[Federal Register Volume 78, Number 35 (Thursday, February 21, 2013)]
[Rules and Regulations]
[Pages 11967-11972]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: 2013-04044]



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Rules and Regulations
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Federal Register / Vol. 78, No. 35 / Thursday, February 21, 2013 / 
Rules and Regulations

[[Page 11967]]



DEPARTMENT OF AGRICULTURE

Food and Nutrition Service

7 CFR Parts 271, 273, and 281

[FNS-2009-0019]
RIN 0584-AD97


Supplemental Nutrition Assistance Program (SNAP): Updated 
Trafficking Definition and Supplemental Nutrition Assistance Program--
Food Distribution Program on Indian Reservations Dual Participation

AGENCY: Food and Nutrition Service, USDA.

ACTION: Final rule.

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

SUMMARY: The Food and Nutrition Service (FNS) is changing the 
Supplemental Nutrition Assistance Program (SNAP or Program) regulations 
pertaining to SNAP client benefit use, participation of retail food 
stores and wholesale food concerns in SNAP, and SNAP client 
participation in the Food Distribution Program on Indian Reservations 
(FDPIR). These changes to SNAP regulations address mandatory provisions 
of the Food, Conservation, and Energy Act of 2008, Public Law 110-246 
(hereinafter referred to as ``the 2008 Farm Bill'') to allow for the 
disqualification of a SNAP client who intentionally obtains cash by 
purchasing, with SNAP benefits, products that have container deposits, 
subsequently discarding the product, and returning the container(s) in 
exchange for cash refund of deposit(s); or who intentionally resells or 
exchanges products purchased with SNAP benefits for purposes of 
obtaining cash and/or other non-eligible items.
    Through existing authority under the Food and Nutrition Act of 
2008, FNS is also stipulating penalties for certain Program abuses 
committed by retailers. These abuses include stealing of SNAP benefits, 
by retailers, without client complicity, and other forms of trafficking 
through complicit arrangements between the retailer and the SNAP 
client. Examples of the latter would be the purchase, by retailers, of 
products originally purchased by clients with SNAP benefits and re-sold 
to stores in exchange for cash or other non-eligible items; or 
retailers taking possession of SNAP client cards and PINs, using the 
SNAP benefits to purchase stock for the store, and subsequently 
returning the card and PIN to the client with cash or other non-
eligible items provided in exchange for having used the SNAP benefit.
    FNS is also addressing the mandatory 2008 Farm Bill provisions 
requiring disqualification in SNAP when an individual is disqualified 
from FDPIR, and under existing authority, clarifying the prohibition 
against dual participation in SNAP and FDPIR.

DATES: Effective date: March 25, 2013.

FOR FURTHER INFORMATION CONTACT: Andrea Gold, Director, Benefit 
Redemption Division, Food and Nutrition Service, USDA, 3101 Park Center 
Drive, Alexandria, Virginia 22302. Ms. Gold can also be reached by 
telephone at 703-305-2434 or by email at Andrea.Gold@fns,usda.gov 
during regular business hours (8:30 a.m. to 5:30 p.m.) Monday through 
Friday.

SUPPLEMENTARY INFORMATION: 

Executive Summary

I. Purpose of Regulatory Action

    The rule codifies nondiscretionary SNAP eligibility 
disqualification provisions and FDPIR provisions of the 2008 Farm Bill 
and addresses retailer Program violations.
    This final regulation will allow the Department to take appropriate 
action against retailers who are stealing SNAP benefits from clients or 
colluding with clients to traffic benefits, and will allow State 
agencies to take appropriate action against violating clients. The 
regulations will also ensure that clients who commit intentional 
Program violations (IPVs) in FDPIR are not able to participate in SNAP 
while serving their FDPIR disqualification, and will ensure that no 
client is able to dually participate in SNAP and FDPIR.

II. Major Provisions

    This rule updates the definition of SNAP trafficking to encompass 
the intentional acquisition of cash by purchasing with SNAP benefits 
containers with deposits, discarding the product, and returning the 
containers to obtain cash refund deposits; the intentional sale of 
products originally purchased with SNAP benefits in exchange for cash 
or consideration other than eligible food; the intentional purchase of 
products originally purchased with SNAP benefits in exchange for cash 
or consideration other than eligible food; and the stealing of SNAP 
benefits.
    Further, this rule corrects the existing regulatory citation 
related to the requirement that State SNAP agencies ensure that dual 
participation in FDPIR and SNAP not be permitted.
    Finally, this rule requires that State SNAP agencies not allow a 
client who has been disqualified from FDPIR for an intentional program 
violation to participate in SNAP until the disqualification period has 
expired.

III. Cost and Benefits

    This final rule will primarily codify mandatory provisions of the 
statute. The Department anticipates that the rule will have a nominal 
cost impact on States that pursue clients who are defrauding the 
Program in the ways described. As the Department has an existing 
process for managing retailer compliance, the cost of pursuing 
retailers who violate Program rules in the manner described is also 
nominal. The problems being addressed in the rule are extremely unusual 
and the Department has no data on which to base an estimate of their 
frequency or the amount of benefits that might be involved. The final 
rule also updates the existing definition of trafficking, and as such 
there are no incremental cost or benefit repercussions.
    State SNAP and FDPIR agencies will be required to perform checks 
for dual participation in their Programs and to ensure that clients 
disqualified from either SNAP or FDPIR are not allowed to participate 
in the alternate program. Cross-program checks for duplicate 
participation in SNAP and FDPIR are already required and checks for 
ensuring that clients disqualified from SNAP or FDPIR are not 
participating in the alternate program should follow a similar process; 
therefore the checks will not significantly impact administrative 
costs.

[[Page 11968]]

    This rulemaking codifies provisions in the Food and Nutrition Act 
of 2008 that improve Program integrity, thereby enhancing the Program's 
ability to serve those who are truly in need, and helping to ensure 
that SNAP benefits are used as intended.

Background

    In this final rule, the Department is revising SNAP regulations in 
accordance with Section 4131 (Eligibility Disqualification) of the 2008 
Farm Bill to update the definition of trafficking to include certain 
Program abuses by clients. The Department is also taking this 
opportunity to address certain retailer abuses of the Program. These 
types of abuse are not specifically addressed in the current definition 
of trafficking.
    This rule also addresses Section 4211 (Assessing the Nutritional 
Value of the Food Distribution Program on Indian Reservations (FDPIR) 
Food Package) of the 2008 Farm Bill which requires, among other things, 
reciprocal disqualification in SNAP when an individual is disqualified 
from FDPIR. These regulatory changes codify the mandatory statutory 
requirement to make reciprocal SNAP disqualification mandatory in 
instances of disqualification from FDPIR.
    Dual participation in SNAP and FDPIR is prohibited under existing 
authority in the Food and Nutrition Act of 2008 and is codified in 
existing regulations. The Department is making a technical correction 
to existing regulations regarding this mandatory prohibition.
    This rule was proposed on June 20, 2011, at 76 FR 35787, and public 
comments were invited through August 19, 2011. Comments have been 
considered and adjustments made to the final rule.

Summary of Comments and Explanation of Revisions

    Twenty-five comments were received from various stakeholders and 
are available for public inspection on line at www.regulations.gov.
    In general, commenters supported the regulations as proposed. 
Several commenters however, expressed concern that lacking further 
specificity, this regulation could result in States acting to 
administratively disqualify clients without sufficient cause. 
Commenters noted that client violations should be treated as IPVS 
rather than trafficking. Commenters further noted that defining client 
violations as ``intentional'' and providing specific examples of when 
client actions would be considered violations is critical. One 
commenter suggested that specific examples of non-violations be 
included in the trafficking definition. Commenters requested that the 
Department provide the specific legal standard necessary for taking 
client action in instances of indirect trafficking and beverage 
dumping. One commenter noted that the final rule should make clear that 
neither eligibility workers nor fraud investigators may summon 
recipients to be questioned about, or respond to accusations 
concerning, use of their SNAP benefits for authorized foods.
    The Department notes that intentional Program violations, as 
defined in 7 U.S.C. 2015 of the statute and 7 CFR 273.16, include SNAP 
benefit trafficking. Throughout the Program's history, trafficking has 
been defined as ``* * * the exchange of SNAP benefits for cash or 
consideration other than food * * *'' While intentionally discarding 
beverages for purposes of collecting cash deposits, or intentionally 
purchasing items with SNAP benefits for purposes of re-selling those 
items for cash constitute an indirect exchange, the intent--i.e. 
exchanging SNAP benefits for cash--is the same and the activity 
constitutes trafficking. This regulation is intended to target 
egregious and intentional Program Violations. Penalties and processes 
that States must follow when pursuing IPVs (including trafficking 
violations) are defined and regulated in 7 CFR 273.16--
``Disqualification for intentional Program Violations''; these 
penalties and processes remain unchanged.
    Several commenters noted that under 7 U.S.C. 2015 [Section 6(p)] of 
the statute, disqualification for discarding beverages is only 
appropriate when at least four distinct conditions are met: (1) The 
recipient purchased products in containers carrying deposits with SNAP 
benefits; (2) the recipient made that purchase with the intent of 
obtaining cash by disposing of the contents and returning the 
container; (3) the recipient did in fact dispose of the contents; and 
(4) the recipient did in fact return the container. One commenter 
further noted that the statute also authorizes the Department to 
further limit the scope of these disqualifications by establishing 
additional requirements for the disqualification and that this would 
allow the Department to narrow, but not broaden, these elements to 
ensure that this penalty is not misapplied. The commenter suggests that 
the final rule should lay out each of these elements separately, 
numbered distinctly, so that investigators can clearly see that they 
must have evidence of each of them before proceeding. Further, this 
commenter notes that if the Department does not add further 
specificity, an environmental impact study should be conducted to 
assess any negative impacts on bottle returns as a result of this rule.
    The Department has incorporated further specificity into the final 
rule. The Department has concluded that an environmental impact study 
is not warranted.
    A commenter further noted that trafficking violations are subject 
to claims and that advocates in several states report that State 
investigators routinely allege, and Administrative Law Judges find, 
that all benefits received in a month, or even in a certification 
period, when there is a finding of trafficking should be subject to a 
claim, regardless of the actual amount trafficked. The commenter 
contends that this has no support in the statute, and it obliterates 
distinctions between small mistakes and egregious abuse. To prevent a 
similar phenomenon with these new disqualifications, the commenter 
suggests that the final rule explicitly state that only the amount 
misspent or trafficked may be treated as a claim.
    The Department concurs on the basis of trafficking-related claims 
regulations at 7 CFR 273.18(c)(2), ``Trafficking-related claims. Claims 
arising from trafficking-related offenses will be the value of 
trafficked benefits as determined by: (i) The individual's admission; 
(ii) adjudication; or (iii) the documentation that forms the basis for 
the trafficking determination.''
    One commenter notes that in addressing these new violations, the 
statute allows disqualifications based only on criminal convictions, 
civil judgments, or decisions in administrative disqualification 
hearings and, as such, no waivers should be allowed. The commenter 
further suggests that, if disqualification waivers are allowed, the 
Department should clarify that the State agency does not have 
sufficient evidence to warrant scheduling a hearing, within the meaning 
of 7 CFR 273.16(f)(1)(i), unless it has evidence that each of the 
elements necessary for disqualification (i.e., found to have obtained 
cash by intentionally purchasing products with SNAP benefits that have 
containers that require return deposits, intentionally discarding the 
product, and intentionally returning the container for the deposit 
amount, or found to have intentionally sold any food that was purchased 
using SNAP benefits) is met.
    The Department considers waivers integral to the administrative, 
civil, and criminal process. Waivers can assist

[[Page 11969]]

clients in avoiding a criminal charge on their permanent record. It is 
acknowledged however, that States should not offer a waiver to a client 
unless the State has sufficient evidence to warrant an administrative 
hearing or referral for civil or criminal prosecution, as provided in 7 
CFR 273.16(f).
    States expressed concern regarding their ability to monitor and 
take action against individual clients who commit violations such as 
purchasing and then intentionally discarding beverages in order to 
collect cash deposits, or indirectly trafficking benefits. One 
commenter suggested that States maintain responsibility only for client 
eligibility oversight and that investigation of acts outside of the 
realm of client eligibility fall to the purview of the Department.
    The Department recognizes the resource challenges faced by State 
and local governments. However, the 7 U.S.C. 2015 of the statute and 
regulations at 7 CFR 273.16 bestow responsibility for broad client 
oversight to State Agencies. Violators damage the integrity of the 
Program and must be subject to appropriate consequences; this rule 
gives States the ability to take action when intentional violations are 
discovered.
    Two commenters noted that the term ``consideration'' in the 
definition of trafficking should be removed as consideration can be an 
intangible item that does not have a specific price or value. The 
Department is aware of instances in which clients have exchanged or 
attempted to exchange SNAP benefits for services that would fit the 
definition of ``consideration other than eligible food'' (e.g., 
bartered services) and for purposes of Program integrity has therefore 
opted not to make this adjustment.
    Commenters suggested that clients whose SNAP benefits are stolen 
should receive replacement benefits when there is clear evidence of 
theft. One commenter suggested that, at a minimum, revised regulations 
should allow for the replacement of benefits when a household makes a 
formal report of stolen benefits to the SNAP office and to the local 
law enforcement agency, and when a review of Electronic Benefit 
Transfer (EBT) transactions show that the household's benefits were 
redeemed through keyed, rather than swiped, transactions. The 
Department acknowledges this concern. However, because all interested 
parties did not have an opportunity to consider this change, the 
Department may propose changes to the regulations guiding replacement 
in a future rulemaking. Keyed transactions still require both a card 
and personal identification number (PIN) and, in general, if the PIN 
number is secured and/or a stolen card is reported immediately, 
benefits will not be lost.
    One commenter suggested that client penalties only apply when the 
violations were committed by a household member or an authorized 
representative of the household. The determination as to whether the 
client should bear responsibility for violations will depend upon the 
circumstances of the case and is therefore a determination to be made 
by State hearing officials. We are unable to address every situation in 
these regulations. However, the Department holds retailers responsible 
for ensuring that all store employees know and understand Program rules 
and abide by those rules; when employees commit violations, SNAP 
authorized retailers bear responsibility. Similarly, clients are 
responsible for ensuring that anyone who is freely given access to 
their SNAP benefits, whether a household member, formally recognized 
authorized representative or informal authorized representative, uses 
those benefits appropriately.
    One commenter requested that USDA explicitly state that allowing a 
non-household member access to the EBT card and PIN should not be 
treated as a trafficking offense, unless there is other clear and 
convincing evidence of fraudulent activity in connection with the card 
and PIN use. The Department acknowledges that giving a non-household 
member access to EBT benefits for purposes of assisting the household 
with shopping activities is not trafficking. However, as noted, the 
head of household maintains responsibility and is subject to penalties 
for fraudulent activity conducted by any person given access to EBT 
benefits by a household member, whether a formally documented 
authorized representative or a non-household member that is assisting 
the household.
    One commenter is concerned about the improper disqualification of 
SNAP clients who provide incorrect or misleading information on their 
SNAP application or recertification form or who fail to timely report a 
change but without fraudulent intent. This commenter requested that the 
Department clarify the IPV legal standard associated with these issues. 
The Department acknowledges these comments, but notes that they fall 
outside of the scope and intent of this rulemaking.
    One commenter noted the difficulties retailers have in tracking 
clients who purchase beverages and intentionally discard those 
beverages and return to stores for the cash deposits. The Department 
acknowledges the challenges associated with this activity and does not 
expect SNAP authorized retailers to take responsibility for monitoring 
bottle returns. Instead, the Department is providing States an avenue 
for taking action on clients who are violating Program rules in this 
manner.
    One commenter was confused by the term ``discard.'' Trafficking 
applies when beverages are intentionally discarded--i.e. disposed of by 
the purchaser, rather than consumed--for purposes of returning the 
containers for the cash deposit. Further, it has come to our attention 
that at least one individual has, in fact, taken steps to get the 
deposit back without emptying the contents of the deposit bottle. Since 
this is contrary to the intent of this provision in the statute, the 
Department is treating such situations as the equivalent of discarding 
the contents, and is expanding coverage to include those who collect 
deposits without taking steps to consume the product.
    One commenter suggested that clients be prevented from purchasing 
water to mitigate the issue of having beverages be intentionally 
discarded so the containers may be returned for cash. One commenter 
implied that this rulemaking is an indirect attempt to prohibit 
purchase of soft drinks with SNAP benefits, and another commenter 
believed any indirect impact that would reduce the purchase of sugary 
drinks is positive. Prohibiting purchase of specific products falls 
outside the authority of this rule. SNAP eligible foods are defined in 
Section 3 of the Food and Nutrition Act and cannot be amended by 
regulation.
    One commenter asked the Department to specify that trafficking in 
farmers' market scrip is equivalent to indirectly trafficking SNAP 
benefits. The Department considers the trafficking of farmers' market 
scrip to be the equivalent of trafficking by purchasing a product and 
reselling it for cash or consideration other than eligible food. The 
Department does not believe that further specificity is necessary in 
this regulation.
    Two commenters noted that the definition of trafficking as written 
in the proposed rule is a run-on sentence and therefore lacks clarity. 
The Department has reviewed the definition to assess clarity and ensure 
it meets legal formatting requirements. The definition has been 
adjusted to adopt statutory language and thereby clarify client 
violations, but no additional formatting changes have been made.

