Catron, an economist at the federal Bureau of Labor Statistics.

The producer price index for dairy products increased 10.4 percent in April, the biggest monthly rise since July 1946, said Brian C.

The increase in the specialty stores coincides with a rise in food prices, which was already squeezing the budget for the program. But they account for more than 37 percent of W.I.C. Sallack said California had 659 W.I.C.-only stores, accounting for 16 percent of all stores in the state's program. If food prices are high, for whatever reason, it means that our federal grant cannot go as far and cannot serve as many people.'' program in the California Department of Health Services, said: ''We consistently find that prices charged in W.I.C.-only stores are higher, on average, than in other stores. specialty stores are typically 10 percent to 20 percent higher than those at supermarkets and other retail grocers. families are not particularly sensitive to shelf prices because their vouchers buy a specific food package, regardless of the amount charged to state agencies, which administer the program with federal money. ''I wish they had these stores 10 years ago when I was on W.I.C.,'' Ms. In supermarkets, she said, the prices may be a little lower but ''it's often a hassle finding the right products and dealing with cashiers.'' Every item in the store meets the specification of the program, said a cashier, Tracy Wynne. shop'' in Virginia Beach, is tucked into a small shopping center, next to a state health clinic that issues W.I.C. Proprietors said the stores had become popular because they offer convenient locations and superior service. The stores have found a niche in the market that Congress did not anticipate. Analysis of food costs in California and Texas shows that ''W.I.C.-only stores in these states have higher prices, on average, than other authorized retailers,'' Mr. Bost, under secretary of the Agriculture Department, which runs the program. ''The rise in W.I.C.-only stores is a fairly recent phenomenon,'' said Eric M. vouchers, not cash, for payment.Ībout 47 percent of all babies born in the United States each year participate in the program. Now a growing number of stores are selling only to W.I.C. The program, the Special Supplemental Nutrition Program for Women, Infants and Children, or W.I.C., helps feed 7.7 million people each month by providing vouchers for infant formula, juice, eggs, milk, cheese, cereal and dried beans. Federal and state officials are expressing alarm about the proliferation of food stores that cater to low-income people but charge more than other grocery stores, thus driving up the cost of a major federal nutrition program.

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