(1) To become authorized to offer basic food incentives, the grocery store must:

(a) Be in good standing with the United States Department of Agriculture as an authorized grocer that can accept SNAP benefits through electronic benefit transfer;

(b) Apply as a grocery store on a form determined by the department, including documentation demonstrating that the grocery store meets the following criteria:

(i) Have a point-of-sale mechanism that allows tracking and redemption of basic food incentives, including either automated or manual tracking;

(ii) Have a designated staff member on-site during operating hours that has completed all required basic food incentive training; and

(iii) Sells fresh fruits and vegetables.

(c) Execute a contract with the department.

(2) The department is not required to authorize all applicants. Selection is based on available funding and community needs and preferences as collected by the department.

(3) An authorized grocery store must reapply at the end of the contract period; however, neither the department nor the participant has an obligation to renew a contract.

(4) The authorized grocery store must, at a minimum:

(a) Comply with the grocery store basic food incentives requirements and the terms of their contract;

(b) Accept annual training and other technical assistance on basic food incentives requirements from department staff;

(c) Provide training to employees and volunteers on basic food incentive requirements including, but not limited to, eligible foods, redemption procedures, data tracking and evaluation requirements;

(d) Be accountable for actions of employees and volunteers;

(e) Ensure basic food incentives are only redeemed for eligible foods;

(f) Comply with federal and state nondiscrimination laws;

(g) Ensure that participants receive the same courtesies as other customers;

(h) Promote the availability of basic food incentives with materials provided by the department;

(i) Promptly provide the department, upon request, with any information it has available regarding its participation in basic food incentives;

(j) Allow the department to share information about the grocery store related to basic food incentives with program partners and in public reports;

(k) Allow the department to monitor the grocery store for compliance with basic food incentive requirements and fiscal recordkeeping;

(l) Notify the department immediately if the grocery store's operations cease; and

(m) Comply with department instructions and guidance with respect to the program.

(5) Authorized grocery stores that do not comply with requirements of this chapter are subject to termination of their contract. Noncompliance includes, but is not limited to:

(a) Violating any applicable state or federal law;

(b) Violating any provision of the contract; or

(c) Accepting basic food incentives without having a signed contract with the department.

(6) Prior to disqualification, the department must consider whether the contract termination would create undue hardships to participants.

(7) Trafficking in basic food incentives in any amount will result in contract termination. Grocery stores should ensure basic food incentives are not trafficked among any participants.

(8) An authorized grocery store that has a terminated contract may reapply for reauthorization.