Chapter ATCP 100

ATCP 100.135(4)(a) (a) If the milk contractor has filed an annual financial statement under s. 126.44, Stats., and that financial statement shows positive equity and a debt to equity ratio of not more than 2.0 to 1.0, the milk contractor’s debt to equity ratio assessment rate equals the greater of zero or the debt to equity ratio assessment factor in sub. (5) (a) multiplied by an amount determined as follows:

ATCP 100.135(4)(a)1. 1. Subtract 2 from the debt to equity ratio.

ATCP 100.135(4)(a)2. 2. Divide the amount determined under subd. 1. by 3.

ATCP 100.135(4)(a)3. 3. Raise the amount determined under subd. 2. to the 9th power.

ATCP 100.135(4)(a)4. 4. Divide the debt to equity ratio by 3.25.

ATCP 100.135(4)(a)5. 5. Raise the amount determined in subd. 4. to the 5th power.

ATCP 100.135(4)(a)6. 6. Add the amount determined under subd. 3. to the amount determined under subd. 5.

ATCP 100.135(4)(a)7. 7. Add 0.025 to the amount determined under subd. 6.

ATCP 100.135(4)(b) (b) If the milk contractor files an annual financial statement under s. 126.44, Stats., and that financial statement shows a debt to equity ratio of greater than 2.0 to 1.0 but less than 2.9 to 1.0, the milk contractor’s debt to equity ratio assessment rate equals the debt to equity ratio assessment factor in sub. (5) (b) multiplied by an amount determined as follows:

ATCP 100.135(4)(b)1. 1. Subtract 2 from the debt to equity ratio.

ATCP 100.135(4)(b)2. 2. Divide the amount determined under subd. 1. by 3.

ATCP 100.135(4)(b)3. 3. Raise the amount determined under subd. 2. to the 9th power.

ATCP 100.135(4)(b)4. 4. Divide the debt to equity ratio by 3.25.

ATCP 100.135(4)(b)5. 5. Raise the amount determined under subd. 4. to the 5th power.

ATCP 100.135(4)(b)6. 6. Add the amount determined under subd. 3. to the amount determined under subd. 5.

ATCP 100.135(4)(b)7. 7. Add 0.025 to the amount determined under subd. 6.

ATCP 100.135(4)(c) (c) Except as provided in par. (e), if the milk contractor has filed an annual financial statement under s. 126.44, Stats., and that financial statement shows negative equity, or a debt to equity ratio of at least 2.9 to 1.0, the milk contractor’s debt to equity ratio assessment rate equals the debt to equity ratio assessment factor in sub. (5) (b) multiplied by 0.590704.

ATCP 100.135(4)(d) (d) Except as provided in par. (e), if the milk contractor has not filed an annual financial statement s. 126.44, Stats., the milk contractor’s debt to equity ratio assessment rate equals the debt to equity ratio assessment factor in sub. (5) (b) multiplied by 0.11325375.

ATCP 100.135(4)(e) (e) If the milk contractor procures producer milk in this state solely as a producer agent and the milk contractor has not filed an annual financial statement under s. 126.44, Stats., or has filed an annual financial statement that shows negative equity or a debt to equity ratio of at least 2.9 to 1.0, the milk contractor’s debt to equity ratio assessment rate is 0.00025, except that for the milk contractor’s 5th or higher consecutive full license year of participation in the fund the milk contractor’s debt to equity ratio assessment rate is 0.000175.

ATCP 100.135(5) (5) Debt to equity ratio assessment factor.

ATCP 100.135(5)(a) (a) A milk contractor’s debt to equity ratio assessment factor under sub. (4) (a) is 0.0015, except as follows:

ATCP 100.135(5)(a)1. 1. For the milk contractor’s 3rd consecutive full license year as a contributing milk contractor, the milk contractor’s debt to equity ratio assessment factor is 0.001.

ATCP 100.135(5)(a)2. 2. For the milk contractor’s 4th consecutive full license year as a contributing milk contractor, the milk contractor’s debt to equity ratio assessment factor is 0.0005.

ATCP 100.135(5)(a)3. 3. For the milk contractor’s 5th or higher consecutive full license year as a contributing milk contractor, the milk contractor’s debt to equity ratio assessment factor is zero.

ATCP 100.135(5)(b) (b) A milk contractor’s debt to equity ratio assessment factor under sub. (4) (b) to (d) is 0.00225, except that, for the milk contractor’s 5th or higher consecutive full license year as a contributing milk contractor, the milk contractor’s debt to equity ratio assessment factor is 0.001.

ATCP 100.135(6) (6) Reduced assessments.

ATCP 100.135(6)(a) (a) If a contributing milk contractor files security under s. 126.47 (1) (b), Stats., the milk contractor’s fund assessment under sub. (1) is reduced by the amount provided in s. 126.46 (5m), Stats. This reduction is in addition to any reduction provided under par. (b).

ATCP 100.135(6)(b) (b) If a contributing milk contractor files security under par. (d) in an amount that is at least equal to the milk contractor’s estimated default exposure less the maximum fund reimbursement amount, the milk contractor’s annual fund assessment under sub. (1) for that year is reduced by an amount that is determined as follows:

ATCP 100.135(6)(b)1. 1. Subtract the maximum fund reimbursement from the milk contractor’s estimated default exposure.

ATCP 100.135(6)(b)2. 2. Divide the result in subd. 1. by the milk contractor’s estimated default exposure.

ATCP 100.135(6)(b)3. 3. Multiply the results in subd. 2. by the amount of the milk contractor’s annual fund assessment under sub. (1).

ATCP 100.135(6)(c) (c) Notwithstanding pars. (a) and (b), no contributing milk contractor may pay a fund assessment that is less than the minimum fund assessment under sub. (9).

ATCP 100.135(6)(d) (d) A milk contractor may at any time file security with the department, regardless of whether the milk contractor is required to file security. Except as provided in par. (b), a voluntary security filing under this paragraph does not relieve a milk contractor of any other obligation to file security or pay fund assessments.

ATCP 100.135 Note Note: A milk contractor who files voluntary security under par. (d) may be eligible for a reduction in fund assessments under par. (b), and may be able to make a more favorable disclosure to producers under s. ATCP 100.20 (2).

ATCP 100.135(7) (7) Quarterly installments.

ATCP 100.135(7)(a) (a) A contributing milk contractor shall pay the milk contractor’s annual fund assessment in equal quarterly installments that are due as follows:

ATCP 100.135(7)(a)1. 1. The first installment is due on June 1 of the license year.

ATCP 100.135(7)(a)2. 2. The 2nd installment is due on September 1 of the license year.

ATCP 100.135(7)(a)3. 3. The 3rd installment is due on December 1 of the license year.

ATCP 100.135(7)(a)4. 4. The 4th installment is due on March 1 of the license year.

ATCP 100.135(7)(b) (b) A contributing milk contractor may prepay any of the quarterly installments under par. (a).

ATCP 100.135(7)(c) (c) A contributing milk contractor who applies for an annual license after the beginning of a license year shall pay for the full annual fund assessment required under this section. The milk contractor shall pay, with the first quarterly installment that becomes due after the day on which the department issues the license, all of the quarterly installments for that license year that were due before that day.

ATCP 100.135(7)(d) (d) If s. 126.45 (1) (b), Stats., requires a license milk contractor to become a contributing milk contractor during the license year, the milk contractor shall pay only those quarterly installments that become due after the requirement takes effect.

ATCP 100.135(7)(e) (e) A contributing milk contractor who fails to pay the full amount of any quarterly installment when due shall pay, in addition to that installment, a late payment penalty of $50 or 10% of the overdue installment, whichever is greater.

ATCP 100.135(8) (8) Notice of annual assessment and quarterly installments. When the department issues an annual license to a contributing milk contractor, the department shall notify the milk contractor of all of the following:

ATCP 100.135(8)(a) (a) The amount of the milk contractor’s annual fund assessment under this section.

ATCP 100.135(8)(b) (b) The amount of each required quarterly installment under sub. (7) and the date by which the milk contractor must pay each installment.

ATCP 100.135(8)(c) (c) The penalty that applies under sub. (7) (e) if the milk contractor fails to pay any quarterly installment when due.

ATCP 100.135(9) (9) Minimum fund assessments. A contributing milk contractor shall pay the following minimum assessment if that minimum assessment is greater than the amount calculated under sub. (1) less applicable reductions under sub. (6):

ATCP 100.135(9)(a) (a) If the milk contractor reports an amount under s. 126.41 (6) (a), Stats., that is less than $1.5 million, the minimum assessment is $100.

ATCP 100.135(9)(b) (b) If the milk contractor reports an amount under s. 126.41 (6) (a), Stats., that is at least $1.5 million but less than $6 million, the minimum assessment is $200.

ATCP 100.135(9)(c) (c) If the milk contractor reports an amount under s. 126.41 (6) (a), Stats., that is at least $6 million, the minimum assessment is $500.

ATCP 100.135(10) (10) Exemption. A contributing milk contractor is not required to pay any fund assessment under this section for a license year, other than a deferred payment assessment required under sub. (1m), if all of the following apply:

ATCP 100.135(10)(a) (a) The milk contractor was classified as a contributing milk contractor in each of the 5 license years immediately preceding that license year.

ATCP 100.135(10)(b) (b) The fund balance attributable to milk contractors was at least $6 million on February 28 of the last preceding license year.

ATCP 100.135(10)(c) (c) The overall fund balance was at least $11 million on February 28 of the last preceding license year.

ATCP 100.135 History History: Emerg. cr. eff. 4-29-04; CR 04-030: cr. Register September 2004 No. 585, eff. 10-1-04; CR 05-068: r. and recr. (1), am. (2) (intro.) Register April 2006 No. 604, eff. 5-1-06; CR 07-073: r. and recr. Register December 2008 No. 636, eff. 1-1-09; corrections in (8) (b) and (c) made under s. 13.92 (4) (b) 7., Stats., Register December 2008 No. 636; correction in (6) (b) (intro.) made under s. 13.92 (4) (b) 7., Stats., Register June 2011 No. 666; EmR1803: emerg. am. (intro.), (1), eff. 2-1-2018; CR 17-047: am. (intro.), (1) Register November 2019 No. 767, eff. 12-1-19; EmR 1816: emerg. r. and recr. (1), cr. (1e), am. (10) (intro.), eff. 8-1-18; CR 18-061: r. and recr. (1), cr. (1e), (1m), am. (10) (intro.) Register February 2020 No. 770 eff. 3-1-20; reprinted to correct transcription error in (1) Register September 2022 No. 801.

ATCP 100.14 ATCP 100.14 Custom processing services to milk producers. Chapter 126, Stats., does not apply to a dairy plant operator who takes temporary custody of producer milk solely to process it for the milk producer, provided that all the following apply:

ATCP 100.14(1) (1) The producer retains title to all of the milk and all of the processed dairy products made from that milk.

ATCP 100.14(2) (2) The operator does not market the milk or processed dairy products, but promptly returns the processed dairy products to the producer or the producer’s agent for consumption or marketing.

ATCP 100.14(3) (3) The operator does not commingle producer-owned milk or dairy products with other milk or dairy products.

ATCP 100.14(4) (4) The operator provides the processing services under a written contract with the producer or the producer’s agent. The contract shall clearly and conspicuously disclose all the following:

ATCP 100.14(4)(a) (a) That the producer retains title to all the milk shipped to the operator for processing, and all the processed dairy products made from that milk.

ATCP 100.14(4)(b) (b) That the producer’s milk shipments to the operator are not secured under ch. 126, Stats.

ATCP 100.14(5) (5) The operator keeps a copy of the contract under sub. (4) for at least 3 years after the contract ends, and makes it available to the department for inspection and copying upon request.

ATCP 100.14(6) (6) The operator submits to the department, by May 1 of each year, an affidavit certifying that the operator qualifies for the custom processing exemption under this section.

ATCP 100.14 History History: CR 02-113: cr. Register April 2003 No. 568, eff. 5-1-03.

ATCP 100.16 ATCP 100.16 Producer agents.

ATCP 100.16(1) (1) Qualified producer agent. A producer agent is not a qualified producer agent under s. 126.45 (3), Stats., nor may a producer agent file a default claim under s. 126.70 (1) (c), Stats., unless all the following apply:

ATCP 100.16(1)(a) (a) The producer agent procures producer milk in this state solely as the agent of milk producers. Notwithstanding this paragraph, a milk contractor who buys some milk and markets other milk as a producer agent may file a default claim under s. 126.70 (1) (c), Stats., for producer milk that the milk contractor markets as a producer agent if the contractor complies with pars. (b) to (f) with respect to all of the milk that the contractor procures in this state as a producer agent.

ATCP 100.16(1)(b) (b) The producer agent does not take title to the producer milk, or to any processed dairy products made from the producer milk.

ATCP 100.16(1)(c) (c) The producer agent markets the producer milk under a written contract with each milk producer. The contract shall comply with sub. (2).

ATCP 100.16(1)(d) (d) The producer agent does not process, as a producer agent, more than 5 million pounds of producer milk in any month.

ATCP 100.16(1)(e) (e) The producer agent gives, to each recipient of producer milk marketed by the producer agent, a written invoice stating that the milk is producer milk not owned by the producer agent.

ATCP 100.16(1)(f) (f) The producer agent files a monthly producer agent report with the department, as provided under sub. (3).

ATCP 100.16 Note Note: Producer agents are regulated as milk contractors under ch. 126, Stats., regardless of whether they comply with sub. (1). But producer agents do not qualify for special treatment as “qualified producer agents” under s. 126.45 (3), Stats., nor may they file default claims under s. 126.70 (1), Stats., unless they comply with sub. (1).

ATCP 100.16(2) (2) Contract with milk producer. The contract under sub. (1) (c) shall be signed by the milk producer and the producer agent, and shall clearly specify the terms under which the producer agent receives, markets and accepts payment for milk on behalf of the producer. The contract shall clearly and conspicuously disclose all the following:

ATCP 100.16(2)(a) (a) That the producer agent does not take title to the producer’s milk, or any dairy products made from that milk.

ATCP 100.16(2)(b) (b) That the producer agent receives payments on behalf of the producer, and holds them in trust for the producer.

ATCP 100.16(2)(c) (c) The terms and conditions of payment to the producer.

ATCP 100.16(2)(d) (d) The procedure by which the producer agent will receive payment on behalf of the producer and make payments to the producer, including any trust fund arrangement.

ATCP 100.16(2)(e) (e) The producer agent’s compensation for serving as the producer’s agent, and the method by which the producer agent will receive that compensation from the producer.

ATCP 100.16(2)(f) (f) The appropriate milk security disclosure statement under s. ATCP 100.20.

ATCP 100.16(3) (3) Monthly report. A producer agent who files a monthly report under sub. (1) (f) shall file the report on or before the 25th day of the month. The report shall include all the following:

ATCP 100.16(3)(a) (a) The name and address of each person to whom the producer agent marketed, in the preceding month, producer milk that the producer agent procured in this state as a producer agent.

ATCP 100.16(3)(b) (b) The total pounds of producer milk that the producer agent marketed to each person under par. (a) in the preceding month.

ATCP 100.16(3)(c) (c) The total dollar value of producer milk that the producer agent marketed to each person under par. (a) in the preceding month.

ATCP 100.16(3)(d) (d) The producer agent’s total gross payments to milk producers for producer milk that the producer agent marketed under par. (a) in the preceding month.

ATCP 100.16(4) (4) Exempt agent. Chapter 126, Stats., does not apply to a person who collects a producer’s milk for delivery to a custom processor under s. ATCP 100.14, and who receives and markets the custom-processed dairy products for the producer, provided that all the following apply: