Earlier this year, FNS updated its Training Guide for Supplemental Nutrition Assistance Program (SNAP) retailers. This 18 page booklet is required reading for owners and managers of the more than 260,000 groceries, convenience stores, chain drug stores, and other retailers authorized to accept SNAP in exchange for eligible food items. In addition to detailing the “dos and don’ts” associated with participating in SNAP (formerly known as the Food Stamp Program), the SNAP Retailer Training Guide describes the statutory, regulatory, and other requirements that retailers follow to remain in compliance and avoid receiving a letter from FNS charging it with trafficking, sale of ineligible items, or other program offenses.
Most SNAP retailers are authorized under Criterion A, which requires offering for sale on a continuous basis at least three qualifying varieties of eligible items in each of the four staple food categories. Retailers must also stock at last three units (e.g. can, box, package, bag, or bunch) of each staple food item at all times, two of which must be perishable (e.g. fresh or frozen).
FNS requires retailers to provide training to employees about SNAP rules, including how to process SNAP transactions. Retailers must train employees within 30 days after they start work and annually thereafter. Failure to train employees and to document such training in writing may result in the withdrawal of the retailer’s SNAP authorization and will render it ineligible for a civil monetary penalty (CMP) in lieu of permanent disqualification in the event that the store is charged with trafficking.
The most significant change in the Training Guide is the new requirement that requires SNAP retailers keep all invoices and all register receipts for one year. Aside from the obligation to maintain purchase invoices and register receipts, in the event that a retailer is charged with trafficking, having this information may be critical to defending against those charges, especially in the event of an ALERT system trafficking charge. The ALERT system is a proprietary computer program that FNS uses to flag patterns of “suspicious transactions” that it believes to be indicative of trafficking. Retailers should consider whether to purchase an integrated point-of-sale (POS) system that provides key details on receipts (and electronically), including the item purchased, price, and other information associated with the transaction.
Disqualified Retailers Are Listed on GSA’s Excluded Parties List (SAM)
During 2017, FNS began listing disqualified SNAP retailers on the U.S. General Services Administration’s System for Award Management (SAM) list of parties excluded from doing business with the federal government. Once a person is listed on SAM, adverse credit and other impacts may ensue. Shockingly, FNS refuses to notify owners of disqualified retailers in writing or otherwise that they are placing them on the SAM list. And in community property states (e.g. California, Texas, Washington, and Louisiana), spouses of owners of disqualified SNAP retailers may be listed on SAM, even when they have no involvement with the business or engaged in any fraudulent activities.
What Should SNAP Retailers Do?
It is imperative that SNAP retailers properly train their employees not more than 30 days after they start work and annually thereafter. Retailers must keep written and dated records that detail the training provided to their employees. SNAP-authorized stores should also have written procedures describing their SNAP compliance policies and procedures for handling employees suspected of committing SNAP program violation. Failure to properly training employees can result in the withdrawal of a store’s SNAP authorization and may lead to a retailer’s and its owner’s – permanent disqualification from the food stamp program – even if ownership is not aware of the illegal acts of its employees. Owners of permanently disqualified stores may also face reciprocal disqualification from SNAP (and WIC) of other stores in which they have full or partial ownership interests. In light of the harsh adverse impacts, the importance of preparing an adequate SNAP training program and training employees cannot be overstated.
For nearly a decade, OFW Law has provided assistance to grocers of all sizes, convenience stores, and chain drug stores on SNAP and WIC compliance, including preparation of retailer training programs and representation before FNS and the federal courts on SNAP trafficking and other program violations.