“Not having WIC is like taking 10 percent of your business out of your pocket,” said Roy
Rabban, who bought this Save-A-Lot in Highland Park last month.
Some retailers in Southeast Michigan say they are losing customers and revenue, and will have to cut jobs, after finding out in recent weeks they can no longer be part of the Women, Infants and Children program, popularly known as WIC.
The federally funded supplemental nutrition program is for low-income pregnant and postpartum women and children under age 5 with health problems. About250,000 clients are served each month.
Women are given a debit card that allows them to buy specific types, brands and amounts of food, rather than being given a set dollar amount. The idea is tofill gaps in nutrition rather than provide for a wider range of grocery needslike the Supplemental Nutrition Assistance Program.
The Department of Community Health limits the number of retailers that can accept WIC by ZIP code. In urban areas, DCH allows one retailer per 175 WIC recipients.
The limit on retailers is because WIC is harder to administer than SNAP, said Stan Bien, director of the WIC program in Michigan.
Federal regulations specify the exact brands of foods and amounts of those brands retailers need to have on their shelves. Specifications are not as
stringent in the SNAP program, in which recipients can purchase a wider array of grocery items.
“It’s a system that’s been proven and is working well,” Bien said.
But retailers stuck on the outside of the system don’t think so, and they want the department to change the quota system.
Retailers can be dropped if the population declines in a ZIP code, causing fewer spots to be available, or if they do not do well on the department’s internal scoring system, which looks largely at selection and prices. They can also be dropped if they do not turn in their application on time.
Auday Arabo
Auday Arabo, president and CEO of the Midwest Independent Retailers Association, said the limitations don’t make sense.
He is lobbying the department to change the ZIP code system so that at the very least, all supermarkets and grocery stores that want to accept WIC can do so.
“From a common-sense standpoint, when a grocery store can’t get WIC, that’s an issue,” he said.
Arabo said his organization represents grocers as well as convenience stores,but still supports putting the larger stores first. Larger stores typicallyoffer lower prices on food items than convenience stores.
In the past three weeks, he said, Arabo has heard from more than 20 retailers who have lost their ability to accept WIC in the region comprising Wayne, Oakland, Macomb, Livingston, Washtenaw, Monroe and Lenawee counties.
“It’s too common, and it’s unfortunate,” Arabo said. “It’s a frustrating thing every year.”
Retailers lose more than just the business from WIC purchases. Because the vast majority of WIC recipients also have SNAP bridge cards, they are often losing that business as well when customers find out they can’t use both cards at the same place anymore.
Mike Perrelli, vendor relations manager for WIC, said potential vendors have to apply or reapply every three years. The department uses an internal scoring system that takes into account the stores with the best prices and selection in each ZIP code. They will also take into account if a vendor has been part of the program, but also if it has had any violations in the program.
Bien said it would take more effort and resources to monitor a larger system.The funds for staffing come out of the yearly federal allocation the state receives, which was $213 million for the upcoming fiscal year. No state funds are spent on the program.
“We are looking at being cost effective,” Bien said. “It’s about adequate client access.”
The federal government does not mandate the number of retailers for WIC but has approved Michigan’s program.
There are 1,750 retailers in the state than can accept WIC, compared to the 10,595 retailers that accept SNAP bridge cards, a program administered by the Department of Human Services. About a quarter of all retailers and a quarter of all WIC recipients in the state are in Wayne County, Bien said.
Both WIC and the bridge card system are funded through the U.S. Department of Agriculture, but the retailer application process for bridge cards is handled at the federal level, while state workers at the Department of Community Health to do the work for WIC.
The department divides the state into three regions, and retailers have to reapply every three years to be in the program, so every year a different
region applies. This year, it was the region including Southeast Michigan.
The Save-A-Lot store in Highland Park is one of 1,750 retailers in Michigan that can accept WIC, a federal nutrition program for low-income women and children under age 5 with health problems.
Roy Rabban, president and owner of the Save-A-Lot supermarket on Woodward Avenue in Highland Park, purchased the store last month. He said he found out just before the closing that the previous owner had not submitted his WIC application by the Feb. 14 deadline.
“Not having WIC is like taking 10 percent of your business out of your pocket,” he said. “I’m getting penalized for someone’s wrongdoing.”
He said he was told by the Department of Community Health that he could apply and be put on a waiting list. Spots open up when a business closes, or
sometimes annually if enough people on WIC move into a ZIP code, creating a need for additional retailers.
Rabban’s brother Randy is co-owner and vice president of the Save-A-Lot on Houston Whittier Street in Detroit. He said his WIC contract was terminated July 1 after 25 years of being a part of the program.
“Right now I am refusing customers left and right, and they are getting angry,” he said.
Randy Rabban said he doesn’t know what happened to his application, though the department has a record of the document being signed for when delivered via UPS in December. Rabban said he didn’t sign for it, and never saw the application.
Regardless, Rabban said he found out about the problem in a letter from the department in late June, 10 days before the contract was terminated, leaving no ability to correct his mistake.
“It will jeopardize me,” he said.
The store makes about $4.2 million annually in sales, of which WIC accounts for about $150,000.
But the revenue loss could end up being more than $500,000, because almost all of his WIC customers have a bridge card, and many will want to do all of their shopping in one place, Randy Rabban said.
He said he will definitely have to cut jobs to account for lost revenue.
While not able to comment on specific cases, Bien said the department works hard to assist retailers in meeting the deadlines and, on occasion, allowing exceptions.
“We bend over backward in our bid to inform vendors,” Perrelli said.
Arabo said he has tried to work with department officials about raising the number of stores that will be approved, but has not had any luck.
Grocery stores also shouldn’t face losing their spots in the program because of missed deadlines, he said. They should be renewed each cycle, so long as they meet the qualifications to be part of the program, Arabo said. This way, customers in an area won’t be harmed because one person made a mistake filling out a form, he said.
Sen. Bert Johnson, D-Highland Park
State Sen. Bert Johnson, D-Highland Park, said the state should want to expand the number of stores that can serve as WIC retailers, especially in areas like Detroit and Highland Park, which he represents. In those areas, there is a higher concentration of lower-income families, without adequate transportation, he said.
“If there’s a quota system in an area where there is high need, someone is always going to be left out of the mix,” Johnson said. “That’s going
to become a problem.”
Linda Gobler, president and CEO of the Lansing-based Michigan Grocers Association, said the quota system seems to go against the idea that the state
would want easy access to healthy products.
She said it hurts the owners of the businesses when they lose access to WIC.
“If a shopper comes in and they want to buy groceries and find out you’re not authorized, then you’ve lost a customer that will probably never come
back,” she said.
Chris Gautz: (517) 403-4403(517) 403-4403, cgautz@crain.com. Twitter: @chrisgautz
