[Roots Return Heritage Farm LLC]

Hi Laurie,

Is there an appeal process, or a process you are undertaking to understand more? Is there any follow up one could do? This would then affect most markets around the country if this type of enforcement will be in place. Any additional info you could add would be helpful. We have hubs here started in MN, and are pushing for more SNAP.

[Laurie Wayne]

It does seem like it would affect many hubs in the country if this is the rule (or if this has been the rule and the FNS is starting to enforce it)!

There is an appeal process, and the hub has til Nov 9 to send an appeal letter but I think it has to be based on something. They are saying the hub is not a retail store because it doesn’t take “possession” of the inventory, and only a retail food store can be authorized for EBT/SNAP. Here’s the definition of a “retail food store” (though there is no definition of “possession” or “farmers market” I could find). I think this online hub probably fits the definition in #4, but many hubs are also basically farmers markets of a kind.

—– pour yourself a cup of tea before reading —–

Retail food store means:

(1) An establishment or house-to-house trade route that sells food for home preparation and consumption normally displayed in a public area, and either offers for sale qualifying staple food items on a continuous basis, evidenced by having 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 qualifying staple variety, including at least one variety of perishable foods in at least three such categories, (Criterion A) as set forth in § 278.1(b)(1) of this chapter, or has more than 50 percent of its total gross retail sales in staple foods (Criterion B) as set forth in § 278.1(b)(1) of this chapter as determined by visual inspection, marketing structure, business licenses, accessibility of food items offered for sale, purchase and sales records, counting of stockkeeping units, or other accounting recordkeeping methods that are customary or reasonable in the retail food industry as set forth in § 278.1(b)(1) of this chapter. Entities that have more than 50 percent of their total gross retail sales in: Food cooked or heated on-site by the retailer before or after purchase; and hot and/or cold prepared foods not intended for home preparation and consumption, including prepared foods that are consumed on the premises or sold for carry-out are not eligible for SNAP participation as retail food stores under § 278.1(b)(1) of this chapter. Establishments that include separate businesses that operate under one roof and share the following commonalities: Ownership, sale of similar foods, and shared inventory, are considered to be a single firm when determining eligibility to participate in SNAP as retail food stores.

(2) Public or private communal dining facilities and meal delivery services; private nonprofit drug addict or alcoholic treatment and rehabilitation programs; publicly operated community mental health centers which conduct residential programs for drug addicts and/or alcoholics; public or private nonprofit group living arrangements; public or private nonprofit shelters for battered women and children; public or private nonprofit establishments, approved by an appropriate State or local agency, that feed homeless persons; or a restaurant that contracts with an appropriate State agency to provide meals at concessional (low or reduced) prices to homeless SNAP households;

(3) Any stores selling equipment for procuring food by hunting and fishing to eligible households in Alaska, as specified in the definition of eligible foods;

(4) Any private nonprofit cooperative food purchasing venture, including those whose members pay for food prior to receipt of the food; and

(5) A farmers’ market.

[Kristina Ortiz]

Maybe they need to buy the produce from the producer then sell to the customer? Also, the snip it says they can reply so I would reapply and provide lots of detail and information.

[Laurie Wayne]

That could totally be, but I am not sure how that would work for an online hub, which often lets a producer “harvest to order” – a huge advantage for everyone. I think at that point, if they were buying (and I assume, storing) the products before offering it to the consumer, they would just be a normal brick and mortar grocery store? It sounds like it’s the model (which tons of hubs use) they are objecting to.

• This reply was modified 1 year, 1 month ago by  Laurie Wayne.

[Eastern Market Partnership]

Hey Laurie, we have a similar model here at Eastern Market. We list farm and food products on our online site and consumers order weekly. Technically, the payment goes to Eastern Market, and then Eastern Market pays the invoices of our suppliers. Does your online platform have payments going to direct to your farm and food businesses? I guess I am not sure why they feel you aren’t taking possession.

[Laurie Wayne]

Thanks for checking in! I think the model is like yours. The customers pay the hub and the hub pays the producers for all their sales on a monthly basis. The prices the customers see and pay are the producer price plus a admin fee of like 20% or so that goes to the hub.

It definitely does feel like when the hub is aggregating customer orders on pickup day it would have possession, even though it hasn’t paid for the products yet.

• This reply was modified 1 year, 1 month ago by  Laurie Wayne.

[Eastern Market Partnership]

I guess I don’t see how it’s not like a regular retailer. Grocery gets food and pays 30 to 60 days later. If you are doing a receiver, you are taking possession.

[Laurie Wayne]

Yes that is totally the hub’s point, but the FNS guy was apparently adamant – not sure how widespread this interpretation is, but we for sure need some clarification.