AB349,14,2119 2. (intro.) Except as provided in par. (c) subd. 3., for a milk contractor who
20procures milk in this state solely as a qualified producer agent, security equal to at
21least the following amounts:
AB349, s. 38 22Section 38. 126.47 (3) (b) of the statutes is created to read:
AB349,14,2523 126.47 (3) (b) A milk contractor who is only required to file or maintain security
24under sub. (1) (b) shall at all times maintain security equal to the milk contractor's
25estimated default exposure, as defined in sub. (1) (b) 1., less the following amount:
AB349,15,1
1a. For the license year beginning on May 1, 2003, $18,000,000.
AB349,15,22 b. For the license year beginning on May 1, 2004, $19,000,000.
AB349,15,33 c. For a license year that begins on May 1, 2005, or later, $20,000,000.
AB349, s. 39 4Section 39. 126.47 (7) (a) (intro.) of the statutes is amended to read:
AB349,15,65 126.47 (7) (a) (intro.) The department may release security filed under sub. (1)
6(a) if any of the following applies:
AB349, s. 40 7Section 40. 126.47 (7) (am) of the statutes is created to read:
AB349,15,138 126.47 (7) (am) The department may release security filed under sub. (1) (b),
9except for any amount of security that the milk contractor is required to file because
10sub. (1) (a) applies to the milk contractor, if the milk contractor files 2 consecutive
11annual financial statements under s. 126.44 showing that the milk contractor no
12longer has negative equity, a current ratio of less than 1.25 to 1.0, or a debt to equity
13ratio of more than 2.0 to 1.0.
AB349, s. 41 14Section 41. 126.59 (2) (c) 3. and 4. of the statutes are amended to read:
AB349,15,1915 126.59 (2) (c) 3. Failure to reimburse the department, within 60 days after the
16department issues a reimbursement demand under s. 126.73 (1), for the full amount
17that the department pays to claimants under s. 126.72 (1) or under s. 126.72 (2) with
18the proceeds of a loan under s. 126.06 (1) (b)
because of that vegetable contractor's
19default.
AB349,15,2320 4. Failure to reimburse a bond surety, within 60 days after the bond surety
21issues a reimbursement demand under s. 126.73 (2), for the full amount that the
22surety pays to the department under s. 126.72 (2) or (3) for the benefit of claimants
23affected by that vegetable contractor's default.
AB349, s. 42 24Section 42. 126.60 (1) (intro.) of the statutes is amended to read:
AB349,16,4
1126.60 (1) General. (intro.) A contributing vegetable contractor shall pay an
2annual fund assessment for each license year. The Except as provided in sub. (5m),
3the
assessment equals $20 or the sum of the following, whichever is greater, unless
4the department by rule specifies a different assessment:
AB349, s. 43 5Section 43. 126.60 (5m) of the statutes is created to read:
AB349,16,96 126.60 (5m) Reduced assessment for certain vegetable contractors filing
7security.
If a vegetable contractor files security under s. 126.61 (1) (bm), the
8vegetable contractor's assessment is the amount determined under sub. (1) reduced
9by an amount determined as follows:
AB349,16,1210 (a) Divide the amount of security that the vegetable contractor is required to
11file as determined under s. 126.61 (3) (b) by the amount of the vegetable contractor's
12estimated default exposure, as defined in s. 126.61 (1) (bm) 1.
AB349,16,1413 (b) Multiply the amount of the assessment determined under sub. (1) by the
14amount determined under par. (a).
AB349, s. 44 15Section 44. 126.61 (1) (bm) of the statutes is created to read:
AB349,16,1716 126.61 (1) (bm) 1. In this paragraph, "estimated default exposure" means the
17sum of the following:
AB349,16,1918 a. Seventy-five percent of the amount last reported under s. 126.56 (9) (b) or
19(12) (a).
AB349,16,2120 b. The full amount of the unpaid deferred contract obligations last reported
21under s. 126.56 (9) (e) or (12) (b).
AB349,17,222 2. Except as provided in par. (c), a vegetable contractor shall file security with
23the department, and maintain that security until the department releases it under
24sub. (7) (bm), if the vegetable contractor files an annual financial statement under
25s. 126.58 (1) that shows negative equity, a current ratio of less than 1.25 to 1.0, or a

1debt to equity ratio of more than 4.0 to 1.0 and the vegetable contractor's estimated
2default exposure is greater than the following amount:
AB349,17,33 a. For the license year beginning on February 1, 2003, $18,000,000.
AB349,17,44 b. For the license year beginning on February 1, 2004, $19,000,000.
AB349,17,55 c. For a license year that begins on February 1, 2005, or later, $20,000,000.
AB349, s. 45 6Section 45. 126.61 (1) (c) (intro.) of the statutes is amended to read:
AB349,17,87 126.61 (1) (c) (intro.) A vegetable contractor is not required to file security
8under par. (a) or (b) this subsection if any of the following applies:
AB349, s. 46 9Section 46. 126.61 (3) of the statutes is renumbered 126.61 (3) (a), and 126.61
10(3) (a) (intro.) and 1., as renumbered, are amended to read:
AB349,17,1311 126.61 (3) (a) (intro.) A Except as provided in par. (b), a vegetable contractor
12who is required to file or maintain security under this section shall, at all times,
13maintain security that is at least equal to the sum of the following:
AB349,17,1614 1. Seventy-five percent of the amount last reported under s. 126.56 (9) (b) or
15(12) (a), except that this amount is not required of a contributing vegetable contractor
16after May 1, 2002.
AB349, s. 47 17Section 47. 126.61 (3) (b) of the statutes is created to read:
AB349,17,2118 126.61 (3) (b) A vegetable contractor who is only required to file or maintain
19security under sub. (1) (bm) shall at all times maintain security equal to the
20vegetable contractor's estimated default exposure, as defined in sub. (1) (bm) 1., less
21the following amount:
AB349,17,2222 1. For the license year beginning on February 1, 2003, $18,000,000.
AB349,17,2323 2. For the license year beginning on February 1, 2004, $19,000,000.
AB349,17,2424 3. For a license year that begins on February 1, 2005, or later, $20,000,000.
AB349, s. 48 25Section 48. 126.61 (7) (a) (intro.) of the statutes is amended to read:
AB349,18,4
1126.61 (7) (a) (intro.) The department may release security filed under sub. (1)
2(a), except for any amount of security that the vegetable contractor is required to file
3because sub. (1) (b) or (bm) applies to the vegetable contractor, if any of the following
4applies:
AB349, s. 49 5Section 49. 126.61 (7) (b) (intro.) of the statutes is amended to read:
AB349,18,96 126.61 (7) (b) (intro.) The department may release security filed under sub. (1)
7(b), except for any amount of security that the vegetable contractor is required to file
8because sub. (1) (a) or (bm) applies to the vegetable contractor, if any of the following
9applies:
AB349, s. 50 10Section 50. 126.61 (7) (bm) of the statutes is created to read:
AB349,18,1611 126.61 (7) (bm) The department may release security filed under sub. (1) (bm),
12except for any amount of security that the vegetable contractor is required to file
13because sub. (1) (a) or (b) applies to the vegetable contractor, if the vegetable
14contractor files 2 consecutive annual financial statements under s. 126.58 showing
15that the vegetable contractor no longer has negative equity, a current ratio of less
16than 1.25 to 1.0, or a debt to equity ratio of more than 4.0 to 1.0.
AB349, s. 51 17Section 51. 126.71 (1) (d) of the statutes is amended to read:
AB349,18,2118 126.71 (1) (d) For each default claim allowed under s. 126.70 against a qualified
19producer agent who, at the time of the default, was a contributing contractor and
20maintained security under s. 126.47 (3) (c) (a) 3., if the default occurs after April 30,
212002, and before May 1, 2004, 15% of the amount allowed.
AB349, s. 52 22Section 52. 126.71 (1) (e) of the statutes is amended to read:
AB349,19,223 126.71 (1) (e) For each default claim allowed under s. 126.70 against a qualified
24producer agent who, at the time of the default, was a contributing contractor and

1maintained security under s. 126.47 (3) (c) (a) 3., if the default occurs after April 30,
22004, and before May 1, 2007, 20% of the amount allowed.
AB349, s. 53 3Section 53. 126.72 (1) of the statutes is amended to read:
AB349,19,64 126.72 (1) Producer security fund. From the appropriation under s. 20.115
5(1) (w), the department shall make payments authorized under s. 126.71 (1), up to
6the deductible amount in sub. (4) (3).
AB349, s. 54 7Section 54. 126.72 (2) and (3) of the statutes are repealed and recreated to
8read:
AB349,19,129 126.72 (2) Proceeds of contingent financial backing. The department shall
10draw on the contingent financial backing acquired under s. 126.06 to make payments
11authorized under s. 126.71 (1), to the extent that those payments exceed the
12deductible amount in sub. (3).
AB349,19,15 13(3) Deductible amount. The deductible amount, for purposes of subs. (1) and
14(2), is 60% of the cash balance in the agricultural producer security fund on the last
15day of the month preceding the month in which the default occurs.
AB349, s. 55 16Section 55. 126.72 (4) of the statutes is repealed.
AB349, s. 56 17Section 56. 126.73 of the statutes is amended to read:
AB349,19,21 18126.73 Reimbursing payments. (1) Payments from the fund. The
19department may demand and collect, from a contractor, any claim amounts that the
20department pays under s. 126.72 (1) or under s. 126.72 (2) with the proceeds of a loan
21under s. 126.06 (1) (b)
because of the contractor's default.
AB349,19,25 22(2) Bond payments. A bond surety may demand and collect, from a contractor,
23any claim amounts that the bond surety pays to the department under s. 126.72 (2)
24or (3) because of the contractor's default. The bond surety shall provide the
25department with a copy of each demand under this subsection.
AB349, s. 57
1Section 57. 126.86 (1) (f) and (g) of the statutes are amended to read:
AB349,20,62 126.86 (1) (f) The contractor fails to reimburse the department, within 60 days
3after the department issues a reimbursement demand under s. 126.73 (1), for the full
4amount that the department pays to claimants under s. 126.72 (1) or under s. 126.72
5(2) with the proceeds of a loan under s. 126.06 (1) (b)
because of the contractor's
6default.
AB349,20,107 (g) The contractor fails to reimburse a bond surety, within 60 days after the
8bond surety issues a reimbursement demand under s. 126.73 (2), for the full amount
9that the surety pays to the department under s. 126.72 (2) or (3) for the benefit of
10claimants affected by the contractor's default.
AB349, s. 58 11Section 58. 126.90 of the statutes is amended to read:
AB349,20,18 12126.90 Agricultural producer security council. The agricultural producer
13security council shall advise the department on the administration and enforcement
14of this chapter. The council shall meet as often as the department considers
15necessary, but at least once annually. The department shall inform the council of
16fund balances and payments, and. The department shall consult with the council
17before acquiring any contingent financial backing under s 126.06 and before
18modifying any license fee, license surcharge, or fund assessment under this chapter.
AB349,20,1919 (End)
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