[[Page 11970]]

    One commenter noted that a national system for checking duplicate 
participation or IPV disqualifications is practically necessary if 
States are to be held accountable for prohibiting dual participation 
and implementing reciprocal disqualification with FDPIR. The Department 
acknowledges the challenges associated with operations when such a 
national database is unavailable. This rule gives States the ability to 
prohibit dual participation and invoke reciprocal disqualifications 
based on available information.
    Finally, one commenter urged the Department to ensure that Indian 
Tribal Organizations (ITO) staffs are fully integrated in the 
consultation and coordination of planning and decisions regarding 
administrative systems, certification monitoring, and developing 
Memorandums of Understanding (MOUs)--especially where USDA and state 
agencies control access to information, administrative resources and 
capacity; and that the Department provide meaningful and timely 
responses to ITO concerns regarding changes. The Department 
acknowledges this comment and notes that at USDA tribal consultations 
held in fiscal year 2011, this rule was discussed. Feedback from those 
consultations is incorporated in the section of this rule titled 
Executive Order 13175.

Regulatory Impact Analysis

    This rule has been designated as non-significant by the Office of 
Management and Budget; therefore, no Regulatory Impact Analysis is 
required.

Executive Orders 12866 and 13563

    Executive Orders 12866 and 13563 direct agencies to assess all 
costs and benefits of available regulatory alternatives and, if 
regulation is necessary, to select regulatory approaches that maximize 
net benefits (including potential economic, environmental, public 
health and safety effects, distributive impacts, and equity). Executive 
Order 13563 emphasizes the importance of quantifying both costs and 
benefits, of reducing costs, of harmonizing rules, and of promoting 
flexibility.
    This final rule has been determined to be not significant under 
section 3(f) of Executive Order 12866.

Regulatory Flexibility Act

    This rule has been reviewed with regard to the requirements of the 
Regulatory Flexibility Act (5 U.S.C. 601-612). It has been certified 
that this final rule will not have a significant economic impact on a 
substantial number of small entities. Departmental Field, Regional, and 
Area Offices, retailers and other firms participating or applying to 
participate in the Supplemental Nutrition Assistance Program, State 
agencies that distribute Supplemental Nutrition Assistance Program 
benefits and State agencies and ITOs that administer Food Distribution 
of Indian Reservations, are the entities affected by this change.

Public Law 104-4

    Unfunded Mandate Reform Act of 1995 (UMRA) Title II of UMRA 
establishes requirements for Federal agencies to assess the effects of 
their regulatory actions on State, local, and tribal governments and 
the private sector. Under Section 202 of the UMRA, the Department 
generally must prepare a written statement, including a cost-benefit 
analysis, for proposed and final rules with ``Federal mandates'' that 
may result in expenditures to State, local, or tribal governments in 
the aggregate, or to the private sector, of $100 million or more in any 
one year. When such a statement is needed for a rule, section 205 of 
the UMRA generally requires the Department to identify and consider a 
reasonable number of regulatory alternatives and adopt the least 
costly, more cost-effective or least burdensome alternative that 
achieves the objectives of the rule. This final rule contains no 
Federal mandates (under the regulatory provisions of Title II of the 
UMRA) for State, local and tribal governments or the private sector of 
$100 million or more in any one year. This rule is, therefore, not 
subject to the requirements of sections 202 and 205 of the UMRA.

Executive Order 12372

    SNAP is listed in the Catalog of Federal Domestic Assistance under 
No. 10.551. For the reasons set forth in the Final Rule codified in 7 
CFR part 3015, Subpart V and related Notice (48 FR 29115), this Program 
is excluded from the scope of Executive Order 12372, which requires 
intergovernmental consultation with State and local officials.

Federalism Summary Impact Statement

    Executive Order 13132 requires Federal agencies to consider the 
impact of their regulatory actions on State and local governments. 
Where such actions have Federalism implications, agencies are directed 
to provide a statement for inclusion in the preamble to the regulations 
describing the agency's considerations in terms of the three categories 
called for under Section (6)(b)(2)(B) of the Executive Order 13132. The 
Department has determined that this rule does not have Federalism 
implications. This rule does not impose substantial or direct 
compliance costs on State and local governments. Therefore, under 
Section 6(b) of the Executive Order, a Federalism summary impact 
statement is not required.

Executive Order 12988

    This final rule has been reviewed under Executive Order 12988, 
Civil Justice Reform. This rule will have preemptive effects with 
respect to any State or local laws, regulations or policies which 
conflict with its provisions or which would otherwise impede its full 
implementation. This rule is not intended to have retroactive effects. 
Prior to any judicial challenge to the provisions of this rule or the 
application of its provisions, all applicable administrative procedures 
must be exhausted.

Executive Order 13175

    Executive Order 13175 requires Federal agencies to consult and 
coordinate with tribes on a government-to-government basis on policies 
that have tribal implications, including regulations, legislative 
comments or proposed legislation, and other policy statements or 
actions that have substantial direct effects on one or more Indian 
tribes, on the relationship between the Federal Government and Indian 
tribes, or on the distribution of power and responsibilities between 
the Federal Government and Indian tribes. In late 2010 and early 2011, 
USDA engaged in a series of consultative sessions to obtain input by 
Tribal officials or their designees concerning the impact of this rule 
on the tribe or Indian Tribal governments, or whether this rule may 
preempt Tribal law. Reports from these sessions for consultation will 
be made part of the USDA annual reporting on Tribal Consultation and 
Collaboration. Each session was fully transcribed and the comments 
received relative to this regulation follow:
    One commenter expressed general concern regarding the disparity in 
benefit value as a result of the increase in SNAP benefits following 
the American Recovery and Reinvestment and Act (ARRA); FDPIR benefits 
were not subject to an ARRA increase.
    One commenter noted that County level SNAP office staff should have 
been in attendance at this consultation; if county level staff is not 
aware of the prohibition relative to dual participation, then they will 
not abide by that prohibition. This was reiterated by a second 
commenter who noted that county level SNAP staff should be in the

[[Page 11971]]

communication loop and receive training. The Department noted that a 
process of notifying all stakeholders would occur once this regulation 
is finalized. A third commenter made a procedural recommendation 
requiring that SNAP certification staff contact the ITO to ensure that 
applicant clients are not dually participating in FDPIR.
    One commenter expressed support for the reciprocal SNAP 
disqualification that would be based on an intentional program 
violation in FDPIR.
    One commenter noted that direct access to county level SNAP staff 
would be beneficial; currently the ITO calls the county level office 
and is subject to an automated message when checking dual 
participation.
    Several commenters noted that access to an automated system for 
checking dual participation and reciprocal disqualification is 
practically necessary to make the process work, and that the current 
process of checking paper printouts is not practical. The Department 
noted that some ITO's have successfully executed an MOU with the State 
SNAP agency or county SNAP offices that allow them view-only access to 
State certification systems for these kinds of checks. Some 
participating ITO's noted difficulties in getting such MOU's in place. 
The Department committed to assist ITO's with this process in Oklahoma, 
and more broadly, to seek examples of successfully executed MOU's and 
provide those to appropriate stakeholders.
    USDA committed to responding in a timely and meaningful manner to 
all Tribal government requests for consultation concerning this rule 
and will provide additional venues, such as webinars and 
teleconferences, to periodically host collaborative conversations with 
Tribal leaders and their representatives concerning ways to improve 
this rule in Indian country. No additional comments were received 
during the proposed rule comment period.
    We are unaware of any current Tribal laws that could be in conflict 
with this rule. No concerns in this regard were expressed in the 
proposed rule comment period.

Civil Rights Impact Analysis

    The Department has reviewed this rule in accordance with 
Departmental Regulations 4300-4, ``Civil Rights Impact Analysis,'' and 
1512-1, ``Regulatory Decision Making Requirements.'' After a careful 
review of the rule's intent and provisions, the Department has 
determined that this rule will not in any way limit or reduce the 
ability of protected classes of individuals to receive SNAP benefits on 
the basis of their race, color, national origin, sex, age, disability, 
religion or political belief nor will it have a differential impact on 
minority owned or operated business establishments, and women owned or 
operated business establishments that participate in SNAP.
    The regulation affects or may potentially affect the retail food 
stores and wholesale food concerns that participate in (accept or 
redeem) SNAP. The only retail food stores and wholesale food concerns 
that will be directly affected, however, are those firms that violate 
SNAP rules and regulations. The Department does not collect data from 
retail food stores or wholesale food concerns regarding any of the 
protected classes under Title VI of the Civil Rights Act of 1964. As 
long as a retail food store or wholesale food concern meets the 
eligibility criteria stipulated in the Food and Nutrition Act of 2008 
and SNAP regulations, they can participate in SNAP. Also, the 
Department specifically prohibits retailers and wholesalers that 
participate in SNAP from engaging in actions that discriminate based on 
race, color, national origin, sex, age, disability, religion, or 
political belief. This rule will not change any requirements related to 
the eligibility or participation of protected classes or individuals, 
minority-owned or operated business establishments, or women-owned or 
operated business establishments in SNAP. As a result, this rule will 
have no differential impact on protected classes of individuals, 
minority-owned or operated business establishments, or women-owned or 
operated business establishments.
    Further, the Department specifically prohibits the State and local 
government agencies that administer the Program from engaging in 
actions that discriminate based on race, color, national origin, 
gender, age, disability, marital or family status. Regulations at 7 CFR 
272.6 specifically state that ``State agencies shall not discriminate 
against any applicant or participant in any aspect of program 
administration, including, but not limited to, the certification of 
households, the issuance of coupons, the conduct of fair hearings, or 
the conduct of any other program service for reasons of age, race, 
color, sex, handicap, religious creed, national origin, or political 
beliefs. Discrimination in any aspect of the program administration is 
prohibited by these regulations, according to the Act. Enforcement may 
be brought under any applicable Federal law. Title VI complaints shall 
be processed in accord with 7 CFR part 15.'' Where State agencies have 
options, and they choose to implement a certain provision, they must 
implement it in such a way that it complies with the regulations at 7 
CFR 272.6.

Paperwork Reduction Act

    The Paperwork Reduction Act of 1995 (44 U.S.C. chapter 35; see 5 
CFR part 1320) requires that the Office of Management and Budget (OMB) 
approve all collections of information by a Federal agency before they 
can be implemented. Respondents are not required to respond to any 
collection of information unless it displays a current valid OMB 
control number. This rule does not contain information collection 
requirements subject to approval by OMB under the Paperwork Reduction 
Act of 1995.
    This rule will not affect the reporting and recordkeeping burden 
and does not contain additional burden requirements subject to OMB 
approval other than those that have been previously approved in 
OMB 0584-0064, expiration date 03/31/2013, by OMB under the 
Paperwork Reduction Act of 1995.

E-Government Act Compliance

    The Department is committed to complying with the E-Government Act 
of 2002 to promote the use of the Internet and other information 
technologies to provide increased opportunities for citizen access to 
government information and services, and for other purposes.

Lists of Subjects

7 CFR Part 271

    Food stamps, Grant programs--Social programs, Reporting and 
recordkeeping requirements.

7 CFR Part 273

    Administrative practice and procedure, Aliens, Claims, Employment, 
Food stamps, Fraud, Government employees, Grant programs--social 
programs, Income taxes, Reporting and recordkeeping requirements, 
Students, Supplemental Security Income, (SSI), wages.

7 CFR Part 281

    Administrative practice and procedure, Food stamps, Grant 
programs--Social programs, Indians.

    Accordingly, 7 CFR parts 271, 273 and 281 are amended as follows:

0
1. The authority citation for 7 CFR parts 271, 273 and 281 continues to 
read as follows:

    Authority: 7 U.S.C. 2011-2036.

[[Page 11972]]

PART 271--GENERAL INFORMATION AND DEFINITIONS

0
2. In part 271:
0
a. Except in Sec.  271.5, remove the words ``the Food Stamp Program'', 
``the food stamp program'', The Food Stamp Program'', or ``FSP'' 
wherever they appear and add, in their place, the word ``SNAP'';
0
b. Remove the words ``a food stamp program'' or ``a Food Stamp 
Program'' wherever they appear and add, in their place, the words ``a 
supplemental nutrition assistance program'';
0
c. Remove the words ``Food Stamp Act of 1977'' and add in their place 
the words ``Food and Nutrition Act of 2008'' wherever they appear, 
except in the definition of ``Food Stamp Act'' in Sec.  271.2;
0
d. Remove the words ``Food Stamp Act'' and add in their place the words 
``Food and Nutrition Act of 2008'' wherever they appear, except in the 
definition of ``Food Stamp Act'' in Sec.  271.2;
0
e. Remove the words ``food stamps'' wherever they appear and add, in 
their place, the words ``SNAP benefits'';
0
f. Remove the words ``food stamp'' wherever they appear and add, in 
their place, the word ``SNAP'';

0
3. In Sec.  271.2, the definition of Trafficking is revised to read as 
follows:


Sec.  271.2  Definitions.

* * * * *
    Trafficking means:
    (1) The buying, selling, stealing, or otherwise effecting an 
exchange of SNAP benefits issued and accessed via Electronic Benefit 
Transfer (EBT) cards, card numbers and personal identification numbers 
(PINs), or by manual voucher and signature, for cash or consideration 
other than eligible food, either directly, indirectly, in complicity or 
collusion with others, or acting alone;
    (2) The exchange of firearms, ammunition, explosives, or controlled 
substances, as defined in section 802 of title 21, United States Code, 
for SNAP benefits;
    (3) Purchasing a product with SNAP benefits that has a container 
requiring a return deposit with the intent of obtaining cash by 
discarding the product and returning the container for the deposit 
amount, intentionally discarding the product, and intentionally 
returning the container for the deposit amount;
    (4) Purchasing a product with SNAP benefits with the intent of 
obtaining cash or consideration other than eligible food by reselling 
the product, and subsequently intentionally reselling the product 
purchased with SNAP benefits in exchange for cash or consideration 
other than eligible food; or
    (5) Intentionally purchasing products originally purchased with 
SNAP benefits in exchange for cash or consideration other than eligible 
food.
* * * * *

0
4. In Sec.  271.5, remove the words ``the food Stamp program'' wherever 
they appear and add, in their place, the words ``the supplemental 
nutrition assistance program'';

PART 273--CERTIFICATION OF ELIGIBLE HOUSEHOLDS

0
5. In Sec.  273.11:
0
a. Remove the words ``the Food Stamp Program'' or ``the food stamp 
program'' wherever they appear and add, in their place, the word 
``SNAP'';
0
b. Remove the words ``food stamps'' wherever they appear and add, in 
their place, the words ``SNAP benefits'';
0
c. Remove the words ``food stamp'' wherever they appear and add, in 
their place, the word ``SNAP'';
0
d. Add two new sentences at the end of paragraph (k) introductory text.
0
e. Add a new sentence to the end of paragraph (k)(6).
    The additions read as follows:


Sec.  273.11  Action on households with special circumstances.

* * * * *
    (k) * * * In the case of disqualification from the Food 
Distribution Program on Indian Reservations (FDPIR) for an intentional 
program violation as described under Sec.  253.8 of this chapter, the 
State agency shall impose the same disqualification on the member of 
the household under SNAP. The State agency must, in cooperation with 
the appropriate FDPIR agency, develop a procedure that ensures that 
these household members are identified.
* * * * *
    (6) * * * In instances where the disqualification is a reciprocal 
action based on disqualification from the Food Distribution Program on 
Indian Reservations, the length of disqualification shall mirror the 
period prescribed by the Food Distribution Program on Indian 
Reservations.
* * * * *

PART 281--ADMINISTRATION OF SNAP ON INDIAN RESERVATIONS

0
6. Revise the heading of part 281 to read as set forth above.
0
7. In part 281:
0
a. Remove the words ``the Food Stamp Program'' wherever they appear and 
add, in their place, the word ``SNAP'';
0
b. Remove the words ``Food Stamp Act of 1977'' wherever they appear and 
add, in their place, the words ``Food and Nutrition Act of 2008'';
0
c. Remove the words ``1977 Food Stamp Act'' wherever they appear and 
add, in their place, the words ``Food and Nutrition Act of 2008'';

0
8. In Sec.  281.1(c) remove the regulatory reference ``Sec.  283.7(e)'' 
and add, in its place, the regulatory reference ``Sec.  253.7(e)''.

    Dated: February 4, 2013.
Audrey Rowe,
Administrator, Food and Nutrition Service.
[FR Doc. 2013-04044 Filed 2-20-13; 8:45 am]
BILLING CODE 3410-30-P