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Statement of Need: Public Law 103-225 amends the Food Stamp Act of 1977, to make changes in eligibility requirements for retail food stores to participate in the Food Stamp Program. Prior to enactment of these changes, a retail food store qualified to participate in the Food Stamp Program if more than 50 percent of its total eligible food sales were in staple foods. The new law changes that to require 50 percent of its total gross sales in staple foods. It also provides another option for stores not meeting the new 50 percent rule. Those stores can now qualify if they offer for sale, on a continuous basis, a variety of food in each of four categories of staple foods. The staple food categories are defined as "(1) meat, poultry, or fish; (2) bread or cereals; (3) vegetables or fruits; or (4) dairy products." This statutory change in eligibility will require developing policy definitions for the terms "continuous basis," "variety," and "perishable."

Alternatives: None. The new law also requires the Secretary to issue new rules providing for the periodic reauthorization of retail food stores and wholesale food concerns. This must include providing periodic notice of the definitions for "retail food stores," "staple foods," and "perishable foods."

Anticipated Costs and Benefits: The legislation requires a report to Congress assessing the impact of these changes. This report has been requested to determine the impact of Public Law 103-225 on retail food stores. It is expected to be completed and presented to the House and Senate Agriculture Committees not later than 18 months after enactment (March 25, 1994). ^PThe report must include data on (a) the number and types of stores newly authorized and (b) the number and types of stores withdrawn (denied authorization/reauthorization) from the Food Stamp Program after implementation of the new law. The report must also include a description of the procedures used and the adequacy of those procedures to determine store eligibility to participate in the Food Stamp Program and to authorize and reauthorize stores to participate. Finally, the report must assess the adequacy of the guidance provided by the Secretary to retail food stores concerning the definitions of "retail food stores," "staple foods," and "perishables," and the eligibility criteria for stores to participate in the Food Stamp Program.

Risks: The report to Congress must include an assessment of whether the change in the definition of "retail food store" has had an adverse effect on the integrity of the Food Stamp Program.