[Federal Register Volume 78, Number 161 (Tuesday, August 20, 2013)]
[Notices]
[Pages 51136-51138]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2013-20244]


-----------------------------------------------------------------------

DEPARTMENT OF AGRICULTURE

Food and Nutrition Service


Request for Information: Supplemental Nutrition Assistance 
Program (SNAP) Enhancing Retail Food Store Eligibility

AGENCY: Food and Nutrition Service, USDA.

ACTION: Notice.

-----------------------------------------------------------------------

SUMMARY: Sections 3(k), (p) and (r), Section 7, and Section 9 of the 
Food and Nutrition Act of 2008 (``the Act''), and Title 7 Parts 271, 
274, and 278 of the Code of Federal Regulations (``the regulations'') 
provide factors for determining the eligibility of retail food stores 
to participate in the Supplemental Nutrition Assistance Program 
(``SNAP''). This notice requests information from any and all 
interested parties on opportunities to enhance retailer definitions and 
requirements in a manner that improves access to healthy food choices 
for SNAP participants as well as program integrity, and ensures that 
only those retailers that effectuate the purpose of SNAP are authorized 
to accept benefits. The Food and Nutrition Service (FNS) considers 
access to a variety of healthy foods at SNAP retailers to be 
fundamental to the effectiveness of this critical nutrition assistance 
program. FNS is requesting information to understand what policy 
changes and, as needed, statutory changes, should be considered for 
retailer authorizations. FNS will use this information in determining 
how to make positive progress in the available healthy choices for 
program participants at authorized SNAP retail stores.

DATES: To be assured of consideration, written comments must be 
submitted on or before October 21, 2013.

ADDRESSES: Comments may be submitted through the Federal eRulemaking 
Portal at www.regulations.gov. Follow the online instructions for 
submitting comments electronically. Comments can also be mailed or 
delivered to: Shanta Swezy, Chief, Retailer Management and Issuance 
Branch, Retailer Policy and Management Division, Supplemental Nutrition 
Assistance Program, Food and Nutrition Service, U.S. Department of 
Agriculture, 3101 Park Center Drive, Room 426, Alexandria, Virginia, 
22302.
    All comments submitted in response to this notice will be included 
in the record and will be made available to the public at 
www.regulations.gov. Please be advised that the substance of the 
comments and the identity of the individuals or entities commenting 
will be subject to public disclosure.
    FNS will conduct public listening sessions to receive input on this 
subject. These listening sessions will provide an opportunity for 
affected parties, key stakeholders, and the general public to provide 
input directly to FNS policy officials.
    Timeline:
    Public listening sessions: 45 day period following RFI publication.
    Comment period for Request for Information closes: 60 days 
following publication.

FOR FURTHER INFORMATION CONTACT: Shanta Swezy, Chief, Retailer 
Management and Issuance Branch, Food and Nutrition Service, (703) 305-
2238.

SUPPLEMENTARY INFORMATION: At the end of fiscal year (FY) 2012, over 
246,000 retailers were authorized to redeem SNAP benefits. This is an 
increase of almost 100,000 authorized stores since 2005. According to 
the most recent data available (2012), 82 percent of all benefits 
redeemed were redeemed at supermarkets, large grocers and superstores. 
Approximately 18 percent of benefits were redeemed at smaller stores, 
including convenience stores, small grocers and farmers' markets. Less 
than one percent were redeemed by authorized treatment programs, group 
homes, homeless meal providers, communal dining facilities and shelters 
as provided for in statute. A 2009 FNS study on benefit use indicates 
that 96.3 percent of all SNAP beneficiaries shopped at supermarkets or 
superstores at least once each month.
    According to Sections 3(k), (p) and (r), and Section 9 of the Act, 
and Title 7 Parts 271, and 278 of the regulations, to be eligible to 
participate in SNAP, stores must sell food for home preparation and 
consumption and meet one of the criteria below:
    (A) Offer for sale, on a continuous basis (any given day of 
operation), at least three varieties of qualifying foods in each of the 
following four staple food groups, with perishable foods in at least 
two of the categories:
     Meat, poultry or fish
     Bread or cereal
     Vegetables or fruits
     Dairy products

OR

    (B) More than one-half (50 percent) of the total dollar amount of 
all things (food, nonfood, gas and services) sold in the store must be 
from the sale of eligible staple foods.
    The last major changes to the store eligibility requirements took 
place in the early 1990's as a result of congressional action. Today, a 
store that consistently stocks as few as 12 total food items from the 
required staple foods categories could technically be licensed to 
participate in SNAP. Store authorization data collected from retailers 
by USDA indicates that over 90,000 currently authorized SNAP retailers 
have substantial (over 50 percent) sales that stem from ineligible 
items.
    In addition to providing minimal access to healthy food, retailers 
that do

[[Page 51137]]

not provide sufficient healthful offerings often tend to be those 
stores that present the greatest integrity challenges for USDA. The 
sale or exchange of SNAP benefits for cash is referred to as 
``trafficking'', an illegal activity punishable by law. According to 
the latest FNS trafficking study covering the period 2009-2011, 99.5 
percent of all trafficking stores involve retailers other than 
supermarkets, superstores and large grocers. Further, 84.5 percent of 
all benefit dollars trafficked involve retailers other than 
supermarkets, superstores and large grocers. The large number of 
smaller stores--roughly 222,000 authorized store locations nationwide--
redeemed 15 percent of SNAP recipient's benefits and present the 
greatest integrity challenge for FNS; the trafficking rate in these 
store types was 7.6 percent. The store violation rate was 12.45 
percent. A 2006 report by the Government Accountability Office (GAO) 
suggested that the minimal stocking requirements in SNAP contribute to 
corrupt retailers entering the program, and noted that FNS regulations 
lacked clarity as to what constitutes sufficient stocking requirements.
    FNS is concerned that there are a large and growing number of 
authorized retailers that do not provide healthful food offerings to 
SNAP recipients and that engage in fraud. These retailers represent a 
management challenge for the program that must be balanced against the 
need to ensure effective access to healthful, nutritious food for SNAP 
households. FNS has an interest in assuring that all authorized 
retailers will play by the rules and further the purpose of SNAP.
    FNS' objectives are to improve the availability of more healthful 
foods without compromising access to nutritious food for SNAP 
participants, or unnecessarily burdening the retailers that redeem SNAP 
benefits, and to improve the integrity of the program. The Agency is 
seeking public input regarding the following questions, with particular 
attention to impacts of each on program integrity, healthy food 
choices, access to food and retailer operations:
    1. Is ensuring that SNAP retailers provide SNAP clients access to 
healthy food choices a reasonable priority for establishing SNAP store 
eligibility criteria?
    2. Are there store types that clearly meet all of the Program goals 
and, consequently, should always be eligible for SNAP participation?
    3. Conversely, are there store types that do not effectively 
improve access to food choices (e.g. stores that sell low amounts of 
food when compared to the amounts of distilled liquor, tobacco and/or 
lottery tickets sold) and, therefore, should always be ineligible for 
SNAP participation?
    4. Would a different definition of the ``staple foods\1\'' required 
in SNAP authorized stores help to ensure that these stores offer more 
healthy food choices? If so, what kinds of changes would be most 
effective? Specifically, almost all foods can be counted towards 
meeting staple food requirements, including those high in added sugar, 
sodium or solid fats. Should foods high in these components be counted 
as staple foods when determining store authorization requirements?
    5. How should prepared foods with multiple ingredients, such as 
chicken pot pie or other frozen dinners, or single serving meat jerky 
packages, be treated with regards to ``staple foods'' categories?
    6. Do twelve items (the minimum amount necessary to meet SNAP 
authorization criterion A, by virtue of needing three varieties in the 
four different staple food categories) provide adequate variety for a 
retailer to further the Program's purpose? If not, what would be a more 
appropriate requirement?
    7. Currently, retailers who are authorized under criterion A are 
required to stock perishable items (e.g., fresh, frozen or refrigerated 
fruits and vegetables; dairy; meats, poultry and fish; bread or cereal) 
in two categories. Should perishable items be required in more than two 
categories?
    8. Are 50 percent of sales in staple foods, as currently required 
for criterion B, sufficient to ensure that a SNAP authorized store 
furthers the program's purpose, given the current definition of 
``staple foods''? Would this percentage be sufficient if the definition 
of ``staple foods'' is changed to exclude items high in added sugar, 
sodium or solid fats?
    9. Should stores whose primary business (as evidenced by marketing, 
inventory or sales) is not the sale of food, be eligible to participate 
in SNAP?
    10. Restaurants are generally prohibited from being SNAP retailers, 
and hot foods cannot be purchased with SNAP benefits. However, there 
are authorized retailers who primarily sell food for immediate 
consumption, often on premises, but also sell their products cold and 
heat them for SNAP recipients immediately after purchase for a nominal 
fee. These stores qualify today based on the array of raw ingredients, 
such as unbaked pizza or raw fish. Should such stores be eligible for 
participation in SNAP?
    11. Should all retailers who meet SNAP eligibility criteria be 
authorized, even when sufficient store access for recipients is not a 
concern?
    12. If store access were a concern in an area where no store meets 
basic eligibility criteria for SNAP authorization, how should FNS 
select the stores to authorize that best serve the needs of the client 
population? Should FNS employ an evaluation and scoring system? If so, 
what criteria should make up such a system?
    13. How should integrity and management priorities be balanced 
against healthy food choice criteria in the SNAP authorization process? 
What elements could be used to assess integrity risks, and how should 
they be applied?
    14. Are there any other ways in which the criteria for retailer 
eligibility should be changed? If so, how?

    Dated: August 15, 2013.
Jeffrey J. Tribiano,
Acting Administrator, Food and Nutrition Service.
    \1\Statutory, Regulatory and Policy Definitions of ``Food'', 
``Staple Food'' and ``Accessory Food'':
    Food and Nutrition Act of 2008 7 U.S.C. 2012 Section 3 Definitions:
    (k) ``Food'' means (1) Any food or food product for home 
consumption except alcoholic beverages, tobacco, and hot foods or hot 
food products ready for immediate consumption other than those 
authorized pursuant to clauses (3), (4), (5), (7), (8), and (9) of this 
subsection, (2) seeds and plants for use in gardens to produce food for 
the personal consumption of the eligible household, (3) in the case of 
those persons who are sixty years of age or over or who receive 
supplemental security income benefits or disability or blindness 
payments under title I, II, X, XIV, or XVI of the Social Security Act 
[(42 U.S.C. 1381 et seq.)], and their spouses, meals prepared by and 
served in senior citizens' centers, apartment buildings occupied 
primarily by such persons, public or private nonprofit establishments 
(eating or otherwise) that feed such persons, private establishments 
that contract with the appropriate agency of the State to offer meals 
for such persons at concessional prices, and meals prepared for and 
served to residents of federally subsidized housing for the elderly, 
(4) in the case of persons sixty years of age or over and persons who 
are physically or mentally handicapped or otherwise so disabled that 
they are unable adequately to prepare all of their meals, meals 
prepared for and delivered to them (and their spouses) at their home by 
a public

[[Page 51138]]

or private nonprofit organization or by a private establishment that 
contracts with the appropriate State agency to perform such services at 
concessional prices, (5) in the case of narcotics addicts or 
alcoholics, and their children, served by drug addiction or alcoholic 
treatment and rehabilitation programs, meals prepared and served under 
such programs, (6) in the case of certain eligible households living in 
Alaska, equipment for procuring food by hunting and fishing, such as 
nets, hooks, rods, harpoons, and knives (but not equipment for purposes 
of transportation, clothing, or shelter, and not firearms, ammunition, 
and ex- plosives) if the Secretary determines that such households are 
located in an area of the State where it is extremely difficult to 
reach stores selling food and that such households depend to a 
substantial extent upon hunting and fishing for subsistence, (7) in the 
case of disabled or blind recipients of benefits under title I, II, X, 
XIV, or XVI of the Social Security Act, or are 3-2 individuals 
described in paragraphs (2) through (7) of subsection (j), who are 
residents in a public or private nonprofit group living arrangement 
that serves no more than sixteen residents and is certified by the 
appropriate State agency or agencies under regulations issued under 
section1616(e) of the Social Security Act or under standards determined 
by the Secretary to be comparable to standards implemented by 
appropriate State agencies under such section [(42 U.S.C. 1382e(e))], 
meals prepared and served under such arrangement, (8) in the case of 
women and children temporarily residing in public or private nonprofit 
shelters for battered women and children, meals prepared and served, by 
such shelters, and (9) in the case of households that do not reside in 
permanent dwellings and households that have no fixed mailing 
addresses, meals prepared for and served by a public or private 
nonprofit establishment (approved by an appropriate State or local 
agency) that feeds such individuals and by private establishments that 
contract with the appropriate agency of the State to offer meals for 
such individuals at concessional prices.
    (r)(1) Except as provided in paragraph (2), ``staple foods'' means 
foods in the following categories:
    (A) Meat, poultry, or fish.
    (B) Bread or cereals.
    (C) Vegetables or fruits.
    (D) Dairy products.
    (2) ``Staple foods'' do not include accessory food items, such as 
coffee, tea, cocoa, carbonated and un-carbonated drinks, candy, 
condiments, and spices.
    7 CFR Part 271 General Information and Definitions: Staple food 
means those food items intended for home preparation and consumption in 
each of the following food categories: meat, poultry, or fish; bread or 
cereals; vegetables or fruits; and dairy products. Commercially 
processed foods and prepared mixtures with multiple ingredients shall 
only be counted in one staple food category. For example, foods such as 
cold pizza, macaroni and cheese, multi-ingredient soup, or frozen 
dinners, shall only be counted as one staple food item and will 
normally be included in the staple food category of the main ingredient 
as determined by FNS. Hot foods are not eligible for purchase with food 
stamps and, therefore, do not qualify as staple foods for the purpose 
of determining eligibility under Sec.  278.1(b)(1) of this chapter. 
Accessory food items including, but not limited to, coffee, tea, cocoa, 
carbonated and un-carbonated drinks, candy, condiments, and spices 
shall not be considered staple foods for the purpose of determining 
eligibility of any firm. However, accessory foods that are offered for 
sale in authorized retail food stores are eligible food items which may 
be purchased with food stamp benefits.
    USDA FNS Policy: ``Accessory food items include coffee, tea, cocoa, 
carbonated and un-carbonated drinks, candy, condiments and spices. All 
foods not identified as accessory in the Act and regulations must be 
considered staple foods''.

[FR Doc. 2013-20244 Filed 8-19-13; 8:45 am]
BILLING CODE 3410-30-P