(1) The department (or local agency in consultation with the department) , before re-authorization, shall conduct periodic reviews of the operations of participating food vendors. In conducting such reviews, the department or local agency may utilize an "educational buy" or a "compliance buy" as described in the "1990 State Plan for Montana's Special Supplemental Food Program for Women, Infants and Children (WIC) " (October 1989 edition) , and shall consider the following:

(a) a review of local agency monitoring reports;

(b) results of one or more on site visits;

(c) shared information from the Montana food stamp officer-in-charge;

(d) file review of one-half of the total currently authorized vendors;

(e) on site follow-up to (1) (a) and (d) above when warranted by incomplete information or complaint;

(f) whether the vendor demonstrates ability to meet Montana WIC program requirements, as evidenced by performance during the current agreement; and

(g) whether patterns of participant use demonstrate compliance with the program.

(2) Based upon such review, the department may take an adverse action (other than a warning letter) against the vendor, including disqualification of the food vendor from participation in the program.

(3) When taking an adverse action (other than a warning letter) against a vendor, including disqualification of a food vendor from the program, the department shall provide the affected vendor with written notice not less than 15 days in advance of the pending action which notice must include the reasons for the adverse action, the date of adverse action, and, except in cases of the expiration of the vendor's WIC agreement, the vendor's right to appeal as set forth in 7 CFR 246.18.

(4) The department hereby adopts and incorporates herein by reference the following:

(a) the "1990 State Plan for Montana's Special Supplemental Food Program for Women, Infants and Children (WIC) " (October 1989 edition) , a comprehensive summary of applicable federal regulations, procedures, and forms used by the department; and

(b) 7 CFR 246.18, which is a federal agency rule setting forth the notice and hearing procedures for local agencies and food vendors who are denied participation or are disqualified from the program.

(c) Copies of these documents may be obtained from the Department of Public Health and Human Services, Special Supplemental Nutrition Program for Women, Infants & Children (WIC) , P.O. Box 202951, Helena, MT 59620-2951.