[Code of Federal Regulations]

[Title 7, Volume 4]

[Revised as of January 1, 2006]

From the U.S. Government Printing Office via GPO Access

[CITE: 7CFR246.18]



[Page 389-392]

 

                          TITLE 7--AGRICULTURE

 

    CHAPTER II--FOOD AND NUTRITION SERVICE, DEPARTMENT OF AGRICULTURE

 

PART 246_SPECIAL SUPPLEMENTAL NUTRITION PROGRAM FOR WOMEN, INFANTS AND 

CHILDREN--Table of Contents

 

                    Subpart E_State Agency Provisions

 

Sec. 246.18  Administrative review of State agency actions.



    (a) Adverse actions subject to administrative reviews--(1) Vendor 

appeals. (i) Adverse actions subject to full administrative reviews. 

Except as provided elsewhere in paragraph (a)(1) of this section, the 

State agency must provide full administrative reviews to vendors that 

appeal the following adverse actions:

    (A) denial of authorization based on the vendor selection criteria 

for competitive price or for minimum variety and quantity of authorized 

supplemental foods (Sec. 246.12(g)(3)(i) and (g)(3)(ii)) or on a 

determination that the vendor is attempting to circumvent a sanction 

(Sec. 246.12(g)(4));

    (B) termination of an agreement for cause;

    (C) disqualification; and

    (D) imposition of a fine or a civil money penalty in lieu of 

disqualification.

    (ii) Adverse actions subject to abbreviated administrative reviews. 

The State agency must provide abbreviated administrative reviews to 

vendors that appeal the following adverse actions, unless the State 

agency decides to provide full administrative reviews for any of these 

types of adverse actions:

    (A) denial of authorization based on the vendor selection criteria 

for business integrity or for a current Food Stamp Program 

disqualification or civil money penalty for hardship (Sec. 

246.12(g)(3)(iii) and (g)(3)(iv));

    (B) denial of authorization based on a State agency-established 

vendor selection criterion if the basis of the denial is a WIC vendor 

sanction or a Food Stamp Program withdrawal of authorization or 

disqualification;

    (C) denial of authorization based on the State agency's vendor 

limiting criteria (Sec. 246.12(g)(2));

    (D) denial of authorization because a vendor submitted its 

application outside the timeframes during which applications are being 

accepted and processed as established by the State agency under Sec. 

246.12(g)(7);



[[Page 390]]



    (E) termination of an agreement because of a change in ownership or 

location or cessation of operations (Sec. 246.12(h)(3)(xvii));

    (F) disqualification based on a trafficking conviction (Sec. 

246.12(l)(1)(i));

    (G) disqualification based on the imposition of a Food Stamp Program 

civil money penalty for hardship (Sec. 246.12(l)(2)(ii)); and

    (H) disqualification or a civil money penalty imposed in lieu of 

disqualification based on a mandatory sanction imposed by another WIC 

State agency (Sec. 246.12(l)(2)(iii)).

    (iii) Actions not subject to administrative reviews. The State 

agency may not provide administrative reviews pursuant to this section 

to vendors that appeal the following actions:

    (A) the validity or appropriateness of the State agency's vendor 

limiting or selection criteria (Sec. 246.12(g)(2) and (g)(3));

    (B) The validity or appropriateness of the State agency's vendor 

peer group criteria and the criteria used to identify vendors that are 

above-50-percent vendors or comparable to above-50-percent vendors;

    (C) the validity or appropriateness of the State agency's 

participant access criteria and the State agency's participant access 

determinations;

    (D) 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 (Sec. 

246.12(l)(1)(i)(B));

    (E) denial of authorization if the State agency's vendor 

authorization is subject to the procurement procedures applicable to the 

State agency;

    (F) the expiration of a vendor's agreement;

    (G) disputes regarding food instrument payments and vendor claims 

(other than the opportunity to justify or correct a vendor overcharge or 

other error, as permitted by Sec. 246.12(k)(3); and

    (H) disqualification of a vendor as a result of disqualification 

from the Food Stamp Program (Sec. 246.12(l)(1)(vii)).

    (2) Effective date of adverse actions against vendors. The State 

agency must make denials of authorization and disqualifications imposed 

under Sec. 246.12(l)(1)(i) effective on the date of receipt of the 

notice of adverse action. The State agency must make all other adverse 

actions effective no earlier than 15 days after the date of the notice 

of the adverse action and no later than 90 days after the date of the 

notice of adverse action or, in the case of an adverse action that is 

subject to administrative review, no later than the date the vendor 

receives the review decision.

    (3) Local agency appeals--(i) Adverse actions subject to full 

administrative reviews. Except as provided in paragraph (a)(3)(ii) of 

this section, the State agency must provide full administrative reviews 

to local agencies that appeal the following adverse actions:

    (A) denial of a local agency's application;

    (B) disqualification of a local agency; and

    (C) any other adverse action that affects a local agency's 

participation.

    (ii) Actions not subject to administrative reviews. The State agency 

may not provide administrative reviews pursuant to this section to local 

agencies that appeal the following actions:

    (A) expiration of the local agency's agreement; and

    (B) denial of a local agency's application if the State agency's 

local agency selection is subject to the procurement procedures 

applicable to the State agency;

    (iii) Effective date of adverse actions against local agencies. The 

State agency must make denials of local agency applications effective 

immediately. The State agency must make all other adverse actions 

effective no earlier than 60 days after the date of the notice of the 

adverse action and no later than 90 days after the date of the notice of 

adverse action or, in the case of an adverse action that is subject to 

administrative review, no later than the date the local agency receives 

the review decision.

    (b) Full administrative review procedures. The State agency must 

develop procedures for a full administrative review of the adverse 

actions listed in paragraphs (a)(1)(i) and (a)(3) of this



[[Page 391]]



section. At a minimum, these procedures must provide the vendor or local 

agency with the following:

    (1) Written notification of the adverse action, the procedures to 

follow to obtain a full administrative review and the cause(s) for and 

the effective date of the action. When a vendor is disqualified due in 

whole or in part to violations in Sec. 246.12(l)(1), such notification 

must include the following statement: ``This disqualification from WIC 

may result in disqualification as a retailer in the Food Stamp Program. 

Such disqualification is not subject to administrative or judicial 

review under the Food Stamp Program.''

    (2) The opportunity to appeal the adverse action within a time 

period specified by the State agency in its notification of adverse 

action.

    (3) Adequate advance notice of the time and place of the 

administrative review to provide all parties involved sufficient time to 

prepare for the review.

    (4) The opportunity to present its case and at least one opportunity 

to reschedule the administrative review date upon specific request. The 

State agency may set standards on how many review dates can be 

scheduled, provided that a minimum of two review dates is allowed.

    (5) The opportunity to cross-examine adverse witnesses. When 

necessary to protect the identity of WIC Program investigators, such 

examination may be conducted behind a protective screen or other device 

(also referred to as an ``in camera'' examination).

    (6) The opportunity to be represented by counsel.

    (7) The opportunity to examine prior to the review the evidence upon 

which the State agency's action is based.

    (8) An impartial decision-maker, whose determination is based solely 

on whether the State agency has correctly applied Federal and State 

statutes, regulations, policies, and procedures governing the Program, 

according to the evidence presented at the review. The State agency may 

appoint a reviewing official, such as a chief hearing officer or 

judicial officer, to review appeal decisions to ensure that they conform 

to approved policies and procedures.

    (9) Written notification of the review decision, including the basis 

for the decision, within 90 days from the date of receipt of a vendor's 

request for an administrative review, and within 60 days from the date 

of receipt of a local agency's request for an administrative review. 

These timeframes are only administrative requirements for the State 

agency and do not provide a basis for overturning the State agency's 

adverse action if a decision is not made within the specified timeframe.

    (c) Abbreviated administrative review procedures. Except when the 

State agency decides to provide full administrative reviews for the 

adverse actions listed in paragraph (a)(1)(ii) of this section, the 

State agency must develop procedures for an abbreviated administrative 

review of the adverse actions listed in paragraph (a)(1)(ii) of this 

section. At a minimum, these procedures must provide the vendor with the 

following:

    (1) Written notification of the adverse action, the procedures to 

follow to obtain an abbreviated administrative review, the cause(s) for 

and the effective date of the action, and an opportunity to provide a 

written response; and

    (2) A decision-maker who is someone other than the person who 

rendered the initial decision on the action and whose determination is 

based solely on whether the State agency has correctly applied Federal 

and State statutes, regulations, policies, and procedures governing the 

Program, according to the information provided to the vendor concerning 

the cause(s) for the adverse action and the vendor's response; and

    (3) Written notification of the review decision, including the basis 

for the decision, within 90 days of the date of receipt of the request 

for an administrative review. This timeframe is only an administrative 

requirement for the State agency and does not provide a basis for 

overturning the State agency's adverse action if a decision is not made 

within the specified timeframe.

    (d) Continuing responsibilities. Appealing an action does not 

relieve a local agency or a vendor that is permitted to continue program 

operations while its appeal is in process from the responsibility of 

continued compliance with



[[Page 392]]



the terms of any written agreement with the State agency.

    (e) Finality and effective date of decisions. The State agency 

procedures must provide that review decisions rendered under both the 

full and abbreviated review procedures are the final State agency 

action. If the adverse action under review has not already taken effect, 

the State agency must make the action effective on the date of receipt 

of the review decision by the vendor or the local agency.

    (f) Judicial review. If the review decision upholds the adverse 

action against the vendor or local agency, the State agency must inform 

the vendor or local agency that it may be able to pursue judicial review 

of the decision.



[65 FR 83266, Dec. 29, 2000, as amended at 70 FR 71724, Nov. 29, 2005]