make timely payment of the CMP, LA WIC shall disqualify the vendor for the length of the disqualification corresponding to the violation for which the CMP was assessed. Disqualification and/or termination of the vendor agreement or payment of a CMP does not relieve the vendor of the obligation to repay any monies claimed by and owed to LA WIC.

J. Notifications to FNS. LA WIC must notify FNS that it has either disqualified or imposed a CMP in lieu of disqualification for any of the federal mandatory sanction violations listed in LAC 48:V.4509.B. Disqualification from WIC may result in disqualification from the Supplemental Nutrition Assistance Program (SNAP) and such SNAP disqualification is not subject to administrative or judicial review under the SNAP.

K. Actions by SNAP

1. SNAP Disqualification. LA WIC shall disqualify from the WIC program a vendor who is disqualified from SNAP. The disqualification shall be for the same length of time as SNAP disqualification, may begin at a later date than SNAP disqualification, and is not subject to administrative or judicial review under LA WIC. However, if LA WIC determines that disqualification of the vendor would result in inadequate participant access, LA WIC must impose a CMP in lieu of disqualification.

2. SNAP CMP. LA WIC shall disqualify a vendor who receives a CMP for hardship by SNAP. The length of such disqualification shall correspond to the period for which the vendor would otherwise have been disqualified in SNAP. However, if LA WIC determines that disqualification of the vendor would result in inadequate participant access, LA WIC may not disqualify the vendor or impose a CMP in lieu of disqualification.

L. Mandatory Sanction by another WIC State Agency. LA WIC shall disqualify a vendor that has been disqualified or assessed a CMP in lieu of disqualification by another WIC state agency for a federal mandatory vendor sanction under the provisions of §4509 of this Subpart.

1. Disqualification by another WIC State agency. The length of the disqualification from LA WIC shall be for the same length of time as the disqualification by the other WIC state agency. The disqualification may begin at a later date than the sanction imposed by the other WIC state agency. If LA WIC determines that the vendor is needed for participant access, LA WIC will issue a CMP in lieu of disqualification.

2. CMP by another WIC State agency. If the other WIC state agency has assessed a CMP in lieu of disqualification, the length of the disqualification from LA WIC shall be for the same length of time for which the vendor would otherwise have been disqualified. The disqualification may begin at a later date than the sanction imposed by the other WIC state agency. If LA WIC determines the vendor is needed for participant access, LA WIC will not disqualify or issue a CMP to the vendor.

M. Legal Remedies Not Precluded by Sanction. A vendor that commits fraud and/or abuse of LA WIC is liable to prosecution under applicable federal, state or local laws. LA WIC shall, where appropriate, refer a vendor that LA WIC suspects has committed fraud and/or abuse to federal, state and/or local authorities and/or another WIC state agency for prosecution. Disqualification and/or termination from LA WIC does not preclude criminal and/or civil legal actions.

La. Admin. Code tit. 48, § V-4509

Promulgated by the Department of Health and Human Resources, Office of Preventive and Public Health Services, LR 13:246 (April 1987), Amended by the Department of Health, Office of Public Health, LR 43338 (2/1/2017), Amended LR 491407 (8/1/2023).

AUTHORITY NOTE: Promulgated in accordance with R.S. 46:972.