AB1186: Bill Text

1) The directors or the persons having the authority otherwise vested in the board are deadlocked in the management of the UCA's affairs and the members are unable to break the deadlock.

2) The directors or those in control of the UCA have acted fraudulently, illegally, or in a manner unfairly prejudicial toward one or more members in their capacities as members, directors, or officers.

3) For a period that includes the time when two consecutive regular members' meetings were held, the members failed to elect successors to directors whose terms expired or would have expired upon the election and qualification of their successors.

4) The UCA's assets are being misapplied or wasted.

5) The UCA's period of duration as provided in the articles has expired and has not been lawfully extended.

A creditor may bring an action against a UCA for dissolution, liquidation, and equitable relief if the creditor has obtained a money judgment against the UCA and an execution on that judgment has been returned unsatisfied or the UCA has admitted in writing that a claim of the creditor against the UCA is due and owing and that the UCA is unable to pay its debts in the ordinary course of business.

After giving a UCA 30 days to make a correction, the attorney general may bring an action against a UCA for dissolution and liquidation, and for equitable relief for persons other than the attorney general, if the articles and certificate of organization of the UCA were procured through fraud; the UCA was organized for a purpose prohibited by state law or not permitted under the law governing the UCA; the UCA has knowingly violated a law governing the UCA, with intentional disregard of the harm which the law is intended to avert; the UCA has violated more than once a law governing the UCA or has violated more than one law governing the UCA; or the actions of the UCA, or its failure to act, constitutes surrender or abandonment of the business of the UCA.

The bill specifies procedures, including the appointment of a receiver, that apply to involuntary dissolution proceedings (the procedures also apply to court-supervised voluntary dissolution proceedings). In addition, the bill requires the court, in determining whether to order a remedy in an involuntary dissolution proceeding to consider the financial condition of the UCA. The court may not refuse to order a remedy solely on the ground that the UCA has accumulated operating profits or current operating profits. The court must also consider whether relief, other than dissolution, suggested by one or more parties would permanently remedy the cause of the action. If the court finds that a party to an involuntary dissolution proceeding has acted arbitrarily, vexatiously, or in bad faith, the court may award reasonable expenses, including attorney fees and disbursements, to any of the other parties.

With certain exceptions, the bill prohibits any creditor or claimant who does not file a claim or bring an action during the pendency of dissolution proceedings or who has not brought an action before the commencement of dissolution proceedings, and all those claiming through or under the creditor or claimant, from bringing an action to collect on that claim or otherwise enforcing it.

Other provisions

Administration

The bill specifies UCA filing fees and permits DFI to assess a larger fee by rule for documents filed in paper format. Also, if a UCA makes an erroneous filing, DFI may revoke and expunge the filing and authorize a curative filing. Under the bill, DFI must charge a $500 fee for any such curative filing.

Statutory references

The bill makes numerous changes to the statutes to incorporate references to UCA's in provisions that currently refer to cooperatives.

Because this bill creates a new crime or revises a penalty for an existing crime, the Joint Review Committee on Criminal Penalties may be requested to prepare a report concerning the proposed penalty and the costs or savings that are likely to result if the bill is enacted.

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:

AB1186, s. 1 Section 1. 11.29 (1) of the statutes is amended to read:

AB1186,24,10 11.29 (1) Nothing in this chapter restricts any corporation, cooperative, unincorporated cooperative association, or voluntary association other than a political party or personal campaign committee from making disbursements for the purpose of communicating only with its members, shareholders or subscribers to the exclusion of all other persons, with respect to endorsements of candidates, positions on a referendum or explanation of its views or interests, without reporting such activity. No such corporation, cooperative, or voluntary association may solicit contributions from persons who are not members, shareholders or subscribers to be used for such purposes.

AB1186, s. 2 Section 2. 11.29 (4) of the statutes is amended to read:

AB1186,24,16 11.29 (4) For purposes of this section, the members of a local or regional cooperative or unincorporated cooperative association are deemed to be members of a state cooperative or unincorporated cooperative association if the local or regional cooperative or unincorporated cooperative association is a member of the state cooperative or unincorporated cooperative association.

AB1186, s. 3 Section 3. 11.38 (1) (a) 1. of the statutes is amended to read:

AB1186,25,2 11.38 (1) (a) 1. No foreign or domestic corporation, or association organized under ch. 185 or 193, may make any contribution or disbursement, directly or indirectly, either independently or through any political party, committee, group, candidate or individual for any purpose other than to promote or defeat a referendum.

AB1186, s. 4 Section 4. 11.38 (2) (b) of the statutes is amended to read:

AB1186,25,8 11.38 (2) (b) This section does not prohibit the publication of periodicals by a corporation or, a cooperative, or an unincorporated cooperative association in the regular course of its affairs which advise the members, shareholders or subscribers of the disadvantages or advantages to their interests of the election to office of persons espousing certain measures, without reporting such activity.

AB1186, s. 5 Section 5. 11.38 (8) (a) of the statutes is amended to read:

AB1186,25,13 11.38 (8) (a) A corporation or association organized under ch. 185 or 193 which accepts contributions or makes disbursements for the purpose of influencing the outcome of a referendum is a political group and shall comply with s. 11.23 and other applicable provisions of this chapter.

AB1186, s. 6 Section 6 . 11.38 (8) (b) of the statutes, as affected by 2005 Wisconsin Act 177, is amended to read:

AB1186,26,2 11.38 (8) (b) Except as authorized in s. 11.05 (12) (b) and (13), prior to making any disbursement on behalf of a political group which is promoting or opposing a particular vote at a referendum and prior to accepting any contribution or making any disbursement to promote or oppose a particular vote at a referendum, a corporation or association organized under ch. 185 or 193 shall register with the appropriate filing officer specified in s. 11.02 and appoint a treasurer. The registration form of the corporation or association under s. 11.05 shall designate an account separate from all other corporation or association accounts as a campaign depository account, through which all moneys received or expended for the adoption or rejection of the referendum shall pass. The corporation or association shall file periodic reports under s. 11.20 providing the information required under s. 11.06 (1).

AB1186, s. 7 Section 7. 13.94 (4) (a) 1. of the statutes is amended to read:

AB1186,26,18 13.94 (4) (a) 1. Every state department, board, examining board, affiliated credentialing board, commission, independent agency, council or office in the executive branch of state government; all bodies created by the legislature in the legislative or judicial branch of state government; any public body corporate and politic created by the legislature including specifically the Fox River Navigational System Authority, a professional baseball park district, a local professional football stadium district, a local cultural arts district and a family care district under s. 46.2895; every Wisconsin works agency under subch. III of ch. 49; every provider of medical assistance under subch. IV of ch. 49; technical college district boards; development zones designated under s. 560.71; every county department under s. 51.42 or 51.437; every nonprofit corporation or cooperative or unincorporated cooperative association to which moneys are specifically appropriated by state law; and every corporation, institution, association or other organization which receives more than 50% of its annual budget from appropriations made by state law, including subgrantee or subcontractor recipients of such funds.

AB1186, s. 8 Section 8. 15.155 (4) (b) of the statutes is amended to read:

AB1186,26,24 15.155 (4) (b) Members of the rural economic development board appointed under par. (a) 5. shall have experience operating a business located in a rural municipality, as defined in s. 560.17 (1) (d). At least one member shall have experience operating a cooperative or unincorporated cooperative association located in a rural municipality, as defined in s. 560.17 (1) (d).

AB1186, s. 9 Section 9. 25.17 (3) (dg) 1. of the statutes is amended to read:

AB1186,27,8 25.17 (3) (dg) 1. Direct obligations of the United States and of agencies of and corporations wholly owned by the United States, and direct obligations of federal land banks, federal home loan banks, central bank for cooperatives and banks for cooperatives or unincorporated cooperative associations, international bank for reconstruction and development, the international finance corporation, inter-American development bank, African development bank and Asian development bank, in each case maturing within one year or less from the date of investment.

AB1186, s. 12m Section 12m. 28.02 (4) (b) 5. of the statutes is amended to read:

AB1186,27,14 28.02 (4) (b) 5. To public utilities and cooperative associations, cooperatives organized under ch. 185 to furnish gas, light, heat, power, or water to their members, and to telecommunications cooperatives formed under ch. 185 or 193 when needed for power and telecommunications substations, transformers, booster stations and similar installations.

AB1186, s. 10 Section 10. 30.40 (9) of the statutes is amended to read:

AB1186,27,20 30.40 (9) "Person" means a natural person, corporation, limited liability company, partnership, association, cooperative, unincorporated cooperative association, municipality or other local governmental unit, private or public utility, municipal power district, estate or trust, the United States, a federal agency, the state of Wisconsin or a state agency.

AB1186, s. 11 Section 11. 32.22 (12) (a) (intro.) of the statutes is amended to read:

AB1186,28,4 32.22 (12) (a) (intro.) Nothing in this section requires the municipality to rehabilitate a residential building, if it appears at any time that total cost of rehabilitation, including structural repairs and alterations, exceeds 80% of the estimated fair market value of the building when rehabilitation is complete. If the municipality determines under this paragraph not to rehabilitate a residential building condemned under this section, the municipality shall sell the building to any corporation organized under ch. 181 that is a nonprofit corporation, as defined in s. 181.0103 (17), or any cooperative organized under ch. 185 or 193 which:

AB1186, s. 12 Section 12. 36.56 (1) of the statutes is amended to read:

AB1186,28,11 36.56 (1) From the appropriation under s. 20.285 (1) (qm), the center for cooperatives under s. 36.11 (40) may award grants to persons to form forestry cooperatives under ch. 185 or 193 that consist primarily of private, nonindustrial owners of woodland. A grant recipient shall provide matching funds equal to 50% of the grant amount awarded. The match may be in the form of money or in-kind services or both, but may not include money received from the state.

AB1186, s. 13 Section 13. 46.037 (1) of the statutes is amended to read:

AB1186,28,16 46.037 (1) Subject to sub. (1m), each residential child care center and each group home, as defined in s. 48.02 (7), that is licensed under s. 48.625 and incorporated under ch. 180, 181 or, 185, or 193 shall establish a per client rate for its services and shall charge all purchasers the same rate.

AB1186, s. 14 Section 14. 49.45 (21) (d) of the statutes is amended to read:

AB1186,28,19 49.45 (21) (d) This subsection supersedes any provision of chs. 180, 181 and, 185, and 193.

AB1186, s. 15 Section 15. 49.455 (4) (d) 1. of the statutes is amended to read:

AB1186,28,24 49.455 (4) (d) 1. The community spouse's expenses for rent or mortgage principal and interest, taxes and insurance for his or her principal residence and, if the community spouse lives in a condominium or, a cooperative, or an unincorporated cooperative association, any required maintenance charge.

AB1186, s. 16 Section 16. 49.455 (4) (d) 2. of the statutes is amended to read:

AB1186,29,5 49.455 (4) (d) 2. The standard utility allowance established under 7 USC 2014 (e), except that if the community spouse lives in a condominium or, a cooperative, or an unincorporated cooperative association for which the maintenance charge includes utility expenses, the standard utility allowance under 7 USC 2014 (e) is reduced by the amount of the utility expenses included in the maintenance charge.

AB1186, s. 17 Section 17. 50.90 (2) of the statutes is amended to read:

AB1186,29,10 50.90 (2) "Organization" means a public agency, as defined in s. 46.856 (1) (b), a nonprofit corporation, a for-profit stock corporation, a cooperative, an unincorporated cooperative association, a partnership, a limited liability company or a sole proprietorship.

AB1186, s. 18 Section 18. 59.43 (2) (ag) 1. of the statutes, as affected by 2005 Wisconsin Act 25, is amended to read:

AB1186,29,16 59.43 (2) (ag) 1. Subject to s. 59.72 (5), for recording any instrument entitled to be recorded in the office of the register of deeds, $11 for the first page and $2 for each additional page, except that no fee may be collected for recording a change of address that is exempt from a filing fee under s. 185.83 (1) (b) or 193.111 (1) (b).

AB1186, s. 19 Section 19. 62.237 (1) (b) of the statutes is amended to read:

AB1186,29,20 62.237 (1) (b) "Dwelling" means any structure used or intended to be used for habitation with up to 2 separate units certified for occupancy by the city. "Dwelling" also means any housing cooperative incorporated under ch. 185 or 193.

AB1186, s. 20 Section 20. 66.0425 (6) of the statutes is amended to read:

AB1186,30,6 66.0425 (6) Subsections (1) to (5) do not apply to telecommunications carriers, as defined in s. 196.01 (8m), telecommunications utilities, as defined in s. 196.01 (10), alternative telecommunications utilities, as defined in s. 196.01 (1d), public service corporations, or to cooperative associations cooperatives organized under ch. 185 to render or furnish telecommunication service, gas, light, heat, or power, or to cooperatives organized under ch. 185 or 193 to render or furnish telecommunications service, but the carriers, utilities, corporations and associations shall secure a permit from the proper official for temporary obstructions or excavations in a highway and are liable for all injuries to person or property caused by the obstructions or excavations.

AB1186, s. 21 Section 21. 66.0807 (1) of the statutes is amended to read:

AB1186,30,10 66.0807 (1) In this section, "privately owned public utility" includes a cooperative association organized under ch. 185 or 193 for the purpose of producing or furnishing utility service to its members only.

AB1186, s. 22 Section 22. 66.0825 (3) (f) of the statutes is amended to read:

AB1186,30,15 66.0825 (3) (f) "Person" means a natural person, a public agency, a cooperative, an unincorporated cooperative association, or a private corporation, limited liability company, association, firm, partnership, or business trust of any nature, organized and existing under the laws of any state or of the United States.

AB1186, s. 23 Section 23. 71.63 (6) (b) 4. of the statutes is amended to read:

AB1186,31,4 71.63 (6) (b) 4. In the employ of the operator of a farm in handling, planting, drying, packaging, processing, freezing, grading, storing or delivering to storage or to market or to a carrier for transportation to market, in its unmanufactured state, any agricultural or horticultural commodity, but only if such operator produced more than one-half of the commodity with respect to which such service was performed, or in the employ of a group of operators of farms (, other than a cooperative organization or an unincorporated cooperative association ), in the performance of such services, but only if such operators produced all of the commodity with respect to which such service is performed, but the provisions of this subdivision shall not be deemed to be applicable with respect to service performed in connection with commercial canning or commercial freezing or in connection with any agricultural or horticultural commodity after its delivery to a terminal market for distribution or consumption;

AB1186, s. 24 Section 24. 77.51 (10) of the statutes is amended to read:

AB1186,31,14 77.51 (10) "Person" includes any natural person, firm, partnership, limited liability company, joint venture, joint stock company, association, public or private corporation, the United States, the state, including any unit or division of the state, any county, city, village, town, municipal utility, municipal power district or other governmental unit, cooperative, unincorporated cooperative association, estate, trust, receiver, personal representative, any other fiduciary, and any representative appointed by order of any court or otherwise acting on behalf of others. "Person" also includes the owner of a single-owner entity that is disregarded as a separate entity under ch. 71.

AB1186, s. 25 Section 25. 77.53 (17r) (f) of the statutes is amended to read:

AB1186,31,21 77.53 (17r) (f) If the owner or lessee is an estate, a trust or, a cooperative, or an unincorporated cooperative association; that estate, that trust and its grantor or that cooperative or association does not have real property or other tangible personal property; except aircraft and such property as hangars, accessories, attachments, fuel and parts required for operation of aircraft; in this state at the time the aircraft is registered in this state.

AB1186, s. 26 Section 26. 91.19 (6) of the statutes is amended to read:

AB1186,32,2 91.19 (6) The department shall release from a farmland preservation agreement any land acquired for use as an electric generating facility authorized under s. 196.491 (3), or which involves acquisition of the fee by a utility or a cooperative organized under ch. 185 or 193 for purposes of generating electricity or other utility uses.

AB1186, s. 27 Section 27. 93.01 (2) of the statutes is amended to read:

AB1186,32,5 93.01 (2) "Cooperative association" includes cooperatives and foreign cooperatives as defined in s. ss. 185.01 and 193.005.

AB1186, s. 28 Section 28. 93.06 (4) of the statutes is amended to read:

AB1186,32,10 93.06 (4) Law enforcement. At the request of the attorney general or of any district attorney, assist in the enforcement of any of the following statutes relating to trade: ss. 133.03 to 133.07, 133.10, 133.12 to 133.15, 133.17, 134.01, 185.94, 193.105, 784.04 and 939.31.

AB1186, s. 29 Section 29. 93.06 (5) of the statutes is amended to read:

AB1186,32,14 93.06 (5) Public markets; cooperative associations. (a) Give assistance in the organization, operation or reorganization of such public markets as are authorized by law, and of cooperative associations and unincorporated cooperative associations.

AB1186,32,20 (b) By general order, prescribe uniform systems of accounting for public markets or cooperative associations and unincorporated cooperative associations, and may, by general or special order, require any such market or cooperative association to render report, in form indicated by the department, to show the nature and volume of business, resources, liabilities, profits, losses and any other facts bearing upon the financial condition of the market or cooperative association.

AB1186, s. 30 Section 30. 93.06 (6) (a) to (c) of the statutes are amended to read:

AB1186,32,25 93.06 (6) Cooperatives. (a) By general or special order, require any cooperative association or unincorporated cooperative association doing business in this state to file with the department a verified copy of its bylaws and of any exclusive contract of sale or agency between the association and its members or patrons.

AB1186,33,9 (b) Investigate the management of any cooperative association or unincorporated cooperative association doing business in this state, and make the facts relating to the management of the cooperative association available to the members of the association, when a request for a management investigation has been filed with the department, signed by all of the directors or by at least 20% of the members of associations of less than 500 members or by at least 100 members of associations of 500 or more members. The department shall fix and collect a fee for investigations under this paragraph, which shall be the actual cost of the investigation.

AB1186,33,12 (c) By general or special order, require any cooperative association or unincorporated cooperative association doing business in this state or in the process of organization to file with the department a report of its promotion expenses.

AB1186, s. 31 Section 31. 94.67 (5) (a) (intro.) of the statutes is amended to read:

AB1186,33,17 94.67 (5) (a) (intro.) "Commercial application business" means a corporation, a limited liability company, a cooperative association, an unincorporated cooperative association, a partnership, a natural person doing business as a sole proprietor or other nongovernmental business entity that does either of the following:

AB1186, s. 32 Section 32. 96.01 (8) of the statutes is amended to read:

AB1186,33,20 96.01 (8) "Member-patron" means a person who is a member of a cooperative under ch. 185 or 193 and whose products are marketed through that cooperative.

AB1186, s. 33 Section 33. 96.08 (3) (b) of the statutes is amended to read: