AB230: Bill Text

LRB-0839/2

RCT:jrd:jlb

1995 - 1996 LEGISLATURE

1995 Assembly BILL 230

March 17, 1995 - Introduced by Representatives Hahn, Goetsch, Musser, Ott, Johnsrud, Freese, Silbaugh, Skindrud, Grothman, Ward, Olsen, Zukowski, Gunderson, Seratti and Owens, cosponsored by Senators Fitzgerald, Drzewiecki and Schultz. Referred to Committee on Agriculture.

AB230,2,2 An Act to repeal 127.17 (1) (a) (title) and 127.17 (1) (b) 2. and 3.; to renumber and amend 127.01 (1), 127.01 (5t), 127.01 (25), 127.02 (3) (b) 1., 127.02 (3) (b) 2., 127.06 (2) (b), 127.06 (3), 127.10 (5), 127.13 (1), 127.17 (1) (intro.), 127.17 (1) (a), 127.17 (1) (b) 1., 127.17 (2) (c) and 127.17 (2) (e); to amend 20.115 (1) (jm), 127.01 (1r), 127.01 (4), 127.01 (5p), 127.01 (6), 127.01 (11), 127.01 (13), 127.01 (15), 127.01 (16), 127.01 (18), 127.01 (19) (intro.), 127.01 (21), 127.01 (22), 127.01 (28), 127.02 (title), (1) and (2), 127.02 (3) (a) and (am), 127.02 (3m), (4) and (5), 127.03 (2), 127.03 (3) (title) and (a) (intro.), 127.03 (3) (a) 2., 127.03 (3) (a) 3., 127.03 (3) (b), 127.03 (3) (bg), 127.03 (3m), (4) and (5), 127.04, 127.05, 127.06 (title), 127.06 (2) (title) and (a), 127.09, 127.10 (title), (1) and (2), 127.10 (4), 127.10 (6), 127.105, 127.11 (2), 127.12 (2), 127.13 (2) and (3), 127.15, 127.16, 127.17 (2) (title), (a) and (b), 127.17 (2) (c) (title), 127.17 (2) (d), 127.17 (2) (e) (title), 127.17 (3) and 127.17 (5); to repeal and recreate 127.01 (5d), 127.01 (8) and (9), 127.01 (13m) and (14), 127.01 (25m), 127.01 (26), 127.02 (3) (b) (title), 127.03 (title) and (1), 127.06 (1), 127.07, 127.13 (title) and 127.14; and to create 127.01 (5r), 127.01 (5t) (a) and (b), 127.01 (25) (b), 127.03 (3) (a) 2m., 127.03 (3) (bk), 127.05 (3) and (4), 127.06 (1m), 127.06 (3), 127.06 (5) and (6), 127.065, 127.067, 127.069, 127.10 (5) (b), 127.13 (1) (c) and 127.17 (1) (b) of the statutes; relating to: regulation of grain dealers and warehouse keepers.

Analysis by the Legislative Reference Bureau

This draft makes numerous changes in the laws regulating grain dealers and grain warehouse keepers. A grain dealer buys grain from and sells grain for growers. A grain warehouse keeper stores grain for growers and others. The department of agriculture, trade and consumer protection (DATCP) administers the laws regulating grain dealers and warehouse keepers.

Under current law, certain large grain dealers (Class A grain dealers) must file annual financial statements with DATCP. If a Class A grain dealer fails to meet specified financial standards, the Class A grain dealer must file security with DATCP for the benefit of growers.

Under this bill, Class B (smaller) grain dealers who use contracts under which growers are not paid for grain within a week after receipt of the grain are required to file annual financial statements. If these grain dealers do not meet minimum financial standards, the bill requires them to file security with DATCP for the protection of growers.

The bill strengthens current financial standards applicable to grain dealers. The bill also changes the manner of calculating the amount of security that a grain dealer that does not meet financial standards must file and eliminates the current $500,000 cap on the amount of security that a grain dealer is required to file.

Under current law, a warehouse keeper that does not meet specified financial standards must file security with DATCP for the benefit of depositors. This bill eliminates the current $500,000 cap on the amount of security that such a warehouse keeper is required to file.

This bill requires warehouse keepers to make disclosures concerning insurance coverage to their depositors.

This bill requires a grain dealer who purchases grain under a contract under which the grower is not paid within a week of the grain dealer receiving the grain to pay the grower no more than 180 days after the day on which the price of the grain is established.

Under current law, most grain dealers and warehouse keepers are required to register with DATCP. This bill changes the registration requirement to a licensing requirement. The bill reduces the annual fee that must be paid by certain small grain dealers.

For further information see the state fiscal estimate, which will be printed as an appendix to this bill.

The people of the state of Wisconsin, represented in senate and assembly, do enact as follows:

AB230, s. 1 Section 1. 20.115 (1) (jm) of the statutes is amended to read:

AB230,3,6 20.115 (1) (jm) Warehouse keeper and grain dealer regulation. All moneys received from the warehouse keeper registration license and inspection fees and surcharges under s. 127.02 (3) and from the grain dealer registration license fees and surcharges under s. 127.03 (3) for the administration and enforcement of the warehouse keepers and grain dealers security act program under ch. 127.

AB230, s. 2 Section 2. 127.01 (1) of the statutes is renumbered 127.01 (1) (intro.) and amended to read:

AB230,3,9 127.01 (1) (intro.) "Affiliate" means any of the following:

AB230,3,11 (a) An officer, director, or partner, member or manager of a warehouse keeper or grain dealer, any.

AB230,3,13 (b) A firm or corporation owned or operated by an officer, director, or partner, member or manager of a warehouse keeper or grain dealer and any.

AB230,3,17 (c) A person acting who, as agent for a warehouse keeper or grain dealer, who is engaged in the business of buying buys or receives grain from, or contracting for the growing of grain by, a producer on behalf of or contracts with a producer to grow grain for delivery to a warehouse keeper or grain dealer.

AB230, s. 3 Section 3. 127.01 (1r) of the statutes is amended to read:

AB230,3,24 127.01 (1r) "Audited financial statement" means a financial statement on which an independent certified public accountant, or a an independent public accountant, who holds holding a certificate of authority under ch. 442, has expressed an opinion in accordance with according to generally accepted accounting principles and has conducted an audit in accordance with according to generally accepted auditing standards.

AB230, s. 4 Section 4. 127.01 (4) of the statutes is amended to read:

AB230,4,3 127.01 (4) "Cash payment" means payment in the form of currency, certified check, money order, barter, or advance money transfer arrangement with a bank which is evidenced in writing or irrevocable letter of credit.

AB230, s. 5 Section 5. 127.01 (5d) of the statutes is repealed and recreated to read:

AB230,4,7 127.01 (5d) "Class A grain dealer" means a person, other than an exempt grain dealer, a Class B grain dealer, a Class B2 grain dealer or a Class C grain dealer, who does any of the following:

AB230,4,9 (a) Buys grain from producers for resale or for introduction into commercial channels.

AB230,4,10 (b) Sells, on behalf of producers, grain received from those producers.

AB230,4,13 (c) A person who is a feeder of livestock or poultry or who operates a feed mill or other manufacturing facility if the person spends $400,000 or more during that person's fiscal year to buy grain from producers.

AB230, s. 6 Section 6. 127.01 (5p) of the statutes is amended to read:

AB230,4,19 127.01 (5p) "Class B grain dealer" means a person that, other than a Class B2 grain dealer, who buys grain from producers only in connection with or incidental to the operation of a feed mill or other manufacturing operation and that expends facility operated by that person and who spends less than $400,000 annually for the purchase of during that person's fiscal year to buy grain from producers.

AB230, s. 7 Section 7. 127.01 (5r) of the statutes is created to read:

AB230,4,25 127.01 (5r) "Class B2 grain dealer" means a person who buys grain from producers only in connection with the operation of a feed mill or other manufacturing facility operated by that person, who spends less than $50,000 during that person's fiscal year to buy grain from producers and who does not buy any grain under a deferred payment contract or a deferred price contract.

AB230, s. 8 Section 8. 127.01 (5t) of the statutes is renumbered 127.01 (5t) (intro.) and amended to read:

AB230,5,7 127.01 (5t) (intro.) "Class C grain dealer" means a feeder of livestock or poultry, or a producer that expends less than $400,000 annually for the purchase of who buys grain from producers solely for his or her own use as a feed or seed or a producer that is engaged solely in selling grain that he or she has produced. " Class C grain dealer" does not include a person who does any of the following:

AB230, s. 9 Section 9. 127.01 (5t) (a) and (b) of the statutes are created to read:

AB230,5,10 127.01 (5t) (a) Spends at least $400,000 during that person's fiscal year to buy grain from producers.

AB230,5,11 (b) Sells grain other than grain that the person produced.

AB230, s. 10 Section 10. 127.01 (6) of the statutes is amended to read:

AB230,5,15 127.01 (6) "Current assets" means cash and assets , including trade or investment items, that may can be readily converted into cash in the ordinary course of business within one year after the date of the balance sheet.

AB230, s. 11 Section 11. 127.01 (8) and (9) of the statutes are repealed and recreated to read:

AB230,5,20 127.01 (8) "Deferred payment contract" means a contract for the sale of grain from a producer to a grain dealer under which the grain dealer takes custody of the grain more than 7 calendar days before paying the producer in full for the grain.

AB230,5,24 (9) "Deferred price contract" means a contract for the sale of grain from a producer to a grain dealer under which the grain dealer takes custody of the grain before the grain dealer and the producer agree on the price that the grain dealer will pay for the grain.

AB230, s. 12 Section 12. 127.01 (11) of the statutes is amended to read:

AB230,6,1 127.01 (11) "Depositor" means any of the following: