1995 - 1996 LEGISLATURE
ASSEMBLY SUBSTITUTE AMENDMENT 1,
To 1995 ASSEMBLY BILL 630
March 5, 1996 - Offered by Representatives Ott, Klusman, Brancel, Albers,
Springer, Baldus, Reynolds
and Wilder.
AB630-ASA1,1,11 1An Act to repeal 100.03 (1) (n), 100.03 (1) (zp), 100.03 (8) (b) 6. and 100.03 (8)
2(bm); to renumber and amend 100.03 (1) (e); to amend 20.115 (1) (gm), 97.29
3(4), 100.03 (title), 100.03 (1) (a) (intro.), 100.03 (1) (f), 100.03 (1) (v) to (wm),
4100.03 (1) (zm), 100.03 (2) (a), 100.03 (3) (a) 2., 100.03 (3) (b), 100.03 (4) (a),
5100.03 (4) (c), 100.03 (4) (f), 100.03 (5) (a) 2., 100.03 (5) (b), 100.03 (5) (c), 100.03
6(5) (e), 100.03 (6) (a), 100.03 (6) (b) 1., 100.03 (6) (b) 3., 100.03 (6) (b) 4., 100.03
7(7) (a) 1., 100.03 (7) (c) (intro.), 100.03 (7) (c) 1., 100.03 (15) (title), 100.03 (15)
8(a) (intro.), 100.03 (15) (c), 100.03 (18) and 100.03 (19) (a) (intro.); to repeal and
9recreate
100.03 (7) (a) 2.; and to create 100.03 (1) (ym), 100.03 (1) (zs), 100.03
10(4m), 100.03 (5) (am), 100.03 (7) (a) 3., 100.03 (8) (cm) and 100.03 (8) (e) of the
11statutes; relating to: fruit and vegetable producer security.
The people of the state of Wisconsin, represented in senate and assembly, do
enact as follows:
AB630-ASA1, s. 1 12Section 1. 20.115 (1) (gm) of the statutes, as affected by 1995 Wisconsin Act 27,
13is amended to read:
AB630-ASA1,2,6
120.115 (1) (gm) (title) Dairy trade regulation; dairy and farm product and
2vegetable
producer security. The amounts in the schedule for the regulation of farm
3product
vegetable procurement under s. 100.03, of dairy plant financial condition
4under s. 100.06 and of dairy trade practices under s. 100.201. All moneys received
5under ss. 100.03 (3) (a) 3., 100.06 (9) and 100.201 (6) shall be credited to this
6appropriation.
AB630-ASA1, s. 2 7Section 2. 97.29 (4) of the statutes is amended to read:
AB630-ASA1,2,168 97.29 (4) (title) Food processing plants buying farm products vegetables
9from producers.
The department may not issue or renew a license to operate a food
10processing plant to any applicant who is a contractor, as defined in s. 100.03 (1) (f),
11unless the applicant has filed all financial information and any security that is
12required under s. 100.03. If an applicant has not filed all financial information and
13any security that is required under s. 100.03, the department may issue a conditional
14license under s. 93.06 (8) that prohibits the licensed operator from procuring farm
15products
vegetables from a producer or a producer's agent, but allows the operator
16to procure farm products vegetables from other sources.
AB630-ASA1, s. 3 17Section 3. 100.03 (title) of the statutes is amended to read:
AB630-ASA1,2,19 18100.03 (title) Farm product Vegetable procurement; financial security;
19grading and tare.
AB630-ASA1, s. 4 20Section 4. 100.03 (1) (a) (intro.) of the statutes is amended to read:
AB630-ASA1,2,2221 100.03 (1) (a) (intro.) "Affiliate" means any of the following persons or business
22entities that procures farm products vegetables for use by an operator:
AB630-ASA1, s. 5 23Section 5. 100.03 (1) (e) of the statutes is renumbered 100.03 (1) (bm) and
24amended to read:
AB630-ASA1,3,6
1100.03 (1) (bm) "Certified Audited financial statement" means a financial
2statement that, in the accompanying opinion of an independent certified public
3accountant or a public accountant holding a certificate of authority under ch. 442,
4fairly and in all material respects represents the financial position of the contractor,
5the results of the contractor's operations and the contractor's cash flows in
6conformity with generally accepted accounting principles.
AB630-ASA1, s. 6 7Section 6. 100.03 (1) (f) of the statutes is amended to read:
AB630-ASA1,3,128 100.03 (1) (f) "Contractor" means a person who buys farm products vegetables
9grown in this state from a producer, or who contracts with a producer to grow farm
10products
vegetables in this state, regardless of whether the contractor is located in
11this state or is engaged in food processing. "Contractor" does not include any of the
12following:
AB630-ASA1,3,1513 1. A person who procures fruits and vegetables primarily for unprocessed fresh
14market use and is licensed under the federal perishable agricultural commodities
15act, 7 USC 499.
AB630-ASA1,3,1716 2. A restaurant or retail food establishment that procures farm products
17vegetables solely for retail sale at the restaurant or retail food establishment.
AB630-ASA1, s. 7 18Section 7. 100.03 (1) (n) of the statutes is repealed.
AB630-ASA1, s. 8 19Section 8. 100.03 (1) (v) to (wm) of the statutes are amended to read:
AB630-ASA1,3,2320 100.03 (1) (v) "Payment on delivery" means cash payment of the full agreed
21price for a farm product vegetable when the farm product vegetable is tendered or
22delivered to a contractor, or cash payment of the full agreed price within 72 hours
23after delivery if the farm product vegetable is graded.
AB630-ASA1,4,224 (vm) "Procurement contract" means an oral or written agreement between a
25contractor and a producer, under which the contractor buys a farm product vegetable

1grown in this state from the producer or contracts with the producer to grow a farm
2product
vegetable in this state.
AB630-ASA1,4,43 (w) "Producer" means a person who produces and sells a farm product
4vegetable, or who grows a farm product vegetable under contract.
AB630-ASA1,4,65 (wm) "Producer claim" means a claim held by a producer for his or her farm
6products
vegetables.
AB630-ASA1, s. 9 7Section 9. 100.03 (1) (ym) of the statutes is created to read:
AB630-ASA1,4,98 100.03 (1) (ym) "Reviewed financial statement" means a financial statement,
9other than an audited financial statement, that is all of the following:
AB630-ASA1,4,1010 1. Sworn and notarized by the contractor.
AB630-ASA1,4,1311 2. Reviewed according to generally accepted accounting principles by an
12independent certified public accountant or a public accountant holding a certificate
13of authority under ch. 442.
AB630-ASA1, s. 10 14Section 10. 100.03 (1) (zm) of the statutes is amended to read:
AB630-ASA1,4,1715 100.03 (1) (zm) "Subsidiary" means a corporation or business entity that is
16owned, controlled or operated by an operator, and that procures a farm product
17vegetable for use by the operator.
AB630-ASA1, s. 11 18Section 11. 100.03 (1) (zp) of the statutes is repealed.
AB630-ASA1, s. 12 19Section 12. 100.03 (1) (zs) of the statutes is created to read:
AB630-ASA1,4,2220 100.03 (1) (zs) "Vegetable" means any vegetable that is grown or sold for use
21in food processing, whether or not that vegetable is actually processed as food.
22"Vegetable" includes sweet corn, but does not include grain.
AB630-ASA1, s. 13 23Section 13. 100.03 (2) (a) of the statutes is amended to read:
AB630-ASA1,5,224 100.03 (2) (a) Requirement. No contractor may enter into a procurement
25contract with a producer unless the contractor holds a registration certificate from

1the department. A registration certificate expires on March January 31 annually
2and is not transferable.
AB630-ASA1, s. 14 3Section 14. 100.03 (3) (a) 2. of the statutes is amended to read:
AB630-ASA1,5,84 100.03 (3) (a) 2. Unless the department by rule establishes a different fee, a fee
5of one cent for each $100 in the total contractual obligations reported under sub. (4)
6(a). The fee under this subdivision is not required if all farm product vegetable
7grading is performed or supervised by the department under contract with the
8contractor.
AB630-ASA1, s. 15 9Section 15. 100.03 (3) (b) of the statutes is amended to read:
AB630-ASA1,5,1710 100.03 (3) (b) Surcharge for operating without a registration certificate. A
11contractor who applies for a registration certificate under sub. (2) shall pay a
12surcharge of $500 if the department determines that, within 365 days before
13submitting the application, the contractor procured a farm product vegetable from
14a producer without a registration certificate in violation of sub. (2). Payment of the
15surcharge does not relieve the contractor of any other civil or criminal liability that
16results from the procurement of the farm product vegetable, but it does not constitute
17evidence of any law violation.
AB630-ASA1, s. 16 18Section 16. 100.03 (4) (a) of the statutes is amended to read:
AB630-ASA1,5,2219 100.03 (4) (a) The contractor's total paid and unpaid contractual obligations to
20producers, for farm products vegetables tendered or delivered, that have accrued
21during the registration year immediately preceding the registration year for which
22application is made.
AB630-ASA1, s. 17 23Section 17. 100.03 (4) (c) of the statutes is amended to read:
AB630-ASA1,6,824 100.03 (4) (c) The contractor's anticipated maximum liability to producers
25during the registration year for which application is made. The application shall

1state if the contractor anticipates a maximum liability of zero. If so, the application
2also shall state whether the contractor anticipates a maximum liability of zero
3because the contractor plans to make cash payment on delivery under every
4procurement contract, or because the contractor plans to procure all farm products
5vegetables from another contractor. A contractor shall immediately notify the
6department in writing if, at any time during the registration year, the contractor has
7reason to believe that the contractor's maximum liability will exceed the maximum
8liability previously anticipated and reported to the department.
AB630-ASA1, s. 18 9Section 18. 100.03 (4) (f) of the statutes is amended to read:
AB630-ASA1,6,1310 100.03 (4) (f) Whether the contractor is a producer-owned cooperative or
11organization doing business on a cooperative pooling basis with its producer owners,
12and whether the producer-owned cooperative or organization procures any farm
13products
vegetables from producers who are not its producer owners.
AB630-ASA1, s. 19 14Section 19. 100.03 (4m) of the statutes is created to read:
AB630-ASA1,6,2215 100.03 (4m) Residual payment liability. As part of or in addition to the
16statement required by sub. (4), the contractor or officer of the contractor shall submit
17a sworn and notarized statement indicating whether the contractor has failed to pay
18any liability to a producer that became due and payable during the registration year
19ending January 31. The statement shall be submitted before February 5. The
20statement may not be submitted before February 1, except that the statement may
21be submitted at such earlier time as the contractor has paid all liabilities to
22producers that are due and payable on or before January 31.
AB630-ASA1, s. 20 23Section 20. 100.03 (5) (a) 2. of the statutes is amended to read:
AB630-ASA1,7,424 100.03 (5) (a) 2. Except as provided under par. (c), a contractor shall file an
25annual financial statement with the department as a condition to the renewal or

1continuation of the contractor's registration certificate under sub. (2). An annual
2financial statement shall be filed by the 15th day of the 4th month commencing after
3the close of the contractor's fiscal year, except that the department may, for cause,
4extend the deadline for filing the annual financial statement for up to 30 days
.
AB630-ASA1, s. 21 5Section 21. 100.03 (5) (am) of the statutes is created to read:
AB630-ASA1,7,86 100.03 (5) (am) Interim statement. Except as provided in par. (c), a contractor
7shall file an interim statement as of the quarter that ends closest to November 30
8with each application for renewal.
AB630-ASA1, s. 22 9Section 22. 100.03 (5) (b) of the statutes is amended to read:
AB630-ASA1,7,1410 100.03 (5) (b) (title) Additional or interim financial statement.
11Notwithstanding par. (c), the department may require a contractor to file a an
12annual
financial statement or interim statement at any time. The department may
13require that a financial statement required under this paragraph be an audited
14financial statement or a reviewed financial statement.
AB630-ASA1, s. 23 15Section 23. 100.03 (5) (c) of the statutes is amended to read:
AB630-ASA1,7,1716 100.03 (5) (c) Exemptions. Paragraph (a) does Paragraphs (a) and (am) do not
17apply to any of the following:
AB630-ASA1,7,2118 1. A contractor who either plans to make payment on delivery for all farm
19products
vegetables tendered or delivered by producers, or to procure all farm
20products
vegetables from another contractor, and who submits a sworn and
21notarized statement to that effect under sub. (4) (c).
AB630-ASA1,7,2322 2. A contractor who files security with the department under sub. (8), except
23for a contractor who files security under sub. (8) (cm)
.
AB630-ASA1,8,3
13. A producer-owned cooperative or organization that procures farm products
2vegetables solely on a cooperative pooling basis from its producer owners, and that
3submits under sub. (4) a sworn and notarized statement to that effect.
AB630-ASA1, s. 24 4Section 24. 100.03 (5) (e) of the statutes is amended to read:
AB630-ASA1,8,115 100.03 (5) (e) (title) Certified or verified Audited or reviewed financial
6statement.
A financial statement under this subsection may par. (a) shall be a
7certified or verified
an audited financial statement or a reviewed financial
8statement, except that if during the year to which that financial statement pertains
9a contractor incurred total contractual obligations to producers, as reported under
10sub. (4) (a), of more than $250,000, the financial statement under par. (a) shall be
11certified an audited financial statement.
AB630-ASA1, s. 25 12Section 25. 100.03 (6) (a) of the statutes is amended to read:
AB630-ASA1,8,2013 100.03 (6) (a) Full payment required. Except as provided under par. (c) or (d),
14the department may not issue or renew a registration certificate under sub. (2)
15unless the contractor has submitted a statement under sub. (4m) that shows that the
16contractor has
paid all liabilities to producers that are due and payable before the
17date of application, as indicated by a sworn and notarized statement under sub. (4)
18(d)
January 31. Notwithstanding par. (b), a contractor shall make payment on
19delivery unless the contractor meets the minimum financial standards under sub.
20(7) or files security with the department under sub. (8).
AB630-ASA1, s. 26 21Section 26. 100.03 (6) (b) 1. of the statutes is amended to read:
AB630-ASA1,9,222 100.03 (6) (b) 1. If a procurement contract does not specify a payment date in
23writing, the contractor shall pay a liability to a producer by the 15th day of the month
24immediately following the month in which the producer tendered or delivered the

1farm products vegetables under the contract, or by an earlier date agreed upon
2between the parties.
AB630-ASA1, s. 27 3Section 27. 100.03 (6) (b) 3. of the statutes is amended to read:
AB630-ASA1,9,174 100.03 (6) (b) 3. By January 31 of each registration year, a contractor shall pay
5for all farm products vegetables that were delivered by producers on or before
6December 31 of that registration year. This requirement does not apply if a written
7contract specifying a later payment date was approved by a vote of producers who
8delivered farm products vegetables to the contractor during the preceding
9registration year. To obtain the approval of producers, a contractor shall give
10advance written notice to every eligible producer. The notice shall include a copy of
11the proposed contract and shall announce a meeting at which producers will be asked
12to vote on the proposed contract. The notice shall also include a mail ballot by which
13a producer may cast his or her vote without attending the meeting. Voting shall be
14by secret ballot. The proposed contract shall be approved by a majority of the
15producers who vote on the proposed contract. The contractor shall file a sworn
16statement with the department, on a form provided by the department, certifying the
17results of the balloting.
AB630-ASA1, s. 28 18Section 28. 100.03 (6) (b) 4. of the statutes is amended to read:
AB630-ASA1,9,2319 100.03 (6) (b) 4. If a producer tenders or delivers farm products vegetables to
20a contractor after December 31 of any registration year, the contractor shall pay the
21producer for the farm products vegetables by the 15th day of the month following the
22month in which the farm products vegetables were tendered or delivered, or within
2330 days
by the 30th day after tender or delivery , whichever is later.
AB630-ASA1, s. 29 24Section 29. 100.03 (7) (a) 1. of the statutes is amended to read:
AB630-ASA1,10,2
1100.03 (7) (a) 1. The contractor's A minimum ratio of current assets to current
2liabilities shall be at least of 1.2 to 1 1.0 on its annual financial statement.
AB630-ASA1, s. 30 3Section 30. 100.03 (7) (a) 2. of the statutes is repealed and recreated to read:
AB630-ASA1,10,54 100.03 (7) (a) 2. A minimum ratio of current assets to current liabilities of 1.0
5to 1.0 at all times of the year other than the end of the contractor's fiscal year.
AB630-ASA1, s. 31 6Section 31. 100.03 (7) (a) 3. of the statutes is created to read:
AB630-ASA1,10,87 100.03 (7) (a) 3. Equity equal to at least 20% of total assets on its annual
8financial statement and at least 10% at all other times.
AB630-ASA1, s. 32 9Section 32. 100.03 (7) (c) (intro.) of the statutes is amended to read:
AB630-ASA1,10,1210 100.03 (7) (c) Exemptions. (intro.) A Paragraph (a) does not apply to a
11contractor is not required to meet the financial standards under par. (a) if any of the
12following applies:
AB630-ASA1, s. 33 13Section 33. 100.03 (7) (c) 1. of the statutes is amended to read:
AB630-ASA1,10,1514 100.03 (7) (c) 1. The contractor makes payment on delivery for all farm
15products
vegetables obtained from producers.
AB630-ASA1, s. 34 16Section 34. 100.03 (8) (b) 6. of the statutes is repealed.
AB630-ASA1, s. 35 17Section 35. 100.03 (8) (bm) of the statutes is repealed.
AB630-ASA1, s. 36 18Section 36. 100.03 (8) (cm) of the statutes is created to read:
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