(1) Accurately complete a WIC Vendor Application, a WIC Price List, and a WIC Vendor Agreement. A vendor applicant must submit its current highest shelf price for each WIC supplemental food listed on the WIC Price List;

(2) At the time of application and throughout the term of authorization, submit all completed forms to the local WIC program, except that a corporate entity operating under a WIC corporate agreement shall submit one completed WIC corporate agreement and the WIC Price Lists to the state agency and a separate WIC Vendor Application for each store to the local WIC agency. A corporate entity operating under a WIC corporate agreement may submit a single WIC Price List for those stores that have the same prices for WIC supplemental foods in each store, rather than submitting a separate WIC Price List for each store;

(3) A vendor applicant's current highest shelf price for each WIC supplemental food listed on the WIC Price List must not exceed the maximum price set by the State agency for each supplemental food within that vendor applicant's peer group, except as provided in Part (b)(3)(B) of this Rule;

(4) Pass a monitoring review by the local WIC program to determine whether the store has minimum inventory of supplemental foods as specified in Subparagraph (c)(24) of this Rule. A vendor applicant who fails this review shall be allowed a second opportunity for an unannounced monitoring review within 14 days. If the applicant fails both reviews, the applicant shall wait 90 days from the date of the second monitoring review before submitting a new application;

(5) Attend, or cause a manager or other authorized store representative to attend, WIC Vendor Training provided by the local WIC Program prior to authorization and ensure that the applicant's employees receive instruction in WIC program procedures and requirements;

(6) Mark the current shelf prices of all WIC supplemental foods clearly on the foods or have the prices posted on the shelf or display case at all times;

(7) The store shall be located at a permanent and fixed location within the State of North Carolina. The store shall be located at the address indicated on the WIC vendor application and shall be the site at which WIC supplemental foods are selected by the WIC customer;

(8) The store shall be open throughout the year for business with the public at least six days a week for a minimum of 40 hours per week between 8:00 a.m. and 11:00 p.m.;

(9) A vendor applicant shall not submit false, erroneous, or misleading information in an application to become an authorized WIC vendor or in subsequent documents submitted to the state or local agency;

(10) The owner(s), officer(s) or manager(s) of a vendor applicant shall not be employed, or have a spouse, child, or parent who is employed by the state WIC program or the local WIC program serving the county in which the vendor applicant conducts business. A vendor applicant shall not have an employee who handles, transacts, deposits, or stores WIC food instruments who is employed, or has a spouse, child, or parent who is employed by the state WIC program or the local WIC program serving the county in which the vendor applicant conducts business;

(11) WIC vendor authorization shall be denied if in the last six years any of the vendor applicant's current owners, officers, or managers have been convicted of or had a civil judgment entered against them for any activity indicating a lack of business integrity, including, but not limited to, fraud, antitrust violations, embezzlement, theft, forgery, bribery, falsification or destruction of records, making false statements, receiving stolen property, making false claims, and obstruction of justice;

(12) A vendor applicant shall not be authorized if it is currently disqualified from the Food Stamp Program or it has been assessed a Food Stamp Program civil money penalty for hardship and the disqualification period that otherwise would have been imposed has not expired;

(13) A vendor applicant, excluding chain stores and stores under a WIC corporate agreement that have a separate manager on site for each store, shall not have an owner who holds a financial interest in any of the following:

The requirements of Subparagraph (b)(13) shall not be met by the transfer or conveyance of financial interest during the period of disqualification. Additionally, the requirements of Subparagraph (b)(13) shall not be met even if such transfer or conveyance of financial interest in a Food Stamp vendor under Subparagraph (b)(13)(A) prematurely ends the disqualification period applicable to that Food Stamp vendor. The requirements of this Subparagraph will apply until the time the Food Stamp vendor disqualification otherwise would have expired;

(14) A vendor applicant, excluding free-standing pharmacies, must have Food Stamp Program authorization for the store as a prerequisite for WIC vendor authorization and must provide its Food Stamp Program authorization number to the state agency; and

(15) A vendor applicant shall not become authorized as a WIC vendor if the store has been disqualified from participation in the WIC Program and the disqualification period has not expired.

(1) Process WIC program food instruments in accordance with the terms of this agreement, state and federal WIC program rules, and applicable law;

(2) Accept WIC program food instruments in exchange for WIC supplemental foods; Supplemental foods are those foods which satisfy the requirements of 15A NCAC 21D .0501. The foods, specifications and product identification are described in the WIC Vendor Manual;

(3) Provide only the authorized supplemental foods listed on the food instrument, accurately determine the charges to the WIC program, and clearly complete the "Pay Exactly" box on the food instrument prior to obtaining the countersignature of the WIC customer; The WIC customer is not required to get all of the supplemental foods listed on the food instrument;

(4) Enter in the "Pay Exactly" box on the food instrument only the total amount of the current shelf prices, or less than the current shelf prices, for the supplemental food actually provided and shall not charge or collect sales taxes for the supplemental food provided;

(5) Charge no more for supplemental food provided to a WIC customer than to a non-WIC customer or no more than the current shelf price, whichever is less;

(6) Accept payment from the state WIC Program only up to the maximum price set by the state agency for each food instrument within that vendor's peer group. The maximum price for each food instrument will be based on the maximum prices set by the state agency for each supplemental food, as described in Part (b)(3)(A) of this Rule, listed on the food instrument. A food instrument deposited by a vendor for payment which exceeds the maximum price will be invalid and returned to the vendor. The vendor may receive a replacement food instrument through the local agency for up to the maximum price set by the state agency for that food instrument;

(7) Not charge the state WIC Program more than the maximum price set by the state agency under Part (b)(3)(A) of this Rule for each supplemental food within the vendor's peer group;

(8) For exempt infant formulas and WIC-eligible medical foods, accept payment from the state WIC Program only up to the maximum price established by the state agency using the Medicaid Durable Medical Equipment Fee Schedule published by the North Carolina Division of Medical Assistance;

(9) For non-contract brand milk-based and soy-based infant formulas, excluding exempt infant formulas, accept payment from the state WIC Program only up to the maximum price established for contract brand infant formulas under Part (b)(3)(A) of this Rule for the vendor's peer group;

(10) For free-standing pharmacies, provide only infant formula and WIC-eligible medical foods;

(11) Excluding free-standing pharmacies, redeem at least two thousand dollars ($2,000) annually in WIC supplemental food sales. Failure to redeem at least two thousand dollars ($2,000) annually in WIC supplemental food sales shall result in termination of the WIC Vendor Agreement. The store must wait 180 days to reapply for authorization;

(12) Accept WIC program food instruments only on or between the "Date of Issue" and the "Participant Must Use By" dates;

(13) Prior to obtaining the countersignature, enter in the "Date Transacted" box the month, day and year the WIC food instrument is exchanged for supplemental food;

(14) Ensure that the food instrument is countersigned in the presence of the cashier;

(15) Refuse acceptance of any food instrument on which quantities, signatures or dates have been altered;

(16) Not transact food instruments in whole or in part for cash, credit, unauthorized foods, or non-food items;

(17) Not provide refunds or permit exchanges for authorized supplemental foods obtained with food instruments, except for exchanges of an identical authorized supplemental food when the original authorized supplemental food is defective, spoiled, or has exceeded its "sell by," "best if used by," or other date limiting the sale or use of the food. An identical authorized supplemental food means the exact brand, type and size as the original authorized supplemental food obtained and returned by the WIC customer;

(18) Clearly imprint the authorized WIC vendor stamp in the "Pay the Authorized WIC Vendor Stamped Here" box on the face of the food instrument;

(19) Clearly imprint the vendor's bank deposit stamp or the vendor's name, address and bank account number in the "Authorized WIC Vendor Stamp" box in the endorsement;

(20) Promptly deposit WIC program food instruments in the vendor's bank. All North Carolina WIC program food instruments must be deposited in the vendor's bank within 60 days of the "Date of Issue" on the food instrument;

(21) Ensure that the authorized WIC vendor stamp is used only for the purpose and in the manner authorized by this agreement and assume full responsibility for the unauthorized use of the authorized WIC vendor stamp;

(22) Maintain secure storage for the authorized WIC vendor stamp and immediately report loss of this stamp to the local agency;

(23) Notify the local agency of misuse (attempted or actual) of the WIC program food instrument(s);

(24) Maintain a minimum inventory of supplemental foods in the store for purchase. Supplemental foods that are outside of the manufacturer's expiration date do not count towards meeting the minimum inventory requirement. The following items and sizes constitute the minimum inventory of supplemental foods for vendors in Peer Groups I through III of Subparagraph (a)(1) and vendors in Peer Groups I through V of Subparagraph (a)(2) of this Rule:

All vendors in Peer Groups I through III of Subparagraph (a)(1) and in Peer Groups I through VI of Subparagraph (a)(2) of this Rule shall supply milk, soy based, or lactose-free infant formula in 32 oz. ready-to-feed or powder within 48 hours of request by the state or local agency;

(25) Ensure that all supplemental foods in the store for purchase are within the manufacturer's expiration date;

(26) Permit the purchase of supplemental food without requiring other purchases;

(27) Attend, or cause a manager or other authorized store representative to attend, annual vendor training class upon notification of class by the local agency;

(28) Inform and train vendor's employees in WIC procedures and regulations;

(29) Be accountable for the actions of its owners, officers, managers, agents, and employees who commit vendor violations;

(30) Allow reasonable monitoring and inspection of the store premises and procedures to ensure compliance with this agreement and state and federal WIC Program rules, regulations and policies. This includes, but shall not be limited to, allowance of access to all WIC food instruments at the store and vendor records pertinent to the purchase of WIC supplemental foods, vendor records of all deductions and exemptions allowed by law or claimed in filing sales and use tax returns, and vendor records of all WIC supplemental foods purchased by the vendor, including invoices, copies of purchase orders, and any other proofs of purchase. These records must be retained by the vendor for a period of three years or until any audit pertaining to these records is resolved, whichever is later. Failure or inability to provide these records, or providing false records for an inventory audit shall be deemed a violation of 7 C.F.R. 246.12(l)(1)(iii)(B) and Part (g)(2)(A) of this Rule;

(31) Submit a current accurately completed WIC Price List when signing this agreement, and by January 1 and July 1 of each year. The vendor also agrees to submit a WIC Price List within one week of any written request by the state or local agency. Failure to submit a WIC Price List as required by this Subparagraph within 30 days of the required submission date shall result in disqualification of the vendor from the WIC Program in accordance with Part (h)(1)(D) of this Rule;

(32) Reimburse the state agency within 30 days of written notification of a claim assessed due to a vendor violation that affects payment to the vendor. The state agency has the authority to deny payment or assess a claim in the amount of the full purchase price of each food instrument affected by the vendor violation. Denial of payment by the state agency or payment of a claim by the vendor for a vendor violation(s) shall not absolve the vendor of the violation(s). The vendor will also be subject to any vendor sanctions authorized under this Rule for the vendor violation(s);

(33) Not seek restitution from the WIC customer for reimbursement paid by the vendor to the state agency or for WIC food instruments not paid or partially paid by the state agency. Additionally, the vendor may not charge the WIC customer for authorized supplemental foods obtained with food instruments;

(34) Not contact a WIC customer outside the store regarding the transaction or redemption of WIC food instruments;

(35) Notify the local agency in writing at least 30 days prior to a change of ownership, change in location, cessation of operations, or withdrawal from the WIC Program. Change of ownership, change in location of more than three miles from the vendor's previous location, cessation of operations, withdrawal from the WIC Program and disqualification from the WIC Program shall result in termination of the WIC Vendor Agreement by the state agency. Change of ownership, change in location, ceasing operations, withdrawal from the WIC Program or nonrenewal of the WIC Vendor Agreement shall not terminate a disqualification period applicable to the store;

(36) Return the authorized WIC vendor stamp to the local agency upon termination of this agreement or disqualification from the WIC Program;

(37) Offer WIC customers the same courtesies as offered to other customers;

(38) The WIC Vendor Agreement does not constitute a license or a property interest. A vendor must reapply to continue to be authorized beyond the period of its current WIC Vendor Agreement. Additionally, a store must reapply to become authorized following the expiration of a disqualification period or termination of the Agreement. In all cases, the vendor applicant will be subject to the vendor selection criteria of Paragraph (b) of this Rule; and

(39) Comply with all the requirements for vendor applicants of Subparagraphs (b)(3) and (b)(6) through (b)(14) of this Rule throughout the term of authorization. The state agency may reassess a vendor at any time during the vendor's period of authorization to determine compliance with these requirements. The state agency shall terminate the WIC Vendor Agreement of any vendor that fails to comply with Subparagraphs (b)(3), (b)(7), (b)(8), (b)(10), (b)(11) or (b)(13) during the vendor's period of authorization, and sanction and/or terminate the Agreement of any vendor that fails to comply with Subparagraphs (b)(6), (b)(9), (b)(12) or (b)(14) during the vendor's period of authorization.

(1) Provide at a minimum annual vendor training classes on WIC procedures and regulations;

(2) Monitor the vendor's performance under this agreement in a reasonable manner to ensure compliance with the agreement, state and federal WIC program rules, regulations and policies, and applicable law. A minimum of one-third of all authorized vendors shall be monitored within a state fiscal year (July 1 through June 30) and all vendors shall be monitored at least once within three consecutive state fiscal years. Any vendor shall be monitored within one week of written request by the state agency;

(3) Provide vendors with the North Carolina WIC Vendor Manual, all Vendor Manual amendments, blank WIC Price Lists, and the authorized WIC vendor stamp indicated on the signature page of the WIC Vendor Agreement;

(4) Assist the vendor with questions which may arise under this agreement or the vendor's participation in the WIC Program; and

(5) Keep records of the transactions between the parties under this agreement pursuant to 15A NCAC 21D .0206.

(1) In accordance with 7 CFR 246.12(l)(1)(i), the State agency shall not allow imposition of a civil money penalty in lieu of disqualification for a vendor permanently disqualified.

(2) A pattern, as referenced in 7 C.F.R. 246.12(l)(1)(iii)(B) through (F) and 246.12(1)(2)(iv), shall be established as follows:

(1) When a vendor commits any of the following violations, the state-established disqualification period shall be:

(2) When a vendor commits any of the following violations, the vendor shall be assessed sanction points as follows for each occurrence:

(3) For the violations listed in Subparagraph (h)(2) of this Rule, all sanction points assessed against a vendor remain on the vendor's record for 12 months or until the vendor is disqualified as a result of those points. If a vendor accumulates 15 or more points, the vendor shall be disqualified. The nature of the violation(s) and the number of violations, as represented by the points assigned in Subparagraph (h)(2), are used to calculate the period of disqualification. The formula used to calculate the disqualification period is: the number of points of the worst offense multiplied by 18 days. 18 days shall be added to the disqualification period for each point over 15 points.

(1) Compliance buy(s) conducted by undercover investigators within a 12-month period to detect the following violations:

(2) Monitoring reviews of a vendor conducted by WIC staff within a 12-month period which detect the following violations:

(3) Any other method used by the State or local agency to detect the following violations by a vendor within a 12-month period:

(1) The civil money penalty formula in 07 C.F.R. 246.12(l)(l)(x) is incorporated by reference with all subsequent amendments and editions, provided that the vendor's average monthly redemptions shall be calculated by using the six-month period ending with the month immediately preceding the month during which the notice of administrative action is dated.

(2) The State agency may also impose civil money penalties in accordance with G.S. 130A-22(c1) in lieu of disqualification of a vendor for the state-established violations listed in Paragraph (h) of this Rule when the State agency determines that disqualification of a vendor would result in undue participant hardship in accordance with Subparagraph (l)(3) of this Rule.

(3) In determining whether to disqualify a WIC vendor for the state-established violations listed in Paragraph (h) of this Rule, the agency shall not consider other indicators of hardship if any of the following factors, which conclusively show lack of undue hardship, are found to exist:

(4) The provisions for failure to pay a civil money penalty in 7 C.F.R. 246.12(l)(6) are incorporated by reference with all subsequent amendments and editions.