As Reported by the House Agriculture and Natural Resources Committee 1
122nd General Assembly 4
Regular Session Am. H. B. No. 425 5
1997-1998 6
REPRESENTATIVES THOMPSON-HAINES-DAMSCHRODER-OPFER 8
10
A B I L L
To amend sections 926.01, 926.021, 926.05, 926.06, 12
926.10, 926.16, 926.18, 926.19, 926.29, 926.30, 13
926.32, and 926.99 and to enact sections 926.051 14
and 926.36 of the Revised Code to change the 15
definition of an agricultural commodity handler, 16
to increase the total net worth that an applicant 17
for an agricultural commodity handler's license 18
must maintain, to increase the penalty for 19
engaging in agricultural commodity handling 20
without a license, and to make other revisions 21
to the law governing agricultural commodity 22
handling. 23
BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF OHIO: 25
Section 1. That sections 926.01, 926.021, 926.05, 926.06, 27
926.10, 926.16, 926.18, 926.19, 926.29, 926.30, 926.32, and 28
926.99 be amended and sections 926.051 and 926.36 of the Revised 29
Code be enacted to read as follows: 31
Sec. 926.01. As used in this chapter: 40
(A) "Agricultural commodity" means barley, corn, oats, 42
rye, grain sorghum, soybeans, wheat, sunflower, speltz, and OR 43
any other agricultural crop which the director of agriculture may 45
designate by rule. "Agricultural commodity" does not mean any 46
grain that is purchased for sale as seed. 47
(B) "Agricultural commodity handling" or "handling" means: 49
(1) Engaging in or participating in the business of 51
purchasing an agricultural commodity for sale, resale, 52
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processing, or for any other use in THE FOLLOWING volumes 53
exceeding ten: 54
(a) IN THE CASE OF PURCHASES MADE FROM PRODUCERS, MORE 56
THAN TWENTY thousand bushels annually; 57
(b) IN THE CASE OF PURCHASES MADE FROM AGRICULTURAL 60
COMMODITY HANDLERS, MORE THAN ONE HUNDRED THOUSAND BUSHELS 61
ANNUALLY;
(c) IN THE CASE OF TOTAL PURCHASES MADE FROM PRODUCERS 64
COMBINED WITH TOTAL PURCHASES MADE FROM HANDLERS, MORE THAN ONE 65
HUNDRED THOUSAND BUSHELS ANNUALLY. 66
(2) Operating a warehouse as a bailee for the receiving, 68
storing, shipping, or conditioning of an agricultural commodity; 69
(3) Receiving into a warehouse an agricultural commodity 71
purchased under a delayed price agreement; 72
(4) PROVIDING MARKETING FUNCTIONS, INCLUDING STORAGE, 74
DELAYED PRICE MARKETING, DEFERRED PAYMENT, FEED AGREEMENTS, OR 75
ANY OTHER MARKETING TRANSACTION WHEREBY CONTROL IS EXERTED OVER 76
THE MONETARY PROCEEDS OF A PRODUCER'S AGRICULTURAL COMMODITIES BY 78
A PERSON OTHER THAN THE PRODUCER.
(C) "Agricultural commodity handler" or "handler" means 80
any person who is engaged in the business of agricultural 81
commodity handling. Any "AGRICULTURAL COMMODITY HANDLER" OR 82
"HANDLER" DOES NOT INCLUDE A person whose purchases of all 83
agricultural commodities do not exceed ten thousand bushels 84
annually and who does not handle agricultural commodities as a 85
bailee is not an AND WHO PURCHASES AGRICULTURAL COMMODITIES IN 86
THE FOLLOWING VOLUMES: 87
(1) TWENTY THOUSAND OR FEWER BUSHELS ANNUALLY FROM 89
PRODUCERS;
(2) ONE HUNDRED THOUSAND OR FEWER BUSHELS ANNUALLY FROM 91
agricultural commodities handler COMMODITY HANDLERS. 92
A PERSON WHO DOES NOT HANDLE AGRICULTURAL COMMODITIES AS A 95
BAILEE AND WHO ANNUALLY PURCHASES TWENTY THOUSAND OR FEWER
BUSHELS OF AGRICULTURAL COMMODITIES FROM PRODUCERS AND ONE 96
3
HUNDRED THOUSAND OR FEWER BUSHELS OF AGRICULTURAL COMMODITIES 97
FROM AGRICULTURAL COMMODITY HANDLERS SHALL BE CONSIDERED TO BE AN 99
AGRICULTURAL COMMODITY HANDLER IF THE COMBINED ANNUAL VOLUME OF 100
PURCHASES FROM THE PRODUCERS AND THE AGRICULTURAL COMMODITY
HANDLERS EXCEEDS ONE HUNDRED THOUSAND BUSHELS. 101
(D) "Depositor" means: 103
(1) Any person who delivers an agricultural commodity to a 105
licensed handler for storage, conditioning, shipment, or sale; 106
(2) Any owner or legal holder of a ticket or receipt 108
issued for an agricultural commodity who is a creditor of the 109
licensed handler for the value of the agricultural commodity; 110
(3) Any licensed handler storing an agricultural commodity 112
that he THE LICENSED HANDLER owns solely, jointly, or in common 113
with others in a warehouse owned or controlled by him THE 115
LICENSED HANDLER or any other licensed handler. 117
(E) "Receipt" means a warehouse receipt issued by a 119
licensed handler. 120
(F) "Nonnegotiable receipt" means a receipt on which it is 122
stated that the agricultural commodity received will be delivered 123
to the depositor or to the order of any other person named in the 124
receipt. 125
(G) "Negotiable receipt" means a receipt on which it is 127
stated that the agricultural commodity received will be delivered 128
to the bearer or to the order of any person named in the receipt. 129
(H) "Ticket" means a scale weight ticket, a load slip, or 131
any evidence, other than a receipt, given to a depositor by a 132
licensed handler upon delivery of an agricultural commodity to 133
the handler. 134
(I) "Warehouse" means any building, bin, protected 136
enclosure, or similar premises under the control of a licensed or 137
unlicensed handler used for receiving, storing, shipping, or 138
handling an agricultural commodity. 139
(J) "Storage" means the deposit of an agricultural 141
commodity into a warehouse either for the account of the licensed 142
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handler operating the warehouse or for the account of a 143
depositor. 144
(K) "Producer" means any person who grows an agricultural 146
commodity on land that he THE PERSON owns or leases. 147
(L) "Agent" means any person, other than a producer, who 149
delivers an agricultural commodity to a licensed handler, either 150
for sale or for storage, for the account of the producer. 151
(M) "Agricultural commodity tester" or "tester" means a 153
person who operates a moisture meter and other quality testing 154
devices to determine the quality of an agricultural commodity. 155
(N) "Federally licensed grain inspector" means a person 157
who is licensed by the United States department of agriculture 158
under the "United States Grain Standards Act," 39 Stat. 482 159
(1916), 7 U.S.C. 71, as amended, to test and grade grain, as 160
"grain" is defined in that act. 161
(O) "Bailee" means a person to whom an agricultural 163
commodity is delivered in trust for storage in a warehouse with 164
title remaining in the name of the depositor. 165
(P) "Bailor" means a person who delivers an agricultural 167
commodity to a bailee in trust for storage in a warehouse with 168
title remaining in the name of the depositor. 169
(Q) "Bailment agreement" means a bailor-bailee agreement 171
between a depositor and a licensed handler as stated in the terms 172
of a receipt that is issued for an agricultural commodity in 173
storage and subject to the requirements of this chapter governing 174
the use of a receipt. 175
(R) "Delayed price agreement" means a written executory 177
contract executed by and between a licensed handler and a 178
depositor that covers the sale and transfer of title of an 179
agricultural commodity and states in its written terms the 180
service charges and the method for pricing the commodity at a 181
later date. 182
(S) "Delayed price marketing" means the sale and transfer 184
of title of an agricultural commodity with the price to be 185
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established at a later date according to the terms of a delayed 186
price agreement. 187
(T) "DEFERRED PAYMENT" MEANS THE DEFERRAL OF PAYMENT TO A 190
DEPOSITOR BY A LICENSED HANDLER FOR AN AGRICULTURAL COMMODITY TO 191
WHICH THE LICENSED HANDLER HAS TAKEN TITLE, FOR THE PURPOSE OF 192
DEFERRING INCOME OF THE DEPOSITOR FROM ONE TAX YEAR TO ANOTHER. 193
(U) "FEED AGREEMENT" MEANS A WRITTEN CONTRACT EXECUTED BY 196
AND BETWEEN A LICENSED HANDLER AND A PRODUCER OR DEPOSITOR WHO 197
DELIVERS AN AGRICULTURAL COMMODITY TO THE LICENSED HANDLER FOR 198
STORAGE WHEREBY EACH OF THE FOLLOWING APPLIES: 199
(1) THE PRODUCER OR DEPOSITOR TRANSFERS TITLE TO THE 201
AGRICULTURAL COMMODITY TO THE LICENSED HANDLER IN EXCHANGE FOR A 202
NOMINAL SUM; 203
(2) THE PRODUCER, UPON DELIVERY OF THE AGRICULTURAL 205
COMMODITY TO THE LICENSED HANDLER, BECOMES A CREDITOR OF THE 206
LICENSED HANDLER DUE TO THE LIEN THAT ARISES UNDER SECTION 207
926.021 OF THE REVISED CODE; 209
(3) ALL OR PART OF THE AGRICULTURAL COMMODITY IS RETURNED 212
TO THE PRODUCER AT A LATER DATE AND USED FOR FEED PURPOSES. 213
(V) NOTWITHSTANDING SECTION 1.02 OF THE REVISED CODE, 217
"AND" SHALL NOT BE READ "OR" AND "OR" SHALL NOT BE READ "AND." 218
Sec. 926.021. (A) As used in this section: 227
(1) "Claimant" means a person who is unable to secure 229
satisfaction of financial obligations due from TO WHOM an 230
agricultural commodity handler OWES A FINANCIAL OBLIGATION FOR 232
AGRICULTURAL COMMODITIES OR THE ACTUAL MONETARY PROCEEDS FROM 233
AGRICULTURAL COMMODITIES THAT HAVE BEEN DELIVERED TO THE HANDLER. 234
(2) "Failure" means any of the following involving an 236
agricultural commodity handler: 237
(a) An inability to financially satisfy claimants 239
FINANCIALLY;
(b) A public declaration of insolvency; 241
(c) A revocation, SUSPENSION, OR CONDITIONAL SUSPENSION of 243
license with outstanding indebtedness to claimants; 245
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(d) Nonpayment in the ordinary course of business where a 247
good faith dispute does not exist; 248
(e) No application for license renewal; 250
(f) Denial of license renewal; 252
(g) Voluntarily surrendering a license. 254
(3) "Agricultural commodity assets" involving a failed AN 256
agricultural commodity handler mean MEANS any of the following: 257
(a) All agricultural commodities owned or stored, 259
including agricultural commodities in transit shipped by the 260
failed handler but not yet paid for; 261
(b) Redeposited agricultural commodities; 263
(c) Proceeds from the sale of agricultural commodities due 265
or to become due; 266
(d) The equity less any secured financing directly 268
associated therewith in assets in hedging or speculative margin 269
accounts held by commodity or security exchanges or dealers 270
representing the exchanges, and any moneys due or to become due 271
less any secured financing directly associated therewith from any 272
transactions on the exchanges; 273
(e) Any other unencumbered funds, property, or equity in 275
funds or property, wherever located, that can be directly traced 276
to the sale of agricultural commodities by the failed handler, 277
provided both that the funds, property, or equity in funds or 278
property shall not be considered to be encumbered unless the 279
encumbrance results from good and valuable considerations 280
advanced by any secured party on a good faith basis and that the 281
encumbrance is not the result of the taking of funds, property, 282
or equity in funds or property as additional collateral for an 283
antecedent debt; 284
(f) Any other unencumbered funds, property, or equity in 286
assets. 287
(B) A lien shall exist on all agricultural commodity 289
assets of a failed AN agricultural commodity handler in favor of 290
any of the following: 292
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(1) Claimants, including lenders, who possess receipts 294
covering grain owned or stored by the handler; 295
(2) Claimants who possess written evidence of ownership 297
other than a receipt disclosing a storage obligation of the 298
handler, including tickets; 299
(3) Claimants who surrendered receipts as part of an 301
agricultural commodity sales transaction but were not fully paid 302
FULLY for the agricultural commodity and the handler failed 303
within twenty TWENTY-ONE days after the surrender; 304
(4) Claimants who possess any other written evidence of 306
the sale of agricultural commodities to the failed handler for 307
which they were not fully paid FULLY, INCLUDING THE SALE OF 308
AGRICULTURAL COMMODITIES FOR A NOMINAL SUM UNDER A FEED 309
AGREEMENT.
(C) The lien which THAT shall secure all claims described 311
in division (D) of this section, shall arise, ATTACH TO THE 312
AGRICULTURAL COMMODITY ASSETS OF AN AGRICULTURAL COMMODITY 313
HANDLER, AND BECOME EFFECTIVE at the time of the delivery of the 316
agricultural commodity for sale OR FOR STORAGE UNDER A BAILMENT 317
AGREEMENT, commencement of the storage obligation, or when funds 318
are advanced by the lender, and shall terminate when the 319
liability of the agricultural commodity handler to the claimant 320
is discharged, provided that the priority of each lien among the 321
respective claimants shall not relate to the date the claim 322
arises but shall be governed by the priorities established in 323
division (D) of this section. The IN THE EVENT OF A FAILURE, THE 324
lien claims of all claimants shall be considered to be assigned 325
by operation of this section to the department of agriculture, 326
and in the event of a failure and subsequent liquidation, the 327
lien shall transfer over to assets or proceeds of assets either 328
received or liquidated by the department of agriculture. 329
(D) In EXCEPT AS PROVIDED IN DIVISION (E) OF THIS SECTION, 331
IN the event of a failure, the director of agriculture shall 333
POSSESS EXCLUSIVE AUTHORITY TO enforce the lien claims and
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allocate the proceeds as follows: 335
(1) First priority against all agricultural commodity 337
assets shall be the following: 338
(a) Claimants, including lenders, who possess receipts 340
covering grain owned or stored by the agricultural commodity 341
handler; 342
(b) Claimants who possess written evidence of ownership 344
other than receipts disclosing a storage obligation of the 345
handler, including tickets; 346
(c) Claimants who surrendered receipts as part of an 348
agricultural commodity transaction, but were not fully paid for 349
the agricultural commodity and the handler failed within 350
twenty-one days after the surrender. 351
(2) Second priority against all agricultural commodity 353
assets shall be to claimants who possess written evidence of the 354
sale of an agricultural commodity, including, but not limited to, 356
tickets, delayed price agreements, or similar agricultural 357
commodity delivery contracts who completed delivery and pricing 358
within thirty days immediately prior to the failure of the 359
handler. 360
(3) To the extent not necessary to satisfy first and 362
second priority claimants, all other claimants who possess 363
written evidence of the sale of agricultural commodities to the 364
failed handler shall participate in the pro rata distribution of 365
the remainder of the agricultural commodity assets in an amount 366
not to exceed the value of their EACH claim. 367
(E) In the event that any adversary proceeding is 369
commenced to recover agricultural commodity assets upon which the 370
lien imposed in this section is imposed and the department of 371
agriculture declines to enter the proceeding, the director of 372
agriculture, upon application to him THE DIRECTOR by any 373
claimant, shall assign to the claimant the applicable lien to 375
permit the claimant to pursue his THE CLAIMANT'S lien in the 376
adversary proceeding to the extent the action will not delay the 378
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resolution of the proceeding, the prompt liquidation of the 379
assets, or the ultimate distribution of the assets of TO all 380
claimants.
Sec. 926.05. (A) Each person desiring to obtain or renew 389
a handler's license shall file an application annually with the 390
director of agriculture at such times, on such forms, and 391
containing such information as he THE DIRECTOR prescribes, 393
INCLUDING, IF APPLICABLE, THE APPOINTMENT OF A STATUTORY AGENT 394
UNDER SECTION 926.051 OF THE REVISED CODE.
(B) Each application for a license or license renewal 396
shall be accompanied by an application fee of two hundred dollars 397
for the first facility operated by the applicant plus one hundred 398
dollars for each additional facility operated by the same 399
applicant and by an examination fee, established by rule of the 400
director pursuant to section 926.02 of the Revised Code, for each 401
facility operated by the applicant. "Facility" means all 402
warehouse storage located on one premises, including any 403
additional warehouse storage located within one thousand yards of 404
that premises. The director may charge fees for examinations in 405
an amount not to exceed those fees charged by the United States 406
department of agriculture for comparable examinations. 407
The director shall deposit all fees collected under this 409
section in the commodity handler regulatory program fund created 410
in section 926.19 of the Revised Code. 411
(C) The director shall approve or reject each application 413
for a license within fifteen days after receipt thereof, provided 414
that such application is in proper form and contains the 415
information required under division (A) of this section. A 416
rejection of an application shall be accompanied by a statement 417
from the director of the additional requirements necessary for a 418
license. The applicant may resubmit his THE application without 419
payment of any additional fee. 420
(D) A handler's license shall expire on the date 422
prescribed by rule of the director. Whenever the director 423
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considers it advisable to cancel the unexpired portion of an 424
outstanding license in order to renew it according to a new or 425
existing system of expiration dates, he THE DIRECTOR shall refund 427
to the handler the unexpired portion of the fees paid under 428
division (B) of this section. Whenever the director issues an 429
initial license on a date that does not conform to the existing 430
system, he THE DIRECTOR shall issue the license for whatever A 432
period of time, not less than six nor more than eighteen months, 434
that makes it THE DATE conform to the existing system. The 436
application fee for that initial license shall be proportionate 437
to the fee for a one-year license.
(E) An application for renewal of a handler's license 439
shall be filed with the director not later than thirty days 440
before the current license expires. An applicant who fails to 441
file a renewal application in time shall pay a late fee of one 442
dollar for each day the application is late or fifteen dollars, 443
whichever is greater. A renewal license shall not be issued 444
until a late fee that is due has been paid. 445
(F) The director, with the approval of the commodity 447
advisory commission, may revoke or refuse to issue or renew a 448
handler's license if any of the following occurred within five 449
years before the application for the license or renewal was 450
filed: 451
(1) The applicant, or the spouse, parent, sibling, or 453
child of the applicant, or a manager employed by the applicant, 454
or any other individual materially involved in the agricultural 455
commodity handling business of the applicant was a principal in a 456
receivership or insolvency that resulted in losses to creditors 457
or to the agricultural commodity depositors fund established in 458
section 926.16 of the Revised Code; 459
(2) The applicant pled guilty to or was convicted of any 461
felony or charge of embezzlement under the laws of this state, 462
any other state, or of the United States; 463
(3) The applicant made a delivery of commodities not 465
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authorized under this chapter; 466
(4) The applicant's license under the "United States 468
Warehouse Act," 39 Stat. 486 (1916), 7 U.S.C. 241, as amended, 469
was revoked or canceled due to a violation of that act. 470
Sec. 926.051. (A) AN APPLICANT FOR A HANDLER'S LICENSE OR 473
RENEWAL ISSUED UNDER SECTION 926.05 OF THE REVISED CODE WHO DOES 475
NOT CONDUCT BUSINESS AT AN ADDRESS IN THIS STATE AT WHICH THE 476
APPLICANT USUALLY CAN BE CONTACTED SHALL INCLUDE WITH THE 477
APPLICATION A WRITTEN APPOINTMENT OF AN AGENT, SOMETIMES REFERRED 478
TO AS A "STATUTORY AGENT," UPON WHOM ANY PROCESS, NOTICE, OR 479
DEMAND MAY BE SERVED. THE APPOINTMENT SHALL BE ACCOMPANIED BY A 480
WRITTEN ACCEPTANCE OF THE APPOINTMENT SIGNED BY THE AGENT. THE 481
AGENT MAY BE A NATURAL PERSON WHO IS A RESIDENT OF THIS STATE OR 482
A CORPORATION WHOSE PRINCIPAL PLACE OF BUSINESS IS LOCATED IN 483
THIS STATE. THE APPOINTMENT SHALL BE ON SUCH FORMS AND CONTAIN 484
SUCH INFORMATION AS THE DIRECTOR OF AGRICULTURE PRESCRIBES. 485
FAILURE TO COMPLY WITH THIS DIVISION IS GROUNDS FOR REJECTION OF 486
THE APPLICATION UNDER DIVISION (C) OF SECTION 926.05 OF THE 489
REVISED CODE. 490
(B)(1) IF AN AGENT REMOVES FROM THE STATE OR RESIGNS, OR 493
IF THE APPLICANT REVOKES THE AGENT'S APPOINTMENT, THE APPLICANT 494
IMMEDIATELY SHALL NOTIFY THE DIRECTOR IN WRITING NOT LATER THAN 495
THIRTY DAYS PRIOR TO THE REMOVAL, RESIGNATION, OR REVOCATION. IF 496
AN AGENT DIES, THE APPLICANT IMMEDIATELY SHALL NOTIFY THE 497
DIRECTOR IN WRITING. PRIOR TO THE REMOVAL, RESIGNATION, OR 498
REVOCATION AND NOT LATER THAN THIRTY DAYS AFTER THE DEATH, THE 499
APPLICANT SHALL APPOINT ANOTHER AGENT AND FILE WITH THE DIRECTOR 500
A WRITTEN APPOINTMENT OF THE AGENT, ALONG WITH A WRITTEN 501
ACCEPTANCE OF THE APPOINTMENT SIGNED BY THE AGENT. 502
(2) IF THE AGENT'S ADDRESS CHANGES FROM THAT APPEARING ON 504
THE APPLICATION, THE APPLICANT, NOT LATER THAN THIRTY DAYS PRIOR 505
TO THE ADDRESS CHANGE, SHALL FILE WITH THE DIRECTOR A WRITTEN 506
STATEMENT SETTING FORTH THE NEW ADDRESS, ALONG WITH ANY OTHER 507
INFORMATION THE DIRECTOR REQUESTS. 508
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(C) FAILURE TO COMPLY WITH DIVISION (B) OF THIS SECTION IS 512
GROUNDS FOR SUSPENSION OR CONDITIONAL SUSPENSION OF A HANDLER'S 513
LICENSE, WITHOUT PRIOR HEARING, UNDER SECTION 926.10 OF THE 514
REVISED CODE. 515
Sec. 926.06. (A) The director of agriculture may issue a 524
handler's license, or renewal thereof, upon the payment of the 525
prescribed application fee, if the director is satisfied that the 526
applicant meets the standards of financial responsibility 527
required under this section and has complied with this chapter 528
and the rules adopted under it. 529
(B) Each (1) ON THE EFFECTIVE DATE OF THIS AMENDMENT, 531
EACH applicant for a handler's license, or renewal thereof, shall 533
have and maintain current assets equal to or greater than current 534
liabilities and a total net worth of EQUAL TO at least ten cents 536
per bushel for the total number of bushels of agricultural 537
commodities that he THE APPLICANT handled during the immediately 538
preceding twelve-month period to cover any indebtedness arising 539
from his THE APPLICANT'S operations as a licensed handler. If 541
ONE YEAR AFTER THE EFFECTIVE DATE OF THIS AMENDMENT, THE TOTAL 543
NET WORTH REQUIREMENT SHALL INCREASE TO ELEVEN CENTS PER BUSHEL. 544
FOR THE NEXT FOUR YEARS, THE REQUIREMENT SHALL CONTINUE TO 545
INCREASE BY ONE CENT PER BUSHEL EACH YEAR ON THE ANNIVERSARY OF 546
THE EFFECTIVE DATE OF THIS AMENDMENT, SO THAT FIVE YEARS AFTER 547
THE EFFECTIVE DATE OF THIS AMENDMENT, AN APPLICANT'S TOTAL NET 548
WORTH SHALL BE EQUAL TO AT LEAST FIFTEEN CENTS PER BUSHEL FOR THE
TOTAL NUMBER OF BUSHELS OF AGRICULTURAL COMMODITIES THAT THE 549
APPLICANT HANDLED DURING THE IMMEDIATELY PRECEDING TWELVE-MONTH 550
PERIOD. 551
(2) ON THE EFFECTIVE DATE OF THIS AMENDMENT, IF an 553
applicant is applying for a handler's license for the first time 554
and did not handle any agricultural commodities during the 555
immediately preceding twelve-month period, he THE APPLICANT shall 556
have an allowable total net worth of at least twenty-five 558
thousand dollars for that purpose. No TO COVER ANY INDEBTEDNESS 560
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ARISING FROM THE APPLICANT'S OPERATIONS AS A LICENSED HANDLER. 561
ONE YEAR AFTER THE EFFECTIVE DATE OF THIS AMENDMENT, THIS
ALLOWABLE TOTAL NET WORTH REQUIREMENT SHALL INCREASE TO THIRTY 562
THOUSAND DOLLARS. FOR THE NEXT FOUR YEARS, THE REQUIREMENT SHALL 564
CONTINUE TO INCREASE BY FIVE THOUSAND DOLLARS EACH YEAR ON THE 565
ANNIVERSARY OF THE EFFECTIVE DATE OF THIS AMENDMENT, SO THAT FIVE 566
YEARS AFTER THE EFFECTIVE DATE OF THIS AMENDMENT, AN APPLICANT'S 567
TOTAL NET WORTH SHALL BE AT LEAST FIFTY THOUSAND DOLLARS. 568
(3) ON THE EFFECTIVE DATE OF THIS AMENDMENT, NO person 571
shall be licensed as a handler unless he THE PERSON has an 572
allowable total net worth of at least twenty-five thousand
dollars. Any ONE YEAR AFTER THE EFFECTIVE DATE OF THIS 574
AMENDMENT, THIS ALLOWABLE TOTAL NET WORTH REQUIREMENT SHALL 575
INCREASE TO THIRTY THOUSAND DOLLARS. FOR THE NEXT FOUR YEARS, 576
THE REQUIREMENT SHALL CONTINUE TO INCREASE BY FIVE THOUSAND 577
DOLLARS EACH YEAR ON THE ANNIVERSARY OF THE EFFECTIVE DATE OF 578
THIS AMENDMENT, SO THAT FIVE YEARS AFTER THE EFFECTIVE DATE OF 579
THIS AMENDMENT, THE PERSON'S TOTAL NET WORTH SHALL BE AT LEAST 580
FIFTY THOUSAND DOLLARS. 581
(4) ON THE EFFECTIVE DATE OF THIS AMENDMENT, ANY 583
deficiency in required total net worth may be compensated for by 585
an indemnity agreement executed by a person pledging personal 586
assets for the benefit of commodity creditors should the licensed 587
handler default in his THE LICENSED HANDLER'S obligations to the 588
creditors; a bond issued by a corporate surety company that is 589
authorized to do business under the laws of this state; or, at 590
the director's discretion, an irrevocable letter of credit issued 591
by a bank or other lending institution that is authorized by this 592
state or the United States to issue such letters of credit and is 593
subject to service of process in this state for any suit on the 594
bond or letter of credit. AN INDEMNITY AGREEMENT EXECUTED BY A 596
PERSON PLEDGING PERSONAL ASSETS SHALL BE ACCOMPANIED BY FINANCIAL 597
STATEMENTS THAT REFLECT THE PERSON'S FINANCIAL POSITION AS AN 598
INDIVIDUAL AND COMPLY WITH THE REQUIREMENTS OF DIVISION (C) OF 600
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THIS SECTION. A bond shall be made to the treasurer of the state 602
of Ohio to be deposited in the agricultural commodity depositors 603
fund created under section 926.16 of the Revised Code for the 604
benefit of any person who may be injured by the handler's failure 605
to meet obligations arising under this chapter. A letter of 606
credit shall be issued for the benefit of the department of 607
agriculture and the agricultural commodity depositors fund. 608
In (5) THE DIRECTOR SHALL ADOPT RULES IN ACCORDANCE WITH 611
CHAPTER 119. OF THE REVISED CODE SPECIFYING THE ASSETS FOR WHICH 614
CREDIT MAY BE GIVEN IN determining AN APPLICANT'S total net 615
worth, credit may be given for fixed assets such as buildings, 616
machinery, and equipment, in the amount of the insured value of 617
such assets under a policy of insurance against loss or damage 619
or, at the discretion of the director, in the amount of their 620
current market value as determined by an accredited rural 621
appraiser or an appraiser certified by the American appraisal 623
institute. The appraiser shall be completely independent of any 625
relationship with the handler. Capital stock shall not be 626
considered a liability for the purpose of determining total net 627
worth. Regardless.
(6) ON THE EFFECTIVE DATE OF THIS AMENDMENT, REGARDLESS of 629
the total number of bushels of agricultural commodities that he 631
AN APPLICANT handled during the immediately preceding 633
twelve-month period, an THE applicant's total net worth need not 635
exceed A MAXIMUM OF three hundred thousand dollars. ONE YEAR 637
AFTER THE EFFECTIVE DATE OF THIS AMENDMENT, THIS MAXIMUM TOTAL 638
NET WORTH NEED NOT EXCEED THREE HUNDRED THIRTY THOUSAND DOLLARS. 639
FOR THE NEXT FOUR YEARS, THIS MAXIMUM TOTAL NET WORTH SHALL 640
CONTINUE TO INCREASE BY THIRTY THOUSAND DOLLARS EACH YEAR ON THE 641
ANNIVERSARY OF THE EFFECTIVE DATE OF THIS AMENDMENT, SO THAT FIVE 642
YEARS AFTER THE EFFECTIVE DATE OF THIS AMENDMENT, AN APPLICANT'S 643
TOTAL NET WORTH NEED NOT EXCEED FOUR HUNDRED FIFTY THOUSAND 644
DOLLARS.
(C) In order for the director to determine if an applicant 646
15
meets the standards of financial responsibility required under 647
division (B) of this section, the applicant for a handler's 648
license, or renewal of a handler's license, shall submit a 649
current financial statement STATEMENTS THAT HAVE BEEN prepared IN 651
ACCORDANCE WITH GENERALLY ACCEPTED ACCOUNTING PRINCIPLES AND THAT 652
HAVE BEEN AUDITED OR REVIEWED by a qualified person who is not 653
directly associated with the applicant's business AN INDEPENDENT
CERTIFIED PUBLIC ACCOUNTANT. The financial statement STATEMENTS 655
shall consist of a THE APPLICANT'S balance sheet showing the 656
current and deferred assets and liabilities of the applicant, a, 657
INCOME statement of income, a statement of retained earnings OR 659
STATEMENT OF STOCKHOLDER'S EQUITY, a AND statement of changes in 661
financial position CASH FLOWS, and whatever notes are sufficient 663
to explain the details contained in the financial statement 664
TOGETHER WITH ANY EXPLANATORY FOOTNOTES OR SUPPLEMENTARY
INFORMATION ACCOMPANYING THESE STATEMENTS AND WITH THE 665
INDEPENDENT ACCOUNTANT'S REPORT ON THE STATEMENTS. 666
The financial statement STATEMENTS accompanying an 668
applicant's original application shall show a statement closing 669
date that is BE FOR A YEAR ENDING within six months of BEFORE the 671
date of application. Thereafter, the applicant applying for 673
renewal shall submit an annual statement SUCH STATEMENTS not 675
later than ninety days after the close END of his business THE 676
year COVERED BY THE STATEMENTS.
The director may require an applicant for a handler's 678
license, or renewal of a handler's license, to submit a financial 679
statement prepared STATEMENTS AUDITED by a AN INDEPENDENT 681
certified public accountant licensed under the laws of this 682
state, and may require the attachment to the statement of the 683
accountant's opinion of the applicant's financial status based on 684
his examination of the records conducted in accordance with 685
generally accepted auditing standards if the director determines 686
that the first financial statement STATEMENTS INITIALLY submitted 687
under this division is ARE incomplete or otherwise 689
16
unsatisfactory.
(D) The director may prepare and publish statistical 691
abstracts of information obtained under this section without 692
disclosing details that would identify a particular applicant 693
with particular statistics. Such information OTHERWISE is 694
otherwise confidential for purposes of section 102.03 of the 696
Revised Code, and records of the department of agriculture 697
containing such information are not otherwise public records 698
under section 149.43 of the Revised Code. 699
Sec. 926.10. The director of agriculture may, by order, 708
MAY refuse to grant or may suspend or conditionally suspend a 710
handler's license, without prior hearing, when he THE DIRECTOR 711
determines that there is reasonable cause to believe that the 713
applicant or licensee: 714
(A) Has failed to maintain the insurance coverage required 716
under section 926.07 of the Revised Code; 717
(B) Has failed to maintain accurate and complete records 719
and accounts as required under section 926.11 of the Revised 720
Code; 721
(C) Has failed to charge, collect, or remit the fee 723
required under division (B) of section 926.16 of the Revised 724
Code; 725
(D) Has refused to allow the director or his THE 727
DIRECTOR'S authorized representative to examine, at a reasonable 729
time, his THE APPLICANT'S OR LICENSEE'S accounting records, 731
accounts, agricultural commodity inventories, or warehouse; 732
(E) Does not have in his possession POSSESS sufficient 734
agricultural commodities to cover the outstanding receipts or 735
tickets issued or assumed by him THE APPLICANT OR LICENSEE under 736
bailment agreements; 737
(F) Has issued a receipt in violation of this chapter or 739
any rules adopted under it; 740
(G) Does not have the net assets specified in division (B) 742
of section 926.06 of the Revised Code or has failed to obtain a 743
17
bond or other protection for any deficiency in required net 744
assets as provided in that division; 745
(H) Does not have his THE obligations for agricultural 747
commodities purchased under delayed price agreements secured or 748
represented as required under division (B) or (C) of section 749
926.29 of the Revised Code; 750
(I) DOES NOT SUBMIT FINANCIAL STATEMENTS THAT COMPLY WITH 753
THE REQUIREMENTS OF DIVISION (C) OF SECTION 926.06 OF THE REVISED 755
CODE WITHIN THE APPLICABLE TIME PERIOD SPECIFIED IN THAT 757
DIVISION;
(J) DOES NOT NOTIFY THE DIRECTOR OF A STATUTORY AGENT'S 760
CHANGE OF ADDRESS OR OF THE DEATH, REMOVAL, RESIGNATION, OR 761
REVOCATION OF THE APPOINTMENT OF A STATUTORY AGENT OR DOES NOT 762
APPOINT ANOTHER AGENT IN ACCORDANCE WITH SECTION 926.051 OF THE 764
REVISED CODE. 765
The applicant or licensee to whom a denial or, suspension, 768
or conditional suspension order is issued shall be afforded a 769
hearing in accordance with Chapter 119. of the Revised Code, 770
after which the director shall issue or deny the license applied 771
for in the pending application or reinstate or revoke the 772
suspended or conditionally suspended license. The director may 773
suspend or, conditionally suspend, or revoke a license after a 775
hearing held in accordance with Chapter 119. of the Revised Code 776
for any other violations of this chapter or any rules adopted 777
under it. 778
The director shall cause a notice to be posted on the 780
property of a person whose license has been suspended, 781
conditionally suspended, or revoked stating the limitations or 782
restrictions imposed on the person in the handling of 783
agricultural commodities as a result of the suspension, 784
conditional suspension, or revocation. The notice shall not be 785
removed from the property without written authorization from the 786
director. 787
Sec. 926.16. (A) There is hereby created in the state 796
18
treasury the agricultural commodity depositors fund. The state 797
shall not be held liable for any claims presented against the 798
fund under section 926.18 of the Revised Code. The fund shall 799
consist of a per-bushel fee remitted by licensed handlers under 800
this section, any sums that the director of agriculture may 801
collect by any legal action on behalf of the fund, and any 802
property or securities acquired through the use of moneys in the 803
fund. The moneys collected under this section and deposited in 804
the fund shall be used exclusively to indemnify depositors as 805
provided in section 926.18 of the Revised Code and for no other 806
purpose. 807
(B) All licensed handlers shall remit such THE fee as is 809
determined by the director in accordance with section 926.17 of 810
the Revised Code on: 811
(1) All agricultural commodities delivered to them for 813
storage under a bailment agreement or for sale, exchange, or 814
negotiation or solicitation of sale by depositors who produced 815
them or caused them to be produced; 816
(2) All agricultural commodities delivered to them for 818
storage under a bailment agreement, regardless of who produced 819
the commodities, if a receipt is to be issued for the 820
commodities; 821
(3) All agricultural commodities that are being stored by 823
licensed handlers who own them solely, jointly, or in common with 824
others and who are issuing a receipt for them in accordance with 825
section 926.25 of the Revised Code. The maximum number of 826
bushels on which a licensed handler shall be required to pay the 827
fee under division (B)(3) of this section between the first day 828
of July and the thirtieth day of June of any marketing year shall 829
be the greatest number of bushels of all commodities for which 830
receipts are outstanding at any one time during that period. 831
(4) ALL AGRICULTURAL COMMODITIES THAT ARE NOT INVOLVED IN 833
A TRANSACTION DESCRIBED IN DIVISION (B)(1), (2), OR (3) OF THIS 834
SECTION AND THE MONETARY PROCEEDS OF WHICH ARE CONTROLLED BY A 835
19
HANDLER WHO IS NOT INVOLVED IN THE PRODUCTION OF THE COMMODITIES 837
AND WHO SERVES AS AN INTERMEDIARY BETWEEN THE PRODUCER AND A 838
HANDLER RECEIVING THE COMMODITIES. IN SUCH A SITUATION, THE
HANDLER RESPONSIBLE FOR PAYING THE PRODUCER SHALL REMIT THE FEE. 839
(C) All licensed handlers shall account for and remit 841
moneys under division (B) of this section to the director in such 842
manner and using such forms as the director shall prescribe by 843
rule. 844
(D) All disbursements from the fund shall be paid by the 846
treasurer of state pursuant to vouchers authorized by the 847
director. 848
(E) All interest earned by the fees collected under this 850
section shall be credited to the fund and, at the request of the 851
director of agriculture and to the extent necessary to pay the 852
examination and administrative costs of this chapter as provided 853
in section 926.19 of the Revised Code, may be transferred by the 854
director of budget and management to the commodity handler 855
regulatory program fund created in that section. 856
Sec. 926.18. (A) When a depositor has made a demand for 865
settlement of an obligation concerning an agricultural commodity 866
on which a fee was required to be remitted under section 926.16 867
of the Revised Code and the licensed handler has failed to honor 868
the demand, the depositor, after providing the director of 869
agriculture or his THE DIRECTOR'S authorized representative with 870
evidence of his THE DEPOSITOR'S demand and the dishonoring of his 872
THAT demand, may file a claim with the director NOT LATER THAN 873
SIX MONTHS AFTER DISHONOR OF THE DEMAND for indemnification of 874
his THE DEPOSITOR'S damages, from the agricultural commodity 875
depositors fund, to be measured as follows: 876
(1) The commodity advisory commission created in section 878
926.32 of the Revised Code shall establish the dollar value of 879
the loss incurred by a depositor holding a receipt or a ticket 880
for agricultural commodities on which a fee was required and that 881
he THE DEPOSITOR delivered to the handler under a delayed price 882
20
agreement or under a, bailment agreement, OR FEED AGREEMENT, OR 884
THAT THE DEPOSITOR DELIVERED TO THE HANDLER BEFORE DELIVERY WAS 885
DUE UNDER A CONTRACT OR OTHER AGREEMENT BETWEEN THE DEPOSITOR AND 886
HANDLER. The value shall be based on the fair market price being 888
paid to producers by handlers for the commodities on the date on 889
which the director received notice that the receipt or ticket was 890
dishonored by the handler. All depositors filing claims under 891
this division shall be bound by the value determined by the 892
commission.
(2) The dollar value of the loss incurred by a depositor 894
who has sold or delivered for sale, exchange, or solicitation or 895
negotiation for sale agricultural commodities on which a fee was 896
required and who is a creditor of the handler for all or a part 897
of the value of the commodities shall be based on the amount 898
stated on the obligation on the date of the sale. 899
(B) The agricultural commodity depositors fund shall be 901
liable to a depositor for any moneys that are not recovered 902
through other legal and equitable remedies as follows: 903
(1) For commodities stored with a licensed handler under a 905
bailment agreement for one hundred per cent of his THE 906
DEPOSITOR'S loss as determined under division (A)(1) of this 907
section;
(2) For commodities stored DEPOSITED with a licensed 909
handler under an agreement other than a bailment agreement for 911
one hundred per cent of the first ten thousand dollars of his THE 912
DEPOSITOR'S loss and eighty per cent of the remaining dollar 913
value of his THAT loss as determined under divisions (A)(1) and 914
(2) of this section. The aggregate amount recovered by a 916
depositor under all remedies shall not exceed one hundred per 917
cent of the value of his THE DEPOSITOR'S loss. If the moneys 918
recovered by a depositor under all remedies exceed one hundred 919
per cent of the value of his THE DEPOSITOR'S loss, the depositor 920
shall reimburse the fund in the amount that exceeds the value of
his THAT loss. 921
21
(C) The director, with the approval of the commodity 923
advisory commission, shall determine the validity of all claims 924
presented against the fund. A claim filed under this section for 925
losses on agricultural commodities other than commodities stored 926
under a bailment agreement shall not be valid unless the 927
depositor has made a demand for settlement of the obligation 928
within twelve months after the commodities are priced or 929
delivered for sale, whichever occurs later. Any depositor whose 930
claim has been refused by the director and the commission may 931
appeal the refusal to either TO the court of common pleas of 932
Franklin county or the court of common pleas of the county in 933
which the depositor resides. 934
The director shall provide for payment from the fund to any 936
depositor whose claim has been found to be valid. 937
(D) If at any time the fund does not contain sufficient 939
assets to pay valid claims, the director shall hold those claims 940
for payment until the fund again contains sufficient assets. 941
Claims against the fund shall be paid in the order in which they 942
are presented and found to be valid. 943
(E) If a depositor files an action for legal or equitable 945
remedies in a state or federal court having jurisdiction in those 946
matters that includes a claim against agricultural commodities 947
upon which the depositor may file a claim against the fund at a 948
later date, he THE DEPOSITOR ALSO shall also file with the 950
director a copy of the action filed with the court. 951
In the event of payment of a loss under this section, the 953
director shall be subrogated to the extent of the amount of any 954
payments to all rights, powers, privileges, and remedies of the 955
depositor against any person regarding the loss. 956
The depositor shall render all necessary assistance to aid 958
the director in securing the rights granted in this section. No 959
action or claim initiated by the depositor and pending at the 960
time of payment from the fund may be compromised or settled 961
without the consent of the director. 962
22
(F) If, prior to the effective date of this amendment JUNE 965
20, 1994, a lawsuit, adversary proceeding, or other legal 966
proceeding is brought against a depositor to recover money or
payments from funds to which a depositor has a right of 967
indemnification under this section, and the depositor retains 968
legal counsel resulting in a cost or expense to the depositor, 969
upon the rendering of a judgment or other resolution of the 970
lawsuit, adversary proceeding, or other legal proceeding, the 971
director, in his THE DIRECTOR'S discretion and with the approval 972
of the commodity advisory commission, may authorize
indemnification from the fund for attorney's fees paid by the 973
depositor. Any claim made by a depositor for the payment of 974
attorney's fees under this division shall be made in the same 975
manner as a claim under division (A) of this section. 976
Attorney's fees payable under this division shall be 978
limited to the actual hourly fee charged or one hundred dollars 979
per hour, whichever is less, and to a total maximum amount of 980
three hundred dollars.
Sec. 926.19. (A) There is hereby created in the state 989
treasury the commodity handler regulatory program fund. The 990
moneys in the fund shall be used to pay the examination and 991
administrative costs of this chapter and shall consist of: 992
(1) All revenues collected by the director of agriculture 994
from distribution of the receipt forms under division (B) of 995
section 926.20 of the Revised Code and such other forms and 996
registration books as the director may require by rule for the 997
administration of this chapter; 998
(2) The application and examination fees collected under 1,000
division (B) of section 926.05 of the Revised Code; 1,001
(3) The agricultural commodity tester certificate fees 1,003
collected under division (B) of section 926.30 of the Revised 1,004
Code; 1,005
(4) Interest income transferred from the agricultural 1,007
commodity depositors fund under section 926.16 of the Revised 1,008
23
Code; 1,009
(5) ALL FINES, PENALTIES, AND COSTS, EXCEPT COURT COSTS, 1,011
THAT ARE COLLECTED UNDER SECTION 926.99 OF THE REVISED CODE IN 1,012
CONSEQUENCE OF A VIOLATION OF THIS CHAPTER; 1,013
(6) ALL SUMS COLLECTED BY THE DIRECTOR OF AGRICULTURE 1,015
UNDER A CONTRACT DESCRIBED IN SECTION 926.36 OF THE REVISED CODE. 1,016
(B) The examination and administrative costs of this 1,018
chapter shall be computed by the director not later than the 1,019
thirty-first day of December of each even-numbered year to cover 1,020
the biennium that begins on the following first day of July. The 1,021
commodity advisory commission created in section 926.32 of the 1,022
Revised Code shall approve, and may amend, the examination and 1,023
administrative costs. The commission's decision shall be binding 1,024
on the director. The commission may also at any time MAY approve 1,026
for presentation to the controlling board a request to increase 1,027
or decrease the appropriation authority for the biennial 1,028
examination and administrative costs if it determines that an 1,029
increase or decrease in the cost is necessary to carry out the 1,030
purpose of this chapter. 1,031
(C) If at any time the moneys deposited in the fund, 1,033
including interest income transferred from the agricultural 1,034
commodity depositors fund under section 926.16 of the Revised 1,035
Code, are not sufficient to pay the examination and 1,036
administrative costs of this chapter, the director shall request 1,037
an appropriation from the general revenue fund to pay those 1,038
costs. 1,039
Sec. 926.29. (A) A delayed price agreement is an 1,048
executory contract which THAT shall be in such a form and contain 1,050
such terms as the director of agriculture shall adopt by rule 1,051
under Chapter 119. of the Revised Code. The agreement shall be 1,052
executed by and between the licensed handler and the depositor or 1,053
by their authorized representatives not later than fifteen days 1,054
after the first delivery of an agricultural commodity is received 1,055
for delayed pricing under the agreement. The handler shall 1,056
24
maintain a file of executed agreements that are available for 1,057
inspection at any reasonable time by the director or his THE 1,058
DIRECTOR'S designated representative. The handler ALSO shall 1,060
also keep records and ledgers the director considers necessary to 1,062
document the handler's obligation to the depositor under a 1,063
delayed price agreement. He THE HANDLER ALSO shall also provide 1,064
reports, forms, and other evidence the director shall adopt by 1,066
rule to document the storage and marketing of commodities under 1,067
the delayed price agreement.
(B) Except SUBJECT TO THE LIEN THAT ATTACHES UNDER SECTION 1,069
926.021 OF THE REVISED CODE AND EXCEPT as otherwise provided in 1,070
division (C) of this section, a licensed handler who purchases 1,071
any agricultural commodity under a delayed price agreement AT ALL 1,072
TIMES shall at all times maintain the commodity, rights in the 1,074
commodity, proceeds from the sale of the commodity, or a 1,075
combination of the commodity, rights, and proceeds equal to at 1,076
least ninety per cent of the value of his THE HANDLER'S 1,077
obligation for all commodities that he THE HANDLER has purchased 1,078
that are not priced under delayed price agreements. The 1,079
obligation shall be secured or represented by one or more of the 1,080
following: 1,081
(1) Maintenance of the commodity in storage in the 1,083
handler's warehouse; 1,084
(2) Rights in commodities as evidenced by a receipt or 1,086
ticket for storage of the commodities under a bailment agreement 1,087
in another warehouse approved by the director; 1,088
(3) Proceeds from the sale of commodities as evidenced or 1,090
represented by one or more of the following: 1,091
(a) Cash on hand or held on account in a state or 1,093
federally licensed financial institution or a lending agency of 1,094
the farm credit administration; 1,095
(b) Short-term investments held in time accounts with 1,097
state or federally licensed financial institutions or a lending 1,098
agency of the farm credit administration; 1,099
25
(c) Balances in commodity margin accounts; 1,101
(d) Commodities sold and shipped by the handler under 1,103
delayed price agreements that have not been priced less any 1,104
payments or advances that have been received by the handler; 1,105
(e) Such other evidence of unencumbered assets as may be 1,107
acceptable to the director, including an irrevocable letter of 1,108
credit. 1,109
(C) A IN ADDITION TO THE LIEN THAT ATTACHES UNDER SECTION 1,111
926.021 OF THE REVISED CODE, A depositor who sells an 1,112
agricultural commodity to a licensed handler under a delayed 1,113
price agreement may, upon giving notice to the handler either at 1,114
or prior to the time of delivery, MAY demand as security for 1,115
payment for the commodity an amount that, at the time of 1,116
delivery, is equal to one hundred per cent of the national loan 1,117
rate value of the commodity under the United States department of 1,118
agriculture price support program, or seventy-five per cent of 1,119
the average price being paid for the commodity in the state on 1,120
the date of demand as published by the market news service of the 1,121
department of agriculture, whichever is less. The handler shall 1,122
satisfy a demand for security on a commodity sold under a delayed 1,123
price agreement at the handler's option by one of the following: 1,124
(1) Payment to the depositor by cash or bank draft on the 1,126
account of the handler; 1,127
(2) Causing an irrevocable letter of credit to be issued 1,129
to the depositor by a bank designated by the handler securing 1,130
payment in the specified amount. The letter of credit shall be 1,131
subject to Chapter 1305. of the Revised Code and rules adopted by 1,132
