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us/guidance/fns/wic — Axiom

(food-packages)(block-2)How do the final changes in the WIC food packages compare to the proposed changes?#

Summary of Requirements Before Changes Summary of Proposed Revisions Summary of Final Revisions Based on Public Comment Current Regulatory Amounts (before inflation): Children $8 Pregnant, postpartum, breastfeeding $10 Increase the cash-value benefit (CVB) base monthly amount for child, pregnant, breastfeeding, and postpartum participants: Current Regulatory Amounts (adjusted for inflation): Children $9 Pregnant, postpartum, breastfeeding $11 Proposed Changes: Children $24 Pregnant, postpartum $43 Breastfeeding $47 Finalize as proposed to provide the CVB in the following base monthly amounts, adjusted annually for inflation: Children $24 Pregnant, postpartum $43 Breastfeeding $47 Note : USDA adjusts CVB amounts annually for inflation in accordance with WIC regulations. CVB levels at the time of rule implementation due to inflation (for FY 2024) will continue at levels states are providing through appropriations language, and will be: Children $26 Pregnant, postpartum $47 Breastfeeding $52 State agencies are only required to authorize fresh fruits and fresh vegetables and have the option to authorize other forms (frozen, canned, or dried). Require WIC state agencies to authorize at least one other form of fruits and vegetables (frozen, canned, or dried) in addition to fresh. Finalize as proposed. Under current minimum stocking requirements, vendors must stock at least 2 different vegetables. Require vendors to stock at least three varieties of vegetables, an increase from two different vegetable varieties currently required. Finalize as proposed. Current regulations do not permit CVV purchases of fresh herbs. Expand what can be purchased with the CVV to include fresh herbs and allow larger package sizes. Finalize as proposed.

Summary of Requirements Before Changes Summary of Proposed Revisions Summary of Final Revisions Based on Public Comment Children: 128 oz. Pregnant and breastfeeding: 144 oz. Postpartum: 96 oz. Reduce the maximum monthly allowances of juice as follows: Children: 64 oz. Pregnant and breastfeeding: 64 oz. Postpartum: zero oz. Reduce juice amounts but all child and adult participants receive 64 fluid ounces. Children: 128 to 64 oz. Pregnant and breastfeeding: 144 to 64 oz. Postpartum: 96 to 64 oz. There is no option for state agencies to authorize substituting a CVV in place of juice. Allow substitution of juice for a $3 CVV. Finalize as proposed.

Summary of Requirements Before Changes Summary of Proposed Revisions Summary of Final Revisions Based on Public Comment Current amounts: Children 1 through 4 years: 16 qts. Pregnant/partially breastfeeding: 16 qts. Fully breastfeeding: 24 qts. Postpartum: 16 qts. Reduce the maximum monthly allowances of milk as follows: Children 12 - 23 months: 12 qts. Children 2 - 4 years: 14 qts. Pregnant/partially breastfeeding: 22 to 16 qts. Fully breastfeeding: 16 qts. Finalize as proposed. See WIC Policy Memorandum #2026-1 for FY 2026 fluid milk amounts. State agency option to authorize lactose-free milk. Require authorization of lactose-free milk, currently a state agency option. Finalize as proposed. a. State agency option to authorize flavored milk. b. Total sugar limit for yogurt is b. Total sugar limit for yogurt is ≤ 40 grams per 1 cup. a. Permit only unflavored milk. b. Reduce total sugars allowed in yogurt from ≤40 to ≤30 grams per 8 ounces; and, add a limit for total sugars in plant-based milk substitutions of ≤12 grams per 8 ounces. a. Finalize as proposed. b. Modify the provision to establish an added sugars limit for yogurt of ≤ 16 grams per 8 ounces; and an added sugars limit for plant-based milk alternatives of ≤ 10 grams per 8 ounces. Must be calcium-set prepared with calcium salts. a. Add a minimum calcium specification for tofu of 200 milligrams per 100 grams. b. Add a vitamin D specification for yogurt of 100 IU (2.5 micrograms) per 8 ounces (1 cup). a. Modify the provision to add a minimum calcium specification of 100 milligrams per 100 grams of tofu. b. Add a minimum vitamin D specification of 106 IU (2.67 micrograms) per 8 oz of yogurt and extend the implementation timeline to 36 months. State agency option: 1 qt. (32 oz.) yogurt may be substituted for 1 qt. milk for child, pregnant, postpartum, and breastfeeding participants. Increase yogurt substitution amounts from 1 quart of yogurt for 1 quart of milk to allow up to 2 quarts of yogurt for 2 quarts of milk. Finalize as proposed. No soy-based cheese option and only cow's milk yogurt is allowed. Add soy-based yogurts and soy-based cheeses as substitution options for milk. Finalize as proposed and allow plant-based yogurts and plant-based cheeses (not just soy-based milk substitution options). Yogurt must conform to the standard of identity for yogurt as listed in Table 4 of 7 CFR 246.10(e)(12). Update the FDA standard of identity citations for yogurt. Finalize as proposed. Whole yogurt is the standard yogurt for issuance to 1-year-old children. Allow yogurts other than whole fat (i.e., reduced fat) to be issued to 1-year-old children without restriction. Finalize as proposed. 1 lb. of cheese was authorized for fully breastfeeding (up to 1 year post-partum) participants in Food Package VII. Remove cheese as a separate food category in the fully breastfeeding food package; cheese remains a partial milk substitution option for child, pregnant, postpartum, and breastfeeding participants. Finalize as proposed.

Summary of Requirements Before Changes Summary of Proposed Revisions Summary of Final Revisions Based on Public Comment Current amounts of Infant Cereal: Fully breastfed: 24 oz. Partially breastfed: 24 oz. Fully formula-fed: 24 oz. Current amounts for Infant Fruits/Vegetables: Fully breastfed: 256 oz. Partially breastfed: 128 oz. Fully formula-fed: 128 oz. Current amounts for Infant Meats: Fully breastfed: 77.5 oz. Partially breastfed: zero oz. Fully formula-fed: zero oz. Reduce infant cereal, infant fruits and vegetables, and infant meat as follows: Amounts of Infant Cereal: Fully breastfed: 16 oz. Partially breastfed: 8 oz. Fully Formula-Fed: 8 oz. Amounts for Infant Fruits/Vegetables: Fully breastfed: 128 oz. Partially breastfed: 128 oz. Fully Formula-Fed: 128 oz. Amounts for Infant Meats: Fully breastfed: 40 oz. Partially breastfed: zero oz. Fully Formula-Fed: zero oz. Finalize as proposed. Only infants ages 9-11 months may receive a CVV to purchase fresh fruits and vegetables as a substitute for half of the jarred infant fruits and vegetables*. * Current amounts and CVV value allowed: Fully breastfed: $9 CVV and 128 oz. jarred infant fruits and vegetables. Partially breastfed and fully formula-fed: $4 CVV and 64 oz. jarred infant fruits and vegetables. Increase CVV substitution amounts for infant fruits and vegetables*, allow forms other than fresh, and lower the minimum age for infants to receive a CVV from 9 to 6 months. * The CVV substitution allows half (64 ounces) or all (128 ounces) of jarred infant fruits and vegetables to be substituted with a $10 or $20 CVV, respectively, for all food packages for infants ages 6 through 11 months Finalize as proposed. Any variety of commercial infant food meat or poultry, as a single major ingredient, with added broth or gravy. Added sugars or salt (i.e. sodium) are not allowed. Prohibit added fats in infant foods. Proposed provision is dropped. No change to current program rules which allows added fats in infant foods.

Summary of Requirements Before Changes Summary of Proposed Revisions Summary of Final Revisions Based on Public Comment Partially breastfed infants may receive up to 104 fl. oz. Increase formula amounts in the first month for partially (mostly) breastfed infants from 104 fl. oz. to up to 364 fl. oz. Finalize as proposed. In the regulations, there are only maximum monthly allowances and minimum or "full nutrition benefit" amounts. Allow all prescribed infant formula quantities to be considered “up to” amounts. Finalize as proposed. Food Package V is issued to two categories of WIC participants: participants with singleton pregnancies; breastfeeding participants whose partially (mostly) breastfed infants receive formula from the WIC program in amounts that do not exceed the maximum formula allowances, as appropriate for the age of the infant as described in Table 1 of paragraph (e)(9) of this section. Create a separate and enhanced food package for partially breastfeeding participants rather than issuing the same package provided to pregnant participants. Finalize as proposed.

Summary of Requirements Before Changes Summary of Proposed Revisions Summary of Final Revisions Based on Public Comment Currently, WIC-eligible whole grain breakfast cereals must have whole grain as the primary ingredient by weight and meet the FDA labeling requirements for making a health claim as a "whole grain food with moderate fat content" and at least half of cereals must be whole grain. Change whole grain criteria for breakfast cereals to require “whole grain” as the first ingredient. Finalize as proposed. At least one half of all breakfast cereals on each state agency’s authorized food list must meet the whole grain requirements as specified in Table 4 at 7 CFR 246.10(e)(12). Require 100 percent of breakfast cereals on a state agency authorized product list meet whole grain criteria. Require 75 percent of breakfast cereals on a state agency authorized product list meet whole grain criteria. Must contain ≤ 21.2 g sucrose and other sugars per 100 g dry cereal (≤ 6 g per 1 dry oz.). No change to sugar limits for breakfast cereal - must contain ≤ 21.2 grams total sugar per 100 grams (≤ 6 g per 1 oz.). Replace the total sugars limit for breakfast cereal with an added sugars limit of ≤ 21.2 grams per 100 grams (≤ 6 g per 1 oz.).

Summary of Requirements Before Changes Summary of Proposed Revisions Summary of Final Revisions Based on Public Comment Current amounts: Children: 32 oz. Pregnant, partially breastfeeding and fully breastfeeding individuals: 16 oz. Reduce maximum monthly allowance of whole wheat/whole grain bread and whole grains in the child food packages from 32 to 24 ounces; and increase amounts in the pregnant, postpartum, and breastfeeding food packages from 16 to 48 ounces. Finalize as proposed. WIC regulations require whole grain bread have a whole grain as the primary ingredient by weight and meet the FDA labeling requirements for making a health claim as a "whole grain food with moderate fat content." Whole grain breads must contain at least at 50 percent whole grains, rather than having a whole grain as the primary ingredient by weight and meeting the FDA health claim labeling requirement as a “whole grain food with moderate fat content”. Finalize as proposed. Whole grain options include brown rice, bulgur, oats, whole-grain barley, and whole wheat macaroni products without added sugars, fats, oils, or salt, and soft com (made from ground masa flour) or whole wheat tortillas. Expand whole grain options to include quinoa; wild rice; millet; triticale; amaranth; kamut; sorghum; wheat berries; tortillas made with folic acid-fortified corn masa flour; corn meal (including blue); teff; buckwheat; and whole wheat bread products (i.e., pita, English muffins, bagels, and naan). Finalize as proposed and allow for additional whole grain options that meet nutrient specifications.

Summary of Requirements Before Changes Summary of Proposed Revisions Summary of Final Revisions Based on Public Comment Children (1 through 4 years) do not receive canned fish. Add 5 ounces of canned fish to food packages for children (2 through 4 years) and specify varieties as salmon, sardines, and Atlantic mackerel. Add 6 ounces canned fish to food packages for all children (1 through 4 years) and allow children to obtain canned salmon, sardines, Atlantic mackerel, Chub mackerel, and light tuna. Pregnant, postpartum, and partially breastfeeding participants do not receive canned fish; fully breastfeeding participants receive 30 ounces. Canned salmon, sardines, Atlantic mackerel, Chub mackerel, Jack Mackerel, and light tuna. Add 10 ounces of canned fish to food packages for pregnant and postpartum participants and 15 ounces for partially breastfeeding participants; and revise amounts for fully breastfeeding participants from 30 to 20 ounces. Remove Jack Mackerel. Finalize as proposed.

Summary of Requirements Before Changes Summary of Proposed Revisions Summary of Final Revisions Based on Public Comment Current legume food category specifies "dry"; State agencies have the option to allow canned. Require WIC state agencies to authorize both dried and canned legumes, instead of canned being an option. Finalize as proposed. Current regulations do not allow substitutions for eggs. Require authorization of legumes and peanut butter as substitutes for eggs (instead of just peanut butter for eggs) and allow WIC state agencies to choose to authorize tofu. Finalize as proposed. Additionally, State agencies may authorize nut and seed butters as a substitute for eggs. Requested comment on the option to allow additional nut and seed butters. Implement a provision to allow WIC state agencies the option to authorize nut and seed butters as a substitute for peanut butter.

Summary of Requirements Before Changes Summary of Proposed Revisions Summary of Final Revisions Based on Public Comment State agencies must identify the brands of foods and package sizes that are acceptable for use in the program in their states that provide participants with the maximum monthly allowances as specified in each food package. Allow WIC state agencies to authorize a greater variety of package sizes to increase variety and choice, while still providing participants with package sizes that ensure they can receive the full benefit amount (i.e., at least one package size, or a combination of sizes, must add up to the full MMA). Finalize as proposed.

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“od States tment of ulture

Food and- Consumer Service

—_

OCT 14 1900 |

SUBJECT: Final Policy Memorandum #99-3 Evaluation Criteria for Infant Formula Rebate Contracts

TO: Regional Directors _ Supplemental Food Programs All Regions

The purpose of this policy memorandum is to clarify Federal statutory and regulatory limitations on the use of technical evaluation requirements for invitations for bid (IFB) for infant formula rebate contracts. Specifically, this memorandum addresses: (1) the statutory requirement that an infant formula rebate contract be awarded to the manufacturer “offering the lowest price” (42 U.S.C. § 1786(b)(17)); and (2) that State agencies are prohibited by Federal regulation from issuing IFBs or entering into contracts excluding “from consideration in the bidding evaluation any infant formula manufacturer in compliance with the Federal Food, Drug and Cosmetic Act (21 U.S.C. § 321 et seq.)” (7 C.F.R. § 246.16(0)(2)).

BACKGROUND |

It has come to our attention that some State agencies included in their IFBs technical requirements that violate the Child Nutrition Act’s (CNA) lowest price requirement. Specifically, the technical requirements used a subjective point evaluation system and/or a weight system that allowed scores for both the technical evaluation and cost evaluation. For example, the technical requirements under this subjective point evaluation standard included provisions such as rating marketing practices or organization size and structure, and/or requiring information on total shelf presence in a State or plant production capability. These types of technical requirements violate 42 U.S.C. § 1786(b)(17) because they create the possibility of awarding an infant formula rebate contract to a manufacturer who has not offered the lowest price.

FEDERAL REQUIREMENTS

Several State agencies have indicated to us they are concerned about contract performance problems and believe evaluating technical requirements allows them to select a bidder that is the most able to provide benefits to the State. However, we must emphasize Federal law explicitly requires State agencies to award infant formula rebate contracts to the bidder offering the lowest price to the State. This lowest price requirement appears in the CNA and is stated in unconditional terms; therefore, it is not subject to modification by the use of technical requirements such as those discussed above. This prohibition against using technical requirements to exclude lowest price bidders is buttressed by WIC regulations. As we have already stated, 7

AN EQUAL OPPORTUNITY EMPLOYER

Guidance documents lack the force and effect of law, unless expressly authorized by statute or incorporated into a contract. USDA may not cite, use, or rely on any guidance that is not available

through their guidance portal, except to establish historical facts.

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Regional Directors 2 a C.F.R. § 246.16(0)(2) requires that “State agencies shall not issue invitations for bid or enter into contracts which...exclude from consideration in the bidding evaluation any infant formula manufacturer in compliance with the Federal Food, Drug and Cosmetic Act.” This regulatory language recognizes that compliance with the Federal Food Drug and Cosmetic Act demonstrates that a manufacturer satisfies all, subjectively evaluated, technical requirements relevant to whether the manufacturer is capable of providing infant formula for the WIC Program.

FNS is not suggesting a State agency must totally exclude technical information from its IFB. A State agency may choose to require bidders to submit information of a technical nature in order to determine if a bidder is responsible and responsive. To be responsive, a bidder must submit a bid that conforms to the solicitation. To be responsible, the bidder must meet the eligibility requirements under the applicable statute and regulations, and be able to meet the requirements set forth in the IFB. For example, if a bidder meets applicable statutory and regulatory requirements, such as the requirement to register under the Food, Drug and Cosmetic Act, it should be deemed responsible.

However, if information is required, such information must be evaluated objectively. A State agency can only ascribe a pass or fail determination based solely on whether the bidder has submitted the required information and that the required information is relevant to the bidder’s capability to provide infant formula products to the State agencies authorized retail vendors. In other words, technical information shall demonstrate factors which are either present or absent, and evaluation of the factors may not allow any subjective assessment.

Contract Provisions

Regarding State agency concerns about possible performance failure, we believe there are ways to provide the State agency with assurances via contractual provisions. To protect a State agency in the event the successful bidder cannot fulfill the terms of the contract, we suggest a clause in the contract that requires the successful bidder to continue to pay a rebate on another brand of similar infant formula issued to WIC participants in the event the contract manufacturer’s formula is unavailable in grocery stores. Granted, this is not an easy solution; however, it does put bidders on notice that a rebate is required and it is in their best interest to have their infant formula readily available to WIC retailers. Also, contracts should contain provisions that allow | the State agency to cancel the contract for non-performance issues such as failure to supply infant formula and hold the company liable for damages.

State agencies must also plan well in advance of the effective date of the contract to alert WIC retailers of an infant formula change to allow ample time to order an

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SUBJECT: Informational Memorandum: WIC Infant Formula Rebate Solicitations – Bidding on Single Milk- and Soy-Based Infant Formula TO: Regional Directors Special Nutrition Programs All Regional Offices WIC State Agency Directors All WIC State Agencies Recently, FNS has received questions about the definition of single milk-based infant formula, including questions related to the allowability of bidding on multiple product lines or formulations in response to a single solicitation. The purpose of this memorandum is to ensure that all stakeholders are aware of the federal regulatory scheme related to bidding on single milk- and soy-based infant formula rebate contracts. WIC regulations at 7 C.F.R. 246.16a(c)(4) require bidders for infant formula rebate solicitations to specify the brand name of the single milk-based infant formula and single soy-based infant formula for which the rebate is being specified in all three physical forms of infant formula (concentrated liquid, powdered, and ready-to-feed). The terms “single milk-based” and “single soy-based” infant formula are not defined in regulation. Additionally there are no federal requirements that infant formula manufacturers must bid using the exact same product line or formulation for all three physical forms of milk- or soy-based infant formula in response to a single solicitation. Pursuant to the Congressional Review Act (5 U.S.C. § 801 et seq.), the Office of Information and Regulatory Affairs designated this notice as ‘not major’, as defined by 5 U.S.C. § 804(2). If you have any questions about this memorandum, please contact Amy Herring, Chief of WIC Program Integrity at amy.herring@usda.gov. Sincerely, SARAH WIDOR Director Supplemental Food Programs Division October 7, 2019 through their guidance portal, except to establish historical facts. incorporated into a contract. USDA may not cite, use, or rely on any guidance that is not available Guidance documents lack the force and effect of law, unless expressly authorized by statute or

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INTERIM GUIDANCE ON WIC VENDOR COST CONTAINMENT FOR PUBLIC RELEASE Contents Page

Reason for Issuance………………………………………………………………………… 1 Content of Guidance……………………………………………………………………….. 1 Above-50-Percent Vendors [Portions Redacted]………………………………………….. 3

Regulatory Provision Choosing to Authorize Above-50-Percent Vendors Methodology for Identifying Above-50-Percent Vendors Assessing Current Vendors Assessing Vendor Applicants Other Considerations Establishing Competitive Price Criteria for Above-50-Percent Vendors

Participant Access Determination Administrative Review Requirements Vendor Cost Containment Certification ...............................…………..…………………. 18

Regulatory Provision The Purpose of Certification Identifying Comparable Vendors Submitting the Request for Certification

Notification of Certification Term of a Certification Assessing the Cost Neutrality of Above-50-Percent Vendors...................……….............. 31 Calculating Average Food Instrument Payments FNS Assessment of Cost Neutrality Vendor Peer Groups [Portions Redacted]……………………………………….......…..... 33 The Benefit of Using Vendor Peer Groups Selecting Peer Group Criteria Evaluating Peer Group Selection Criteria Defining Geographic Markets Obtaining Approval to Use One Peer Group Criterion Exemption from the Vendor Peer Group System Requirement………………………......... 38

Regulatory Provision

Requesting an Exemption Due Date of the Request for Exemption Term of an Exemption i through their guidance portal, except to establish historical facts. incorporated into a contract. USDA may not cite, use, or rely on any guidance that is not available Guidance documents lack the force and effect of law, unless expressly authorized by statute or

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Competitive Price Criteria [Redacted].....………………………………………….............. 41 The Role of Shelf Prices The Role of Food Instrument Redemption Data Analyzing Prices Using a Market Basket Index Using Standard Deviations to Set the Competitive Price Range Summary Applying Maximum Allowable Reimbursement Levels [REDACTED].…………........... 47 List of Tables [REDACTED CONSISTENT WITH SECTION REDACTIONS] Table 1. Methodologies and Indicators for Determining Whether a Vendor Applicant is Expected to be an Above-50-Percent Vendor……..……………….. 15 Table 2. Data for WIC Vendor Cost Containment Certification – Overview …………….. 24 Table 3. Data for WIC Vendor Cost Containment Certification – Peer Group Structure..... 25 Table 4. Data for WIC Vendor Cost Containment Certification – Average Payments to Vendors……………………………………………………………………….. 26 Table 5. Establishing Vendor Peer Groups………………………………………………. 35 Table 6. Calculating a Market Basket Index……………………………………………… 44 List of Figures Figure 1: WIC Vendor Cost Containment Certification Requirements and Timelines…… 30 Figure 2: A Normal Distribution [REDACTED]…………………………………………. 45 List of Attachments [REDACTED] Attachment 1 – Food Sales Factsheet Attachment 2 – Authorized Vendors Identified as Potentially Meeting the 50 Percent Criterion Report Attachment 3 – Flow Chart for Identifying Above-50-Percent Vendors Using Food Sales Data Attachment 4 – Regular Vendor Food Sales and Maximum WIC Redemptions Calculator Attachment 5 – Development of the Retail Food Sales Calculator Attachment 6 – Preparing a Request for Exemption from the Peer Group Requirement Attachment 7 – Worksheet for Assessing Statewide Maximum Reimbursement Amount ii through their guidance portal, except to establish historical facts. incorporated into a contract. USDA may not cite, use, or rely on any guidance that is not available Guidance documents lack the force and effect of law, unless expressly authorized by statute or

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INTERIM GUIDANCE ON WIC VENDOR COST CONTAINMENT Reason for Issuance This guidance is intended to assist State agencies to implement vendor cost containment systems that meet the requirements of the WIC Vendor Cost Containment Interim Rule, which was published in the Federal Register on November 29, 2006 (70 FR 71708). The Interim Rule incorporates changes made to section 17(h)(11) of the Child Nutrition Act of 1966 (CNA) as amended (42 U.S.C. 1786(h)(11)), by the Child Nutrition and WIC Reauthorization Act of 2004 (Public Law 108-265). Section 17(h)(11) of the CNA, Vendor Cost Containment, imposes new requirements on State agencies to ensure that the WIC Program pays all vendors competitive prices for supplemental foods. While State agencies have flexibility under the CNA to design vendor cost containment systems that meet their individual needs, they also have increased accountability to demonstrate that these systems are operating effectively. A primary measure of effectiveness is a State agency’s ability to contain the costs to the program of vendors that derive more than 50 percent of their annual food sales revenue from WIC food instruments (referred to in this guidance as “above-50-percent vendors”). The Food and Nutrition Service (FNS) expects that every State agency will view the new vendor cost containment requirements as both a mandate and an opportunity to enhance present performance. Content of Guidance This guidance enunciates federal policy on various requirements in the WIC Vendor Cost Containment Interim Rule (referred to throughout this document as the “Interim Rule”) in order to facilitate implementation by State agencies. All State agencies are affected by the Interim Rule and will benefit from the information in this guidance. The contents have been organized to assist State agencies in carrying out the following actions: 1. Identify above-50-percent vendors (section 246.12(g)(4)(i)) and, if the State agency chooses to authorize such vendors after December 30, 2005, obtain FNS certification (section 246.12(g)(4)(vi) of the Interim Rule); 2. If the State agency intends to authorize above-50-percent vendors, determine whether above-50-percent vendors cost the program more than if participants used regular vendors (section 246.12(g)(4)(i)(D)); 3. Implement or modify a vendor peer group system, competitive price criteria, and/or allowable reimbursement levels (section 246.12(g)(4)). Each State agency, regardless of whether it intends to authorize above-50-percent vendors, must implement a vendor peer group system (unless FNS exempts the State agency from this requirement), competitive price criteria, and allowable reimbursement levels; or 1 through their guidance portal, except to establish historical facts. incorporated into a contract. USDA may not cite, use, or rely on any guidance that is not available Guidance documents lack the force and effect of law, unless expressly authorized by statute or

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ABOVE-50-PERCENT VENDORS Regulatory Provision Section 246.12(g)(4) of the Interim Rule contains a new requirement that a State agency must establish a vendor peer group system, unless FNS exempts the State agency from this requirement. In implementing its peer group system, a State agency that chooses to authorize above-50-percent vendors must distinguish such vendors from other vendors within the peer group system. A State agency may distinguish above-50-percent vendors by establishing separate peer groups for them or by applying distinct competitive price criteria and allowable reimbursement levels to above-50-percent vendors that are in peer groups with other vendors. Choosing to Authorize Above-50-Percent Vendors Annually each State agency that operates a retail food delivery system (as defined in section 246.12(e) of the WIC regulations (7 CFR Part 246)) must identify the above-50-percent vendors that are currently authorized and any new vendor applicants that are expected to be above-50-percent vendors (section 246.12(g)(4)(i)). This requirement applies to State agencies that use a vendor peer group system and to those that receive approval from FNS to utilize an alternative vendor cost containment system (such as a bid system). State agencies have the discretion to choose whether or not to authorize above-50-percent vendors. A State agency that chooses to authorize above-50-percent vendors must first identify these vendors in order to meet the requirements of section 246.12(g)(4)(i)(C) of the Interim Rule related to their selection and reimbursement State agencies were required to complete the process of identifying currently authorized above-50-percent vendors by August 30, 2005, using the methodology contained in WIC Policy Memorandum #2005-2, dated December 14, 2004, the Interim Rule, and the draft cost containment guidance issued in July 2005. State agencies must apply this methodology annually to identify above-50-percent vendors. In accordance with the vendor cost containment legislation, every State agency that authorizes above-50-percent vendors after December 30, 2005, must obtain prior FNS approval through certification as discussed below. Methodology for Identifying Above-50-Percent Vendors Pursuant to regulatory requirements, this guidance provides a uniform procedure for all State agencies to follow in identifying above-50-percent vendors. The methodology relies on objective data and documentation of the revenue that a vendor derives annually from food sales. The State agency must obtain and assess the relevant information and designate each currently authorized vendor and new vendor applicant as an above-50-percent vendor or a regular vendor. 3 through their guidance portal, except to establish historical facts. incorporated into a contract. USDA may not cite, use, or rely on any guidance that is not available Guidance documents lack the force and effect of law, unless expressly authorized by statute or

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Assessing Current Vendors To determine whether a currently authorized vendor meets the above-50-percent criterion in section 246.12(g)(4)(i) of the Interim Rule, the State agency must calculate annual WIC redemptions as a percentage of the vendor’s total annual foods sales revenue. This calculation must be performed annually to allow the State agency to report its findings in the State Plan. The definition of “food sales” that State agencies must apply when identifying above-50 percent vendors is the “sale[s] of all foods that are eligible items under the Food Stamp Program (FSP).” These foods are intended for home preparation and consumption and include meat, fish, and poultry; bread and cereal products; dairy products; fruits and vegetables. Items such as condiments and spices, coffee, tea, cocoa, and carbonated and noncarbonated beverages are included in food sales only when offered for sale along with foods in the four primary categories. Food sales do not include sales of any items that are not approved for purchase with food stamp benefits, such as nonfood items, alcoholic beverages, hot foods, or food that will be eaten on the store premises. The term “food sales” used throughout this document refers to sales of FSP-eligible items, unless otherwise noted. The use of this definition does not require that a vendor be authorized by the FSP. State agencies must provide the definition of “food sales” to vendors when requesting the amount of annual food sales revenue. Vendors that are FSP-authorized should already be aware of the FSP-eligible foods. State agencies should provide the attached list of FSP-eligible items to vendors (Attachment 1). Section 246.2 of the Interim Rule defines above-50-percent vendors based on the percent of their annual revenue from the sale of food items. State agencies must use annual food sales data to assess a vendor. The annual period may be the most recent calendar year, fiscal year, or other 12-month period. If the food sales data obtained by the State agency covers less than a year (e.g., for a vendor that has been in operation for six months), the State agency should not annualize the amount of food sales. WIC redemption data used in the State agency’s calculations should cover the same period covered by the vendor’s food sales amount. The State agency shall use the results of its assessment to classify each vendor as being either a regular vendor or an above-50-percent vendor during the subsequent fiscal year. State agencies must include commissaries and pharmacies in the assessment of above-50-percent vendors. 1. Identifying Potential Above-50-Percent Vendors from WIC and FSP Redemptions As an initial step in identifying above-50-percent vendors, the State agency should compare a vendor’s WIC redemptions to the vendor’s FSP redemptions for the same period. Since most WIC vendors are also FSP-authorized, a comparison of readily available WIC and FSP redemption data will reduce the level of effort a State agency must expend to identify above-50-percent vendors. If a vendor’s FSP redemptions exceed its WIC redemptions, no further assessment is required. The vendor would be deemed a regular vendor. Collection of an annual food sales amount for the vendor would not be necessary. 4 through their guidance portal, except to establish historical facts. incorporated into a contract. USDA may not cite, use, or rely on any guidance that is not available Guidance documents lack the force and effect of law, unless expressly authorized by statute or

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To assist State agencies with the comparison of WIC redemption and FSP redemption data, FNS has included a report entitled Authorized Vendors Identified as Potentially Meeting the 50-Percent Criterion in The Integrity Profile (TIP) on-line system (see Attachment 2). This report lists all FSP-authorized WIC vendors whose ratio of WIC redemptions-to-(WIC + FSP) redemptions exceeds 50 percent.1 It will also identify WIC vendors for which a ratio could not be calculated because the vendor is not FSP-authorized. State agencies will be able to generate this report beginning with the fiscal year 2005 TIP data submission. 2. Calculating the WIC Redemptions-to-Total Annual Food Sales Ratio If a State agency is unable to determine that a currently authorized vendor is not an above-50-percent vendor using WIC and Food Stamp redemption data alone, then the State agency must collect food sales data from the vendor and compute the ratio of annual WIC redemptions to annual food sales in order to designate the vendor properly. The process is discussed in detail below. a. The Required Procedure To meet legislative requirements related to above-50-percent vendors, State agencies must obtain food sales data from vendors whose designation as a regular vendor or an above-50-percent vendor has not been confirmed through the use of WIC and FSP redemption data alone.2 After obtaining the annual food sales amount from a vendor, the State agency will calculate the ratio of annual WIC redemptions to total annual food sales (i.e., WIC redemptions divided by total food sales) and designate the vendor as an above-50-percent vendor or a regular vendor. This scenario (Scenario 1) appears on the left-hand side of the attached Flow Chart for Identifying Above-50-Percent Vendors Using Food Sales Data (Attachment 3). The food sales amount used in this calculation must be a documented amount that includes sales of FSP-eligible items only. A documented food sales amount is an amount that is supported by written sales or financial statements, reports, tax forms, or other records sufficient for establishing FSP-eligible food sales. (The requirement for submission and retention of documentation is discussed below under Documentation and Recordkeeping.) b. An Interim Approach Since the definition of “food sales” used in this guidance is new to WIC vendors, and because vendors differ in their ability to derive this amount from 1 Since the WIC redemption data in this report pertains to a single State agency, the report will not identify shared vendors that would fall into the potentially above-50-percent category when WIC redemptions from another State agency are considered. Thus, State agencies will need to assess separately all vendors that are authorized by more than one State agency. Using the FSP authorization number of an authorized WIC vendor, a State agency will be able to access all WIC redemption amounts for a vendor. 2 When obtaining food sales and/or gross sales data from vendors, State agencies should inform vendors that the amount(s) reported should include sales of infant formula. 5 through their guidance portal, except to establish historical facts. incorporated into a contract. USDA may not cite, use, or rely on any guidance that is not available Guidance documents lack the force and effect of law, unless expressly authorized by statute or

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Scenario 2 Estimating FSP-Eligible Food Sales from a Food Sales Amount That Includes Other Items This scenario indicates the steps a State agency should take to identify above 50-percent vendors when a vendor provides a food sales amount that includes items other than FSP-eligible foods. (1) Calculate the WIC redemptions-to-food sales ratio using the food sales amount provided by the vendor. If the State agency determines that the vendor is an above-50-percent vendor using a food sales amount that includes items other than FSP-eligible foods, then the State agency does not need to estimate a FSP- eligible foods sales amount. If this calculation does not indicate that the vendor is an above-50-percent vendor, proceed to step (2). (2) Obtain a gross sales amount from the vendor. The State agency will use the vendor’s gross sales to estimate the amount of FSP-eligible food sales. (3) Estimate FSP-eligible food sales using the attached food sales calculator. Insert the name of the store, vendor identification number, a code for the store type, the vendor’s annual gross sales, and amount of annual WIC redemptions (columns A through D and column H).3 The food sales calculator will automatically apply the appropriate food sales share (column E) to the gross sales amount and compute an estimated FSP-eligible food sales amount (column F). The food sales share (column E) was computed by Economic Research Service staff, USDA, using retail trade data from the 2002 Economic Census, adjusted to exclude foods that are not FSP-eligible.4 The estimated food share varies from 94.7% for specialized food stores to 4.8% for pharmacies.5 The food sales calculator will also compute the maximum amount of WIC redemptions the vendor can have and be classified as a regular vendor (column G). It will then compare this amount with the annual WIC redemptions (column H) and insert a “Y” in column I if the annual WIC redemptions exceed the maximum amount in column G. (4) Compare the estimated FSP-eligible food sales amount in column F of the food sales calculator to the food sales amount provided by the vendor (which was 3 The food sales calculator will compute the estimated FSP-eligible food sales when the store type and annual gross sales are entered into the calculator. The vendor name and ID number are included so that the State agency will have complete documentation. The State agency may add other data elements, if desired. 4 The Economic Census is conducted every five years. 5 State agencies should work with military commissaries to obtain the required food sales data. FNS Instruction 806-4, Rev. 1, recognizes the uniqueness of commissaries as WIC vendors and provides guidance to State agencies on resolving any problems that might arise in obtaining required information. 8 through their guidance portal, except to establish historical facts. incorporated into a contract. USDA may not cite, use, or rely on any guidance that is not available Guidance documents lack the force and effect of law, unless expressly authorized by statute or

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Scenario 4 Estimating FSP-Eligible Food Sales from an Undocumented Gross Sales Amount In rare instances a vendor may not have written documentation of a store’s annual gross sales amount due to some extraordinary occurrence or circumstance (such as a fire or natural disaster). In such instances, a State agency may allow a vendor to make a written self-declaration of the store’s annual gross sales. The self- declaration should be made on a form developed by the State agency. It should include the self-declared gross sales amount, the period to which the gross sales amount applies (e.g., January 1, 2005 to December 31, 2005), the reason why the vendor is unable to provide either a documented food sales or gross sales amount, and the signature of the store owner or authorized representative. To estimate a vendor’s FSP-eligible food sales under this scenario: (1) Obtain the vendor’s self-declared annual gross food sales amount. Determine the reasonableness of the amount using relevant information, if any, that the State agency has available. (2) Using the food sales calculator, compute the estimated FSP-eligible food sales. (3) Designate the vendor as a regular vendor or an above-50-percent vendor based on the results in column I of the food sales calculator. (4) Advise the vendor, in writing, that a documented food sales amount will be required for the upcoming three-month period (which the State agency will specify). Inform the vendor of the type of documentation that the State agency will accept. (5) Reassess the vendor in 90 days using the vendor’s documented food sales amount by computing the ratio of WIC redemptions-to-total food sales for the 90-day period. Compare the documented food sales amount with the estimated food sales amount derived using the food sales calculator. Confirm or modify the vendor’s designation. To locate this scenario on the Flow Chart, follow the sequence in which the answer to the question, “Did the vendor provide a documented total food sales amount?” is “No” and the answer to “Did the vendor provide a documented gross sales amount?” is also “No.” 11 through their guidance portal, except to establish historical facts. incorporated into a contract. USDA may not cite, use, or rely on any guidance that is not available Guidance documents lack the force and effect of law, unless expressly authorized by statute or

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c. Additional Comments on Using the Food Sales Calculator In certain instances a State agency may need to estimate food sales from gross sales data that cover less than a one-year period. It would still be appropriate to use the food sales calculator. The actual WIC redemptions in column I must apply to the same period of time as the gross sales data. For example, a State agency needs to determine whether a new vendor that has been authorized for eight months is an above-50-percent vendor. The State agency would obtain the vendor’s gross sales amount for the eight-month period and the vendor’s WIC redemptions for the same period and insert these amounts in columns D and H, respectively, of the food sales calculator. Attachment 5 contains information on the development of the food sales calculator. State agencies that choose not to use the food sales calculator must, as part of the State Plan submission, describe their alternative policy and/or procedure for identifying above-50-percent vendors using food sales data. 3. Documentation and Recordkeeping Vendors must provide documentation of the food sales amount reported to a State agency. For State agencies that choose not to authorize any above-50-percent vendors, a vendor’s annual food sales will be a deciding factor in whether or not a vendor is authorized. For all other State agencies, a vendor’s annual food sales revenue will determine whether the vendor is designated as a regular vendor or an above-50-percent vendor. Thus, vendors must be able to substantiate the amount of food sales reported. Although State agencies will take steps to minimize the reporting burden imposed on vendors (e.g., by using WIC and FSP redemption data to identify the vast majority of vendors who are regular vendors), State agencies will need to obtain documentation of food sales data from vendors whose status cannot be determined based on data already available. It is the vendor’s responsibility to maintain and submit the documentation required by the program. Section 246.12(h)(xv) of the WIC regulations states: “The vendor must maintain inventory records used for Federal tax reporting purposes and other records the State agency may require for the period of time specified by the State agency in the vendor agreement. Upon request, the vendor must make available to the State agency…all program-related records.” FNS encourages State agencies to confer with their vendor advisory committees, vendor associations, and/or other groups to understand the accounting or recordkeeping methods that retail food vendors customarily and reasonably employ. State agencies must notify vendors in the vendor agreement or handbook, as appropriate, that documentation of the annual food sales amount may be required, and that a vendor’s failure to provide such documentation, as well as provision of false information, will result in denial of authorization or termination of the vendor agreement. 12 through their guidance portal, except to establish historical facts. incorporated into a contract. USDA may not cite, use, or rely on any guidance that is not available Guidance documents lack the force and effect of law, unless expressly authorized by statute or

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FNS recommends that State agencies collect a gross sales amount from vendors that are required to provide a food sales amount. Having the gross sales amount for a store can be useful to the State agency in assessing the reasonableness of the food sales amount. In addition, the gross sales amount reported to the State agency should correspond to the gross sales reported on State or Federal tax returns. Since business entities already are required to maintain records substantiating information reported on tax returns, requests from State agencies for such information should not impose a burden on vendors. The State agency is not required to make an extraordinary effort to determine whether a vendor is an above-50-percent vendor, but should use its best judgment to classify the vendor after reviewing available information provided by the vendor, including information already on file (such as the size and location of the store). FNS does not expect State agencies to routinely verify the food sales and/or gross sales amounts reported by vendors. Verification refers to the process whereby the information presented (such as a vendor’s sales report or financial statement) is validated through the use of an external source of information other than the vendor. FNS encourages verification of any questionable food sales information, particularly when the information affects a vendor’s authorization. 4. Timing of the Annual Vendor Assessment Starting with the fiscal year 2005 submission, State agencies will use data from the TIP report that is due to FNS annually by February 1st to identify above-50-percent vendors for the upcoming fiscal year. State agencies must assess vendors annually in sufficient time to include the results of the assessment in the next State Plan. A State agency may update or revise a vendor’s designation at any time. Whenever a State agency determines that it has one or more above-50-percent vendors, and the State agency has not received FNS certification, the State agency must submit a request for certification to FNS within 90 days of making this determination. Other Considerations A State agency can accept a currently authorized vendor’s written statement that the store receives more than 50 percent of its annual food sales revenue from WIC food instruments, and may designate the store as an above-50-percent vendor based on this statement. In addition, a State agency may automatically designate as above-50-percent vendors all vendors that are WIC-only stores. In such instances, the State agency does not need to collect food sales data from the vendor. If a vendor was authorized by more than one State agency during the period under consideration, then the State agency must obtain the amount of WIC redemptions the vendor received from every other State agency that authorized the vendor and sum all of the WIC redemptions to calculate the ratio of WIC redemptions to total annual food sales. 13 through their guidance portal, except to establish historical facts. incorporated into a contract. USDA may not cite, use, or rely on any guidance that is not available Guidance documents lack the force and effect of law, unless expressly authorized by statute or

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A State agency that chooses not to authorize above-50-percent vendors still must determine whether any such vendors currently are authorized so that it can take appropriate action to end their authorization. State agencies must ensure that their decision not to authorize above-50 percent vendors does not result in inadequate participant access to supplemental foods. A State agency that authorizes above-50-percent vendors only when needed to ensure participant access must comply with all requirements of section 246.12(g)(4) related to such vendors. Assessing Vendor Applicants State agencies must assess all new vendor applicants during the vendor selection process and identify those that they expect will be above-50-percent vendors. Vendor applicants include a new store location for an owner that currently has a WIC-authorized store, and a vendor with no prior involvement with WIC. To conduct the assessment, the State agency must first ask vendor applicants whether they expect to derive more than 50 percent of the store’s annual food sales revenue from WIC food instruments. If the vendor applicant’s answer is “yes,” no further assessment would be necessary. The State agency must designate the vendor as an above-50-percent vendor. The State agency must further assess all vendor applicants that state that they do not expect to derive more than 50 percent of the store’s annual revenue from WIC food instruments using the data sources and methodologies listed in Table 1. At its discretion, the State agency may use additional data sources and methodologies. Failure of a vendor applicant to provide documentation requested by the State agency shall result in denial of the vendor’s application. The indicators shown in Table 1 provide the State agency with a composite picture of how the new vendor applicant is likely to operate if the store were authorized. They assume that a new store location is likely to be an above-50-percent vendor if other WIC-authorized stores operated by the same ownership entity currently are above-50-percent vendors. The indicators rely on historical and current data that the State agency maintains in its vendor management system and relevant documentation provided by the vendor applicant. If the State agency determines that the vendor applicant may be authorized, the State agency shall use the on-site preauthorization visit (required by section 246.12(g)(5) to confirm that the new store is or is not expected to be an above-50-percent vendor. State agency staff must document the findings of its assessment of each vendor applicant’s status as a potential above-50-percent vendor. The State agency shall monitor all newly-authorized vendors subsequent to authorization to assure that they have been properly designated as being or not being above-50-percent vendors. As required by section 246.12(g)(4)(i)(B) of the Interim Rule, such monitoring shall include a comparison of WIC and FSP redemption data and/or a review of WIC redemptions to total food sales within six-months from the date of authorization. At authorization, the State agency shall notify vendors in writing of this assessment and the requirement to provide proper written documentation of their total food sales. As noted under item 4 above, Timing of the Annual Vendor Assessment, whenever the State agency determines that it has one or more above-50-percent vendors, and the State agency has not received FNS certification, the State agency must submit a request for certification to FNS within 90 days of making this determination. 14 through their guidance portal, except to establish historical facts. incorporated into a contract. USDA may not cite, use, or rely on any guidance that is not available Guidance documents lack the force and effect of law, unless expressly authorized by statute or

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Table 1. Methodologies and Indicators for Determining Whether a Vendor Applicant is Expected to be an Above-50-Percent Vendor Indicator Methodologies and Data Sources The vendor applicant currently 1) Determine if the vendor (i.e., the ownership entity) has one or more stores where currently has one or more stores that are authorized by WIC food sales are more than 50 the State agency or by another State agency to accept percent of total annual food sales. WIC food instruments. 2) If the vendor (the ownership entity) has one or more stores that are authorized to accept WIC food instruments, determine whether any of these stores (including the applicant store location, if it is authorized by another State agency) are above-50-percent vendors. The vendor applicant is expected 1) Request the percentage of anticipated food sales by to accept WIC as the primary type of payment, i.e., cash, FSP, WIC, and credit/debit. form of payment for the sale of 2) If the applicant store is already open for business, supplemental food items. request the total food sales during the last year. To the extent possible, validate the information on the percentage of anticipated food sales by type of payment and/or the total food sales against other data sources. 3) If the vendor (i.e., ownership entity) was previously authorized by the State agency, and the State agency has the necessary historical data (e.g., annual WIC and FSP redemptions, a total food sales amount, documentation that the store was a WIC-only store) determine whether the previously authorized store location(s) was an above 50-percent vendor. The vendor applicant is expected 1) Request inventory invoices to substantiate foods that to or currently offers for sale have been purchased for sale. primarily WIC-authorized food 2) Determine whether a variety of foods in each of the items (i.e., does not offer a variety following four categories will be or are currently being of foods, including meat, poultry, offered for sale on a continuous basis: meats, poultry, or fish; bread or cereal; vegetables or fish; bread or cereal; vegetables or fruits; and dairy. fruits, and dairy products). Continuous basis means that on any given day of operation, a store offers for sale and normally displays in a public area no fewer than three different varieties of food items in each of the four categories. 3) Request the percentage of foods intended to be offered for sale in each category, i.e., 15% meat, poultry, or fish; 30% bread or cereal; 30 % fruits and vegetables; 20% dairy products, etc. 4) If the vendor selection process proceeds to the point of a site visit, determine through the site visit whether the percentages provided by the vendor are realistic. The vendor applicant is dependent upon WIC authorization before the store can open for business. On the vendor application, request the date the store will open for continuous business. 15 through their guidance portal, except to establish historical facts. incorporated into a contract. USDA may not cite, use, or rely on any guidance that is not available Guidance documents lack the force and effect of law, unless expressly authorized by statute or

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-- Participant Access Determination Section 246.12(g)(1) of the Interim Rule requires State agencies to authorize an appropriate number and distribution of vendors in order to ensure the lowest practicable food prices consistent with adequate participant access to supplemental foods and to ensure effective State agency management, oversight, and review of its authorized vendors. In making the decision to authorize or not authorize any vendor, the State agency shall ensure adequate participant access to supplemental foods. In developing its participant access criteria, the State agency must consider the availability of other authorized vendors in the area and any geographic barriers to using such vendors. Further, section 246.4(a)(14)(xiii) of the WIC regulations requires that a description of the participant access determination criteria be included in the State Plan. Each State agency that chooses not to authorize above-50-percent vendors shall use the participant access criteria included in its State Plan to determine whether a currently authorized vendor who is an above-50-percent vendor shall retain its authorization, and whether a new vendor applicant who is expected to be an above-50-percent vendor should be authorized for participant access reasons. Administrative Review Requirements Consistent with 7 CFR 246.18(a)(1)(ii) of the WIC regulations, vendors who are denied authorization because the State agency determines that they are expected to be above-50 percent vendors are eligible for an abbreviated administrative review. The validity and appropriateness of the State agency’s criteria for determining whether a vendor applicant is expected to be an above-50-percent vendor are not subject to administrative review, as stated in sections 246.12(a)(1)(iii)(A) and (B). In addition, the State agency’s participant access determination is not subject to administrative review as stated in section 246.18(a)(1)(iii)(C) of the WIC regulations. The administrative review is solely to determine if the State agency properly applied the criteria based on the documentation provided by the vendor applicant. 17 through their guidance portal, except to establish historical facts. incorporated into a contract. USDA may not cite, use, or rely on any guidance that is not available Guidance documents lack the force and effect of law, unless expressly authorized by statute or

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VENDOR COST CONTAINMENT CERTIFICATION Regulatory Provision Section 246.12(g)(4)(vi) of the Interim Rule contains a new requirement that a State agency that elects to authorize above-50-percent vendors shall demonstrate to the Department, and the Department shall certify, that the State agency’s competitive price criteria and allowable reimbursement levels do not result in average payments per food instrument to above-50 percent vendors that are higher than average payments per food instrument to comparable vendors that are not above-50-percent vendors. State agencies that plan to utilize above-50 percent vendors after December 30, 2005, must obtain prior certification from FNS that they meet this legislative requirement. The Purpose of Certification Vendor cost containment certification verifies that the State agency that chooses to authorize above-50-percent vendors meets the requirement in section 246.12(g)(4)(vi). This requirement is one of two cost neutrality requirements contained in the Child Nutrition and WIC Reauthorization Act of 2004. Section 246.12(g)(4)(vi) prescribes that cost neutrality will be assessed by comparing the average payments per food instrument made to above-50-percent vendors to the average payment per food instrument to comparable regular vendors. Average payments to above-50-percent vendors may not exceed average payments to comparable regular vendors. Achieving cost neutrality begins with the selection of vendors that offer the program the most competitive prices in their geographic area. It also includes the application of reimbursement methods that limit payments to levels consistent with the competitive price levels applied to the vendors at authorization. During the certification process, a State agency demonstrates to FNS that it has implemented methods that distinguish above-50-percent vendors from regular vendors at authorization; that it bases competitive price criteria and maximum allowable reimbursement amounts on the prices of regular vendors; that it applies appropriate reimbursement limits during the food instrument redemption process and makes price adjustments to any payments that exceed the maximum allowable reimbursement level; and that it reimburses above-50 percent vendors at a level that should achieve overall cost neutrality under section 246.12(g)(4)(i)(D) of the Interim Rule. Obtaining FNS certification does not guarantee that a State agency will achieve cost neutrality. Achieving cost neutrality requires the effective ongoing application of competitive pricing methods. Identifying Comparable Vendors Section 246.12(g)(4)(vi) gives the State agency discretion to define comparable vendors as it deems appropriate, as long as the State agency achieves cost neutrality of above-50-percent vendors. A State agency may place some or all above-50-percent vendors into peer groups with regular vendors or in peer groups by themselves. A State agency should define comparable vendors in a way that will meet the overall cost neutrality requirement in section 246.12(g)(4)(i)(D) of the Interim Rule. A State agency achieves overall cost neutrality if the 18 through their guidance portal, except to establish historical facts. incorporated into a contract. USDA may not cite, use, or rely on any guidance that is not available Guidance documents lack the force and effect of law, unless expressly authorized by statute or

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average payments per food instrument (by type) to all above-50-percent vendors do not exceed average payments to all regular vendors. (See “Assessing the Cost Neutrality of Above-50 Percent Vendors”.) State agencies should consider the usefulness of the following vendor characteristics for determining “comparability” among above-50-percent vendors and regular vendors: 1. Store type: Differences in store type are largely due to the underlying business model of the retailer. For example, supermarkets depend on high sales volume in order to lower the average cost per unit of goods sold, which if passed on to consumers, results in lower retail prices. Having high volume also allows supermarkets to spread fixed operating costs (rent, utilities, and insurance, for example) over many units sales, thereby contributing to lower retail margins--the difference between cost of purchased goods and their retail price. Because margins are low, supermarkets have a relatively high minimum sales requirement in order to achieve profitability, the point at which total sales exceeds total costs (food costs plus operating costs). To achieve high sales volume, supermarkets offer a wide variety of items and extensive store services. They also advertise widely and offer sales and promotions as incentives. In contrast, convenience store retailers offer a limited variety of products and services and are much smaller in selling area (floor space) than supermarkets. They provide “fill-in” grocery products, snack food and beverages, as well as sundries, operate extended hours, and offer easily accessible locations. These retailers typically must apply higher margins and prices than supermarkets in order to achieve profitability at a lower volume of sales. Other store types, such as supercenters, warehouse club stores, limited assortment stores, dollar stores, and drugstores sell retail foods under different business models, each with its own characteristics that determine profitability. All of these commercial retailers must compete in the marketplace in order to gain sales. An important distinction of above-50-percent vendors is their ability to avoid price competition, due to a primary dependency on redemptions of WIC participant vouchers. Rather than market forces, price is determined by the allowable reimbursement level of each voucher. For this reason, their business model is unlike that of other commercial food retailers. Competition among above-50 percent vendors is largely based on non-price characteristics such as convenient location, hours of operation, level of store services, including bi-lingual staff, service-based order filling, and promotions involving free merchandise of both food and non-food items. In order to maximize sales, order fulfillment most likely ensures that all participant vouchers are fully redeemed. In contrast, other vendors depend mostly on non-WIC sales, and are less likely to encourage full redemption of vouchers unless required to do so by the State agency. 19 through their guidance portal, except to establish historical facts. incorporated into a contract. USDA may not cite, use, or rely on any guidance that is not available Guidance documents lack the force and effect of law, unless expressly authorized by statute or

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Although sales volume may typically be equivalent to a small grocery store or convenience store, unlike these stores, the above-50-percent vendors carry a much smaller variety of items with relatively high inventory turnover. As a result, above 50-percent vendors may be able to obtain volume discounts from wholesale suppliers comparable to those obtained by similar volume grocery stores. Lower food costs contribute to greater margins relative to other similar-volume retailers. 2. Firm size/number of stores operated: Multiple-store firms tend to gain efficiencies in procurement and distribution compared with single-store retailers, particularly when the stores are located in the same market or geographic area. Multiple-store retailers have an advantage over single-store operators in wholesale cost, even when they do not own distribution warehouses. Many of the large, multiple-market retailers provide their own buying and distribution services. Others may operate buying offices but rely on grocery wholesalers for shipments from manufacturers and distribution to stores. Among above-50-percent vendors, multi-vendor firms may have lower procurement and distribution costs than single-store vendors, depending on the extent of services provided internal to the firm. This distinction may serve as important criteria when assigning comparable vendors. 3. Gross sales: Gross weekly, monthly, or annual sales volume is another peer group criterion that could be used to determine comparable vendors for above-50-percent vendors. As a measure of store size, gross sales (food and nonfood) are closely related to store type as an indicator of cost per unit of output. With higher volume of sales, a store’s cost per unit is likely to be lower than that of a lower volume store; hence item prices are more likely to be negatively correlated with volume measures. Gross sales of commercial retailers are less comparable to above-50 percent vendors, however. Typically, gross sales include non-food sales and non- WIC food sales, which could include products with a different cost and profit ratio, while above-50-percent vendors sales are concentrated in WIC food categories. 4. Food sales: The share of sales derived from food can vary considerably between store types. While food sales of supermarkets average 73 percent of gross sales, supercenters may average only 36 percent, while convenience stores sell 45 percent in food. The volume of food sales by a retailer, once determined, may be more comparable to the sales of above-50-percent vendors than gross sales. 5. Number of registers: A store’s number of checkout registers has often been used as a classification criterion, but there are limitations to this approach. Studies that have correlated selected WIC multiple-item food instrument values across stores or individual item shelf prices have typically found lower food instrument costs as the number of checkouts per store increased. According to a study of WIC vendors in Texas, the WIC-only stores had the highest food instrument cost, except for a few 1 2 register vendors (Burger Carroll and Associates, Inc., 2003). The impact on cost 20 through their guidance portal, except to establish historical facts. incorporated into a contract. USDA may not cite, use, or rely on any guidance that is not available Guidance documents lack the force and effect of law, unless expressly authorized by statute or

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containment of using number of registers as a comparability criterion would therefore be minimal in this particular case. One way to address this shortcoming in comparability is to incorporate differences in food sales. By calculating food sales per register, a more appropriate measure of store size would result. With relatively high sales per register, WIC-only stores and other above-50-percent vendors may be more similar to larger grocery stores and supermarkets, which typically have been found to have lower voucher costs and shelf prices than smaller grocery stores. A greater cost containment impact on above-50-percent vendors would likely result if competitive prices, average food instrument values, and allowable reimbursements of larger grocery stores and supermarkets were applied to above-50-percent vendors. 6. Geographic area: Geographic area is a required criterion for assignment of vendors to peer groups. The use of BEA Economic Areas has been suggested as a workable definition of a marketplace in which vendors compete. (See the section of this guidance on Vendor Peer Groups, Defining Geographic Markets.) These areas tend to be quite large, encompassing multiple counties and having a metropolitan or micropolitan core area. Unlike other classes of vendors, above-50-percent vendors are typically concentrated in urban, residential areas. In these high population density areas, there are fewer supermarkets and a greater number of neighborhood groceries. Operating costs in urban areas are typically higher as well, due to rental rates, taxes, and insurance. Wholesalers may add a premium to servicing costs in urban locations due to the lack of inventory space, requiring more frequent deliveries, and lack of loading dock facilities, requiring less efficient front door unloading. These factors are likely to contribute to higher food prices. State agencies may consider comparing above-50-percent vendors in urban areas with similarly located comparable vendors. 7. Price level: The use of a price level, whether based on food instrument redemption amounts or shelf prices as a comparability criterion should be avoided. Assigning above-50-percent vendors to comparable vendors based on price levels will not serve the interests of competitive pricing or program food cost containment. Comparability and peer groups are best determined by non-price criteria. Ultimately, vendors having similar characteristics are more likely to have similar price levels than those that are different. An effective peer group system regards price as an outcome measure. By assigning above-50-percent to comparable peer groups, the State Agency is defining competitive price and maximum allowable food instrument reimbursement levels for effective cost containment. In summary, careful analysis of the cost implications is necessary when determining comparable regular vendors for above-50-percent vendors. The criteria that a State agency uses to identify comparable vendors will largely determine whether it will be able to ensure that above-50-percent vendors are cost neutral. Determining which method best achieves the cost neutrality goal may require some trial and adjustment. Examples of competitive pricing methods that State agencies may employ to meet certification requirements include (1) placing 21 through their guidance portal, except to establish historical facts. incorporated into a contract. USDA may not cite, use, or rely on any guidance that is not available Guidance documents lack the force and effect of law, unless expressly authorized by statute or

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above-50-percent vendors in a peer group by themselves to which the State agency applies statewide competitive price criteria and statewide maximum reimbursement levels applicable to regular vendors; (2) placing all above-50-percent vendors in a single peer group with the regular vendors whose competitive price criteria and maximum reimbursement levels would ensure cost neutrality; and (3) placing above-50-percent vendors in the same peer group as regular vendors, but applying different competitive price criteria and allowable reimbursement levels to the above-50-percent vendors to assure cost neutrality. State agencies also may place above-50-percent vendors in peer groups with comparable regular vendors and apply the same competitive price criteria and allowable reimbursement levels to the above-50-percent vendors and the regular vendors, as long as this achieves overall cost neutrality as defined by section 246.12(g)(4)(i)(D). Submitting the Request for Certification The State agency is responsible for providing sufficient information to allow FNS to determine whether its methodologies for applying competitive price criteria and maximum reimbursement levels are appropriate. Each State agency that elects to authorize any above-50 percent vendors after December 30, 2005, including currently authorized vendors and new vendor applicants, must submit a written request for certification to the FNS Regional Office that contains a detailed description of the following items numbered in sequential order as listed below: 1. The methodology the State agency used to derive new competitive price levels for regular vendors, which may not include the prices of above-50-percent vendors; and any other changes the State agency made to the competitive price criteria to secure the lowest prices for supplemental foods (e.g., requiring a vendor’s prices to be within 5 percent of the average prices for the peer group, rather than within 10 percent); 2. The State agency’s methodology for establishing allowable reimbursement levels for regular vendors and above-50-percent vendors, including: a. How the allowable reimbursement levels are linked to the competitive price criteria applied to the vendors at authorization to ensure that vendors continue to meet the competitive price criteria throughout the authorization period; b. How the State agency will ensure that average payments to above-50-percent vendors do not exceed average payments to comparable vendors; c. Whether the State agency has exempted any above-50-percent vendors from the competitive price criteria and allowable reimbursement levels for participant access reasons, and if so, how many vendors have been exempted; d. How the State agency applies peer-group-specific maximum allowable amounts to food instruments to redeemed food instruments; and e. If the State agency includes a factor to reflect wholesale price fluctuations, how the State agency derived this amount. 22 through their guidance portal, except to establish historical facts. incorporated into a contract. USDA may not cite, use, or rely on any guidance that is not available Guidance documents lack the force and effect of law, unless expressly authorized by statute or

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3. The State agency’s methodology for grouping above-50-percent vendors in its peer group system (i.e., separately or in peer groups with regular vendors) and how the State agency identifies comparable vendors for each group of above-50-percent vendors; 4. If the State agency plans to exempt any non-profit above-50-percent vendors (except non-profit health or human services agencies or organizations such as Catholic Charities) from competitive price criteria and allowable reimbursement levels, explain: a. The reason the State agency decided to exempt such vendors (i.e., the benefits to the program) and the number of non-profit vendors exempted; b. Whether the non-profit above-50-percent vendors are needed to ensure participant access to supplemental foods; c. How the prices of the non-profit vendors compare to those of other vendors in their geographic area that are subject to competitive price criteria and allowable reimbursement levels; and d. How the State agency established the level of reimbursement for the non-profit above-50-percent vendors that it has exempted. 5. Confirmation that the competitive price criteria and allowable reimbursement methodologies described in the State agency’s submission to FNS have been fully implemented. If the State agency has not fully implemented revised competitive price and allowable reimbursement methodologies, the State agency must provide the current status of its efforts to meet the requirements of section 246.12(g)(4)(vi) and its timetable for achieving full implementation; 6. Whether the State agency has exempted any pharmacy vendors from competitive price criteria and allowable reimbursement levels, and if so, confirmation that these pharmacies provide only exempt infant formula and/or WIC-eligible medical foods as defined in section 246.2 of the WIC regulations; and 7. The data specified in Tables 2-4 to demonstrate that the State agency’s methodologies for establishing and implementing competitive price criteria and allowable reimbursement levels are achieving the required outcomes. The State agency also may provide additional data, if desired. 8. A copy of the report that the State agency will use to monitor average payments to above-50-percent vendors compared to average payments to regular vendors. Every State agency that chooses to authorize any above-50-percent vendors must have a means of monitoring average monthly redemptions to such vendors as compared to comparable vendors. FNS expects that each State agency will generate a report or other appropriate monitoring tool for this purpose. Attach a copy of the report(s) that the State agency plans to use to verify that its allowable reimbursement levels are operating effectively. 23 through their guidance portal, except to establish historical facts. incorporated into a contract. USDA may not cite, use, or rely on any guidance that is not available Guidance documents lack the force and effect of law, unless expressly authorized by statute or

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Table 3: Data for WIC Vendor Cost Containment Certification – Peer Group Structure Please describe all vendor peer groups and identify the regular vendors that are comparable to each group of above-50-percent vendors. Insert lines for additional peer groups, as necessary. The information provided should describe the peer group system as structured to comply with the new vendor cost containment requirements. Peer Group Comparable Vendors Peer Group Number (6) No. (1) Description (e.g., supermarkets, chain stores, pharmacies) (2) Number of Vendors in Peer Group Regular Vendors (3) Above-50% Vendors (4) Total (5) 1 2 3 4 Instructions: Column 1 – Assign a sequential number to each peer group. Column 2 – Describe the vendors in the peer group. Column 3 – Insert the number of authorized vendors that are regular vendors. Column 4 – Insert the number of above-50-percent vendors currently authorized. Column 5 – Insert the total number of authorized vendors. This number should be the sum of columns 3 and 4, since the State agency must identify each vendor as being either a regular vendor or an above-50-percent vendor. Column 6 – For each peer group that contains above-50-percent vendors, insert the number of the peer group that contains comparable regular vendors. The comparable vendor peer group is the peer group that the State agency uses to derive the competitive price criteria and maximum reimbursement levels that it applies to the above-50-percent vendors. If above-50-percent vendors are placed in a peer group with regular vendors, then the number in column 1 should be the same as that in column 6. If above-50-percent vendors are in separate peer groups, then the number in column 1 will be different from that in column 6. 25 through their guidance portal, except to establish historical facts. incorporated into a contract. USDA may not cite, use, or rely on any guidance that is not available Guidance documents lack the force and effect of law, unless expressly authorized by statute or

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Table 4: Data for WIC Vendor Cost Containment Certification – Average Payments to Vendors Using the format below, provide the latest redemption data for the ten (10) most frequently redeemed food instrument types. Then indicate how these amounts have changed or will change with the implementation of the revised competitive price criteria and allowable reimbursement amounts. Prepare a separate chart for each group of above-50-percent vendors identified in Table 3. Chart for: Above-50-Percent Vendors in Peer Group No.______ Food Instrument Number of Food Average Redemption Price and Standard Deviation Per Food Instrument for (Insert Month and Year) Difference in Average Redemption Amount Between Average Redemption Price Per Food Instrument for (Insert Month and Year) Type/Number and Description (1) Instruments Redeemed (2) Above-50% Vendors (3) Comparable Regular Vendors (4) Above-50% Vendors and Comparable Regular Vendors (5) Above-50% Vendors (6) Comparable Regular Vendors (7) Price Std. Dev. Price Std. Dev. Instructions: Begin by identifying the above-50-percent vendors to which the data in the chart refer. Insert the peer group number for the above-50-percent vendors and write it on the line at the top of the chart. All data in the chart should pertain only to the above-50-percent vendors in the peer group and the comparable regular vendors. Complete a separate chart for each group of above-50-percent vendors and comparable regular vendors identified in Table 3. Column 1 – Insert the food instrument (FI) type or number and list the foods included on the FI. Include no more than two infant formula food instrument types, but complete the chart using the next most frequently redeemed food instrument types. Column 2 – For each type of FI identified in column 1, insert the number of food instruments redeemed (paid) in the calendar month. The data in this column must apply to a month prior to the implementation of new competitive price criteria and allowable reimbursement levels. . Columns 3 & 4 – Insert the average food instrument redemption amount (or mean) and the standard deviation for the above-50-percent vendors and for the regular vendors that the State agency has identified in the chart for Table 3 as comparable vendors. 26 through their guidance portal, except to establish historical facts. incorporated into a contract. USDA may not cite, use, or rely on any guidance that is not available Guidance documents lack the force and effect of law, unless expressly authorized by statute or

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9. If the State agency does not have such a report, describe the State agency’s plans to develop and implement a report for monitoring average food instrument redemption amounts of above-50-percent vendors and comparable vendors. Include target dates for implementation, a description of the report contents or fields, and any other relevant information. 10. An explanation and illustration of the methodology the State agency uses to calculate and compares average payments per food instrument for above-50-percent vendors and regular vendors. Notification of Certification Upon receipt of the State agency’s request for certification, the FNS Regional Office will review the information submitted and any other relevant data to determine whether the State agency’s competitive price criteria and allowable reimbursement levels established pursuant to sections 246.12(g)(4)(i)(A) and (C) do not result in higher average payments per food instrument to above-50-percent vendors than to comparable regular vendors. If FNS determines that the State agency’s competitive price criteria and allowable reimbursement levels meet this requirement, then FNS will notify the State agency that it has received certification. If the State agency fails to demonstrate that its methodology for establishing and implementing competitive price criteria and allowable reimbursement levels meets the requirement of section 246.12(g)(4)(vi), then FNS will disapprove the State agency’s request for certification. A State agency that fails to receive certification will be required to take the following corrective action until certification is received: 1. After December 30, 2005: a. May not authorize any new above-50-percent vendors unless such vendors are needed for participant access; and b. May not pay above-50-percent vendors more on average than the State agency pays regular vendors for each food instrument (by type). The average payment to regular vendors must be calculated without using data from any above-50 percent vendors. State agencies that have authorized any regular vendors that do not meet competitive price criteria, but are required for participant access, must lower the maximum reimbursement levels for regular vendors to competitive price levels and establish separate reimbursement limits for non-competitively-priced vendors authorized for access reasons. This is to prevent the inflation of maximum reimbursement levels for all vendors. 28 through their guidance portal, except to establish historical facts. incorporated into a contract. USDA may not cite, use, or rely on any guidance that is not available Guidance documents lack the force and effect of law, unless expressly authorized by statute or

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Figure 1: WIC Vendor Cost Containment Certification Corrective Action Plan Does the SA intend to authorize above 50% vendors? Yes No

i i i State agency must obtain certification from FNS by Dec. 30, 2005, for its competitive price and allowable reimbursement policies. If certification is not received by Dec. 30, 2005, the State agency must not: 1) Authorize any new above-50% vendors after Dec. 30th unless needed for participant access; and 2) May not pay above-50-percent vendors more on average than the statewide average payment to regular vendors for each food instrument (by type). In calculating the statewide average payment, the State agency must exclude payments to above-50% vendors. The State agency may, if it chooses, exclude payments to non- competitively priced regular vendors (i.e., vendors that do not meet competitive price criteria, but are needed to ensure adequate participant access). By June 30, 2006, the State agency must have established peer groups consistent with FNS requirements (unless an exemption has been granted). FNS certification is not required. The State agency must comply with all other vendor cost containment requirements, including those related to the vendor peer group system, competitive price criteria, and allowable reimbursement levels. By Dec. 30, 2005, if the State agency has not made all of the changes needed to implement the requirements, it must identify the changes that are needed to comply fully with all vendor cost containment requirements. By June 30, 2006, as part of its corrective action, the State agency must have established vendor peer groups consistent with regulatory requirements, unless FNS has granted an exemption. By Sep. 30, 2006, to complete corrective action, the State agency must the have established acceptable peer groups, competitive price criteria and appropriate reimbursement methods and obtained FNS approval of all related policies and procedures. By Sep. 30, 2006, the State agency must have established acceptable peer groups, competitive price criteria and appropriate reimbursement methods, including methods to ensure that overall cost neutrality will be achieved, and obtained FNS approval of all related policies and procedures. 30 through their guidance portal, except to establish historical facts. incorporated into a contract. USDA may not cite, use, or rely on any guidance that is not available Guidance documents lack the force and effect of law, unless expressly authorized by statute or

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ASSESSING THE COST NEUTRALITY OF ABOVE-50-PERCENT VENDORS This section provides guidance for State agencies that have received certification to authorize above-50-percent vendors under section 246.12(g)(4)(vii) of the Interim Rule and for those seeking such certification, on computing average food instrument payments for the purpose of monitoring redemptions to above-50-percent vendors and regular vendors. It also contains instructions for determining whether above-50-percent vendors are cost neutral to the program (i.e., whether they cost the program no more than if participants had used regular vendors). Calculating Average Food Instrument Payments To meet the cost neutrality requirement in section 246.12(g)(4)(i)(D) of the Interim Rule, the State agency must calculate the average redemption amounts for food instruments (by type) redeemed by regular vendors and above-50-percent vendors. The State agency must add the redemption amounts for all redeemed food instruments (or a representative sample of redeemed food instruments) of the same type and divide the sum by the number of food instruments of that type. If the State agency does not designate food instruments by type, it must calculate the average payment for each distinct combination of foods prescribed, by type and quantity, on the food instrument. On a quarterly basis, if the average price of the food instruments redeemed at regular vendors is equal to or greater than the average price of food instruments redeemed at above-50-percent vendors, then the State agency has achieved cost neutrality. At least quarterly, the State agency must compute statewide average costs per food instrument (or per food item) to monitor compliance with the overall cost neutrality requirement in section 246.12(g)(4)(i)(D) of the Interim Rule. The State agency must use the results of the quarterly assessment to make any necessary adjustments in its competitive price criteria and/or maximum reimbursement levels in order to ensure cost neutrality for the next quarterly and ultimately for the fiscal year. The State agency shall maintain for periodic review by FNS the results of its quarterly assessment of payments to above-50-percent vendors as compared to payments to regular vendors. Any State agency that is interested in calculating average food instrument payments based on a representative sample of food instruments (section 246.12(g)(4)(vi) of the Interim Rule), rather than all food instruments must submit a description of its proposed sampling procedure to FNS for review prior to its implementation. A representative sample is a randomly selected sample of a population that is large enough to make inferences or draw conclusions about the characteristics of that population. Each sample of food instruments must be such that all types of food instruments (e.g., pregnant woman, postpartum woman, breastfeeding woman, infant, child, etc.) are proportionately represented. Because of the complexity of conducting a true representative sample, FNS generally would not recommend that State agencies employ this procedure. The State agency must calculate average payments for every type of food instrument (or combination of food items, or individual food items) redeemed by both above-50-percent vendors and regular vendors. The State agency must include all food instruments in its assessment of cost neutrality, except the following: 31 through their guidance portal, except to establish historical facts. incorporated into a contract. USDA may not cite, use, or rely on any guidance that is not available Guidance documents lack the force and effect of law, unless expressly authorized by statute or

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a. Food instruments (by type) that were redeemed by regular vendors only. b. Food instruments (by type) that were redeemed by above-50-percent vendors only. The State agency must include the total dollar value of these food instruments in its report to FNS. c. At State agency option, food instruments redeemed by vendors (above-50-percent and/or regular vendors) whose shelf prices exceeded the competitive price criteria and that were authorized to meet participant access needs. The State agency must include the total dollar value of the food instruments redeemed by these vendors in its report to FNS. d. Food instruments redeemed by pharmacy vendors that supply only exempt infant formula and/or WIC-eligible medical foods, if the State agency has exempted these vendors from competitive price criteria and allowable reimbursement levels. e. Food instruments redeemed by non-profit vendors that the State agency has exempted from competitive price criteria and allowable reimbursement levels. If any quarterly assessment shows that average payments per food instrument to above-50 percent vendors exceed average payments per food instrument to all regular vendors, the State agency must take action to ensure compliance at the beginning of the next quarterly period. Such action includes adjusting competitive price criteria and maximum reimbursement levels. It is critical to complete the quarterly assessment at or prior to the beginning of the next quarter, even if this means using less than three months of redemption data, in order to effect any needed change at the start of the next quarter. No adjustments to payments previously provided to vendors or termination of vendors whose payments were within the maximum allowable amounts established by the State agency shall occur as a result of the findings of the assessment of cost neutrality. FNS Assessment of Cost Neutrality FNS will assess cost neutrality through management evaluation reviews and through other information available from the State agency. If FNS determines that a State agency has properly assessed cost neutrality, in accordance with the procedures set forth in the Interim Rule and this guidance, has conducted such assessments on a quarterly basis, and has adjusted competitive price criteria and maximum reimbursement levels each quarter, if necessary, then FNS will deem the State agency to have achieved cost neutrality. FNS will assess a claim against a State agency and/or take other administrative action if it determines that the State agency has failed to properly assess cost neutrality, failed to conduct cost neutrality assessments on a quarterly basis, and/or has failed to take action, if necessary for any quarter, to achieve compliance at the beginning of the next quarterly period. 32 through their guidance portal, except to establish historical facts. incorporated into a contract. USDA may not cite, use, or rely on any guidance that is not available Guidance documents lack the force and effect of law, unless expressly authorized by statute or

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VENDOR PEER GROUPS Section 246.12(g)(4) of the Interim Rule requires State agencies to establish a vendor peer group system (unless they are specifically exempted from the requirement) and to distinguish above-50-percent vendors from other vendors in the peer group system. Beyond these general requirements, the rule gives State agencies broad latitude to develop vendor peer group systems to meet their individual circumstances. Data obtained by FNS indicate that many State agencies already have vendor peer groups and most use two or more criteria to establish peer groups. The data also reveal that some State agencies could achieve greater cost containment by making modest changes to the structure of their vendor peer groups. This section of the Guidance considers various aspects of peer group development to assist State agencies in identifying areas for improvement. It also explains a new requirement that State agencies must use at least two criteria to designate peer groups, one of which must be a measure of geography. The Benefit of Using Vendor Peer Groups The use of peer groups is based on the philosophy that vendors with certain shared characteristics may be expected to have similar business practices and prices. For example, supermarkets operate under a similar business model that depends on a low-margin, low-price strategy that requires high sales volume to generate profits. Supermarkets typically compete with other supermarkets. In contrast, lower volume, higher cost neighborhood grocery stores typically do not compete with supermarkets on price. Rather, they offer convenient location and often longer business hours in order to generate sales. Although some degree of competition may exist between a local supermarket and a neighborhood grocery store, they are most likely to compete with other similar stores. Thus, by grouping vendors together based on these characteristics, a State agency can more easily identify the competitive price range for WIC foods and differentiate between vendors whose prices fall within or outside of this range. The use of different peer groups results in greater cost containment than if State agencies used a statewide competitive price range and maximum reimbursement level for all vendors because they allow State agencies to determine the competitive price range and, as a result, the maximum reimbursement levels that are appropriate to specific vendor types. Additionally, grouping vendors by type can constrain price increases and prevent all peer groups from raising prices to a statewide maximum. State agencies must establish competitive price criteria and maximum reimbursement levels for each vendor peer group in accordance with sections 246.12(g)(4) of the Interim Rule.6 As a general rule, the use of statewide competitive price criteria and maximum allowable reimbursement amounts for all peer groups is not permitted, unless the State agency has demonstrated the appropriateness of this practice in obtaining an exemption from the vendor peer group requirement. 6 In some instances, a State agency might need to apply statewide competitive price criteria and maximum reimbursement amounts to above-50-percent vendors in order to achieve cost neutrality. Additionally, the use of statewide competitive price criteria and maximum reimbursement levels might be appropriate for some ITOs and geographic State agencies with very few vendors. 33 through their guidance portal, except to establish historical facts. incorporated into a contract. USDA may not cite, use, or rely on any guidance that is not available Guidance documents lack the force and effect of law, unless expressly authorized by statute or

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EXEMPTION FROM THE VENDOR PEER GROUP SYSTEM REQUIREMENT Regulatory Provision Section 246.12(g)(4)(v) of the Interim Rule authorizes FNS to grant a State agency an exemption from the requirement to establish a vendor peer group system under the following two conditions: 1. The State agency elects not to authorize any above-50-percent vendors and demonstrates to FNS that establishing a vendor peer group system would be inconsistent with the efficient and effective operation of the program, or that the State agency’s alternative cost containment system would be as effective as a peer group system; or 2. The State agency authorizes above-50-percent vendors whose WIC redemptions comprised less than five percent of the total WIC redemptions (dollars) in the year preceding a year in which the exemption is effective. (For example, total redemptions for above-50-percent vendors in fiscal year 2005 must be less than five percent of total redemptions in order for a State agency to qualify for an exemption from the peer group system requirement in fiscal year 2006.) The State agency also must demonstrate that its alternative vendor cost containment system would be as effective as a vendor peer group system and would not result in higher costs if program participants transact their food instruments at above-50-percent vendors rather than at regular vendors. Requesting an Exemption A State agency that requests an exemption from the vendor peer group system must demonstrate to FNS that it meets one of the conditions in section 246.12(g)(4)(v) of the Interim Rule by submitting the following information: 1. A State agency that elects not to authorize any above-50-percent vendors must submit written documentation that: a. Confirms that the State agency has assessed all authorized vendors and new vendor applicants and determined that it (1) does not currently authorize any above-50-percent vendors; and (2) has established policies and procedures to prevent authorization of any new vendor applicants that are expected to be above-50-percent vendors, and to terminate the vendor agreement with any authorized vendor that is determined to be an above-50-percent vendor subsequent to authorization; b. Describes the State agency’s alternative vendor cost containment system, including how the system ensures that the State agency— (1) Authorizes vendors that offer competitive prices for supplemental foods compared to currently authorized vendors and other vendor applicants; and 38 through their guidance portal, except to establish historical facts. incorporated into a contract. USDA may not cite, use, or rely on any guidance that is not available Guidance documents lack the force and effect of law, unless expressly authorized by statute or

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(2) Reimburses vendors subsequent to authorization at levels that are consistent with the competitive price criteria applied to the vendor at authorization. c. Demonstrates either of the following: (1) That implementing a peer group system would be inconsistent with the efficient and effective operation of the program. For example, a State agency might explain that it has too few authorized vendors to establish effective peer groups or that the degree of variability in food prices and types of vendors is so minimal that the costs of implementing a vendor peer group system would outweigh any potential benefits to the program. (2) That its alternative vendor cost containment system would be as effective as a peer group system. The State agency must explain how it applies competitive price requirements to currently authorized vendors and new vendor applicants under its alternative cost containment system. The State agency’s submission should include relevant data (such as current redemption data) and documents (e.g., excerpts from the vendor agreement that describe competitive price requirements and terms of reimbursement) to support its case. 2. A State agency that elects to authorize any above-50-percent vendors must submit written documentation that: a. Substantiates that fiscal year 2005 redemptions to above-50-percent vendors authorized by the State agency comprised less than five percent of the total WIC redemptions in fiscal year 2005. (Redemption data will apply to the year prior to the year for which the State agency requests an exemption.) This shall include the total dollar amount and percent of redemptions to above-50-percent vendors and the total amount of redemptions to all WIC vendors; b. Demonstrates that the State agency has an effective process for monitoring the percent of redemptions to above-50-percent vendors on a monthly basis to ensure that this percentage remains less than five percent on average; and c. Demonstrates that the State agency’s alternative cost containment system would be as effective as the vendor peer group system and would not result in higher food costs if program participants redeem food instruments at above-50-percent vendors rather than at regular vendors. The State agency shall apply the weighted mean methodology described on page 16 of this guidance to assess whether or not above-50-percent vendors result in higher costs to the State agency than regular vendors. The justification must explain how the State agency applies competitive price criteria and allowable reimbursements levels to currently authorized vendors and new vendor applicants; and include the average payments that the State agency makes to above-50-percent vendors and to regular vendors for either the 39 through their guidance portal, except to establish historical facts. incorporated into a contract. USDA may not cite, use, or rely on any guidance that is not available Guidance documents lack the force and effect of law, unless expressly authorized by statute or

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standard food packages or the ten most frequently issued food instrument types for women, infants, and children. As a guide to preparing the request for an exemption from the vendor peer group requirement, the State agency should refer to Attachment 6, Preparing a Request for Exemption from the Peer Group Requirement, and Attachment 7, Worksheet for Assessing Statewide Maximum Reimbursement Amount. Due Date of the Request for Exemption Since State agencies must be in compliance with the vendor peer group requirement by September 30, 2006, a State agency that desires to be exempted from the peer group system requirement in fiscal year 2006 should submit its request for exemption to FNS in ample time to permit initial review and, when necessary, followup on the request if additional information is required. FNS will review the information submitted by the State agency and determine whether the State agency qualifies for an exemption. A State agency that obtains an exemption from the peer group requirement still must implement competitive pricing criteria for vendor selection and allowable reimbursement levels to limit payments to vendors. After fiscal year 2006, a State agency may submit its request for an exemption for the peer group requirement at any time during the year or as part of its State Plan. Term of an Exemption An exemption from the peer group requirement would remain in effect: until the State agency no longer meets the condition in section 246.12(g)(4)(v) on which the exemption was based; until FNS revokes the exemption; or for three years, whichever occurs first. During the period of the exemption, the State agency must provide to FNS annually in the State Plan documentation that it either authorizes no above-50-percent vendors, or that such vendors’ redemptions continue to represent less than five percent of total WIC redemptions. State agencies that authorize above-50-percent vendors also should be able to demonstrate that these vendors are cost neutral to the program. 40 through their guidance portal, except to establish historical facts. incorporated into a contract. USDA may not cite, use, or rely on any guidance that is not available Guidance documents lack the force and effect of law, unless expressly authorized by statute or

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United States Department of Agriculture Food and Nutrition Service 3101 Park Center Drive Alexandria, VA 22302-1500 May 20, 2011 SUBJECT: WIC Policy Memorandum 2011-5 WIC Nutrition Risk Criteria TO: Regional Directors Supplemental Food Programs All Regions WIC State Agency Directors All Regions I. PURPOSE This policy memorandum describes nutrition risk eligibility in the Special Supplemental Nutrition Program for Women, Infants and Children (WIC), and explains the requirements of the use and management of the Food and Nutrition Se1vice (FNS)-issued nutrition risk criteria by WIC State agencies. It reinforces that State agencies must use the FNS criteria as a part of the certification process, and it outlines the process for updating and revising the criteria and related information. This memorandum consolidates and replaces all previous versions to, and reorganizes and reiterates the narrative body of, WIC Policy Memorandum #98-9, Nutrition Risk Criteria, issued by FNS on June 29, 1998. II. BACKGROUND A. History of WIC Nutrition Risk Requiring nutrition risk as an eligibility criterion is a unique feature of WIC. In addition to meeting categorical, income, and residency requirements, each WIC applicant must be determined to be at nutrition risk on the basis of a medical or nutrition assessment by a physician, nutritionist, dietitian, nurse, or some other competent professional authority (CPA), in order to be certified as a WIC participant. For nearly 25 years after the WIC Program was established, Federal policy permitted WIC State agencies to develop criteria, within broad Federal parameters, for use in their local programs to determine program eligibility. In 1989, the Child Nutrition and WIC Reauthorization Act (Public Law 101-147) mandated that the Department of Agriculture (USDA) conduct a review of risk criteria and the priority system. The purpose of this review was to ensure that WIC benefits were being provided to those most in need of them, in the event that funds were not available to serve all eligible program applicants. As a result of the variation in nutrition risk criteria among State agencies, the USDA awarded a grant in 1993 to the National Academy of Sciences' Institute of through their guidance portal, except to establish historical facts. incorporated into a contract. USDA may not cite, use, or rely on any guidance that is not available Guidance documents lack the force and effect of law, unless expressly authorized by statute or

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Regional and State Directors Page 2 Medicine (IOM) to undertake a comprehensive, independent review of the criteria in use by WIC State agencies at that time. In 1996, IOM released its report titled WIC Nutrition Risk Criteria: A Scientific Assessment (referenced in this memo as the IOM Nutrition Risk Report). The report included a detailed review of the literature underlying each studied risk criterion, along with the Committee's recommendations concerning each criterion. B. Risk Identification and Selection Collaborative As a result of the 1996 IOM Nutrition Risk Report, FNS and the National WIC Association (NWA) known at that time as the National Association of WIC Directors, established a collaborative partnership to address the issues and recommendations in the Report, and to develop an action plan to achieve greater consistency among WIC State agencies in the use and application of sound and appropriate nutrition risk criteria. The Risk Identification and Selection Collaborative (RISC) was created to manage the transition from this initial effort to an ongoing review process. RISC is charged with revising currently-allowed and adding new WIC nutrition risk criteria. Such criteria must be based on sound science, practical for WIC application, and nutritionally linked or related to the nutrition services provided by WIC. RISC also periodically reviews allowed criteria to identify criteria that should be deleted because they are no longer supported by current science and research; or represent conditions that cannot be mitigated, controlled, or eliminated as a result of receiving WIC nutrition services (food packages, referrals, nutrition education/counseling, and breastfeeding promotion and support). RISC membership includes NWA-appointed State and local agency staff along with FNS Headquarters and Regional Office staff. All RISC members are involved in the deliberation, development and composition of the criteria and guidelines. This allows for representative WIC State and local agency input at eve1y step in the development process for nutrition risk criteria. C. Nutrition Risk Criteria and Nutrition Assessment Policy Section 17(b)(8) of the Child Nutrition Act of 1966, as amended (the law that established and authorizes the WIC Program) broadly defines nutrition risk as "(a) detrimental or abnormal nutritional conditions detectable by biochemical or anthropometric measures, (b) other documented nutritionally related medical conditions, (c) dietary deficiencies that impair or endanger health, or (d) conditions that predispose persons to inadequate nutritional patterns or nutritionally related medical conditions." This legislative definition is implemented at Section 246.7 (e)(2) of the Federal WIC regulations. The Value Enhanced Nutrition Assessment (VENA) Guidance established standards for the nutrition assessment process used to determine WIC eligibility. In addition, WIC Policy Memorandum #2006-5: VENA - WIC Nutrition Assessment Policy (issued March 15, 2006) further explained that the nutrition assessment serves as the foundation on which other through their guidance portal, except to establish historical facts. incorporated into a contract. USDA may not cite, use, or rely on any guidance that is not available Guidance documents lack the force and effect of law, unless expressly authorized by statute or

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Regional and State Directors Page 3 nutrition services (food packages, referrals, nutrition education/counseling, and breastfeeding promotion and support) are planned and provided. In order to facilitate this VENA principle, as individual criteria are revised, criteria write-ups will contain a section titled "Implications for WIC Nutrition Services". This section will describe how a given risk criterion is nutritionally linked to and has application for the nutrition services WIC provides to mitigate a given nutritional risk. III. ISSUANCE AND DISSEMINATION OF NUTRITION RISK CRITERIA Historically, specific risk criteria revisions, additions, or deletions have been issued via numbered policy; however, this will no longer be the process. In 2008, in an effort to improve communication and technical assistance to FNS Regional Offices and WIC State agencies, FNS began using SharePoint® software via its PartnerWeb to disseminate and communicate policy and guidance information. FNS will use the PartnerWeb to disseminate all nutrition risk related information. When criteria are revised, removed, or added, the current index of allowable and not-allowable criteria (along with any other applicable appendices) will be posted to the Nutrition Risk section of the PartnerWeb community for WIC State agencies. The site will contain historical information, such as previous versions of policy memos and criteria write-ups, as well as directions for proposing a new risk criterion or criterion revision. In addition, technical information and expert reports will be available on the site. Some criteria have been determined by FNS to be inappropriate or lack sufficient science-based evidence for use in certifying persons for the WIC Program. Although some of these criteria may be considered to be nutritionally related, they do not reflect conditions that can be accurately assessed or effectively addressed through the nutrition services provided through the WIC Program. Only risk criteria on the Index of Allowable Criteria may be used to certify WIC applicants. The dissemination of new and/or revised criteria through PartnerWeb is more streamlined and flexible than previous processes for the issuance of revisions to nutrition risk criteria to WIC State agencies. This process will allow FNS to issue nutrition risk revisions on an as-needed basis, but generally once or twice a year. When criteria are added, revised, or deleted, an announcement will be posted to the FNS PartnerWeb indicating that updates to the nutrition risk section have been posted. The FNS PartnerWeb community for WIC State agencies can be accessed at https:// www.partnerweb.usda.gov/default.aspx. IV. IMPLEMENTATION WIC State agencies are expected to implement any revised and new nutrition risk criteria they plan to adopt and to remove any that have been determined to be no longer allowable for use, by the implementation date specified on the transmittal memorandum that will be through their guidance portal, except to establish historical facts. incorporated into a contract. USDA may not cite, use, or rely on any guidance that is not available Guidance documents lack the force and effect of law, unless expressly authorized by statute or

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Regional and State Directors Page 4 Published on the PartnerWeb. In general, State agencies will have a minimum of one fiscal year to implement the revisions based on the date they are published to the FNS PartnerWeb. If a WIC State agency is unable to meet the implementation date for the addition or modification of a new/revised nutrition risk criterion, it must submit a request for an extension and a timeline for implementation to the appropriate FNS Regional Office. Regional Offices may extend the deadline, within reasonable limits, on an individual case basis, depending on the circumstances of the State agency. Long-term extension requests (more than 6 months) must receive concurrence from FNS Headquarters staff in the Supplemental Food Programs Division. V. STATE AGENCY APPLICATION OF NUTRITION RISKCRITERIA A. Reflective of Current/Recent Status For all allowed nutrition risk criteria, the documented risk condition must apply to an applicant's current or most recent nutrition risk condition, as opposed to any history of the condition, unless otherwise stated in the specific definition of the nutrition risk criterion. B. Self Report of a Physician' s Diagnosis Section 246.7(i)(8) of the Federal WIC Program regulations requires the State agency to ensure that appropriate documentation is included in the applicant's WIC certification records to substantiate the nutrition risk condition(s) used to certify the applicant, and to validate conformance with the definition of nutrition risk condition(s). Some nutrition risk criteria, specified in the definition of each criterion, as appropriate, allow an applicant or caregiver to tell the CPA at the local WIC office (self-report) that the applicant has a condition that was diagnosed by a physician. Self-reporting of a diagnosis by a physician or other recognized medical authority should not be confused with self-diagnosis, where a person simply claims to have or have had a medical condition, without any reference to professional diagnosis of that condition. A self-reported medical diagnosis should prompt the CPA to validate the presence of the condition by asking more probing questions related to the self-repo1ted professional diagnosis, suchas: • Whether the condition is being managed by a medical professional; • The name and contact information for that medical professional (to allow communication and verification if necessary); • Whether it is being controlled by diet, medication, or other therapy; and • What types of medications, if any have been prescribed, rule being taken to address the condition. through their guidance portal, except to establish historical facts. incorporated into a contract. USDA may not cite, use, or rely on any guidance that is not available Guidance documents lack the force and effect of law, unless expressly authorized by statute or

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--- Regional and State Directors Page 5 For example, if a postpartum woman reports that she is experiencing mood swings, feelings of sadness and sleep disturbances - symptoms associated with postpartum depression - she should not automatically be assigned the risk criterion #361 Depression. If, upon further questioning, the CPA determines the woman has been medically diagnosed and is being treated for depression, it is appropriate to assign risk criterion #361 Depression. In those instances, when with additional questioning it is determined that the condition has not been diagnosed by a medical provider; the risk criterion may not be assigned. Although a risk may not be assigned based on a self-diagnosis (i.e., without a medical diagnosis), it is appropriate for WIC staff to provide referral services to participants who report having symptoms so that a medical provider can confirm or rule out the presence of a medical condition. Self-reporting for "History of..." conditions should be treated in the same manner as self- reporting for current conditions requiring a physician's diagnosis, i.e., the applicant may report to the CPA that s/he was diagnosed by a physician with a given condition at some point in the past. As with current conditions, self-diagnosis of a past condition should never be confused with self- reporting. C. Alternative to a Physician's Diagnosis When a criterion requires the formal diagnosis of a physician, or alternatively, a person working under a physician's orders, this alternative is intended to be applied only to those persons working directly with the physician, i.e. physician's assistant, nurse practitioner, or other State recognized medical authority. This alternative is intended to facilitate access to referral data from private physicians, by permitting their nurses or physician’s assistants to provide the necessary documentation without the WIC applicant having to spend the time or money for the actual physician to provide it. Non-traditional health care providers such as shamans, medicine men or women, acupuncturists, chiropractors, or holistic health advisors are not considered to be physicians whose diagnoses can be accepted for purposes of this policy or for establishing the eligibility of an applicant for WIC Program benefits. D. Case File Documentation Section 246.7(e)(l) of the WIC Program regulations require that every certified applicant's case file contain the specific condition(s) for which the applicant was found to be eligible to receive Program benefits. It must be possible, when reviewing a case file, to identify the specific condition(s) for which the applicant was determined to be at nutrition risk for WIC eligibility, certification and nutrition education purposes. FNS has established minimum and follow-up documentation requirements in WIC Policy Memorandum #2008-4, WIC Nutrition Services Documentation. In addition, this policy memorandum identifies the through their guidance portal, except to establish historical facts. incorporated into a contract. USDA may not cite, use, or rely on any guidance that is not available Guidance documents lack the force and effect of law, unless expressly authorized by statute or

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Regional and State Directors Page 6 purpose, necessary elements and outcomes for nutrition services documentation in the WIC Program. In some circumstances, it may be appropriate to request that the applicant or parent/caregiver complete and sign a consent form, so that WIC staff can communicate with the applicant's health care provider. This consent would allow the collection of pertinent medical or dietary information to support the nutrition risk determination, and to assist the WIC CPA in developing the nutrition care plan for the participant. Related to case file documentation, if a participant transfers in from another State or local agency and presents a valid Verification of Certification card containing information on the nutrition risk(s) used to certify the participant in the previous location, it is not necessary to reassess at the new agency. For more information on how to handle transfer of certification, please see nutrition risk criterion #502 Transfer of Certification, FNS Instruction 803-11 Rev. I-Verification of Ce1tification (VOC) and Section 246.7 (k) of the Federal WIC Regulations. E. Use of Referral Data for Professionally Diagnosed Nutrition Risk Conditions Every effort has been made to establish the cut-offs/thresholds in the list of allowed criteria based on prevailing scientific data; therefore, a reasonable assumption is made that the medical/health community routinely uses compatible and comparable thresholds and criteria for medical diagnosis. A referral diagnosis from a physician or other health care professional documenting an allowed WIC nutrition risk criterion may thus be assumed to meet the stipulated definition, cut-off or threshold of the applicable criterion. For example, a physician's referral diagnosis of infant prematurity could be used at face value by WIC staff to certify for nutritional risk, without further review or validation against the definition for risk criterion #311 History of preterm delivery. The acceptability of referral data from physicians and other health care professionals doesnot eliminate the regulatory requirement for documentation of anthropometric and biochemical assessment data (height, weight, and hematocrit/hemoglobin levels) in each participant's file. F. State Agency Modifications to Risk Criteria Designations State agencies may use the groupings, names, and numbers provided on the allowable index, or they may regroup, rename or renumber allowed risk criteria. A State agency may also use more restrictive criteria, revise the units of measure, or choose not to use certain criteria at all. through their guidance portal, except to establish historical facts. incorporated into a contract. USDA may not cite, use, or rely on any guidance that is not available Guidance documents lack the force and effect of law, unless expressly authorized by statute or

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Regional and State Directors Page 7 State agencies choosing to group, name, or number individual criteria differently from the way they are issued must include in their State Plans a clear cross-reference between the FNS allowable criteria and the State agency's classification system. A State agency may also revise the units of measure as long as the revisions are equivalent (or more restrictive than) the thresholds established in the definition. A State agency may not change the definition(s) or cut-off values of the allowable risk criteria, unless such changes result in a more stringent definition or criterion than that issued by FNS. Local agency CPA's may encounter isolated incidents of diseases or illnesses that meet the definition for a given criterion - that is, the condition in question sufficiently interferes with food consumption or nutrient absorption, or compromises nutritional status to justify its addition as a condition to establish WIC Program eligibility - but are not specifically included in the list of examples provided in the risk criterion's definition. For example, a CPA might assign Huntington's disease to Risk #348 Central Nervous System Disorders. The condition meets the definition of a central nervous disorder and can therefore be assigned. In specific localities or regions, a State agency may observe a more frequent incidence of such a condition not included on the list in the criterion's definition. In such cases, the State agency may amend its risk criterion accordingly to include the condition, after obtaining concurrences and approval from the FNS Regional Office. All State agency modifications to nutrition risk criteria (outside of the regular State Plan submission schedule) must be submitted to the Regional Office for approval prior to implementation, along with a justification supporting the proposed modification. Such a modification is typically submitted as a State Plan amendment, which includes amendments to a State agency’s Policy and Procedures Manual or Handbook, which is part of the official State Plan of Operations. G. WIC Participant and Program Characteristics (PC) Reporting Nutrition risk reporting is part of the minimum data set for the biennial PC studies. State agencies are asked to report all risk criteria identified (up to a maximum of 10). State agencies that provide data using their own coding schemes will need to provide a crosswalk or index between their codes and the Federal nutrition risk codes. through their guidance portal, except to establish historical facts. incorporated into a contract. USDA may not cite, use, or rely on any guidance that is not available Guidance documents lack the force and effect of law, unless expressly authorized by statute or

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USDA .... ~ March 15, 2006 United States Department of Agriculture SUBJECT: Final WIC Policy Memorandum #2006-6 Vendor Cost Containment Interim Rule Clarification Food and Nutrition Service TO: Regional Directors 3101 Park Supplemental Food Programs Center Drive All Regions Alexandria, VA 22302-1500 This policy memorandum updates the guidance provided in Final WIC Policy Memorandum #2006-4, dated January 11, 2006, regarding the implementation of the WIC Vendor Cost Containment Interim Rule, published in the Federal Register on November 29, 2005, at 70 FR 71708. On February 23, 2006, the U.S. District Court for the District of Columbia dismissed the lawsuit filed by the National Women, Infants, and Children Grocers Association (NWGA) and other plaintiffs to halt implementation of the Interim Rule. The court also vacated the temporary restraining order of December 29, 2005, which had enjoined the Food and Nutrition Service (FNS) from enforcing two provisions of the Interim Rule. The court’s decision has cleared the way for us to provide further instructions and clarifications regarding corrective actions State agencies must take in order to be in compliance with the Interim Rule by September 30, 2006. State Agency Responsibility to Comply with the Interim Rule All State agencies should be moving forward with efforts to implement all applicable provisions of the Vendor Cost Containment Interim Rule. By now, all State agencies should have identified above-50-percent vendors and, if they wish to authorize such stores, submitted to FNS a request for vendor cost containment certification. If FNS determines that a State agency has already implemented appropriate competitive price criteria and allowable reimbursement levels, FNS will certify that the State agency’s cost containment methodologies meet regulatory requirements. To obtain certification, the State agency must demonstrate that its competitive price criteria and allowable reimbursement levels do not result in higher average payments per food instrument to above-50-percent vendors than to comparable regular vendors (section 17(h)(11)(E) of the Child Nutrition Act of 1966 (42 U.S.C. 1786(h)(11)(E)) and section 246.12(g)(4)(vi) of the Interim Rule). State agencies that wish to authorize above-50-percent vendors, but have not yet submitted a request for certification should do so as soon as possible, following the instructions contained in the draft Vendor Cost Containment Guidance issued in July 2005. FNS will review the methodologies that a State agency proposes to employ and will approve them or advise the State agency of needed changes. Once FNS approves a State agency’s proposed competitive pricing and allowable reimbursement methodologies, the State agency should implement its plan promptly so that it may receive certification by September 30, 2006. Effective January 1, 2006, all State agencies with above-50-percent vendors were required to compute new maximum allowable reimbursement levels for food instruments considering only the prices of regular vendors, and to ensure that average payments to above-50-percent through their guidance portal, except to establish historical facts. incorporated into a contract. USDA may not cite, use, or rely on any guidance that is not available Guidance documents lack the force and effect of law, unless expressly authorized by statute or

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Regional Directors Page 2 vendors for food instruments (by type) issued on or after January 1 do not exceed average payments to comparable regular vendors. Any State agency that chose to delay this process pending the resolution of the NWGA lawsuit must take steps immediately to comply with this requirement. State agencies that do not have any above-50-percent vendors also should be taking corrective action to implement all relevant provisions of the Interim Rule (i.e., provisions other than those related to above-50-percent vendors) by September 30, 2006. Requests for exemption from the vendor peer group system requirement in the Interim Rule should be submitted to FNS as soon as possible, in order to allow sufficient time for implementation of peer groups if an exemption is not granted. In addition to using the information contained in the draft Guidance on Vendor Cost Containment issued in July 2005, a State agency that intends to request a peer group exemption should obtain from the Regional Office supplemental instructions for submitting data to support the request. Achieving Overall Cost Neutrality Section 246.12(g)(4)(i)(D) of the Interim Rule is intended to implement the statutory requirement that State agencies must ensure that above-50-percent vendors do not result in higher costs to the program than if participants had transacted their food instruments at regular vendors (section 17(h)(11)(A) of the Child Nutrition Act of 1966 (42 U.S.C. 1786(h)(11)(A)). This section of the rule requires State agencies to compare average payments to all above-50-percent vendors to average payments to all regular vendors. If average payments per food instrument to all above-50-percent vendors do not exceed average payments to all regular vendors, then the State will have achieved the required outcome of cost neutrality. The certification process required by section 246.12(g)(4)(vi) of the Interim Rule considers the means by which State agencies achieve this outcome. During the certification process State agencies must demonstrate that their methods for implementing competitive price criteria and allowable reimbursement levels will not result in higher average payments per food instrument to above-50-percent vendors than to comparable regular vendors. State agencies should employ competitive pricing methods and define comparable vendors in a way that will achieve the overall cost neutrality outcome required by section 246.12(g)(4)(i)(D) of the Interim Rule. State agencies are not required to limit payments to above-50-percent vendors more than is necessary to achieve cost neutrality. Some State agencies have asked about acceptable approaches to establishing competitive price criteria and maximum reimbursement levels that will allow them to meet the cost neutrality requirement. The statute allows State agencies to employ a variety of competitive pricing approaches provided that the approach used does not permit average payments to above-50-percent vendors to exceed average payments to regular vendors. This memorandum rescinds the requirement in the December 21, 2005, email message that through their guidance portal, except to establish historical facts. incorporated into a contract. USDA may not cite, use, or rely on any guidance that is not available Guidance documents lack the force and effect of law, unless expressly authorized by statute or

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Regional Directors Page 3 State agencies must apply the same maximum reimbursement levels for above-50-percent vendors and comparable regular vendors. Determining which method best achieves the cost neutrality goal may require some trial and adjustment. Examples of competitive pricing methods that State agencies may employ to meet certification requirements include (1) placing above-50-percent vendors in a peer group by themselves to which the State agency applies statewide competitive price criteria and statewide maximum reimbursement levels applicable to regular vendors; (2) placing all above-50-percent vendors in a single peer group with the regular vendors whose competitive price criteria and maximum reimbursement levels would ensure cost neutrality; and (3) placing above-50-percent vendors in the same peer group as regular vendors, but applying different competitive price criteria and allowable reimbursement levels to the above-50 percent vendors to assure cost neutrality. State agencies also may place above-50-percent vendors in peer groups with comparable regular vendors and apply the same competitive price criteria and allowable reimbursement levels to the above-50-percent vendors and the regular vendors, as long as this achieves overall cost neutrality as defined by section 246.12(g)(4)(i)(D). With respect to the methodologies that State agencies may employ in order to ensure that they meet the overall cost neutrality requirement, State agencies are advised that FNS will not approve a request for certification for a State agency that plans to recoup monies that were paid to a vendor for food instruments redeemed within the established maximum allowable reimbursement level for that vendor. This does not preclude a State agency from making price adjustments to food instruments in accordance with 7 CFR 246.12(h)(3)(viii) of the WIC regulations and recouping amounts paid to the vendor above the established maximum allowable reimbursement rate applicable to the vendor. Assessing Overall Cost Neutrality In an email message dated December 21, 2005, we indicated that a State agency that authorizes above-50-percent vendors will be required to submit data to FNS for the period from January 1, 2006, through September 30, 2006, no later than January 1, 2007, to demonstrate whether the cost neutrality requirement had been met. Due to delays associated with the NWGA lawsuit, we have changed the period for which data will be required to July 1, 2006, through September 30, 2006, and will allow State agencies the option of using a simple average rather than a weighted average when assessing cost neutrality in fiscal year 2006. We will be issuing further guidance to State agencies on cost neutrality requirements and options. This memorandum is effective immediately. PATRICIA N. DANIELS Director Supplemental Food Programs Division through their guidance portal, except to establish historical facts. incorporated into a contract. USDA may not cite, use, or rely on any guidance that is not available Guidance documents lack the force and effect of law, unless expressly authorized by statute or

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February 16, 2024 SUBJECT: WIC Policy Memorandum #2024-3: Implementing ABFA Requirements in WIC State Plans TO: Regional Directors Supplemental Nutrition Division All Regional Offices WIC State Agency Directors All WIC State Agencies

Effective with the publication of the Special Supplemental Nutrition Program for Women, Infants, and Children (WIC): Implementation of the Access to Baby Formula Act of 2022 and Related Provisions - Final Rule with Request for Comment on December 14, 2023, as of February 12, 2024, WIC State agencies are now required to include a plan of alternate operating procedures, commonly referred to as a disaster plan, as part of their State Plan. This requirement is effective beginning with State agency fiscal year (FY) 2025 State Plan submissions, due to USDA’s Food and Nutrition Service (FNS) no later than August 15, 2024. This transmittal outlines the minimum required elements for alternate operating procedures and is intended to help State agencies determine how they will implement this new requirement. FNS will reinforce these requirements through the FY 2025 State Plan Guidance and revise the existing guidance found in the Guide to Coordinating WIC Service During Disasters to ensure the information is up to date and available for reference. FNS recognizes not every WIC State agency currently has a plan in place and that some State agencies have more experience in disaster response than others. FNS stands ready to support State agencies in the development and refinement of their alternate operating procedures to meet the requirements of this provision.1 Background

On May 21, 2022, the Access to Baby Formula Act of 2022 (ABFA, Pub. L. 117-129) was signed into law. On December 14, 2023, FNS revised WIC regulations through publication of the Special Supplemental Nutrition Program for Women, Infants, and Children (WIC): Implementation of the Access to Baby Formula Act of 2022 and Related Provisions - Final Rule with Request for Comment to implement the provisions of ABFA and other related changes to strengthen WIC’s ability to address certain disasters, emergencies, and supply chain disruptions, particularly those impacting infant formula. The rule established a new regulatory requirement at 7 CFR 246.4(a)(30) which requires WIC State agencies to include a plan of alternate operating procedures, commonly referred to as a disaster plan, as part of 1 7 CFR 246.4(a)(30) USDA is an equal opportunity provider, employer, and lender. Food and Nutrition Service, Braddock Metro Center, 1320 Braddock Place, Alexandria, VA 22314 through their guidance portal, except to establish historical facts. incorporated into a contract. USDA may not cite, use, or rely on any guidance that is not available Guidance documents lack the force and effect of law, unless expressly authorized by statute or

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their State Plan. This requirement will ensure WIC State agencies have plans in place to support continuity of operations in the event of a disruption of WIC services, including but not limited to disasters, emergencies, public health emergencies, supplemental food recalls, and other supply chain disruptions. The new ABFA State Plan requirements recognize that WIC is not designed to be a disaster assistance program and is not considered a first response option for disaster survivors. As such, FNS encourages WIC State agencies to work with and use available resources from State and local emergency services offices, as well as the Federal Emergency Management Agency (FEMA), to the maximum extent practicable during an emergency period. Minimum Required Elements Alternate operating procedures must describe the process by which the WIC State agency will minimize the negative impact of program disruptions to WIC operations and services and ensure the availability of authorized supplemental foods to the extent feasible. Alternate operating procedures must include the minimum regulatory requirements as listed in Appendix A, which include Coordination and Communication, Continuation of Benefits, Benefit Issuance and Redemption, Vendor Management, and Nutrition Services. Suggested example procedures to help meet these requirements are also provided in Appendix A, as well as considerations State agencies should keep in mind when developing alternate operating procedures. The suggested example procedures to meet these requirements are not all inclusive but are instead intended to help State agencies begin to determine how they will meet the needs of their participant populations. Waivers ABFA established permanent waiver authority for the Secretary of Agriculture to address certain emergencies, disasters, and supply chain disruptions impacting WIC. Program requirements may be waived in the event of (1) a presidentially declared major disaster as defined under Section 102 of the Robert T. Stafford Disaster Relief and Emergency Assistance Act (Stafford Act, 42 U.S.C. 5121 et seq.), (2) a presidentially declared emergency as defined under the Stafford Act, (3) a public health emergency declared by the Secretary of Health and Human Services under Section 319 of the Public Health Service Act (42 U.S.C. 247d), (4) a renewal of such a public health emergency, and (5) a supply chain disruption as declared by the Secretary of Agriculture. State agencies should include as a part of their alternate operating procedures steps to (1) determine if any of these events exist and (2) determine if a waiver is necessary to continue WIC services. Additional guidance will be released by FNS at a later date on implementation of the regulatory provisions related to waivers allowable under ABFA’s waiver authority. through their guidance portal, except to establish historical facts. incorporated into a contract. USDA may not cite, use, or rely on any guidance that is not available Guidance documents lack the force and effect of law, unless expressly authorized by statute or

(guidance)(wpm-2024-3-implementing-abfa-requirements-state-plans)(page-4)Page 4#

Appendix A

Checklist Requirement Suggested Procedures to Meet Requirements and Other Considerations Coordination and Communication * A designated emergency contact within the State agency for disasters, emergencies, public health emergencies, supplemental food recalls, and other supply chain disruptions. For example, a procedure: • For providing contact information for key State agency staff on the State agency’s public website and to ensure that this information is kept up to date. • To ensure that the appropriate entities (e.g., Regional Offices, other State agencies, coordinating Programs) are aware of the State agency’s designated contact and to ensure that this information is kept up to date. A designated emergency contact within the State agency to address the needs of participants with documented qualifying conditions receiving Food Package III. For example, a procedure: • For providing a participant point of contact for key State agency staff on the State agency’s public website and/or participant portals and to ensure that this information is kept up to date. * A plan to establish a relationship with relief agencies responsible for disaster and public health emergency planning applicable to the State agency’s jurisdiction and participants to support data-informed approaches when responding to emergency periods, supplemental food recalls, and other supply chain disruptions. For example, a procedure: • To coordinate with FEMA, relief organizations, State/local emergency operation centers. • To maintain a list of relief agency contacts and to ensure that this information is kept up to date. • That identifies WIC State agency staff positions for full or partial redeployment (i.e., staff positions tagged for temporary reassignment to fulfill a non-WIC specific disaster related role). A communications plan to keep FNS, State and local agency staff, authorized WIC vendors, WIC participants, and the public For example, a procedure: • To establish external communications with relief organizations, vendors, and FNS Regional Office staff.

through their guidance portal, except to establish historical facts. incorporated into a contract. USDA may not cite, use, or rely on any guidance that is not available Guidance documents lack the force and effect of law, unless expressly authorized by statute or

(guidance)(wpm-2024-3-implementing-abfa-requirements-state-plans)(page-7)Page 7#

Page 7 of 8

Checklist Requirement Suggested Procedures to Meet Requirements and Other Considerations • To provide direct distribution. • To provide home delivery. • To develop a WIC formula (infant formula, exempt infant formula, or WIC-eligible nutritional) distribution plan. • If a WIC State agency already has a direct distribution or home delivery system in place, to update policy to specifically include provisions reasonable to institute during recalls and/or supplemental food shortages. Vendor Management A plan to address vendor requirements For example, a procedure: • To meet the annual vendor monitoring and training schedule and to expedite authorization of new vendors if needed. * A plan to adjust State agency specific minimum requirements for the variety and quantity of supplemental foods that a vendor applicant must stock to be authorized. For example, a procedure: • To reduce minimum stocking requirements to align with federal standards when State specific requirements are higher or implement a federal waiver. State agencies should consider variety and quantity when developing a plan to meet minimum stocking requirements. Nutrition Services * A plan to address food package adjustments. For example, a procedure: • To make food package substitution adjustments based on the availability of options from the approved food list found in Table 4. • To seek any needed food package waivers for adjustments based on the availability of items on the approved food list. A plan to ensure continuity of WIC services and address the needs of participants with documented qualifying conditions For example, a procedure: • To collect medical documentation. Refer to the Disaster Guide for State Agency options. through their guidance portal, except to establish historical facts. incorporated into a contract. USDA may not cite, use, or rely on any guidance that is not available Guidance documents lack the force and effect of law, unless expressly authorized by statute or

(income-eligibility-guidelines)(2025-2026)(block-1)Federal Register, Volume 90 Issue 45 (Monday, March 10, 2025)#

[Federal Register Volume 90, Number 45 (Monday, March 10, 2025)] [Notices] [Pages 11598-11600] From the Federal Register Online via the Government Publishing Office [ www.gpo.gov ] [FR Doc No: 2025-03576]

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DEPARTMENT OF AGRICULTURE

Food and Nutrition Service

Special Supplemental Nutrition Program for Women, Infants, and Children (WIC): 2025/2026 Income Eligibility Guidelines

AGENCY: Food and Nutrition Service (FNS), USDA.

ACTION: Notice.

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SUMMARY: The U.S. Department of Agriculture (``Department'') announces adjusted income eligibility guidelines to be used by State agencies in determining the income eligibility of persons applying to participate in the Special Supplemental Nutrition Program for Women, Infants, and Children (WIC). These income eligibility guidelines are to be used in conjunction with the WIC Regulations.

DATES: Applicable date July 1, 2025.

FOR FURTHER INFORMATION CONTACT: Allison Post, Chief, WIC Administration, Benefits, and Certification Branch, Policy Division, FNS, USDA, 1320 Braddock Place, Alexandria, Virginia 22314, 703-457- 7708.

SUPPLEMENTARY INFORMATION:

Executive Order 12866

This notice is exempt from review by the Office of Management and Budget under Executive Order 12866.

Regulatory Flexibility Act

This action is not a rule as defined by the Regulatory Flexibility Act (5 U.S.C. 601-612) and thus is exempt from the provisions of this Act.

Paperwork Reduction Act of 1995

This notice does not contain reporting or recordkeeping requirements subject to approval by the Office of Management and Budget in accordance with the Paperwork Reduction Act of 1995 (44 U.S.C. 3507).

Executive Order 12372

This program is listed in the Catalog of Federal Domestic Assistance Programs under No. 10.557 and is subject to the provisions of Executive Order 12372, which requires intergovernmental consultation with State and local officials (7 CFR part 3015, subpart V, 48 FR 29100, June 24, 1983, and 49 FR 22675, May 31, 1984).

Description

Section 17(d)(2)(A) of the Child Nutrition Act of 1966, as amended (42 U.S.C. 1786(d)(2)(A)), requires the Secretary of Agriculture to establish income criteria to be used with nutritional risk criteria in determining a person's eligibility for participation in the WIC Program. The law provides that persons will be income-eligible for the WIC Program if they are members of families that satisfy the income standard prescribed for reduced-price school meals under section 9(b) of the Richard B. Russell National School Lunch Act (42 U.S.C. 1758(b)). Under section 9(b), the income limit for reduced-price school meals is 185 percent of the Federal poverty guidelines, as adjusted. Section 9(b) also requires that these guidelines be revised annually to reflect changes in the Consumer Price Index. The annual revision for 2025 was published by the Department of Health and Human Services (HHS) at 90 FR 5917 on January 17, 2025. The guidelines published by HHS are referred to as the ``poverty guidelines.'' Program Regulations at 7 CFR 246.7(d)(1) specify that State agencies may prescribe income guidelines either equaling the income guidelines established under Section 9 of the Richard B. Russell National School Lunch Act for reduced-price school meals, or identical to State or local guidelines for free or reduced-price health care. However, in conforming WIC income guidelines to State or local health care guidelines, the State cannot establish WIC guidelines which exceed the guidelines for reduced-price school meals, or which are less than 100 percent of the Federal poverty guidelines. Consistent with the method used to compute income eligibility guidelines for reduced-price meals under the National School Lunch Program, the poverty guidelines were multiplied by 1.85 and the results rounded upward to the next whole dollar. Currently, the Department is publishing the maximum and minimum WIC income eligibility guidelines by household size for the period of July 1, 2025, through June 30, 2026. Consistent with section 17(f)(17) of the Child Nutrition Act of 1966, as amended (42 U.S.C. 1786(f)(17)), a State agency may implement the revised WIC income eligibility guidelines concurrently with the implementation of income eligibility guidelines under the Medicaid Program established under Title XIX of the Social Security Act (42 U.S.C. 1396, et seq.). State agencies may coordinate implementation with the revised Medicaid guidelines, i.e., earlier in the year, but in no case may implementation take place later than July 1, 2025. State agencies that do not coordinate implementation with the revised Medicaid guidelines must implement the WIC income eligibility guidelines on or before July 1, 2025.

[[Page 11599]]

Income Eligibility Guidelines [Effective from July 1, 2025, to June 30, 2026] -------------------------------------------------------------------------------------------------------------------------------------------------------- Federal poverty guidelines--100% Reduced price meals--185% ----------------------------------------------------------------------------------------------------------------------- Household size Twice- Twice- Annual Monthly monthly Bi-weekly Weekly Annual Monthly monthly Bi-weekly Weekly -------------------------------------------------------------------------------------------------------------------------------------------------------- 48 Contiguous States, DC, Guam and Territories -------------------------------------------------------------------------------------------------------------------------------------------------------- 1............................... $15,650 $1,305 $653 $602 $301 $28,953 $2,413 $1,207 $1,114 $557 2............................... 21,150 1,763 882 814 407 39,128 3,261 1,631 1,505 753 3............................... 26,650 2,221 1,111 1,025 513 49,303 4,109 2,055 1,897 949 4............................... 32,150 2,680 1,340 1,237 619 59,478 4,957 2,479 2,288 1,144 5............................... 37,650 3,138 1,569 1,449 725 69,653 5,805 2,903 2,679 1,340 6............................... 43,150 3,596 1,798 1,660 830 79,828 6,653 3,327 3,071 1,536 7............................... 48,650 4,055 2,028 1,872 936 90,003 7,501 3,751 3,462 1,731 8............................... 54,150 4,513 2,257 2,083 1042 100,178 8,349 4,175 3,853 1,927 Each add'l family member add.... + $5,500 + $459 + $230 + $212 + $106 + $10,175 + $848 + $424 + $392 + $196 -------------------------------------------------------------------------------------------------------------------------------------------------------- Alaska -------------------------------------------------------------------------------------------------------------------------------------------------------- 1............................... 19,550 1,630 815 752 376 36,168 3,014 1,507 1,392 696 2............................... 26,430 2,203 1,102 1,017 509 48,896 4,075 2,038 1,881 941 3............................... 33,310 2,776 1,388 1,282 641 61,624 5,136 2,568 2,371 1,186 4............................... 40,190 3,350 1,675 1,546 773 74,352 6,196 3,098 2,860 1,430 5............................... 47,070 3,923 1,962 1,811 906 87,080 7,257 3,629 3,350 1,675 6............................... 53,950 4,496 2,248 2,075 1,038 99,808 8,318 4,159 3,839 1,920 7............................... 60,830 5,070 2,535 2,340 1,170 112,536 9,378 4,689 4,329 2,165 8............................... 67,710 5,643 2,822 2,605 1,303 125,264 10,439 5,220 4,818 2,409 Each add'l family member add.... + $6,880 + $574 + $287 + $265 + $133 + $12,728 + $1,061 + $531 + $490 + $245 -------------------------------------------------------------------------------------------------------------------------------------------------------- Hawaii -------------------------------------------------------------------------------------------------------------------------------------------------------- 1............................... 17,990 1,500 750 692 346 33,282 2,774 1,387 1,281 641 2............................... 24,320 2,027 1,014 936 468 44,992 3,750 1,875 1,731 866 3............................... 30,650 2,555 1,278 1,179 590 56,703 4,726 2,363 2,181 1,091 4............................... 36,980 3,082 1,541 1,423 712 68,413 5,702 2,851 2,632 1,316 5............................... 43,310 3,610 1,805 1,666 833 80,124 6,677 3,339 3,082 1,541 6............................... 49,640 4,137 2,069 1,910 955 91,834 7,653 3,827 3,533 1,767 7............................... 55,970 4,665 2,333 2,153 1,077 103,545 8,629 4,315 3,983 1,992 8............................... 62,300 5,192 2,596 2,397 1,199 115,255 9,605 4,803 4,433 2,217 Each add'l family member add.... + $6,330 + $528 + $264 + $244 + $122 + $11,711 + $976 + $488 + $451 + $226 --------------------------------------------------------------------------------------------------------------------------------------------------------

Income Eligibility Guidelines [Effective from July 1, 2025, to June 30, 2026] [Household size larger than 8] -------------------------------------------------------------------------------------------------------------------------------------------------------- Federal poverty guidelines--100% Reduced price meals--185% ----------------------------------------------------------------------------------------------------------------------- Household size Twice- Twice- Annual Monthly monthly Bi-weekly Weekly Annual Monthly monthly Bi-weekly Weekly -------------------------------------------------------------------------------------------------------------------------------------------------------- 48 Contiguous States, DC, Guam and Territories -------------------------------------------------------------------------------------------------------------------------------------------------------- 9............................... $59,650 $4,971 $2,486 $2,295 $1,148 $110,353 $9,197 $4,599 $4,245 $2,123 10.............................. 65,150 5,430 2,715 2,506 1,253 120,528 10,044 5,022 4,636 2,318 11.............................. 70,650 5,888 2,944 2,718 1,359 130,703 10,892 5,446 5,028 2,514 12.............................. 76,150 6,346 3,173 2,929 1,465 140,878 11,740 5,870 5,419 2,710 13.............................. 81,650 6,805 3,403 3,141 1,571 151,053 12,588 6,294 5,810 2,905 14.............................. 87,150 7,263 3,632 3,352 1,676 161,228 13,436 6,718 6,202 3,101 15.............................. 92,650 7,721 3,861 3,564 1,782 171,403 14,284 7,142 6,593 3,297 16.............................. 98,150 8,180 4,090 3,775 1,888 181,578 15,132 7,566 6,984 3,492 Each add'l family member add.... + $5,500 + $459 + $230 + $212 + $106 + $10,175 + $848 + $424 + $392 + $196 -------------------------------------------------------------------------------------------------------------------------------------------------------- Alaska -------------------------------------------------------------------------------------------------------------------------------------------------------- 9............................... 74,590 6,216 3,108 2,869 1,435 137,992 11,500 5,750 5,308 2,654 10.............................. 81,470 6,790 3,395 3,134 1,567 150,720 12,560 6,280 5,797 2,899 11.............................. 88,350 7,363 3,682 3,399 1,700 163,448 13,621 6,811 6,287 3,144 12.............................. 95,230 7,936 3,968 3,663 1,832 176,176 14,682 7,341 6,776 3,388 13.............................. 102,110 8,510 4,255 3,928 1,964 188,904 15,742 7,871 7,266 3,633 14.............................. 108,990 9,083 4,542 4,192 2,096 201,632 16,803 8,402 7,756 3,878 15.............................. 115,870 9,656 4,828 4,457 2,229 214,360 17,864 8,932 8,245 4,123 16.............................. 122,750 10,230 5,115 4,722 2,361 227,088 18,924 9,462 8,735 4,368 Each add'l family member add.... + $6,880 + $567 + $284 + $262 + $131 + $12,580 + $1,049 + $525 + $484 + $242 -------------------------------------------------------------------------------------------------------------------------------------------------------- Hawaii -------------------------------------------------------------------------------------------------------------------------------------------------------- 9............................... 68,630 5,720 2,860 2,640 1,320 126,966 10,581 5,291 4,884 2,442

[[Page 11600]]

10.............................. 74,960 6,247 3,124 2,884 1,442 138,676 11,557 5,779 5,334 2,667 11.............................. 81,290 6,775 3,388 3,127 1,564 150,387 12,533 6,267 5,785 2,893 12.............................. 87,620 7,302 3,651 3,370 1,685 162,097 13,509 6,755 6,235 3,118 13.............................. 93,950 7,830 3,915 3,614 1,807 173,808 14,484 7,242 6,685 3,343 14.............................. 100,280 8,357 4,179 3,857 1,929 185,518 15,460 7,730 7,136 3,568 15.............................. 106,610 8,885 4,443 4,101 2,051 197,229 16,436 8,218 7,586 3,793 16.............................. 112,940 9,412 4,706 4,344 2,172 208,939 17,412 8,706 8,037 4,019 Each add'l family member add.... + $6,330 + $528 + $264 + $244 + $122 + $11,711 + $976 + $488 + $451 + $226 --------------------------------------------------------------------------------------------------------------------------------------------------------

The table of this notice contains the income limits by household size for the 48 contiguous States, the District of Columbia, and all United States Territories, including Guam. Separate tables for Alaska and Hawaii have been included for the convenience of the State agencies because the poverty guidelines for Alaska and Hawaii are higher than for the 48 contiguous States.

(Authority: 42 U.S.C. 1786)

Tameka Owens, Acting Administrator, Food and Nutrition Service, USDA. [FR Doc. 2025-03576 Filed 3-7-25; 8:45 am] BILLING CODE 4150-05-P

(income-eligibility-guidelines)(2026-2027)(block-1)Federal Register, Volume 91 Issue 82 (Wednesday, April 29, 2026)#

[Federal Register Volume 91, Number 82 (Wednesday, April 29, 2026)] [Notices] [Pages 23050-23052] From the Federal Register Online via the Government Publishing Office [ www.gpo.gov ] [FR Doc No: 2026-08323]

�======================================================================== �Notices � Federal Register �________________________________________________________________________ � �This section of the FEDERAL REGISTER contains documents other than rules �or proposed rules that are applicable to the public. Notices of hearings �and investigations, committee meetings, agency decisions and rulings, �delegations of authority, filing of petitions and applications and agency �statements of organization and functions are examples of documents �appearing in this section. � �======================================================================== �

��Federal Register / Vol. 91, No. 82 / Wednesday, April 29, 2026 / Notices��

[[Page 23050]]

DEPARTMENT OF AGRICULTURE

Food and Nutrition Service

Special Supplemental Nutrition Program for Women, Infants, and Children (WIC): 2026/2027 Income Eligibility Guidelines

AGENCY: Food and Nutrition Service (FNS), USDA.

ACTION: Notice.

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

SUMMARY: The United States Department of Agriculture (``Department'') announces adjusted income eligibility guidelines to be used by State agencies in determining the income eligibility of persons applying

DATES: These guidelines are effective July 1, 2026.

SUPPLEMENTARY INFORMATION:

Executive Order 12866

This notice is exempt from review by the Office of Management and Budget under Executive Order 12866.

Regulatory Flexibility Act

This action is not a rule as defined by the Regulatory Flexibility Act (5 U.S.C. 601-612) and thus is exempt from the provisions of this Act.

Paperwork Reduction Act of 1995

Executive Order 12372

Description

Section 17(d)(2)(A) of the Child Nutrition Act of 1966, as amended (42 U.S.C. 1786(d)(2)(A)), requires the Secretary of Agriculture to establish income criteria to be used with nutritional risk criteria in determining a person's eligibility for participation in the WIC program. The law provides that persons will be income-eligible for the WIC program if they are members of families that satisfy the income standard prescribed for reduced-price school meals under section 9(b) of the Richard B. Russell National School Lunch Act (42 U.S.C. 1758(b)). Under section 9(b), the income limit for reduced-price school meals is 185 percent of the Federal poverty guidelines, as adjusted. Section 9(b) also requires that these guidelines be revised annually to reflect changes in the Consumer Price Index. The annual revision for 2026 was published by the Department of Health and Human Services (HHS) at 91 FR 1797 on January 15, 2026. The guidelines published by HHS are referred to as the ``poverty guidelines.'' Consistent with the method used to compute income eligibility guidelines for reduced-price meals under the National School Lunch Program, the poverty guidelines were multiplied by 1.85 and the results rounded upward to the next whole dollar. Program Regulations at 7 CFR 246.7(d)(1) specify that State agencies may prescribe income guidelines either equaling the income guidelines established under Section 9 of the Richard B. Russell National School Lunch Act for reduced-price school meals, or identical to State or local guidelines for free or reduced-price health care. However, in conforming WIC income guidelines to State or local health care guidelines, the State cannot establish WIC guidelines which exceed the guidelines for reduced-price school meals, or which are less than 100 percent of the Federal poverty guidelines. Currently, the Department is publishing the maximum and minimum WIC income eligibility guidelines by household size for the period of July 1, 2026, through June 30, 2027. Consistent with section 17(f)(17) of the Child Nutrition Act of 1966, as amended (42 U.S.C. 1786(f)(17)), a State agency may implement the revised WIC income eligibility guidelines concurrently with the implementation of income eligibility guidelines under the Medicaid program established under Title XIX of the Social Security Act (42 U.S.C. 1396, et seq.). State agencies may coordinate implementation with the revised Medicaid guidelines, i.e., earlier in the year, but in no case may implementation take place later than July 1, 2026. State agencies that do not coordinate implementation with the revised Medicaid guidelines must implement the WIC income eligibility guidelines on or before July 1, 2026.

Income Eligibility Guidelines [Effective from July 1, 2026, to June 30, 2027] -------------------------------------------------------------------------------------------------------------------------------------------------------- Federal poverty guidelines--100% Reduced-price meals--185% ----------------------------------------------------------------------------------------------------------------------- Household size Twice- Twice- Annual Monthly monthly Bi-weekly Weekly Annual Monthly monthly Bi-weekly Weekly -------------------------------------------------------------------------------------------------------------------------------------------------------- 48 Contiguous States, D.C., Guam and Territories -------------------------------------------------------------------------------------------------------------------------------------------------------- 1............................... $15,960 $1,330 $665 $614 $307 $29,526 $2,461 $1,231 $1,136 $568 2............................... 21,640 1,804 902 833 417 40,034 3,337 1,669 1,540 770 3............................... 27,320 2,277 1,139 1,051 526 50,542 4,212 2,106 1,944 972

[[Page 23051]]

4............................... 33,000 2,750 1,375 1,270 635 61,050 5,088 2,544 2,349 1,175 5............................... 38,680 3,224 1,612 1,488 744 71,558 5,964 2,982 2,753 1,377 6............................... 44,360 3,697 1,849 1,707 854 82,066 6,839 3,420 3,157 1,579 7............................... 50,040 4,170 2,085 1,925 963 92,574 7,715 3,858 3,561 1,781 8............................... 55,720 4,644 2,322 2,144 1,072 103,082 8,591 4,296 3,965 1,983 Add per family member........... + $5,680 + $474 + $237 + $219 + $110 + $10,508 + $876 + $438 + $405 + $203 -------------------------------------------------------------------------------------------------------------------------------------------------------- Alaska -------------------------------------------------------------------------------------------------------------------------------------------------------- 1............................... 19,950 1,663 832 768 384 36,908 3,076 1,538 1,420 710 2............................... 27,050 2,255 1,128 1,041 521 50,043 4,171 2,086 1,925 963 3............................... 34,150 2,846 1,423 1,314 657 63,178 5,265 2,633 2,430 1,215 4............................... 41,250 3,438 1,719 1,587 794 76,313 6,360 3,180 2,936 1,468 5............................... 48,350 4,030 2,015 1,860 930 89,448 7,454 3,727 3,441 1,721 6............................... 55,450 4,621 2,311 2,133 1,067 102,583 8,549 4,275 3,946 1,973 7............................... 62,550 5,213 2,607 2,406 1,203 115,718 9,644 4,822 4,451 2,226 8............................... 69,650 5,805 2,903 2,679 1,340 128,853 10,738 5,369 4,956 2,478 Add per family member........... + $7,100 + $592 + $296 + $274 + $137 + $13,135 + $1,095 + $548 + $506 + $253 -------------------------------------------------------------------------------------------------------------------------------------------------------- Hawaii -------------------------------------------------------------------------------------------------------------------------------------------------------- 1............................... 18,360 1,530 765 707 354 33,966 2,831 1,416 1,307 654 2............................... 24,890 2,075 1,038 958 479 46,047 3,838 1,919 1,772 886 3............................... 31,420 2,619 1,310 1,209 605 58,127 4,844 2,422 2,236 1,118 4............................... 37,950 3,163 1,582 1,460 730 70,208 5,851 2,926 2,701 1,351 5............................... 44,480 3,707 1,854 1,711 856 82,288 6,858 3,429 3,165 1,583 6............................... 51,010 4,251 2,126 1,962 981 94,369 7,865 3,933 3,630 1,815 7............................... 57,540 4,795 2,398 2,214 1,107 106,449 8,871 4,436 4,095 2,048 8............................... 64,070 5,340 2,670 2,465 1,233 118,530 9,878 4,939 4,559 2,280 Add per family member........... + $6,530 + $545 + $273 + $252 + $126 + $12,081 + $1,007 + $504 + $465 + $233 --------------------------------------------------------------------------------------------------------------------------------------------------------

Income Eligibility Guidelines [Effective from July 1, 2026, to June 30, 2027] [Household size larger than 8] -------------------------------------------------------------------------------------------------------------------------------------------------------- Federal poverty guidelines--100% Reduced-price meals--185% ----------------------------------------------------------------------------------------------------------------------- Household size Twice- Twice- Annual Monthly monthly Bi-weekly Weekly Annual Monthly monthly Bi-weekly Weekly -------------------------------------------------------------------------------------------------------------------------------------------------------- 48 Contiguous States, D.C., Guam and Territories -------------------------------------------------------------------------------------------------------------------------------------------------------- 9............................... $61,400 $5,117 $2,559 $2,362 $1,181 $113,590 $9,466 $4,733 $4,369 $2,185 10.............................. 67,080 5,590 2,795 2,580 1,290 124,098 10,342 5,171 4,773 2,387 11.............................. 72,760 6,064 3,032 2,799 1,400 134,606 11,218 5,609 5,178 2,589 12.............................. 78,440 6,537 3,269 3,017 1,509 145,114 12,093 6,047 5,582 2,791 13.............................. 84,120 7,010 3,505 3,236 1,618 155,622 12,969 6,485 5,986 2,993 14.............................. 89,800 7,484 3,742 3,454 1,727 166,130 13,845 6,923 6,390 3,195 15.............................. 95,480 7,957 3,979 3,673 1,837 176,638 14,720 7,360 6,794 3,397 16.............................. 101,160 8,430 4,215 3,891 1,946 187,146 15,596 7,798 7,198 3,599 Add per family member........... + $5,680 + $474 + $237 + $219 + $110 + $10,508 + $876 + $438 + $405 + $203 -------------------------------------------------------------------------------------------------------------------------------------------------------- Alaska -------------------------------------------------------------------------------------------------------------------------------------------------------- 9............................... 76,750 6,396 3,198 2,952 1,476 141,988 11,833 5,917 5,462 2,731 10.............................. 83,850 6,988 3,494 3,225 1,613 155,123 12,927 6,464 5,967 2,984 11.............................. 90,950 7,580 3,790 3,499 1,750 168,258 14,022 7,011 6,472 3,236 12.............................. 98,050 8,171 4,086 3,772 1,886 181,393 15,117 7,559 6,977 3,489 13.............................. 105,150 8,763 4,382 4,045 2,023 194,528 16,211 8,106 7,482 3,741 14.............................. 112,250 9,355 4,678 4,318 2,159 207,663 17,306 8,653 7,988 3,994 15.............................. 119,350 9,946 4,973 4,591 2,296 220,798 18,400 9,200 8,493 4,247 16.............................. 126,450 10,538 5,269 4,864 2,432 233,933 19,495 9,748 8,998 4,499 Add per family member........... + $7,100 + $592 + $296 + $274 + $137 + $13,135 + $1,095 + $548 + $506 + $253 -------------------------------------------------------------------------------------------------------------------------------------------------------- Hawaii -------------------------------------------------------------------------------------------------------------------------------------------------------- 9............................... 70,600 5,884 2,942 2,716 1,358 130,610 10,885 5,443 5,024 2,512 10.............................. 77,130 6,428 3,214 2,967 1,484 142,691 11,891 5,946 5,489 2,745 11.............................. 83,660 6,972 3,486 3,218 1,609 154,771 12,898 6,449 5,953 2,977 12.............................. 90,190 7,516 3,758 3,469 1,735 166,852 13,905 6,953 6,418 3,209 13.............................. 96,720 8,060 4,030 3,720 1,860 178,932 14,911 7,456 6,882 3,441 14.............................. 103,250 8,605 4,303 3,972 1,986 191,013 15,918 7,959 7,347 3,674 15.............................. 109,780 9,149 4,575 4,223 2,112 203,093 16,925 8,463 7,812 3,906 16.............................. 116,310 9,693 4,847 4,474 2,237 215,174 17,932 8,966 8,276 4,138 Add per family member........... + $6,530 + $545 + $273 + $252 + $126 + $12,081 + $1,007 + $504 + $465 + $233 --------------------------------------------------------------------------------------------------------------------------------------------------------

[[Page 23052]]

Patrick Penn, Deputy Under Secretary, Food, Nutrition and Consumer Services. [FR Doc. 2026-08323 Filed 4-28-26; 8:45 am] BILLING CODE 4150-05-P

(policy-memo)(2025-1)(document-1)#

USDA is an Equal Opportunity Provider, Employer and Lender 1

Food and Nutrition Service

1320 Braddock Place Alexandria, VA 22314 DATE: SUBJECT: TO: December 6, 2024

WIC Policy Memorandum #2025-1: Clarification on Corporate Changes of Ownership Regional Directors Supplemental Nutrition Divisions WIC State Agency Directors All WIC State Agencies

FNS is committed to modernizing WIC Food Delivery policy to increase program flexibility to adapt to a changing retail marketplace. This policy memorandum provides guidance to WIC State agencies on how to address corporate changes of ownership, including existing vendor authorization flexibilities, and on how to mitigate any resulting impacts on vendor authorization and participant access.

Per WIC regulations at 7 CFR 246.12(h)(3)(xviii), WIC State agencies have the discretion to determine whether a change in business structure constitutes a change in ownership. This policy memorandum clarifies that WIC State agencies have the discretion to view corporate mergers and related transactions as changes in ownership only if the taxpayer identification numbers/employer identification numbers (EIN) change. If the State agency determines that a change in ownership has occurred, the vendor is treated like a new vendor applicant, requiring a preauthorization visit and new vendor agreement. FNS recognizes that corporate changes of ownership may likely impact many vendors and have downstream effects, including increased vendor authorization processing and potential disruptions in service for participants. As such, FNS will permit WIC State agencies to streamline the authorization process for these vendors by allowing routine monitoring visits made up to one year prior to the transaction to meet the preauthorization visit requirement. State agencies should prioritize these vendors for monitoring until the State agency is able to visit each impacted vendor.

In addition, State agencies should assess the scale of reported vendor changes in their jurisdiction, including how many stores are impacted and the timeline of the expected changes. State agencies should understand the impacts on participant access and aim to prevent or minimize any disruptions in service. This may include proactively reviewing the new ownership’s vendor application and assessing selection criteria while concurrently working to offboard the current vendor ownership. through their guidance portal, except to establish historical facts. incorporated into a contract. USDA may not cite, use, or rely on any guidance that is not available Guidance documents lack the force and effect of law, unless expressly authorized by statute or

USDA is an Equal Opportunity Provider, Employer and Lender 2

FNS encourages State agencies to update their policies to address corporate changes of ownership and to identify opportunities for efficiencies to ensure continuity of services for participants. WIC State agencies should work with their legal counsel to determine whether and when additional action may be needed at the state level. In the coming years, FNS will continue work to modernize WIC Food Delivery regulations to increase program flexibility to adapt to a changing retail marketplace, and appreciates State agency dedication to the WIC Program, its mission, and the participants. WIC State agencies are critical to ensuring program integrity and continuity of services for WIC participants.

This memorandum supersedes the following WIC memorandum: • WIC Policy Memorandum #2015-1: Sale of Safeway, Inc. to AB Acquisition Impact on Vendor Authorization Any WIC State agency with questions regarding this change should contact its respective FNS Regional Office.

Sara Olson Director Policy Division Supplemental Nutrition and Safety Programs through their guidance portal, except to establish historical facts. incorporated into a contract. USDA may not cite, use, or rely on any guidance that is not available Guidance documents lack the force and effect of law, unless expressly authorized by statute or

(policy-memo)(2025-3)(document-1)#

Food and Nutrition Service, Braddock Metro Center, 1320 Braddock Place, Alexandria, VA 22314 USDA is an Equal Opportunity Provider, Employer, and Lender January 10, 2025 SUBJECT: WIC Policy Memorandum #2025 – 3 TO: Policy Memorandum Revision: Use of Banked Human Breast Milk in WIC Regional Directors Supplemental Nutrition Division All Regional Offices WIC State Agency Directors All WIC State Agencies This memorandum revises and replaces WIC Policy Memorandum #2000-2, Use of Banked Human Breast Milk in the WIC Program, issued February 28, 2000. USDA promotes and supports breastfeeding as the best source of infant nutrition. Human milk provides unique nutritional and non-nutritional benefits for an infant’s growth and development. In some situations, parents or caretakers may look for alternative sources of human milk such as banked human milk to feed their babies. USDA recognizes that banked human milk may be an important resource, particularly for medically vulnerable infants. The U.S. Department of Health and Human Services, Food and Drug Administration (FDA) regulates banked human milk as a food and inspects donor human milk banks that are registered with FDA as food facilities. Banked human milk, on its own, does not meet the statutory definition of infant formula (21 U.S.C. 321(z)). WIC regulations define the types of foods that WIC State agencies may offer participants in the food packages. For infant food packages, the available supplemental foods are infant formula and, depending on their age, infant cereals, infant fruits and vegetables, and infant meats. Banked human milk is not a WIC-eligible supplemental through their guidance portal, except to establish historical facts. incorporated into a contract. USDA may not cite, use, or rely on any guidance that is not available Guidance documents lack the force and effect of law, unless expressly authorized by statute or

Page 2 of 3 food as defined by 7 CFR 246.10. Therefore, banked human milk may not be issued as a program benefit. The WIC food packages are periodically reviewed by the National Academies of Science, Engineering, and Medicine (NASEM) who in turn make recommendations to USDA to update the food packages through the rulemaking process. The most recent NASEM review, published in 2017, did not recommend revising the infant food packages to include human donor milk as a benefit. USDA is required to conduct a periodic review of the WIC food packages and the next review will include a broad range of infant feeding practices. WIC federal funds cannot be used for the purposes of collecting, storing, purchasing, or disseminating banked human milk. If indicated by the nutrition assessment, WIC staff may inform caregivers about banked human milk, refer participants to donor human milk banks, and, if appropriate, inform caregivers about donating their milk. WIC regulations do not prohibit a State agency from using non-WIC funds to allow WIC clinic sites to serve as a human milk depot in partnership with another organization. The State agency should first enter into a Memorandum of Understanding (MOU) with the organization to clearly describe roles and responsibilities of each organization. It must be made clear that banked human milk is not a WIC benefit and that the collaboration does not imply that the donor human milk bank or depot is WIC sponsored. Furthermore, staff time must be cost allocated to other allowable funding sources, except for activities related to breastfeeding education and promotion such as referring participants to donor human milk banks. State WIC agencies are also advised to ensure that their malpractice insurance policy covers WIC staff on any negligible activities related to banked human milk. Coverage is needed if a WIC participant or donor human milk depot user claims to be adversely affected by banked human milk. USDA requests that State agencies share with the FNS Regional Office information about donor human milk bank or depot activities occurring in WIC clinic sites. through their guidance portal, except to establish historical facts. incorporated into a contract. USDA may not cite, use, or rely on any guidance that is not available Guidance documents lack the force and effect of law, unless expressly authorized by statute or

Page 3 of 3 For additional information, see the WIC Breastfeeding Policy and Guidance and the Food and Drug Administration’s Use of Donor Human Milk. State agencies may direct any questions to their respective FNS Regional Office. /Original Signature on File /Original Signature on File Kristin Garcia Sara Olson Director Director Food Safety and Nutrition Division Policy Division through their guidance portal, except to establish historical facts. incorporated into a contract. USDA may not cite, use, or rely on any guidance that is not available Guidance documents lack the force and effect of law, unless expressly authorized by statute or

(policy-memo)(2025-4)(document-1)#

Food and Nutrition Service, Braddock Metro Center, 1320 Braddock Place, Alexandria, VA 22314 USDA is an equal opportunity provider, employer, and lender. March 27, 2025 SUBJECT: TO: WIC Policy Memorandum #2025-4: Publication of the 2025-2026 Special Supplemental Nutrition Program for Women, Infants, and Children (WIC) Income Eligibility Guidelines Regional Directors Special Nutrition Programs WIC State Agency Directors All State Agencies This policy memorandum transmits the 2025-2026 Income Eligibility Guidelines (IEGs) for the Special Supplemental Nutrition Program for Women, Infants, and Children (WIC) that were published in the Federal Register on March 10, 2025, at 90 FR 11598. Section 17(d)(2)(A) of the Child Nutrition Act of 1966, as amended (42 U.S.C. 1786(d)(2)(A)), requires the establishment of income criteria to be used with nutritional risk criteria in determining a person’s eligibility for participation in WIC. Income eligibility for WIC is determined using income standards as prescribed under Section 9(b) of the Richard B. Russell National School Lunch Act (42 U.S.C. 1758(b)). The income limit is 185 percent of the Federal poverty guidelines, as adjusted. Section 9(b) also requires that these guidelines be revised annually to reflect changes in the Consumer Price Index. The annual revision for 2025 was published by the Department of Health and Human Services (HHS) at 90 FR 5917, on January 17, 2025. In accordance with the established income guidance, the revised WIC income eligibility guidelines are to be used in conjunction with the WIC regulations at 7 CFR 246.7(d). WIC State agencies may implement the revised IEGs concurrently with the implementation of IEGs under the Medicaid program. State agencies that do not coordinate implementation with the Medicaid program must implement the revised WIC IEGs no later than July 1, 2025. WIC State agencies must ensure that Management Information Systems incorporate the 2025- 2026 changes accordingly. A supplemental chart is attached for State agencies to use in determining the annual, monthly, twice-monthly, biweekly, and weekly income limits. There is also a chart for families greater than eight. SARA OLSON Director Policy Division Supplemental Nutrition and Safety Programs through their guidance portal, except to establish historical facts. incorporated into a contract. USDA may not cite, use, or rely on any guidance that is not available Guidance documents lack the force and effect of law, unless expressly authorized by statute or

Page 2 of 3 Food and Nutrition Service, Braddock Metro Center, 1320 Braddock Place, Alexandria, VA 22314 USDA is an equal opportunity provider, employer, and lender. Income Eligibility Guidelines (Effective from July 1, 2025 to June 30, 2026) Household Size Federal Poverty Guidelines - 100% Reduced Price Meals - 185% Annual Monthly Twice- Monthly Bi-Weekly Weekly Annual Monthly Twice- Monthly Bi-Weekly Weekly 48 Contiguous States, D.C., Guam and Territories 1 $15,650 $1,305 $653 $602 $301 $28,953 $2,413 $1,207 $1,114 $557 2 21,150 1,763 882 814 407 39,128 3,261 1,631 1,505 753 3 26,650 2,221 1,111 1,025 513 49,303 4,109 2,055 1,897 949 4 32,150 2,680 1,340 1,237 619 59,478 4,957 2,479 2,288 1,144 5 37,650 3,138 1,569 1,449 725 69,653 5,805 2,903 2,679 1,340 6 43,150 3,596 1,798 1,660 830 79,828 6,653 3,327 3,071 1,536 7 48,650 4,055 2,028 1,872 936 90,003 7,501 3,751 3,462 1,731 8 54,150 4,513 2,257 2,083 1,042 100,178 8,349 4,175 3,853 1,927 Add per family member + $5,500 + $459 + $230 + $212 + $106 + $10,175 + $848 + $424 + $392 + $196 Alaska 1 $19,550 $1,630 $815 $752 $376 $36,168 $3,014 $1,507 $1,392 $696 2 26,430 2,203 1,102 1,017 509 48,896 4,075 2,038 1,881 941 3 33,310 2,776 1,388 1,282 641 61,624 5,136 2,568 2,371 1,186 4 40,190 3,350 1,675 1,546 773 74,352 6,196 3,098 2,860 1,430 5 47,070 3,923 1,962 1,811 906 87,080 7,257 3,629 3,350 1,675 6 53,950 4,496 2,248 2,075 1,038 99,808 8,318 4,159 3,839 1,920 7 60,830 5,070 2,535 2,340 1,170 112,536 9,378 4,689 4,329 2,165 8 67,710 5,643 2,822 2,605 1,303 125,264 10,439 5,220 4,818 2,409 Add per family member + $6,880 + $574 + $287 + $265 + $133 + $12,728 + $1,061 + $531 + $490 + $245 Hawaii 1 $17,990 $1,500 $750 $692 $346 $33,282 $2,774 $1,387 $1,281 $641 2 $24,320 $2,027 $1,014 $936 $468 $44,992 $3,750 $1,875 $1,731 $866 3 30,650 2,555 1,278 1,179 590 56,703 4,726 2,363 2,181 1,091 4 36,980 3,082 1,541 1,423 712 68,413 5,702 2,851 2,632 1,316 5 43,310 3,610 1,805 1,666 833 80,124 6,677 3,339 3,082 1,541 6 49,640 4,137 2,069 1,910 955 91,834 7,653 3,827 3,533 1,767 7 55,970 4,665 2,333 2,153 1,077 103,545 8,629 4,315 3,983 1,992 8 62,300 5,192 2,596 2,397 1,199 115,255 9,605 4,803 4,433 2,217 Add per family member + $6,330 + $528 + $264 + $244 + $122 + $11,711 + $976 + $488 + $451 + $226 through their guidance portal, except to establish historical facts. incorporated into a contract. USDA may not cite, use, or rely on any guidance that is not available Guidance documents lack the force and effect of law, unless expressly authorized by statute or

Page 3 of 3 Income Eligibility Guidelines (Effective from July 1, 2025 to June 30, 2026) Household Size Larger Than 8 Household Size Federal Poverty Guidelines - 100% Reduced Price Meals - 185% Annual Monthly Twice- Monthly Bi-Weekly Weekly Annual Monthly Twice- Monthly Bi-Weekly Weekly 48 Contiguous States, D.C., Guam and Territories 9 $59,650 $4,971 $2,486 $2,295 $1,148 $110,353 $9,197 $4,599 $4,245 $2,123 10 65,150 5,430 2,715 2,506 1,253 120,528 10,044 5,022 4,636 2,318 11 70,650 5,888 2,944 2,718 1,359 130,703 10,892 5,446 5,028 2,514 12 76,150 6,346 3,173 2,929 1,465 140,878 11,740 5,870 5,419 2,710 13 81,650 6,805 3,403 3,141 1,571 151,053 12,588 6,294 5,810 2,905 14 87,150 7,263 3,632 3,352 1,676 161,228 13,436 6,718 6,202 3,101 15 92,650 7,721 3,861 3,564 1,782 171,403 14,284 7,142 6,593 3,297 16 98,150 8,180 4,090 3,775 1,888 181,578 15,132 7,566 6,984 3,492 Add per family member + $5,500 + $459 + $230 + $212 + $106 + $10,175 + $848 + $424 + $392 + $196 Alaska 9 $74,590 $6,216 $3,108 $2,869 $1,435 $137,992 $11,500 $5,750 $5,308 $2,654 10 81,470 6,790 3,395 3,134 1,567 150,720 12,560 6,280 5,797 2,899 11 88,350 7,363 3,682 3,399 1,700 163,448 13,621 6,811 6,287 3,144 12 95,230 7,936 3,968 3,663 1,832 176,176 14,682 7,341 6,776 3,388 13 102,110 8,510 4,255 3,928 1,964 188,904 15,742 7,871 7,266 3,633 14 108,990 9,083 4,542 4,192 2,096 201,632 16,803 8,402 7,756 3,878 15 115,870 9,656 4,828 4,457 2,229 214,360 17,864 8,932 8,245 4,123 16 122,750 10,230 5,115 4,722 2,361 227,088 18,924 9,462 8,735 4,368 Add per family member + $6,880 + $574 + $287 + $265 + $133 + $12,728 + $1,061 + $531 + $490 + $245 Hawaii 9 $68,630 $5,720 $2,860 $2,640 $1,320 $126,966 $10,581 $5,291 $4,884 $2,442 10 $74,960 $6,247 $3,124 $2,884 $1,442 $138,676 $11,557 $5,779 $5,334 $2,667 11 81,290 6,775 3,388 3,127 1,564 150,387 12,533 6,267 5,785 2,893 12 87,620 7,302 3,651 3,370 1,685 162,097 13,509 6,755 6,235 3,118 13 93,950 7,830 3,915 3,614 1,807 173,808 14,484 7,242 6,685 3,343 14 100,280 8,357 4,179 3,857 1,929 185,518 15,460 7,730 7,136 3,568 15 106,610 8,885 4,443 4,101 2,051 197,229 16,436 8,218 7,586 3,793 16 112,940 9,412 4,706 4,344 2,172 208,939 17,412 8,706 8,037 4,019 Add per family member + $6,330 + $528 + $264 + $244 + $122 + $11,711 + $976 + $488 + $451 + $226 through their guidance portal, except to establish historical facts. incorporated into a contract. USDA may not cite, use, or rely on any guidance that is not available Guidance documents lack the force and effect of law, unless expressly authorized by statute or

(policy-memo)(2025-5)(document-1)#

DATE: August 19, 2025 SUBJECT: WIC Policy Memorandum #2025-5 Implementing Revisions to the WIC Food Packages: Flexibilities to Support Healthy Choices, Healthy Outcomes, and Healthy Families To: Regional Directors Supplemental Nutrition Division īīϙôČĖĺĲÍīϙiƯĖèôŜ WIC State Agency Directors All WIC State Agencies USDA’s Special Supplemental Nutrition Program for Women, Infants, and Children (WIC) is proven to improve the nutritional health of its participants—pregnant and breastfeeding women, women who recently had a baby, infants, and children up to 5 years of age. WIC provides minimally processed, healthy foods ŜŕôèĖƱèÍīīƅϙŕŘôŜèŘĖæôîϙťĺϙsupport growth and development during those critical life stages. Nutrition education, breastfeeding support, and healthcare referrals are also included. This memo èīÍŘĖƱôŜϙťÍťôϙÍČôĲèƅϙƲôƄĖæĖīĖťƅ to implement changes to the WIC food packages in ways that support the Trump Administration’s commitment, under the leadership of USDA Secretary Brooke Rollins, to encourage healthy choices, healthy outcomes, and healthy families through the federal nutrition programs. Background On April 18, 2024, FNS published the Special Supplemental Nutrition Program for Women, Infants, and Children (WIC): Revisions in the WIC Food Packages ƱĲÍīϙŘŪīô (which will be ŘôċôŘŘôîϙťĺϙťēŘĺŪČēĺŪťϙťēĖŜϙîĺèŪıôĲťϙÍŜϙťēôϙƱĲÍīϙŘŪīôϽ. The revised WIC food packages support participants’ health by better promoting and supporting the establishment of successful, long-term breastfeeding; providing WIC participants with a wider variety of Food and Nutrition Service, Braddock Metro Center, 1320 Braddock Place, Alexandria, VA 22314 USDA is an equal opportunity provider, employer, and lender. Guidance documents lack the force and effect of law, unless expressly authorized by statute or incorporated into a contract. USDA may not cite, use, or rely on any guidance that is not available through their guidance portal, except to establish historical facts.

foods including fruits, vegetables and whole grains; and providing WIC State agencies with more options to accommodate each WIC participant’s individual needs.

Implementation Flexibilities State agencies ēÍŽôϙƲôƄĖæĖīĖťƅϙťĺ implement the WIC food packages changes in ways that meet their participants’ unique nutritional needs, reduce administrative burden for WIC ŜťÍƯϠ and minimize program costs, thereby protecting the investment of American taxpayers.

Implementation Timelines State agencies have until April 20, 2026, to implement most of the changes in the ƱĲÍīϙ rule. (Vitamin D supplementation in yogurt has an extended implementation date of April 19, 2027.) WIC Policy Memorandum #2024-5 encourages State agencies to implement changes before implementation deadlines. In doing this, State agencies may: x Phase-in the revised WIC food packages on a participant category basis. For example, changes to food packages for children ages 1-4 years may be implemented on a îĖƯôŘôĲťϙschedule than changes to food packages for pregnant participants. x Implement any changes that expand substitution options State agency-wide (e.g., additional whole grain options) at any time, including before implementing any food package-ŜŕôèĖƱèϙchanges.

Whole-Grain Cereal Whole grains contain a variety of nutrients, ĖĲèīŪîĖĲČϙƱæôŘ, and are an important part of a healthy diet. The revised WIC food packages require that 75 percent of breakfast cereals meet whole grain criteria, allowing State agencies to provide a wide variety of whole grain cereals along with some non-whole grain options. State agencies have Guidance documents lack the force and effect of law, unless expressly authorized by statute or incorporated into a contract. USDA may not cite, use, or rely on any guidance that is not available through their guidance portal, except to establish historical facts.

ƲôƄĖæĖīĖťƅ and are encouraged to support healthy choices by making more than 75 ŕôŘèôĲťϙĺċϙťēôϙæŘôÍħċÍŜťϙèôŘôÍīŜϙĺƯôŘôîϙſēĺīôϙČŘÍĖĲϟϙ

Substitution Options While all WIC foods must align with program requirements, State agencies have ŜĖČĲĖƱèÍĲťϙƲôƄĖæĖīĖťƅϙťĺϙîôťôŘıĖĲôϙťēôϙæŘÍĲîŜϠϙťƅŕôŜϠϙÍĲîϙċĺŘıŜϙĺċϙ®I -eligible foods to authorize for their state food list. Further, while State agencies are required to authorize certain substitutions to ensure all WIC families receive a package of healthy foods, they have the choice to ĺƯôŘ additional substitution options.

ťÍťôϙÍČôĲèĖôŜϙÍŘôϙôĲèĺŪŘÍČôîϙťĺϙèĺĲŜĖîôŘϙſÍƅŜϙťēôŜôϙƲôƄĖæĖīĖťĖôŜϙÍĲîϙĺŕťĖĺĲŜϙcan best support healthy outcomes for WIC participants. Attachment A provides a high-level summary of these requirements (see 7 CFR 246.10 for full requirements) and available State agency options.

We appreciate your commitment to the successful and timely implementation of the revised WIC food packages and, in turn, are committed to supporting ƅĺŪϙĖĲϙťēĖŜϙôƯĺŘťϟ The Changes to the WIC Food Packages Q&As ĺƯôŘϙèīÍŘĖƱèÍťĖĺĲϙĺĲϙÍϙŽÍŘĖôťƅϙĺċϙťēôϙchanges, and Attachment B can help answer additional questions about ƲôƄĖæĖīĖťĖôŜϙÍŽÍĖīÍæīôϙťĺϙ State agencies when implementing the revised WIC food packages.

State agencies may direct any questions to their respective >bϙôČĖĺĲÍīϙiƯĖèô.

SARA OLSON KRISTIN GARCIA Director Director

Policy Division Food Safety and Nutrition Division Supplemental Nutrition and Safety Programs Supplemental Nutrition and Safety Programs

SARA OLSON Digitally signed by SARA OLSON Date: 2025.08.19 13:07:46 -04'00' KRISTIN GARCIA Digitally signed by KRISTIN GARCIA Date: 2025.08.19 11:02:09 -04'00' Guidance documents lack the force and effect of law, unless expressly authorized by statute or incorporated into a contract. USDA may not cite, use, or rely on any guidance that is not available through their guidance portal, except to establish historical facts.

ATTACHMENT A State Agency Options and Select Federal Requirements

State agencies are responsible for identifying the brands, types, and forms of WIC-eligible foods, including substitution options, to authorize for their state food list and must include more than one product for most WIC food categories. While State agencĖôŜϙēÍŽôϙƲôƄĖæĖīĖťƅϙ and options when making these determinations, they are required to authorize certain substitution types and forms to ensure WIC families are receiving a package of healthy foods.

The table below provides a high-level summary of certain requirements (see 7 CFR 246.10 for full requirements) and available State agency options. All foods authorized must meet federal minimum nutrient requirements in 7 CFR 246.10(e)(12); State agencies may also establish additional criteria per 7 CFR 246.10(b)(1)(i).

Food Category Federal Requirementௗ State Agency Option Cow’s Milk Required Substitution: N/A If authorized, when substituting cheese for milk, State agencies may not eliminate the “dangling quart” as a cost-containment measure. States may issue half gallon containers every other month to contain costs.ௗ

More-than-one provision: N/A Satisfied by the two types that regulations require.ௗ Types: Unflavored cow’s milk and lactose- free milk Substitution Options:ௗ x Dairy and plant-based cheeseௗ x Dairy and plant-based yogurt (flavored or unflavored)ௗ x Plant-based milk alternatives (flavored or unflavored)ௗ x Tofu

Forms: fluid, shelf-stable, dry, or evaporatedௗ Types: cultured, acidified, UHT,ௗgoat

Organic

Additional State agency criteria Juice

Required Substitution: Cash value- voucher/benefit (CVV/B)1,2 Substitution Option: N/A Forms: fresh, concentrated, frozen, canned, or shelf stable Guidance documents lack the force and effect of law, unless expressly authorized by statute or incorporated into a contract. USDA may not cite, use, or rely on any guidance that is not available through their guidance portal, except to establish historical facts.

Food Category Federal Requirementௗ State Agency Option Juice More-than-one provision: At a minimum, the State agency must authorize more than one variety of juice (e.g., orange, tomato, etc.). Types: single varieties (orange) and blends (orange-pineapple)

Combinations ofௗsingle-strength and concentrated juices may be issued provided that the total volume does not exceed the maximum monthly allowance (MMA)ௗfor single-strength juice.

Organic

Additional State agency criteria Breakfast Cereal (ready-to-eat and instant and regular hot cereals) Required Substitution:ௗN/A

More-than-one provision: At a minimum, the State agency must authorize more than one cereal grain (whole wheat, oat, corn, etc.).ௗ

At least 75 percent of cereals on the State Authorized Foods List (AFL) must meet whole grain criteria. Substitution Option:ௗN/A

More than 75 percent of cereals on the State AFL can meet whole grain criteria (up to 100 percent).

Organic

Additional State agency criteria Whole Wheat Bread, Whole Grain Bread (includes buns and rolls)

Required Substitution:ௗN/A

More-than-one provision:ௗAt a minimum, the State agency must authorize more than one of these breads (i.e., whole wheat bread and whole grain bread, or whole wheat bread and 100% whole wheat rolls).

Substitution Options: Authorize any of the whole grain options listed in Table 4 (7 CFR 246.10(e)(12))

Additional State agency criteria Fruits and Vegetablesௗ (CVV/B) Required Substitution:ௗN/A

More-than-one provision: N/A

Forms: Fresh and one other form (dried, frozen, canned) Organic ௗ May not selectively choose which WIC- eligible fruits and vegetables to authorize. Substitution Option:ௗN/A

Forms: Authorize more than two forms.

Authorize fresh herbs3

Authorize larger package sizes of fresh produce ௗ Additional State agency criteria Guidance documents lack the force and effect of law, unless expressly authorized by statute or incorporated into a contract. USDA may not cite, use, or rely on any guidance that is not available through their guidance portal, except to establish historical facts.

Food Category Federal Requirementௗ State Agency Option Eggs Required Substitutions: x 1 pound dry or 64 oz canned mature legumes x 18 oz peanut butter

More-than-one provision: N/A

Substitution Options: x 1 pound of tofu x 18 oz nut or seed butters

Forms: fresh shell, dried, liquid; hard boiled (for homeless only)

Organic

Brown or other eggshell colors

Size (medium, large, etc.)

Additional State agency criteria

Peanut Butter Required Substitution:ௗ1 pound dry or 64 oz canned mature legumes

More-than-one provision: N/A

Substitution Option:ௗ18 oz nut or seed butter

Organic

Additional State agency criteria

Mature Legumes (beans and peas) ௗ Required Substitution:ௗ18 oz peanut butter

More-than-one provision: At a minimum, the State agency must authorize more than one type of legume (e.g., black beans and kidney beans).

Forms: Dried and canned Substitution Option:ௗ18 oz nut or seed butter

Type: Baked beans - only for participants with limited cooking facilities.

Organic ௗ Additional State agency criteria Canned Fish Required Substitution:ௗN/A

More-than-one provision: At a minimum, the State agency must authorize more than one variety (e.g., salmon and light tuna).

Substitution Option:ௗN/A

Types: Boneless or skinless, added sauces and flavorings (e.g., tomato sauce, mustard).

Packed in water or oil

Wild-caught or farm-raised

Additional State agency criteria

Food Category Federal Requirementௗ State Agency Option Infant Cerealௗௗௗௗ (6-11 months) Required Substitution:ௗN/A

More-than-one provision: At a minimum, the State agency must authorize more than one cereal grain (e.g., oat and multi-grain). Substitution Option: N/A

Organic

Additional State agency criteria Infant Food Fruits and Vegetablesௗௗ (6 – 11 months) ௗ Required Substitution:ௗN/A

More-than-one provision: At a minimum, the State agency must authorize more than one variety of infant fruits (e.g., apples and pears). A combination of two or more types (e.g., apple-banana) is considered one variety. At a minimum, the State agency must authorize more than one variety of infant vegetables (e.g., butternut squash and sweet potato). A combination of two or more types (e.g., carrots-peas) is considered one variety.ௗ

Substitution Option (applies to both infant fruits and infant vegetables, e.g., cannot apply only to fruits): x 64 oz of infant fruits and vegetables and a CVV/B4 or x No infant fruits and vegetables and a larger CVV/B (relative to the CVV/B provided for half of infant fruits and vegetables)

A State agency exercising the CVV/B substitution option must authorize fresh and at least one other form (frozen or canned).5

Organic

Additional State agency criteria

Infant Meatௗௗௗ (6-11 months) Required Substitution:ௗN/A

More-than-one provision: At a minimum, the State agency must authorize more than one variety (e.g., chicken and beef).

Substitution Option: N/A

Allowing added broth or gravy

Organic

Additional State agency criteria

ATTACHMENT B WIC Food Packages Flexibility Q&As General Flexibilities: 1. Question: Does the option for WIC State agencies to authorize additional product package sizes that provide less than the full maximum monthly allowance (MMA) apply to all foods? Answer: The State agency option to authorize additional product package sizes that provide less than the full MMA applies to all WIC-eligible foods except formula. WIC State agencies must continue to authorize products that provide the full MMA amounts available to participants. This means that at least one package size, or a combination of sizes, must add up to the MMA for all food packages. 2. Question: Do State agencies have discretion to set up food package issuance in their Management Information Systems (MIS) to reduce administrative burden in the clinic and ıÍƄĖıĖƏôϙŕÍŘťĖèĖŕÍĲťϙèēĺĖèôϙÍĲîϙƲôƄĖæĖīĖťƅϙÍťϙťēôϙŜťĺŘôϦϙ For instance: a. May State agencies set up food packages in their MIS so that participants can select substitutions within a food category at the store (also known as “broadbanding”)? For example, issuing broadbanded legumes would allow participants to choose between beans, peanut butter, and if allowable by the State, nut and seed butter at the store. b. May State agencies set up food packages that include commonly issued substitutions? For example, a default food package could include cheese and yogurt in place of only milk. Answer: Yes. State agencies have discretion to set up food packages within their MIS to ıÍƄĖıĖƏôϙÍîıĖĲĖŜťŘÍťĖŽôϙôƯĖèĖôĲèĖôŜϙÍĲîϙĖıŕŘĺŽôϙťēôϙŕÍŘťĖèĖŕÍĲťϙôƄŕôŘĖôĲèôϟϙēôϙŜèôĲÍŘĖĺŜϙ described in both a. and b. above are allowable. State agencies may issue a food category as broadband to allow for more choice at the store, and they may set up “pre-tailored” food ŕÍèħÍČôŜϙťēÍťϙŘôƲôèťϙèĺııĺĲīƅϙèēĺŜôĲϙŜŪæŜťĖťŪťĖĺĲϙĺŕťĖĺĲŜϟϙēôϙaIϙıŪŜťϙæôϙƲôƄĖæīôϙÍĲîϙ Íīīĺſϙ®I ϙŜťÍƯϙťĺϙċŪŘťēôŘϙťÍĖīĺŘϙϼĖϟôϟϠϙıĺîĖċƅϽϙÍϙŕÍŘťĖèĖŕÍĲť’s food package to align with their needs and preferences. Regardless of how the State agency sets up their MIS, all food package issuance and tailoring must be based on a nutrition assessment, which serves as the basis for all other WIC nutrition services. All participants must be informed of the maximum monthly allowance and substitution options of each food category (7 CFR 246.10(b)(2)(ii)(A)). XĲĺſĖĲČϙēĺſϙÍϙŕÍŘťĖèĖŕÍĲťϙŕīÍĲŜϙťĺϙŜŪæŜťĖťŪťôϙċĺĺîŜϙèÍĲϙēôīŕϙ®I ϙŜťÍƯϙŕŘĺŽĖîôϙıĺŘôϙ ôƯôèťĖŽôϙĲŪťŘĖťĖĺĲϙôîŪèÍťĖĺĲϟ Guidance documents lack the force and effect of law, unless expressly authorized by statute or incorporated into a contract. USDA may not cite, use, or rely on any guidance that is not available through their guidance portal, except to establish historical facts.

3. Question: The WIC food packages ƱĲÍīϙŘŪīôϙÍīīĺſŜϙŜıÍīīôŘϙŕÍèħÍČôϙŜĖƏôŜϙťĺϙæôϙÍŪťēĺŘĖƏôîϙ as long as there is an option for WIC participants to redeem their full maximum monthly allowance (MMA) of WIC foods. For example, there is a brand that has some milk packages ťēÍťϙèĺıôϙĖĲϙÍϙ͔͘ϙƲŪĖîϙĺŪĲèôŜϙŜĖƏôϟϙ®ĺŪīîϙťēĖŜϙæôϙÍĲϙÍīīĺſÍæīôϙŕÍèħÍČôϙŜĖƏôϙťĺϙæôϙ®I ϙ approved since other milk options are available in a ͕͓ϙƲŪĖîϙĺŪĲèôŜϙŜĖƏôϙÍĲîϙĖťϙſĖīīϙæôϙŪŕϙťĺϙ the participant to decide which package size to redeem? Answer: Yes, but only as long as the full maximum monthly allowance (MMA) is made available to participants. The State agency option to authorize additional product package sizes that provide less than the full MMA applies to all WIC-eligible foods except WIC formula. State agencies must continue to authorize products that provide the full MMA amounts available to participants. This means that at least one package size, or a combination of sizes, must add up to the MMA for all food packages. So, in the example ıôĲťĖĺĲôîϠϙıĖīħϙĖĲϙ͔͘ϙƲŪĖîϙĺŪĲèôϙèĺĲťÍĖĲôŘŜϙèĺŪīîϙæôϙÍŪťēĺŘĖƏôîϙÍīĺĲČϙſĖťēϙıĖīħϙĖĲϙ͕͓ϙƲŪĖîϙ ounce containers. If a State agency exercises the option to authorize additional package sizes that don’t equal or add up to the full MMA, the local agency must inform participants about the MMA of authorized supplemental foods, consistent with the regulations at 246.10(b)(2)(ii)(A), 246.11(a)(1). As an example of how to satisfy this requirement, a local agency may explain ſēĖèēϙÍŪťēĺŘĖƏôîϙċĺĺîŜϙſĺŪīîϙÍīīĺſϙťēôϙŕÍŘťĖèĖŕÍĲťϙťĺϙŘôîôôıϙťēôϙċŪīīϙıĺĲťēīƅϙæôĲôƱťϙ amount as part of participant education. Fruits & Vegetables: 1. Question: We only authorize fresh fruits and vegetables for purchase with the cash-value æôĲôƱťϙϼ «ϽϙÍĲîϙēÍîϙæôôĲϙŕīÍĲĲĖĲČϙťĺϙèēÍĲČôϙťĺϙÍîîϙċŘĺƏôĲϙÍĲîϙèÍĲĲôîϟϙ®ôДîϙīĖħôϙťĺϙ implement adding frozen and canned across all the categories (women, children, and infants) at the same time. Can we make that change across all participant categories without making all the other changes for children and women? Answer: Yes, State agencies may authorize canned and frozen forms at any time for adult ÍĲîϙèēĖīîϙŕÍŘťĖèĖŕÍĲťŜϙŜĖĲèôϙŘôČŪīÍťĖĺĲŜϙŕŘĖĺŘϙťĺϙťēôϙƱĲÍīϙŘŪīôϙÍīīĺſôîϙ®I ϙťÍťôϙÍČôĲèĖôŜϙťĺϙ authorize one or more of the forms in addition to fresh (canned, frozen, and dried) for adult and child participants. 2. Question: At what age can infants have a cash-ŽÍīŪôϙæôĲôƱťϙϼ «ϽϦϙ Answer: The CVB substitution for infant fruits and vegetables is a WIC State agency option ťēÍťϙèÍĲϙæôϙĺƯôŘôîϙæôČĖĲĲĖĲČϙÍťϙ͕ϙıĺĲťēŜϙĺċϙÍČôϙťēŘĺŪČēϙ͐͐ϙıĺĲťēŜϙĺċϙÍČôϟϙťϙÍČôϙ͐ϙyear, ťēôϙŕÍŘťĖèĖŕÍĲťϙſĺŪīîϙťēôĲϙæôϙŘôèôŘťĖƱôîϙÍŜϙÍϙèēĖīîϙÍĲîϙŘôèôĖŽôϙ>ĺĺîϙÍèħÍČôϙI«ϠϙſēĖèēϙ includes a standalone CVB. Juice: Guidance documents lack the force and effect of law, unless expressly authorized by statute or incorporated into a contract. USDA may not cite, use, or rely on any guidance that is not available through their guidance portal, except to establish historical facts.

1. Question: "ĺôŜϙťēôϙƱĲÍīϙŘŪīôϙÍīīĺſϙťÍťôϙÍČôĲèĖôŜϙťĺϙŕŘĺŽĖîôϙŜıÍīīôŘϙĤŪĖèôϙèĺĲťÍĖĲôŘϙŜĖƏôŜϙ than the 64-ounce container size? Answer: Yes, but only as long as the full maximum monthly allowance (MMA) is made available to participants. It is a State agency option to authorize additional product package sizes that provide less than the full MMA, which applies to all WIC-eligible foods except WIC ċĺŘıŪīÍϟϙĖĲèôϙťēĖŜϙŕÍèħÍČôϙŜĖƏôϙƲôƄĖæĖīĖťƅϙĖŜϙÍϙťÍťôϙÍČôĲèƅϙĺŕťĖĺĲϠϙ®I ϙťÍťôϙÍČôĲèĖôŜϙıÍƅϙ îĖƯôŘϙĖĲϙťēôϙŕŘĺîŪèťϙŜĖƏôŜϙťēôƅϙÍŪťēĺŘĖƏôϟ Whole Grains: 1. Question: For the requirement that 75 percent of breakfast cereals on a State agency food list be whole grain, how do State agencies count and consider the number of whole grain èôŘôÍīŜϙŽôŘŜŪŜϙťĺťÍīϙèôŘôÍīŜϦϙ>ĺŘϙîĖƯôŘôĲťϙƲÍŽĺŘŜϙĺċϙťēôϙŜÍıôϙèôŘôÍīϠϙôϟČϟϠϙēĺĲôƅϙŘĺÍŜťôîϠϙ almonds, cinnamon, and vanilla. Is this counted as one or four? Answer: "ĖƯôŘôĲťϙŽÍŘĖôťĖôŜϙĺŘϙƲÍŽĺŘŜϙĺċϙťēôϙŜÍıôϙèôŘôÍīϙèan æôϙĺƯôŘôîϙÍĲîϙèĺŪĲťôîϙ ŜôŕÍŘÍťôīƅϙĖċϙťēôƅϙĖĲîĖŽĖîŪÍīīƅϙıôôťϙťēôϙıĖĲĖıŪıϙċôîôŘÍīϙŜŕôèĖƱèÍťĖĺĲŜϙĺŪťīĖĲôîϙĖĲϙ͖ϙ >ϙ 246.10(e)(12). IťЍŜϙĖıŕĺŘťÍĲťϙťĺϙŘôıôıæôŘϙťēÍťϙťēôϙŕŪŘŕĺŜôϙĺċϙťēĖŜϙƲôƄĖæĖīĖťƅϙĖŜϙťĺϙĺƯôŘϙÍϙſĖîôϙŽÍŘĖôťƅϙĺċϙ ČŘÍĖĲŜϟϙ"ĖƯôŘôĲťϙŜťĺŘôϙæŘÍĲîŜϙĺċϙťēôϙŜÍıôϙèôŘôÍīϠϙēĺſôŽôŘϠϙŜēĺŪīîϙèĺŪĲťϙÍŜϙĺĲôϙèôŘôÍīϟϙ>ĺŘϙ example, if a State agency authorizes a name-brand æŘÍĲϙƲÍħôŜϙÍĲîϙťēŘôôϙîĖƯôŘôĲťϙŜťĺŘôϙ brand alternatives (ċĺŘϙÍϙťĺťÍīϙĺċϙċĺŪŘϙæŘÍĲϙƲÍħôŜϙĺŕťĖĺĲŜ), the State agency should count the name-æŘÍĲîϙæŘÍĲϙƲÍħôŜϙÍŜϙĺĲôϙſēĺīôϙČŘÍĖĲϙĺŕťĖĺĲϙÍĲîϙťēôϙťēŘôôϙŜťĺŘôϙæŘÍĲîϙŽôŘŜĖĺĲŜϙĺċϙ æŘÍĲϙƲÍħôŜϠϙèĺıæĖĲôîϠϙÍŜϙÍϙŜôèĺĲîϙſēĺīôϙČŘÍĖĲϙĺŕťĖĺĲϟ Each cereal should be evaluated individually to ensure it meets whole grain criteria as well as iron requirements and added sugar limits. 2. Question: What type of grains besides rice can æôϙĺƯôŘôîϦϙ Answer: Whole grain options include brown rice, wild rice, quinoa, bulgur, oats, whole-grain æÍŘīôƅϠϙıĖīīôťϠϙťŘĖťĖèÍīôϠϙÍıÍŘÍĲťēϠϙèĺŘĲıôÍīϙϼĖĲèīŪîĖĲČϙæīŪôϽϠϙèĺŘĲϙıÍŜÍϙƲĺŪŘϠϙſēĺīôϙſēôÍťϙ macaroni (pasta) products, whole wheat bread products (e.g., pita, English muƯĖĲϠϙæÍČôīŜϠϙ ĲÍÍĲϽϠϙŜĺċťϙèĺŘĲϙĺŘϙſēĺīôϙſēôÍťϙťĺŘťĖīīÍŜϠϙæŪèħſēôÍťϠϙťôƯϠϙħÍıŪťϠϙĺŘϙŜĺŘČēŪıϠϙſēôÍťϙ berries, and other intact whole grains (red rice, black rice, freekeh, spelt, farro, etc.). 3. Question: Can a State agency ÍŕŕŘĺŽôϙČŘĖťŜϠϙŕĺīôĲťÍϠϙÍĲîϙıÍŜÍϙēÍŘĖĲÍϙƲĺŪŘϙťēÍťϙēÍŽôϙèĺŘĲϙ as the only ingredient as a whole grain? Some masa harina and other corn products are made with just corn and lime/trace of lime; can a State agency add products that contain just corn and lime? Answer: Corn grits and polenta may be WIC-eligible if the form of corn used is a whole grain (and does not contain added sugars, fats, oils, or salt (i.e., sodium)). State agencies may allow grits and polenta if they verify that the only ingredient is intact whole corn grain, either Guidance documents lack the force and effect of law, unless expressly authorized by statute or incorporated into a contract. USDA may not cite, use, or rely on any guidance that is not available through their guidance portal, except to establish historical facts.

by reviewing the product’s ingredient list or requesting product information from the ıÍĲŪċÍèťŪŘôŘϙċĺŘϙèĺĲƱŘıÍťĖĺĲϟϙЊ ĺŘĲϠЋϙЊîôČôrminated corn meal,” and “degermed corn” are ĲĺťϙſēĺīôϙČŘÍĖĲϙċĺŘıŜϟϙaÍŜÍϙēÍŘĖĲÍϙƲĺŪŘϙĖŜϙÍϙ®I -eligible whole grain. “Lime” and “trace of īĖıôЋϙīĖŜťôîϙĖĲϙťēôϙĖĲČŘôîĖôĲťϙīĖŜťϙĺċϙıÍŜÍϙēÍŘĖĲÍϙƲĺŪŘϙĖŜϙÍĲϙÍīīĺſÍæīôϙĖĲČŘôîĖôĲťϠϙÍŜϙťēôϙīĖıôϙ is an alkaline solution used in processing the corn. 4. Question: Are sprouted rolled oats allowable? Answer: Yes. State agencies have the option to identify and authorize other intact whole grain options without added sugar, fats, oils, or salt (i.e., sodium) including sprouted rolled oats. Nut and Seed Butters: 1. Question: What seed butters align with the protein and iron requirements? What does it mean for nut and seed butters to be ‘nutritionally equivalent’ to peanut butter? Is there a range or percent that nut or seed butter must be within? For reference here is a chart that includes both protein and iron content per 2- tablespoon (32g) serving for the nut or seed butters: Nut/Seed Butter | Protein (g) | Iron (mg) Peanut Butter | 8 | 0.6 Almond Butter | 7 | 1 Cashew Butter | 5 | 2 ŪĲƲĺſôŘϙôôîϙŪťťôŘϙиϙ͕ϙиϙ͐ϟ͔ϙ Soy Nut Butter | 7 | 1.5 Pumpkin Seed Butter | 9 | 4 Hemp Seed Butter | 10 | 4 Answer: To better accommodate participants’ special dietary needs, cultural practices, and personal preferences, State agencies may authorize nut and seed butters that are nutritionally comparable – but not necessarily equivalent – to peanut butter. When doing so, State agencies have discretion to determine which products are nutritionally comparable and should consider the amounts of macronutrients (e.g., protein) and key micronutrients (e.g., iron) provided. 2. Question: Is tahini allowed as a seed butter? Answer: State agencies have discretion to determine which nut and seed butters, including tahini, to authorize as peanut butter substitutes. When choosing WIC-eligible nut and seed butter substitutions that are nutritionally comparable to peanut butter, State agencies should consider the amounts of macronutrients (e.g., protein) and key micronutrients (e.g., iron) provided. Guidance documents lack the force and effect of law, unless expressly authorized by statute or incorporated into a contract. USDA may not cite, use, or rely on any guidance that is not available through their guidance portal, except to establish historical facts.

Milk/Milk Alternative: 1. Question: Can a State agency exclude a plant-based milk alternative even it meets federal WIC requirements for criteria for plant-based milk? Answer: Yes, authorizing plant-based milk alternatives as a substitute for milk is a State agency option, therefore State agencies determine if they will authorize such products. Each WIC State agency is encouraged ťĺϙĺƯôŘϙÍŜϙıŪèēϙŽÍŘĖôťƅϙÍĲîϙèēĺĖèôϙÍŜϙŕĺŜŜĖæīôϙ within their budget and cost containment measures to accommodate their participants’ nutritional needs. Fish: 1. Question: IŜϙŜŪČÍŘϙÍĲϙÍŕŕŘĺŽôîϙĖĲČŘôîĖôĲťϙЀċĺŘϙèÍĲĲôîϙƱŜēЁϦ Answer: ēôϙıĖĲĖıŪıϙĲŪťŘĖôĲťϙŘôŗŪĖŘôıôĲťŜϙÍĲîϙŜŕôèĖƱèÍťĖĺĲŜϙċĺŘϙèÍĲĲôîϙƱŜēϙîĺϙĲĺťϙ ŕŘĺēĖæĖťϙÍîîôîϙŜŪČÍŘϙÍŜϙÍĲϙĖĲČŘôîĖôĲťϙťĺϙèÍĲĲôîϙƱŜēϙϼŜôôϙÍæīôϙ͓ϙĺċϙ͖ϙ >ϙ͓͕͑ϟ͐͏ϼôϽϼ͐͑ϽϙċĺŘϙ the full list of federal minimum requirements). To provide participants with variety, ŘôČŪīÍťĖĺĲŜϙÍīīĺſϙťÍťôϙÍČôĲèĖôŜϙťĺϙÍŪťēĺŘĖƏôϙèÍĲĲôîϙƱŜēϙŕŘĺîŪèťŜϙſĖťēϙÍîîôîϙŜÍŪèôŜϙÍĲîϙ ƲÍŽĺŘĖĲČŜϠϙſēĖèēϙıÍƅϙèĺĲťÍĖĲϙÍîîôîϙŜŪČÍŘŜϟϙ State agencies have administrative ƲôƄĖæĖīĖťƅϙϼŜôôϙ7 CFR 246.10(b)(1)(i)) to establish criteria in addition to the minimum Federal requirements, which could include prohibiting or ŕīÍèĖĲČϙÍϙīĖıĖťϙĺĲϙÍîîôîϙŜŪČÍŘϙĖĲϙèÍĲĲôîϙƱŜēϙſĖťēϙŜÍŪèôŜϙÍĲîϙƲÍŽĺŘĖĲČŜϟ Other: 1. Question: ťÍťôϙÍČôĲèĖôŜϙÍŘôϙŜôôħĖĲČϙČŪĖîÍĲèôϙĺĲϙÍŕŕŘĺŽĖĲČϙċĺĺîŜϙſĖťēϙÍŘťĖƱèĖÍīϙÍĲîϙ ЊĲÍťŪŘÍīЋϙŜſôôťôĲôŘŜϙϼŜťôŽĖÍϠϙÍŜŕÍŘťÍıôϠϙıĺĲħϙċŘŪĖťϠϙôťèϟϽϠϙŜŕôèĖƱèÍīīƅϙƅĺČŪŘťŜϙÍĲîϙĺťēôŘϙ foods as applicable. Answer: While restricting or allowing foods with non-nutritive sweeteners (stevia, aspartame, monk fruit, etc.) continues to be a State agency option, State agencies are encouraged to support WIC participants in making healthy choices by authorizing nutrient dense foods. In addition, and in accordance with the Dietary Guidelines, low- and no- calorie sweeteners are not recommended for children younger than the age of two. State agencies have administrative ƲôƄĖæĖīĖťƅϙϼŜôôϙ7 CFR 246.10(b)(1)(i)) to establish criteria in addition to the minimum Federal requirements, which could include prohibiting or placing a limit on foods containing ÍŘťĖƱèĖÍīϙŜſôôťôĲôŘŜϟ

(policy-memo)(2026-1)(document-1)#

Food and Nutrition Service, Braddock Metro Center, 1320 Braddock Place, Alexandria, VA 22314 USDA is an equal opportunity provider, employer, and lender. DATE: SUBJECT: TO: December 5, 2025 WIC Policy Memorandum #2026-1: Implementation of the Continuing Appropriations, Agriculture, Legislative Branch, Military Construction and Veterans Affairs, and Extensions Act, 2026 (P.L. 119-37), Temporary Increase to the Maximum Monthly Allowance of Fluid Milk Regional Directors Supplemental Nutrition Division All Regional Offices WIC State Agency Directors All WIC State Agencies On November 12, 2025, President Trump signed the Continuing Appropriations, Agriculture, Legislative Branch, Military Construction and Veterans Affairs, and Extensions Act, 2026 (P.L. 119-37, the Act) into law. Section 787 of the Act directs USDA to update the maximum monthly allowance (MMA) of fluid milk for certain food packages provided in the Special Supplemental Nutrition Program for Women, Infants, and Children (WIC) Program. Under the leadership of Secretary Brooke Rollins, USDA is encouraging healthy choices, healthy outcomes, and healthy families through the timely implementation of this provision. Changes to MMA of Fluid Milk Per the Act, the MMA of fluid milk as defined under WIC regulations at 7 CFR 246.10(e) is updated effective immediately to reflect the following amounts for fiscal year (FY) 2026: WIC Food Package Temporary Milk MMA for FY 2026 Food Package III ** Food Package IV A and B 16 quarts Food Package V A and B 22 quarts Food Package VI 16 quarts through their guidance portal, except to establish historical facts. incorporated into a contract. USDA may not cite, use, or rely on any guidance that is not available Guidance documents lack the force and effect of law, unless expressly authorized by statute or

Page 2 of 3 Food Package VII 24 quarts **Fluid milk MMA is equivalent to the food package MMA increase as authorized by the Act and corresponding to the participant category as outlined in 7 CFR 246.10(e) and 7 CFR 246.10(e)(4) through (7). The authority for these updated amounts terminates on September 30, 2026. Benefits issued with a first date of use in September 2026 must reflect the updated amounts. However, the time periods for transacting and redeeming the food benefits may occur after September 30, 2026, in accordance with current State agency policy and procedures. The State agency must maintain the updated MMAs of fluid milk through September 30, 2026. Implementation of Changes We recognize that implementation of the Special Supplemental Nutrition Program for Women, Infants, and Children (WIC): Revisions in the WIC Food Packages final rule (referred to herein as the 2024 final rule) is currently underway. The temporary changes outlined above return milk MMAs to amounts authorized prior to the 2024 final rule. State agencies that have NOT previously completed implementation of Food Packages III – VII as outlined in the 2024 final rule and in accordance with WIC Policy Memorandum #2024-5: Implementing the Provisions of the Special Supplemental Nutrition Program for Women, Infants, and Children (WIC): Revisions in the WIC Food Packages Final Rule should cancel planned changes to the MMA of milk. To the maximum extent practicable, State agencies should communicate the changes to the fluid milk MMA to their participants and vendors. FNS is committed to working with State agencies to ensure prompt implementation of the temporary increase to MMA for fluid milk. State agencies should direct any questions related to this memorandum to their respective FNS Regional Offices. through their guidance portal, except to establish historical facts. incorporated into a contract. USDA may not cite, use, or rely on any guidance that is not available Guidance documents lack the force and effect of law, unless expressly authorized by statute or

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SARA L. OLSON Director Policy Division Supplemental Nutrition and Safety Programs through their guidance portal, except to establish historical facts. incorporated into a contract. USDA may not cite, use, or rely on any guidance that is not available Guidance documents lack the force and effect of law, unless expressly authorized by statute or

(policy-memo)(2026-2)(document-1)#

DATE: December 10, 2025 SUBJECT: WIC Policy Memorandum #2026-2: Fiscal Year (FY) 2026 Cash-Value Voucher/Benefit (CVV/B) Amounts TO: Regional Directors Supplemental Nutrition Division All Regional Offices WIC State Agency Directors All State Agencies The U.S. Department of Agriculture’s (USDA) Special Supplemental Nutrition Program for Women, Infants, and Children (WIC) is one of the nation’s most trusted and important public health programs. Under the leadership of USDA Secretary Brooke Rollins, WIC supports the Trump Administration’s commitment to encouraging healthy choices, healthy outcomes, and healthy families through the federal nutrition programs. This memorandum encourages state agencies to allow more fruit and vegetable options for participants to purchase with their monthly cash-value voucher/benefit (CVV/B) and lists the inflation adjustments to the CVV/B amounts for fiscal year (FY) 2026 – which runs from October 1, 2025, to September 30, 2026. Providing More Fruit and Vegetable Options for WIC Families In line with Congressional directives accompanying the FY 2026 WIC appropriations, FNS strongly supports state agency efforts to provide more fresh, frozen, canned, and dried fruit and vegetable options for WIC participants.1 Allowing WIC families to purchase additional forms of fruits and vegetables with their CVV/B promotes healthy outcomes for participants. FNS acknowledges that state agencies are already working to ensure that WIC families have more fruit and vegetable options. Recent changes to the WIC food packages require state agencies to authorize at least one form (i.e., frozen, canned, and/or dried) of fruits and vegetables in addition to fresh by April 2026.2 As of November 2025, 95 percent of state agencies are in compliance, authorizing fresh and at least one additional form of fruits and 1 See the Joint Explanatory Statement for Division B of the Continuing Appropriations, Agriculture, Legislative Branch, Military Construction and Veterans Affairs, and Extensions Act, 2026 (P.L. 119-37), available online: https://www.appropriations.senate.gov/imo/media/doc/ag_divbjes.pdf. 2 Special Supplemental Nutrition Program for Women, Infants, and Children (WIC): Revisions in the WIC Food Packages final rule, 89 FR 28488. Food and Nutrition Service, Braddock Metro Center, 1320 Braddock Place, Alexandria, VA 22314 USDA is an equal opportunity provider, employer, and lender. Guidance documents lack the force and effect of law, unless expressly authorized by statute or incorporated into a contract. USDA may not cite, use, or rely on any guidance that is not available through their guidance portal, except to establish historical facts.

Page 2 of 3 vegetables. We appreciate state agencies' timely implementation of these changes and support state agency-led efforts to expand healthy options for families. FY 2026 CVV/B Amounts WIC regulations require annual inflation adjustments to the baseline CVV/B monthly values.3 Increases to the CVV/B amounts are rounded down to the next lowest whole dollar.4 In FY 2026, the CVV/B inflation adjustment is 11.8 percent over the FY 2022 baseline amounts. This results in a one dollar increase over the FY 2025 CVV/B amount for pregnant and postpartum participants and no change to the amounts for children and breastfeeding participants. Therefore, the FY 2026 amounts are: Table 1: FY 2026 CVV/B Amounts Category Affected Food Packages FY 2026 Monthly CVV/B Amount Children III, IV $26 Pregnant and postpartum participants III, V-A, VI $48 Fully and partially (mostly) breastfeeding participants III, V-B, VII $52 CVV/B Juice Substitution Amount The FY 2026 inflation adjustment does not result in a whole dollar increase to the monthly CVV/B substitution amount for juice. Therefore, the FY 2026 amount remains at: Table 2: FY 2026 Juice CVV/B Substitution Amounts Category Affected Food Packages FY 2026 Monthly CVV/B Amount Children and adults, full juice substitution (64 fl. oz.) III, IV, V, VI, VII $3 3 7 CFR 246.16(j) 4 The inflation adjustment must equal the percentage (if any) by which the annual average value of the Consumer Price Index for fresh fruits and vegetables, computed from monthly values published by the Bureau of Labor Statistics, for the twelve months ending on March 31 of the fiscal year immediately prior to the adjustment year, exceeds the average of the monthly values of that index for the twelve months ending on March 31, 2021. If any increase in the CVV/B is not a multiple of $1, the increase must be rounded to the next lowest multiple of $1. Guidance documents lack the force and effect of law, unless expressly authorized by statute or incorporated into a contract. USDA may not cite, use, or rely on any guidance that is not available through their guidance portal, except to establish historical facts.

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CVV/B Infant Food Jarred Fruit and Vegetable Substitution Amounts

The FY 2026 inflation adjustment does not result in a whole dollar increase to the monthly CVV/B substitution amounts of infant food jarred fruits and vegetables. Therefore, the FY 2026 amounts remain at:

Table 3: FY 2026 Infant Jarred Fruit and Vegetable CVV/B Substitution Amounts Category

Affected Food Packages FY 2026 Monthly CVV/B Amount Infants 6-11 months, half jarred infant food fruits and vegetables substitution (64 oz.) II, III $11 Infants 6-11 months, full jarred infant food fruits and vegetables substitution (128 oz.) II, III

$22

State agencies may direct any questions related to this memorandum to their respective FNS regional office.

SARA OLSON Director Policy Division Supplemental Nutrition and Safety Programs Guidance documents lack the force and effect of law, unless expressly authorized by statute or incorporated into a contract. USDA may not cite, use, or rely on any guidance that is not available through their guidance portal, except to establish historical facts.

(policy-memo)(2026-4)(document-1)#

Guidance documents lack the force and effect of law, unless expressly authorized by statute or incorporated into a contract. USDA may not cite, use, or rely on any guidance that is not available through their guidance portal, except to establish historical facts. Food and Nutrition Service, Braddock Metro Center, 1320 Braddock Place, Alexandria, VA 22314 USDA is an equal opportunity provider, employer, and lender. DATE: March 30, 2026 SUBJECT: WIC Policy Memorandum #2026-4

Dietary Guidelines for Americans, 2025-2030 – Eat Real Food TO: Regional Directors, Special Nutrition Programs, All Regions

WIC State Agency Directors, All State Agencies On January 7, 2026, the United States Department of Health and Human Services and the United States Department of Agriculture (USDA) released the Dietary Guidelines for Americans, 2025-2030 (Guidelines). These Guidelines call on every American to eat more real food. Farmers, ranchers, health care professionals, insurers, educators, community leaders, industry, and lawmakers across all levels of government are encouraged to join in this critical effort. America’s future depends on what we grow, what we serve, and what we choose to eat. These Guidelines place whole, nutrient- dense food back at the center of our diets. You can access the new edition, the New Pyramid, and the daily servings guide at https://realfood.gov/. In summary, these Guidelines have been updated by: • Prioritizing a variety of high quality, nutrient-dense protein foods at every meal from animal sources, including eggs, poultry, seafood, and red meat, as well as a variety of plant-sourced protein foods including beans, peas, lentils, legumes, nuts, seeds, and soy.

Page 2 of 7 Guidance documents lack the force and effect of law, unless expressly authorized by statute or incorporated into a contract. USDA may not cite, use, or rely on any guidance that is not available through their guidance portal, except to establish historical facts. • Encouraging a variety of dairy fat options, including whole and reduced-fat milk. • Promoting the consumption of vegetables and fruits of all types, including fresh, frozen, canned, juiced, and dried, throughout the day. • Incorporating healthy fats from whole foods such as meats, poultry, eggs, seafood, nuts, seeds, full-fat dairy, olives, and avocados. • Prioritizing fiber-rich whole grains while significantly reducing refined grains, especially those high in added sugars. • Limiting highly processed foods, added sugars, and refined carbohydrates. The Special Supplemental Nutrition Program for Women, Infants, and Children (WIC) plays an important role in supporting healthy development during the critical life stages of pregnancy, postpartum, breastfeeding, infancy, and childhood. While release of the new Guidelines does not immediately impact program requirements, USDA is actively identifying opportunities to further align the WIC food packages with the key recommendations in the Guidelines and will use the rulemaking process to propose any changes to program requirements. The Guidelines will also inform the review of the WIC food packages, which is required by Congress at least every 10 years.1 Secretary of Agriculture Brooke Rollins strongly encourages WIC State agencies to familiarize themselves with the Guidelines and consider how the key recommendations can be incorporated into program operations to promote healthy outcomes and healthy families. WIC State Agency Flexibilities While all WIC-eligible foods must align with program requirements, State agencies have

1 Section 17 of the Child Nutrition Act of 1966, as amended (42 U.S.C. 1786).

Page 3 of 7 Guidance documents lack the force and effect of law, unless expressly authorized by statute or incorporated into a contract. USDA may not cite, use, or rely on any guidance that is not available through their guidance portal, except to establish historical facts. significant flexibility to determine which brands, types, and forms to authorize for their WIC food lists. The historic release of the Guidelines offers State agencies the opportunity to critically evaluate how they can update their WIC authorized food lists to prioritize options that promote whole, nutrient-dense protein foods, dairy, vegetables, fruits, healthy fats, and whole grains while limiting added sugars and refined carbohydrates. State agencies can also establish criteria in addition to Federal minimum specifications. Attachment A outlines examples of flexibilities State agencies can implement to further align the WIC food packages with the goals of the updated Guidelines. State agencies and local WIC staff are invited to share their creative ideas with their Food and Nutrition Service (FNS) Regional Offices, as they could become the model for other WIC programs. Substitution Options State agencies are encouraged to offer substitution options that support the goals of the Guidelines and best support healthy outcomes for WIC participants. WIC Policy Memorandum #2025-5, Implementing Revisions to the WIC Food Packages: Flexibilities to Support Healthy Choices, Healthy Outcomes, and Healthy Families, outlines substitution options and requirements for State agencies. Nutrition Education WIC nutrition education is a program benefit that should be leveraged to reinforce the goals of the Guidelines to help participants make lasting changes to improve their long- term health. State agencies are reminded that the WIC Works Resource System is a tool for WIC staff that supports their nutrition education efforts. Resources available include staff training, healthy recipes, and other educational materials like nutrient infographics that highlight the importance of iron, choline, folate, vitamin D, iodine, and zinc as part of a healthy diet during pregnancy, postpartum, breastfeeding, infancy, and

Page 4 of 7 Guidance documents lack the force and effect of law, unless expressly authorized by statute or incorporated into a contract. USDA may not cite, use, or rely on any guidance that is not available through their guidance portal, except to establish historical facts. childhood. USDA is reviewing and will update, as needed, WIC nutrition education resources to ensure alignment with the new Guidelines. State agencies should distribute this information to local WIC agencies and may direct any questions to their respective FNS Regional Office. We look forward to continuing our work together to support healthy choices, healthy outcomes, and healthy families. Sincerely,

Sarah Widor Acting Associate Administrator Supplemental Nutrition and Safety Programs Food and Nutrition Service U.S. Department of Agriculture

SARAH WIDOR Digitally signed by SARAH WIDOR Date: 2026.03.30 15:48:20 -04'00'

Page 5 of 7 Guidance documents lack the force and effect of law, unless expressly authorized by statute or incorporated into a contract. USDA may not cite, use, or rely on any guidance that is not available through their guidance portal, except to establish historical facts. ATTACHMENT A State Agency Flexibilities to Further Align the WIC Food Packages with the Dietary Guidelines for Americans, 2025-2030 WIC food packages should be tailored to each WIC participant’s individual needs following a nutrition assessment. Prioritize Protein Foods at Every Meal High-quality, nutrient-dense protein foods should be consumed with every meal as part of a healthy dietary pattern. The WIC food packages provide protein-rich foods like milk, eggs, beans, legumes, and canned fish. WIC staff should offer information to participants about the amount of protein foods they need each day and encourage full redemption of protein foods offered through their WIC benefit. Consume Dairy Dairy is an excellent source of protein, healthy fats, vitamins, and minerals. Milk is included in the WIC food packages for women and children. Depending on the participant’s age and nutritional needs, they may be prescribed whole, reduced-fat, low- fat, or non-fat milk. WIC staff should: 1. Prescribe milk with higher fat content, when allowable in accordance with WIC requirements at 7 CFR 246.10. 2. Offer information to participants about the important nutrients dairy provides and encourage dairy consumption through full redemption of their WIC benefit for dairy. Focus on Whole Grains Whole grains contain a variety of nutrients, including fiber, and are an important part of a healthy diet. Whole wheat or whole grain bread and whole grain breakfast cereal are

Page 6 of 7 Guidance documents lack the force and effect of law, unless expressly authorized by statute or incorporated into a contract. USDA may not cite, use, or rely on any guidance that is not available through their guidance portal, except to establish historical facts. included in the WIC food packages for women and children. WIC State agencies are encouraged to: • Require that more than the Federal minimum of 75 percent of the breakfast cereals on their food list meet whole grain criteria (i.e., must contain whole grain as the first ingredient). • Establish criteria that go beyond the minimum Federal requirement of a whole grain listed as the first ingredient for breakfast cereal and only authorize cereals that are 100 percent whole grain. • Authorize a variety of whole grain options to offer as a substitute to whole wheat or whole grain bread such as whole grain oats, brown rice, pita, and naan.2 Eat Vegetables and Fruits Throughout the Day Vegetables and fruits are rich in important nutrients, such as vitamin C, potassium, and fiber, and vary in the amounts of nutrients they provide. The WIC food packages’ cash- value benefit (CVB) provides participants with access to a variety of colorful, nutrient- dense produce. For participants with juice in their food package, they have the option of substituting an additional CVB in place of their full juice amount. WIC agencies should: • Authorize all forms of fruits and vegetables (fresh, canned, frozen, dried) with no added sugars for women and children. • Encourage families to eat vegetables and fruits in their original form by making the $3 CVB substitute for juice the default, with juice issued upon request in the food packages for women and children.3,4

2 For a full list of allowable whole grain options, see 7 CFR 246.10 (1)(12), Table 4 3 See Revisions in the WIC Food Packages Final Rule. 4 In accordance with 7 CFR 246.10 and 246.11, WIC State agencies must inform participants about the standard foods in their food package, including juice.

Page 7 of 7 Guidance documents lack the force and effect of law, unless expressly authorized by statute or incorporated into a contract. USDA may not cite, use, or rely on any guidance that is not available through their guidance portal, except to establish historical facts. • Exercise the option for older infants (6 months through 11 months) to allow a CVB substitution for at least half the maximum monthly allowance of infant fruits and vegetables. If exercising this option, State agencies should authorize fresh, canned, and frozen forms with no added sugars. Limit Highly Processed Foods, Added Sugars, and Refined Carbohydrates WIC provides a variety of whole, nutrient-dense foods for participants to prepare at home. Most WIC-eligible foods have no added sugars. • WIC-eligible foods include breakfast cereals containing ≤ 6 grams of added sugars per dry ounce and, as a substitute for milk based on an individual nutrition assessment, yogurt containing ≤ 16 grams of added sugar per 8 ounces and plant-based milk alternatives containing ≤ 10 grams of added sugar per 8 ounces. State agencies are strongly encouraged to further restrict added sugars in these and other WIC-eligible foods by establishing lower added sugars limits. • WIC regulations do not prohibit artificial flavors, petroleum-based dyes, artificial preservatives, and low-calorie and non-nutritive sweeteners in WIC-eligible foods. However, State agencies are strongly encouraged to establish criteria that exclude or limit specific WIC-eligible foods that contain these ingredients from their list of authorized foods.

(policy-memo)(2026-5)(document-1)#

USDA iiiii U.S. DEPARTMENT OF AGRICULTURE DATE: April 29, 2026 SUBJECT: WIC Policy Memorandum #2026-5: Publication of 2026-2027 Special Supplemental Nutrition Program for Women, Infants, and Children (WIC) Income Eligibility Guidelines TO: Regional Directors Special Nutrition Programs WIC State Agency Directors All State Agencies This policy memorandum transmits the 2026-2027 Income Eligibility Guidelines (IEGs) for the Special Supplemental Nutrition Program for Women, Infants, and Children (WIC) that were published in the Federal Register on April 29, 2026, at 91 FR 23050. Section 17(d)(2)(A) of the Child Nutrition Act, as amended (42 U.S.C. 1786(d)(2)(A)), requires the establishment of income criteria to be used with nutritional risk criteria in determining a person’s eligibility for participation in WIC. Income eligibility for WIC is determined using income standards as prescribed under Section 9(b) of the Richard B. Russell National School Lunch Act (42 U.S.C. 1758(b)). The income limit is 185 percent of the Federal poverty guidelines, as adjusted. Section 9(b) also requires that these guidelines be revised annually to reflect changes in the Consumer Price Index. The annual revision for 2026 was published by the Department of Health and Human Services (HHS) at 91 FR 1797, on January 15, 2026. In accordance with the established income guidance, the revised WIC IEGs are to be used in conjunction with the WIC regulations at 7 CFR 246.7(d). Guidance documents lack the force and effect of law, unless expressly authorized by statute or incorporated into a contract. USDA may not cite, use, or rely on any guidance that is not available through their guidance portal, except to establish historical facts. Office of the Under Secretary for Food, Nutrition, and Consumer Services, 1400 Independence Avenue, SW, Washington, DC 20250-9600 USDA is an equal opportunity provider, employer, and lender.

Page 2 of 4 WIC State agencies may implement the revised IEGs concurrently with the implementation of IEGs under the Medicaid program. State agencies that do not coordinate implementation with the Medicaid program must implement the revised WIC IEGs no later than July 1, 2026. WIC State agencies must ensure that Management Information Systems incorporate the 2026-2027 changes accordingly. A supplemental chart is attached for State agencies to use in determining the annual, monthly, twice-monthly, bi-weekly, and weekly income limits. There is also a chart for families greater than eight. SARA OLSON Policy Director Supplemental Nutrition and Safety Programs Food and Nutrition Service U.S. Department of Agriculture Guidance documents lack the force and effect of law, unless expressly authorized by statute or incorporated into a contract. USDA may not cite, use, or rely on any guidance that is not available through their guidance portal, except to establish historical facts.

Page 3 of 4 Income Eligibility Guidelines (Effective from July 1, 2026, to June 30, 2027) Household Size Federal Poverty Guidelines - 100% Reduced Price Meals - 185% Annual Monthly Twice- Monthly Bi-Weekly Weekly Annual Monthly Twice- Monthly Bi-Weekly Weekly 48 Contiguous States, D.C., Guam and Territories 1 $15,960 $1,330 $665 $614 $307 $29,526 $2,461 $1,231 $1,136 $568 2 21,640 1,804 902 833 417 40,034 3,337 1,669 1,540 770 3 27,320 2,277 1,139 1,051 526 50,542 4,212 2,106 1,944 972 4 33,000 2,750 1,375 1,270 635 61,050 5,088 2,544 2,349 1,175 5 38,680 3,224 1,612 1,488 744 71,558 5,964 2,982 2,753 1,377 6 44,360 3,697 1,849 1,707 854 82,066 6,839 3,420 3,157 1,579 7 50,040 4,170 2,085 1,925 963 92,574 7,715 3,858 3,561 1,781 8 55,720 4,644 2,322 2,144 1,072 103,082 8,591 4,296 3,965 1,983 Add per family member + $5,680 + $474 + $237 + $219 + $110 + $10,508 + $876 + $438 + $405 + $203 Alaska 1 $19,950 $1,663 $832 $768 $384 $36,908 $3,076 $1,538 $1,420 $710 2 27,050 2,255 1,128 1,041 521 50,043 4,171 2,086 1,925 963 3 34,150 2,846 1,423 1,314 657 63,178 5,265 2,633 2,430 1,215 4 41,250 3,438 1,719 1,587 794 76,313 6,360 3,180 2,936 1,468 5 48,350 4,030 2,015 1,860 930 89,448 7,454 3,727 3,441 1,721 6 55,450 4,621 2,311 2,133 1,067 102,583 8,549 4,275 3,946 1,973 7 62,550 5,213 2,607 2,406 1,203 115,718 9,644 4,822 4,451 2,226 8 69,650 5,805 2,903 2,679 1,340 128,853 10,738 5,369 4,956 2,478 Add per family member + $7,100 + $592 + $296 + $274 + $137 + $13,135 + $1,095 + $548 + $506 + $253 Hawaii 1 $18,360 $1,530 $765 $707 $354 $33,966 $2,831 $1,416 $1,307 $654 2 24,890 2,075 1,038 958 479 46,047 3,838 1,919 1,772 886 3 31,420 2,619 1,310 1,209 605 58,127 4,844 2,422 2,236 1,118 4 37,950 3,163 1,582 1,460 730 70,208 5,851 2,926 2,701 1,351 5 44,480 3,707 1,854 1,711 856 82,288 6,858 3,429 3,165 1,583 6 51,010 4,251 2,126 1,962 981 94,369 7,865 3,933 3,630 1,815 7 57,540 4,795 2,398 2,214 1,107 106,449 8,871 4,436 4,095 2,048 8 64,070 5,340 2,670 2,465 1,233 118,530 9,878 4,939 4,559 2,280 Add per family member + $6,530 + $545 + $273 + $252 + $126 + $12,081 + $1,007 + $504 + $465 + $233 Guidance documents lack the force and effect of law, unless expressly authorized by statute or incorporated into a contract. USDA may not cite, use, or rely on any guidance that is not available through their guidance portal, except to establish historical facts.

Page 4 of 4 Income Eligibility Guidelines (Effective from July 1, 2026, to June 30, 2027) Household Size Larger Than Eight Household Size Federal Poverty Guidelines - 100% Reduced Price Meals - 185% Annual Monthly Twice- Monthly Bi-Weekly Weekly Annual Monthly Twice- Monthly Bi-Weekly Weekly 48 Contiguous States, D.C., Guam and Territories 9 $61,400 $5,117 $2,559 $2,362 $1,181 $113,590 $9,466 $4,733 $4,369 $2,185 10 67,080 5,590 2,795 2,580 1,290 124,098 10,342 5,171 4,773 2,387 11 72,760 6,064 3,032 2,799 1,400 134,606 11,218 5,609 5,178 2,589 12 78,440 6,537 3,269 3,017 1,509 145,114 12,093 6,047 5,582 2,791 13 84,120 7,010 3,505 3,236 1,618 155,622 12,969 6,485 5,986 2,993 14 89,800 7,484 3,742 3,454 1,727 166,130 13,845 6,923 6,390 3,195 15 95,480 7,957 3,979 3,673 1,837 176,638 14,720 7,360 6,794 3,397 16 101,160 8,430 4,215 3,891 1,946 187,146 15,596 7,798 7,198 3,599 Add per family member + $5,680 + $474 + $237 + $219 + $110 + $10,508 + $876 + $438 + $405 + $203 Alaska 9 $76,750 $6,396 $3,198 $2,952 $1,476 $141,988 $11,833 $5,917 $5,462 $2,731 10 83,850 6,988 3,494 3,225 1,613 155,123 12,927 6,464 5,967 2,984 11 90,950 7,580 3,790 3,499 1,750 168,258 14,022 7,011 6,472 3,236 12 98,050 8,171 4,086 3,772 1,886 181,393 15,117 7,559 6,977 3,489 13 105,150 8,763 4,382 4,045 2,023 194,528 16,211 8,106 7,482 3,741 14 112,250 9,355 4,678 4,318 2,159 207,663 17,306 8,653 7,988 3,994 15 119,350 9,946 4,973 4,591 2,296 220,798 18,400 9,200 8,493 4,247 16 126,450 10,538 5,269 4,864 2,432 233,933 19,495 9,748 8,998 4,499 Add per family member + $7,100 + $592 + $296 + $274 + $137 + $13,135 + $1,095 + $548 + $506 + $253 Hawaii 9 $70,600 $5,884 $2,942 $2,716 $1,358 $130,610 $10,885 $5,443 $5,024 $2,512 10 77,130 6,428 3,214 2,967 1,484 142,691 11,891 5,946 5,489 2,745 11 83,660 6,972 3,486 3,218 1,609 154,771 12,898 6,449 5,953 2,977 12 90,190 7,516 3,758 3,469 1,735 166,852 13,905 6,953 6,418 3,209 13 96,720 8,060 4,030 3,720 1,860 178,932 14,911 7,456 6,882 3,441 14 103,250 8,605 4,303 3,972 1,986 191,013 15,918 7,959 7,347 3,674 15 109,780 9,149 4,575 4,223 2,112 203,093 16,925 8,463 7,812 3,906 16 116,310 9,693 4,847 4,474 2,237 215,174 17,932 8,966 8,276 4,138 Add per family member + $6,530 + $545 + $273 + $252 + $126 + $12,081 + $1,007 + $504 + $465 + $233 Guidance documents lack the force and effect of law, unless expressly authorized by statute or incorporated into a contract. USDA may not cite, use, or rely on any guidance that is not available through their guidance portal, except to establish historical facts.

(food-packages)WIC Food Packages#

(food-packages)(block-1)What are the WIC food packages?#

(food-packages)WIC Food Packages#

(food-packages)(block-1)What are the WIC food packages?#

(food-packages)(block-2)How do the final changes in the WIC food packages compare to the proposed changes?#

(guidance)(evaluation-criteria-infant-formula-rebate-contracts)WIC Policy Memorandum #1999-3: Evaluation Criteria for Infant Formula Rebate Contracts#

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(guidance)(infant-formula-rebate-solicitations-bidding)WIC Infant Formula Rebate Solicitations - Bidding on Single Milk- and Soy-Based Infant Formula (informational memorandum)#

(guidance)(infant-formula-rebate-solicitations-bidding)(page-1)Page 1#

(guidance)(interim-guidance-vendor-cost-containment)Interim Guidance on WIC Vendor Cost Containment (June 2006)#

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(guidance)(nutrition-risk-criteria)WIC Policy Memorandum #2011-5: WIC Nutrition Risk Criteria#

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(guidance)(vendor-cost-containment-interim-rule-clarification)WIC Policy Memorandum #2006-6: Vendor Cost Containment Interim Rule Clarification#

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(guidance)(wpm-2024-3-implementing-abfa-requirements-state-plans)WIC Policy Memorandum #2024-3: Implementing ABFA Requirements in WIC State Plans#

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