126.44(6)
(6) Accounting period. A milk contractor filing an annual financial statement under
sub. (1) or
(2) shall file a financial statement that covers the milk contractor's last completed fiscal year unless the milk contractor has been in business for less than one year.
126.44(6m)
(6m) Interim financial statement. The department may, at any time, require a milk contractor licensed under
s. 126.41 (1) to file an interim financial statement with the department. With the interim financial statement, the milk contractor shall provide the milk contractor's sworn and notarized statement that the financial statement is correct. An interim financial statement need not be a reviewed financial statement or an audited financial statement.
126.44(7)
(7) Generally accepted accounting principles. 126.44(7)(a)(a) Except as provided in
par. (b), a milk contractor filing an annual financial statement under this section shall file a financial statement that is prepared according to generally accepted accounting principles.
126.44(7)(b)
(b) If a milk contractor is a sole proprietor and the milk contractor's financial statement is not audited, the milk contractor shall file a financial statement that is prepared on a historical cost basis.
126.44(8)(a)(a) Except as provided in
par. (b), a milk contractor filing a financial statement under this section shall file a financial statement that consists of a balance sheet, income statement, equity statement, statement of cash flows, notes to those statements, and any other information required by the department. If the milk contractor is a sole proprietor, the milk contractor shall file his or her business and personal financial statements.
126.44(8)(b)
(b) If a milk contractor has been in business for less than one year, the milk contractor may file an annual financial statement under
sub. (1) or
(2) consisting of a balance sheet and notes. A milk contractor may file a quarterly financial statement under
sub. (3) consisting of a balance sheet and income statement.
126.44(8)(c)
(c) A milk contractor filing a financial statement under this section shall include in the financial statement, or in an attachment to the financial statement, calculations of all of the following:
126.44(8)(c)1.
1. The milk contractor's current ratio, excluding any items required to be excluded under
sub. (9).
126.44(8)(c)2.
2. The milk contractor's debt to equity ratio, excluding any items required to be excluded under
sub. (9).
126.44(9)
(9) Items excluded. A milk contractor may not include any of the following items in the calculations under
sub. (8) (c), unless the department specifically approves their inclusion:
126.44(9)(a)
(a) A nontrade note or account receivable from an officer, director, employee, partner, or stockholder, or from a member of the family of any of those individuals, unless the note or account receivable is secured by a first priority security interest in real or personal property.
126.44(9)(b)
(b) A note or account receivable from a parent organization, a subsidiary, or an affiliate other than an employee.
126.44(9)(c)
(c) A note or account that has been receivable for more than one year, unless the milk contractor has established an equal offsetting reserve for uncollectible notes and accounts receivable.
126.44(9)(d)
(d) A liability and the corresponding impact to equity resulting from the recording of a loss as a component of other comprehensive income due to the recognition of the funding status of a defined benefit pension plan.
126.44(9)(e)
(e) An asset and the corresponding liability that represent an amount that is collectible from and owed to the milk contractor itself, as proven by the milk contractor.
126.44(10)
(10) Entity covered. A person filing a financial statement under this section may not file, in lieu of that person's financial statement, the financial statement of the person's parent organization, subsidiary, predecessor, or successor.
126.44(11)
(11) Department review. The department may analyze a financial statement submitted under this section and may reject a financial statement that fails to comply with this section.
126.45
126.45
Contributing milk contractors; disqualification. 126.45(1)(a)(a) Except as provided in
sub. (3), a licensed milk contractor shall pay fund assessments under
s. 126.46 if the milk contractor does not file annual and quarterly financial statements under
s. 126.44.
126.45(1)(b)
(b) Except as provided in
sub. (3), a licensed milk contractor shall pay fund assessments under
s. 126.46 if the milk contractor files an annual, quarterly, or interim financial statement under
s. 126.44 that shows a current ratio of less than 1.25 to 1.0, a debt to equity ratio of more than 2.0 to 1.0, or negative equity. The milk contractor shall continue to pay fund assessments until the milk contractor files 2 consecutive annual financial statements under
s. 126.44 that show a current ratio of at least 1.25 to 1.0, positive equity, and a debt to equity ratio of not more than 2.0 to 1.0.
126.45(2)
(2) Voluntary contributors. Except as provided in
sub. (3), a licensed milk contractor who is not required to pay fund assessments under
s. 126.46 may elect to do so.
126.45(3)(b)
(b) A milk contractor is disqualified from the fund if the department does any of the following:
126.45(3)(b)1.
1. Denies, suspends, or revokes the milk contractor's license.
126.45(4)(a)(a) A milk contractor disqualified under
sub. (3) (b) 2. may not engage in any activities for which a license is required under
s. 126.41 (1) (a) if the milk contractor files an annual, quarterly, or interim financial statement under
s. 126.44 that shows a current ratio of less than 1.25 to 1.0, a debt to equity ratio of more than 2.0 to 1.0, or negative equity.
126.45(4)(b)
(b) The department may not return, to a disqualified milk contractor, any fund assessments that the milk contractor paid as a contributing milk contractor.
126.45(4)(c)
(c) A disqualified milk contractor remains liable for any unpaid fund installment under
s. 126.46 that became due while the milk contractor was a contributing milk contractor. A disqualified milk contractor is not liable for any fund installment that becomes due after the milk contractor is disqualified under
sub. (3).
126.45(5)
(5) Notice to producers. A milk contractor who is disqualified under
sub. (3) shall immediately give written notice of the disqualification to all milk producers and producer agents to whom the milk contractor has unpaid milk payment obligations. The department may by rule or order specify the form and content of the notice.
126.46
126.46
Contributing milk contractors; fund assessments. 126.46(1)(1)
General. A contributing milk contractor shall pay an annual fund assessment for each license year in the amount specified by the department by rule.
126.46(5m)
(5m) Reduced assessment for certain milk contractors filing security. If a contributing milk contractor files security under
s. 126.47 (1) (b), the contributing milk contractor's fund assessment is the amount specified under
sub. (1) reduced by an amount determined as follows:
126.46(5m)(a)
(a) Divide the amount of security that the milk contractor is required to file under
s. 126.47 (3) (b) by 75 percent of the following:
126.46(5m)(b)
(b) Multiply the amount specified under
sub. (1) by the amount determined under
par. (a).
126.46(6)(a)(a) A contributing milk contractor shall pay the milk contractor's annual fund assessment in equal quarterly installments that are due as follows:
126.46(6)(a)1.
1. The first installment is due on June 1 of the license year.
126.46(6)(a)2.
2. The 2nd installment is due on September 1 of the license year.
126.46(6)(a)3.
3. The 3rd installment is due on December 1 of the license year.
126.46(6)(a)4.
4. The 4th installment is due on March 1 of the license year.
126.46(6)(b)
(b) A contributing milk contractor may prepay any of the quarterly installments under
par. (a).
126.46(6)(c)
(c) A contributing milk contractor who applies for an annual license after the beginning of a license year shall pay 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.
126.46(6)(d)
(d) If
s. 126.45 (1) (b) requires a licensed 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.
126.46(6)(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 percent of the overdue installment amount, whichever is greater.
126.46(7)
(7) 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:
126.46(7)(a)
(a) The amount of the milk contractor's annual fund assessment under this section.
126.46(7)(b)
(b) The amount of each required quarterly installment under
sub. (6) and the date by which the milk contractor must pay each installment.
126.46(7)(c)
(c) The penalty that applies under
sub. (6) (e) if the milk contractor fails to pay any quarterly installment when due.
126.47
126.47
Milk contractors; security. 126.47(1)(a)(a) A milk contractor shall file security with the department, and maintain that security until the department releases it under
sub. (7), if all of the following apply when the department first licenses the milk contractor under
s. 126.41 (1):
126.47(1)(a)2.
2. The milk contractor files an annual financial statement under
s. 126.44 (1) and that financial statement shows negative equity.
126.47(1)(b)1.1. In this paragraph, “
estimated default exposure" means 75 percent of the following:
126.47(1)(b)2.
2. A milk contractor shall file security with the department, and shall maintain that security until the department releases it under
sub. (7) (am), if all of the following apply:
126.47(1)(b)2.a.
a. The milk contractor's last annual financial statement under
s. 126.44 (1) shows negative equity, a current ratio of less than 1.25 to 1.0, or a debt to equity ratio of more than 2.0 to 1.0.
126.47(1)(b)2.b.
b. The milk contractor's estimated default exposure exceeds $20,000,000.
126.47(3)(a)(a) Except as provided in
par. (b), a milk contractor who is required to file or maintain security under
sub. (1) shall at all times maintain security in an amount equal to at least 75 percent of the following:
126.47(3)(b)
(b) A milk contractor who is required to file or maintain security only under
sub. (1) (b) shall at all times maintain security equal to the milk contractor's estimated default exposure, as defined in
sub. (1) (b) 1., less $20,000,000.
126.47(4)
(4) Form of security. The department shall review, and determine whether to approve, security filed under this section. The department may approve only the following types of security:
126.47(4)(b)
(b) A commercial surety bond if all of the following apply:
126.47(4)(b)1.
1. The surety bond is made payable to the department for the benefit of milk producers and producer agents.
126.47(4)(b)2.
2. The surety bond is issued by a person authorized to operate a surety business in this state.
126.47(4)(b)3.
3. The surety bond is issued as a continuous term bond that may be canceled only with the department's written agreement or upon 90 days' prior written notice served on the department in person or by certified mail.
126.47(4)(b)4.
4. The surety bond is issued in a form, and subject to any terms and conditions, that the department considers appropriate.
126.47(4)(c)
(c) A certificate of deposit or money market certificate, if all of the following apply:
126.47(4)(c)1.
1. The certificate is issued or endorsed to the department for the benefit of milk producers and producer agents.
126.47(4)(c)2.
2. The certificate may not be canceled or redeemed without the department's written permission.
126.47(4)(c)3.
3. No person may transfer or withdraw funds represented by the certificate without the department's written permission.
126.47(4)(c)4.
4. The certificate renews automatically without any action by the department.
126.47(4)(c)5.
5. The certificate is issued in a form, and subject to any terms and conditions, that the department considers appropriate.
126.47(4)(d)
(d) An irrevocable bank letter of credit if all of the following apply:
