SB55-ASA1-AA1,946,1
11. Ninety percent of the first $40,000 allowed.
SB55-ASA1-AA1,946,22 2. Eighty-five percent of the next $40,000 allowed.
SB55-ASA1-AA1,946,33 3. Eighty percent of the next $40,000 allowed.
SB55-ASA1-AA1,946,44 4. Seventy-five percent of any amount allowed in excess of $120,000.
SB55-ASA1-AA1,946,85 (d) For each default claim allowed under s. 126.70 against a qualified producer
6agent who, at the time of the default, was a contributing contractor and maintained
7security under s. 126.47 (3) (c), if the default occurs after April 30, 2002, and before
8May 1, 2004, 15% of the amount allowed.
SB55-ASA1-AA1,946,129 (e) For each default claim allowed under s. 126.70 against a qualified producer
10agent who, at the time of the default, was a contributing contractor and maintained
11security under s. 126.47 (3) (c), if the default occurs after April 30, 2004, and before
12May 1, 2007, 20% of the amount allowed.
SB55-ASA1-AA1,946,14 13(1m) When default occurs. For the purposes of this chapter, a default occurs
14on the date on which payment or delivery becomes overdue.
SB55-ASA1-AA1,946,18 15(2) Claims against contractor who has filed security. If the department
16allows default claims under s. 126.70 against a contractor who has security on file
17with the department, the department shall convert that security and use the
18proceeds as follows:
SB55-ASA1-AA1,946,2319 (a) If the contractor was not a contributing contractor when the default
20occurred, the department shall use the security proceeds to pay the full amount of
21the allowed claims, except that, if the security is not adequate to pay the full amount
22of the allowed claims, the department shall pay claimants on a prorated basis in
23proportion to their allowed claims.
SB55-ASA1-AA1,947,624 (b) If the contractor was a contributing contractor when the default occurred,
25the department shall use the security proceeds to reimburse the sources under s.

1126.72 from which the department makes any claim payment under sub. (1). If the
2security amount exceeds the amount payable under sub. (1) from the sources under
3s. 126.72, the department shall use the remaining security proceeds to pay the
4balance of the allowed claims. If the security amount is not adequate to pay the full
5remaining balance, the department shall pay claimants on a prorated basis in
6proportion to their allowed claims.
SB55-ASA1-AA1,947,157 (c) Notwithstanding par. (b), if the contractor was a contributing contractor
8when the default occurred, the department may, at its discretion, pay claims directly
9from security proceeds rather than from a fund source under s. 126.72. If the
10department acts under this paragraph, the department shall first pay claims in the
11amounts provided in sub. (1). If the security amount exceeds the amount payable
12under sub. (1) from the sources under s. 126.72, the department shall use the
13remaining security proceeds to pay the balance of the allowed claims. If the security
14amount is not adequate to pay the full remaining balance, the department shall pay
15claimants on a prorated basis in proportion to their allowed claims.
SB55-ASA1-AA1,947,17 16(3) Payment restrictions. (a) The department may not pay any portion of the
17following from any source identified in s. 126.72:
SB55-ASA1-AA1,947,1918 1. A default claim related to a default by a grain dealer or grain warehouse
19keeper that occurs before September 1, 2002.
SB55-ASA1-AA1,947,2120 2. A default claim related to a default by a milk contractor that occurs before
21May 1, 2002.
SB55-ASA1-AA1,947,2322 3. A default claim related to a default by a vegetable contractor that occurs
23before February 1, 2002.
SB55-ASA1-AA1,947,2524 4. A default claim allowed against a contractor who was not a contributing
25contractor when the default occurred.
SB55-ASA1-AA1,948,2
1(b) The department may not pay any default claim under this chapter, except
2as provided in sub. (1) or (2).
SB55-ASA1-AA1,948,53 (c) If the total amount of default claims exceeds the amount available under s.
4126.72, the department shall prorate the available amount among the eligible
5claimants in proportion to the amount of their allowed claims.
SB55-ASA1-AA1,948,9 6(4) Effect of payment. A claimant who accepts payment under sub. (1) or (2)
7releases his or her claim against the contractor to the extent of the payment. A
8payment under sub. (1) or (2) does not prevent a claimant from recovering the
9balance of an allowed claim directly from the contractor.
SB55-ASA1-AA1,948,13 10126.72 Claims against contributing contractor; payment sources. (1)
11Producer security fund. From the appropriation under s. 20.115 (1) (w), the
12department shall make payments authorized under s. 126.71 (1), up to the deductible
13amount in sub. (4).
SB55-ASA1-AA1,948,17 14(2) Industry bond proceeds. The department shall make a demand against the
15appropriate industry bond under s. 126.06 and shall use the proceeds of that bond
16to make payments authorized under s. 126.71 (1), to the extent that those payments
17exceed the deductible amount in sub. (4).
SB55-ASA1-AA1,948,21 18(3) Blanket bond proceeds. The department shall make a demand against the
19blanket bond under s. 126.07 and shall use the bond proceeds to pay any remaining
20amounts authorized under s. 126.71 (1) after the department makes payments under
21subs. (1) and (2).
SB55-ASA1-AA1,948,23 22(4) Deductible amount. The deductible amount, for purposes of subs. (1) and
23(2), is as follows:
SB55-ASA1-AA1,948,2524 (a) For default claims against a grain dealer or grain warehouse keeper who
25was a contributing contractor when the default occurred:
SB55-ASA1-AA1,949,2
11. If the department allows the claims on or after September 1, 2002, but before
2September 1, 2004, $500,000.
SB55-ASA1-AA1,949,43 2. If the department allows the claims on or after September 1, 2004, but before
4September 1, 2006, $750,000.
SB55-ASA1-AA1,949,65 3. If the department allows the claims on or after September 1, 2006,
6$1,000,000.
SB55-ASA1-AA1,949,87 (b) For default claims against a milk contractor who was a contributing
8contractor when the default occurred:
SB55-ASA1-AA1,949,109 1. If the department allows the claims on or after May 1, 2002, but before May
101, 2004, $1,000,000.
SB55-ASA1-AA1,949,1211 2. If the department allows the claims on or after May 1, 2004, but before May
121, 2006, $1,500,000.
SB55-ASA1-AA1,949,1313 3. If the department allows the claims on or after May 1, 2006, $2,000,000.
SB55-ASA1-AA1,949,1514 (c) For claims against a vegetable contractor who was a contributing contractor
15when the default occurred:
SB55-ASA1-AA1,949,1716 1. If the department allows the claims on or after February 1, 2002, but before
17February 1, 2004, $500,000.
SB55-ASA1-AA1,949,1918 2. If the department allows the claims on or after February 1, 2004, but before
19February 1, 2006, $750,000.
SB55-ASA1-AA1,949,2020 3. If the department allows the claims on or after February 1, 2006, $1,000,000.
SB55-ASA1-AA1,949,23 21126.73 Reimbursing payments. (1) Payments from the fund. The
22department may demand and collect, from a contractor, any claim amounts that the
23department pays under s. 126.72 (1) because of the contractor's default.
SB55-ASA1-AA1,950,2 24(2) Bond payments. A bond surety may demand and collect, from a contractor,
25any claim amounts that the bond surety pays to the department under s. 126.72 (2)

1or (3) because of the contractor's default. The bond surety shall provide the
2department with a copy of each demand under this subsection.
SB55-ASA1-AA1,950,43 SUBCHAPTER VIII
4 ADMINISTRATION AND ENFORCEMENT
SB55-ASA1-AA1,950,5 5126.78 Definitions. In this subchapter:
SB55-ASA1-AA1,950,6 6(1) "Contributing contractor" has the meaning given in s. 126.68 (1).
SB55-ASA1-AA1,950,7 7(2) "Depositor" has the meaning given in s. 126.25 (5).
SB55-ASA1-AA1,950,8 8(3) "Grain dealer" has the meaning given in s. 126.10 (9).
SB55-ASA1-AA1,950,9 9(4) "Grain warehouse keeper" has the meaning given in s. 126.25 (9).
SB55-ASA1-AA1,950,10 10(5) "Milk contractor" has the meaning given in s. 126.40 (8).
SB55-ASA1-AA1,950,12 11(6) "Producer agent" means a person who is a producer agent, as defined in s.
12126.10 (13), 126.40 (13), or 126.55 (12).
SB55-ASA1-AA1,950,13 13(7) "Vegetable contractor" has the meaning given in s. 126.55 (14).
SB55-ASA1-AA1,950,14 14(8) "Vegetable producer" has the meaning given in s. 126.55 (16).
SB55-ASA1-AA1,950,16 15126.80 Department authority; general. The department shall administer
16this chapter.
SB55-ASA1-AA1,950,18 17126.81 Rule-making. The department may promulgate rules to do any of the
18following:
SB55-ASA1-AA1,950,19 19(1) Interpret and implement this chapter.
SB55-ASA1-AA1,950,21 20(2) Modify the license fees and surcharges provided in s. 126.11 (4), 126.26 (3),
21126.41 (3), 126.42, or 126.56 (4).
SB55-ASA1-AA1,950,23 22(3) Modify the fund assessments provided under s. 126.15, 126.30, 126.46, or
23126.60, as provided in s. 126.88.
SB55-ASA1-AA1,950,25 24(4) Require a contractor to notify producers and producer agents of the
25contractor's license, security, or fund contribution status under this chapter.
SB55-ASA1-AA1,951,3
1126.82 Investigations. The department may conduct investigations that it
2considers necessary for the administration of this chapter, including investigations
3to determine any of the following:
SB55-ASA1-AA1,951,4 4(1) Whether a contractor complies with this chapter.
SB55-ASA1-AA1,951,5 5(2) Whether a contractor is able to honor contract obligations when due.
SB55-ASA1-AA1,951,6 6(3) Whether a contractor has failed to honor contract obligations when due.
SB55-ASA1-AA1,951,8 7(4) Whether a grain warehouse keeper has sufficient grain on hand to meet the
8grain warehouse keeper's obligations to depositors.
SB55-ASA1-AA1,951,10 9(5) The nature and amount of a contractor's storage obligations or other
10contract obligations.
SB55-ASA1-AA1,951,12 11126.83 Information. The department may require a contractor to provide
12information that is relevant to the administration and enforcement of this chapter.
SB55-ASA1-AA1,951,15 13126.84 Records; confidentiality. (1) Public records exemption. The
14following records obtained by the department under this chapter are not open to
15public inspection under s. 19.35:
SB55-ASA1-AA1,951,1616 (a) Contractor financial statements.
SB55-ASA1-AA1,951,1717 (b) A contractor's purchase, storage, or procurement records.
SB55-ASA1-AA1,951,21 18(2) Use of records in court or administrative proceedings. Notwithstanding
19sub. (1), the department may introduce any information obtained under this chapter
20in a court proceeding or administrative contested case, subject to any protective
21order that the court or administrative tribunal determines to be appropriate.
SB55-ASA1-AA1,952,3 22126.85 Remedial orders. (1) General. The department may, by special
23order, require a contractor to remedy a violation of this chapter or a rule promulgated
24under this chapter. The department may order the contractor to take specific
25remedial actions, including actions to remedy deficiencies or to prevent losses to

1persons protected under this chapter. Except as provided in sub. (2), the department
2shall give the contractor notice and an opportunity for hearing before the department
3issues an order.
SB55-ASA1-AA1,952,7 4(2) Summary order. The department may issue an order under sub. (1) without
5prior notice or hearing if the department finds that the order is necessary to prevent
6a clear and imminent threat of harm to persons protected under this chapter.
7Conditions indicating a clear and imminent threat of harm include the following:
SB55-ASA1-AA1,952,98 (a) A contractor fails to pay producers according to this chapter or according
9to the contractor's contracts with producers.
SB55-ASA1-AA1,952,1110 (b) A contractor fails to file replacement insurance within the time required
11under this chapter.
SB55-ASA1-AA1,952,1312 (c) A contractor fails to file security according to this chapter, or in response to
13the department's demand under this chapter.
SB55-ASA1-AA1,952,1414 (d) A contractor fails to pay a fund assessment when due.
SB55-ASA1-AA1,952,1715 (e) A vegetable contractor fails to pay vegetable producers by January 31 for
16vegetables delivered by December 31 of the previous year, except as authorized in a
17deferred payment contract.
SB55-ASA1-AA1,952,1918 (f) A grain warehouse keeper fails to return grain to depositors upon demand,
19as required under s. 126.34 (4).
SB55-ASA1-AA1,952,2120 (g) A grain warehouse keeper fails to maintain adequate grain inventory as
21required under s. 126.34 (3), and at least one of the following applies:
SB55-ASA1-AA1,952,2322 1. The amount of the deficiency exceeds 10,000 bushels or 10% of the grain
23warehouse keeper's obligations to depositors, whichever amount is less.
SB55-ASA1-AA1,952,2524 2. The grain warehouse keeper fails to correct the deficiency within 15 days
25after receiving the department's written notice that a deficiency exists.
SB55-ASA1-AA1,953,7
1(3) Hearing on summary order. (a) A contractor named in a summary order
2under sub. (2) may, within 10 days after receiving the order, request a hearing on the
3order. The department shall hold an informal hearing as soon as possible after
4receiving a hearing request, but not later than 10 days after receiving the hearing
5request, unless the contractor waives the informal hearing or agrees to hold it at a
6later date. If the matter is not resolved at the informal hearing, the department shall
7hold a contested case hearing under ch. 227 as soon as reasonably possible.
SB55-ASA1-AA1,953,98 (b) A hearing request under par. (a) does not automatically stay a summary
9order. The department may stay a summary order pending hearing.
SB55-ASA1-AA1,953,12 10126.86 License actions. (1) General. The department may for cause deny,
11suspend, revoke, or impose conditions on a contractor's license, as provided in s.
1293.06 (7) and (8). Cause may include any of the following:
SB55-ASA1-AA1,953,1413 (a) The contractor fails to comply with this chapter or a rule promulgated under
14this chapter.
SB55-ASA1-AA1,953,1615 (b) The contractor fails to comply with an order that the department issues
16under this chapter.
SB55-ASA1-AA1,953,1817 (c) The contractor fails to provide relevant information that the department
18requests under this chapter or falsifies information provided to the department.
SB55-ASA1-AA1,953,2119 (d) The contractor fails to file a financial statement, security, fees, or
20assessments required under this chapter, or fails to meet other requirements for
21licensing.
SB55-ASA1-AA1,953,2322 (e) The contractor fails to honor contract obligations to persons who are
23authorized to file default claims under s. 126.70 (1).
SB55-ASA1-AA1,954,224 (f) The contractor fails to reimburse the department, within 60 days after the
25department issues a reimbursement demand under s. 126.73 (1), for the full amount

1that the department pays to claimants under s. 126.72 (1) because of the contractor's
2default.
SB55-ASA1-AA1,954,63 (g) The contractor fails to reimburse a bond surety, within 60 days after the
4bond surety issues a reimbursement demand under s. 126.73 (2), for the full amount
5that the surety pays to the department under s. 126.72 (2) or (3) for the benefit of
6claimants affected by the contractor's default.
SB55-ASA1-AA1,954,10 7(2) Hearing on license action; general. Except as provided in sub. (3), the
8department shall give a contractor notice and an opportunity for hearing before the
9department suspends, revokes, or imposes conditions on a license held by the
10contractor.
SB55-ASA1-AA1,954,16 11(3) Summary action. (a) The department may, without prior notice or hearing,
12summarily suspend, revoke, or impose conditions on a license held by a contractor
13if the department finds that summary action is necessary to prevent a clear and
14imminent threat of harm to persons protected under this chapter. Conditions
15indicating a clear and imminent threat of harm include those identified in s. 126.85
16(2).
SB55-ASA1-AA1,954,2317 (b) A contractor who is the subject of a summary action under par. (a) may,
18within 10 days after receiving notice of that action, request a hearing on the action.
19The department shall hold an informal hearing as soon as possible after receiving a
20hearing request, but not later than 10 days after receiving the hearing request,
21unless the contractor waives the informal hearing or agrees to hold it at a later date.
22If the matter is not resolved at the informal hearing, the department shall hold a
23contested case hearing under ch. 227 as soon as reasonably possible.
SB55-ASA1-AA1,954,2524 (c) A request for hearing under par. (b) does not automatically stay a summary
25action under par. (a). The department may stay a summary action pending hearing.
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