The closures come after the implementation of new federal pricing guidelines on July 1, and leaves the Manna Foods Express store in Lebanon as the state's only store exclusive to the Women, Infants and Children, or WIC, program participants.
Nearly 172,000 Oregonians took part in the program last year, receiving vouchers for specific types and amounts of food, such as a gallon of milk or 15 ounces of baby cereal. States then reimburse stores for the food.
WIC-only stores carry only products that match the vouchers, and store employees will gather the products for customers.
Oregon has 640 authorized WIC vendors, including Wal-Mart, Roth's and Safeway.
Cathy Thiessen, who owns three WIC-only stores in Marion County, said she will close her stores Aug. 1.
"We want to stay in business," Thiessen said, "but in our current model, no way."
Great Start customer Joylene Guerrero, carrying her 1-month-old son, Angel, in her arms, said she'll miss Thiessen's store, calling it more convenient then shopping at a large supermarket, with thousands of products.
In response to Congressional complaints and decreased funding, new federal rules require WIC-only stores to price their food products relative to the state average for those goods. Previously states simply set a maximum reimbursement limit.
A group of WIC-only stores challenged the new rules shortly before they were to go into effect, but the case was dismissed in January.
Starting July 1, all WIC-only stores in Oregon had to change their prices to reflect what the state determined was the average price.
Oregon WIC Director Susan Woodbury said that in Oregon WIC-only stores normally charged 25 percent more than the state average.
"The federal government said that we can't reimburse (WIC-only) stores at a higher rate than we would other stores," Woodbury said. "It's just holding them to a competitive price."
But Thiessen said prices at big-box stores such as Wal-Mart drove down the state average to a point at which her small business couldn't survive.
"I tried to stay around the Safeways and the Roths," she said, "but it turns out the average is Wal-Mart prices."
California currently has 598 WIC-only stores, down from 652 in 2004. New pricing regulations took effect there on June 1, but so far stores haven't been closing as expected, said Laurie True, executive director for the nonprofit California WIC Association.
She said about 20 California stores have closed because of the pricing changes.
She said the stores have been able to drop their prices and some have even formed buying alliances to keep costs down.
"It's surprising to us. We thought more would drop out," True said.
Thiessen said the WIC-only stores are important to the self-respect of the those in the program and can help drive up WIC participation by making it easier for participants to use the program.
(Copyright 2006 by The Associated Press. All Rights Reserved.)