USDA Releases Final Rule on SNAP Stocking Requirements *Updated*
Posted On: December 14, 2016
USDA’s Food and Nutrition Service (FNS) recently released rules requiring that SNAP-authorized food retailers stock at least seven (up from three in years past) varieties of items in each of USDA’s four staple food categories—Meat, poultry or fish; bread or cereals; vegetables or fruits; and dairy products. USDA took this step largely in order to address concerns that SNAP-authorized convenient and liquor stores were frequently failing to provide a basic selection of staple foods to their customers. Moreover, Congress expressed concerns that restaurants, including “you buy, we fry” establishments were circumventing prohibitions on the purchase of hot or prepared foods with SNAP funds.
This rule applies to food establishments whose inventory includes less than 50% of the aforementioned staple food items. This means that the vast majority of farmers markets won’t be affected by this rule change. USDA clarified that “The changes noted above will not impact farmer’s markets, direct-marketing farmers, military commissaries, and other relevant establishments as described in Sec. 4002 of the Act.” (Regulations.gov)
The new SNAP stocking rule states that in order to be eligible to participate in SNAP as a retailer, stores must comply with either Criterion A or Criterion B. Under this rule, retailers that are SNAP authorized under Criterion A must offer for sale in a public area, no fewer than seven different varieties of food items in each of the four staple food categories with a minimum depth of stock of three stocking units for each staple variety. This means that, on any given day of operations, a retailer should offer a total of 84 units for sale (3 stocking units, 7 staple varieties, 4 staple food categories, equaling 84 units).
Alternatively, retailers can qualify to be eligible SNAP retailers under Criterion B. Under Criterion B, retailers must have more than 50% of their total gross retail sales in staple foods. Total gross retail sales must include all retail sales, including food and non-food merchandise, as well as services, such as rental fees, professional fees, and entertainment/sports/games income. A fee directly connected to the processing of staple foods, such as raw meat, poultry, or fish by the service provider, may be calculated as staple food sales under Criterion B.
Staple foods are generally considered to be basic items of food that make up a significant portion of an individual’s diet and are usually prepared at home. Some examples include tomatoes, eggs, ground beef, milk, or rice. Here’s a description of the USDA’s staple food varieties.
If a retailer operates in an isolated or underserved community, and is not able to meet either Criterion A, nor Criterion B, then it may be considered under the “need for access” provision of the final rule. This provision allows FNS to consider other factors when making a SNAP authorization determination, allowing them to accommodate small businesses and protecting from a loss of food access.
The USDA has stated that the updated SNAP stocking rule is not intended to impact farmers markets. The vast majority of farmers markets will fall under Criterion B, and will not need to adhere to the rule. However, as FMC understands it, if less than 50% of a farmers market’s total sales are in staple foods, then they could fall under Criterion A, and be subject to the rule. SNAP retailers have one year to come into compliance, and in the meantime, FMC will work to get more concrete declaration from USDA on how farmers markets are expected to handle the new rule.
The exact language from regulations.gov is as follows:
This new requirement only affects establishments and house-to-house trade routes that meet the definition of a retail food store in accordance with Section 3(o)(1)(A) of the Act; it does not affect establishments and house-to-house trade routes that have over 50 percent of their total sales in staple foods and would meet the definition of retail food store under Section 3(o)(1)(B) of the Act (i.e. stores that currently participate under criteria B generally include, for example, specialty food meat, fruit and vegetable, or seafood markets with 50% or more of their sales in a specific staple food category. These firm types will not be affected by the changes in this rule.).