the director pursuant to Chapter 119. of the Revised Code. 1,133
Sec. 926.30. (A) No licensed handler or employee of a 1,142
licensed handler who receives an agricultural commodity from a 1,143
producer, either for sale or for storage under a bailment 1,144
agreement, shall perform a quality test on the commodity for the 1,145
purpose of applying a premium, discount, or conditioning charge 1,146
unless the person making the test has completed a training course 1,147
26
or on-the-job training as an agricultural commodity tester PASSED 1,148
AN EXAMINATION ON THE SUBJECT THAT IS APPROVED BY THE DIRECTOR OF 1,149
AGRICULTURE. UPON APPLICATION BY A PERSON WHO HAS PASSED THE 1,150
EXAMINATION, THE DIRECTOR SHALL ISSUE TO THE PERSON AN 1,151
AGRICULTURAL COMMODITY TESTER CERTIFICATE THAT SHALL BE VALID FOR 1,152
A PERIOD OF THREE YEARS. EXCEPT AS OTHERWISE PROVIDED IN THIS 1,153
DIVISION, AN AGRICULTURAL COMMODITY TESTER SHALL PASS AN 1,154
EXAMINATION ON AGRICULTURAL COMMODITY TESTING APPROVED BY THE
DIRECTOR PRIOR TO EACH RENEWAL OF A CERTIFICATE. THE DIRECTOR 1,155
MAY EXEMPT FROM THE EXAMINATION REQUIREMENT FOR CERTIFICATE 1,156
RENEWAL AN AGRICULTURAL COMMODITY TESTER WHO, DURING THE YEAR 1,157
PRIOR TO EXPIRATION OF THE CERTIFICATE, SUCCESSFULLY COMPLETES 1,158
TRAINING ON AGRICULTURAL COMMODITY TESTING THAT HAS BEEN APPROVED 1,159
BY THE DIRECTOR. The director of agriculture shall establish by 1,160
rule the curriculum for the training course or on-the-job 1,161
STANDARDS THAT SUCH training that shall MUST MEET IN ORDER TO BE 1,163
APPROVED BY THE DIRECTOR. THE RULES SHALL REQUIRE THE TRAINING 1,164
TO include instructions in the use of the official grain 1,165
standards of the United States as a basis for determining the 1,166
quality of the commodities tested by an agricultural commodity 1,167
tester. AN AGRICULTURAL COMMODITY TESTER CERTIFICATE ISSUED 1,168
PRIOR TO THE EFFECTIVE DATE OF THIS AMENDMENT SHALL BE CONSIDERED 1,169
TO BE VALID UNTIL THE DATE ON WHICH, AT THE TIME OF ISSUANCE, IT 1,170
WAS SCHEDULED TO EXPIRE. UPON EXPIRATION OF THE CERTIFICATE, THE 1,171
EXAMINATION REQUIREMENT FOR RENEWAL SHALL APPLY.
(B) Upon successful completion of the training required 1,173
under division (A) of this section and upon application by the 1,174
trainee, the director shall issue to an agricultural commodity 1,175
tester a certificate that shall be valid for a period of two 1,176
years. The director may determine that retraining or review is 1,177
necessary for the tester as a result of changes in or amendments 1,178
to the official grain standards of the United States, or if the 1,179
director has reason to believe that retraining is necessary as a 1,180
result of complaints relating to the tester's inability to 1,181
27
accurately test commodities according to the official grain 1,182
standards. A fee to cover the cost of issuing certificates and 1,183
administering the educational program shall be established by 1,184
rule of the director adopted under Chapter 119. of the Revised 1,185
Code and shall be deposited into the commodity handler regulatory 1,186
program fund created in section 926.19 of the Revised Code. 1,187
(C) The director may suspend or revoke the certificate of 1,189
an agricultural commodity tester in accordance with Chapter 119. 1,190
of the Revised Code for failure or inability of the tester to 1,191
apply the official grain standards of the United States in 1,192
testing the quality of an agricultural commodity. 1,193
Sec. 926.32. (A) There is hereby created the commodity 1,202
advisory commission consisting of seven members to be appointed 1,203
by the director of agriculture. Not later than January 1, 1983, 1,204
the director shall make appointments to the commission. Of the 1,205
initial appointments, three shall be for terms ending January 1, 1,206
1984, two shall be for terms ending January 1, 1985, and two 1,207
shall be for terms ending January 1, 1986. Thereafter, terms of 1,208
office shall be for three years, each term ending on the same day 1,209
of the same month of the year as did the term that it succeeds. 1,210
Each member shall hold office from the date of his appointment 1,211
until the end of the term for which he THE MEMBER was appointed. 1,212
Any member appointed to fill a vacancy occurring prior to the 1,214
expiration of the term for which his THE MEMBER'S predecessor was 1,215
appointed shall hold office for the remainder of the term. Any 1,217
member shall continue in office subsequent to the expiration date 1,218
of his THE MEMBER'S term until his THE MEMBER'S successor takes 1,220
office or until a period of sixty days has elapsed, whichever 1,221
occurs first.
(B) The commission shall at all times be composed of three 1,223
farmers who are primarily engaged PRIMARILY in the production of 1,224
agricultural commodities, one licensed handler who is the manager 1,225
of a farmers cooperative, one licensed handler who is the owner 1,226
and operator of a warehouse located in a rural area, one licensed 1,227
28
handler representing a warehouse located at a major agricultural 1,228
commodity transportation center, and one banker who is an officer 1,229
of a rural bank. The director shall annually designate ANNUALLY 1,230
one member of the commission to serve as its chairman CHAIRPERSON 1,232
and may, after notice and public hearing, MAY remove any member 1,234
only for neglect of duty or malfeasance in office. 1,235
(C) A vacancy on the commission shall not impair the right 1,237
of the other members to exercise all of the commission's powers. 1,238
Two farmer members and two handler members shall constitute a 1,239
quorum for the conduct of business of the commission. 1,240
(D) The commission shall meet in Columbus at least three 1,242
times annually at times that the commission shall set by rule and 1,243
may meet at other times that the chairman CHAIRPERSON or a 1,244
majority of the commission members considers appropriate; 1,246
provided, that no meeting shall be held on the call of the 1,247
chairman CHAIRPERSON unless at least seven days' written notice 1,249
is first given to all members of the commission. 1,250
(E) Each member shall be reimbursed for his THE MEMBER'S 1,252
actual and necessary expenses incurred in the discharge of his 1,254
duties as a commission member. 1,255
(F) The commission may adopt, amend, or rescind rules or 1,257
procedures governing the conduct of its internal affairs. 1,258
(G) The commission may request from the director, and the 1,260
director shall provide, meeting space, assistance, services, and 1,261
data to enable it to carry out its functions. 1,262
(H) All costs of the commission, including all of the 1,264
expenses of its members and consultants authorized in this 1,265
section, shall be paid from the commodity handler regulatory 1,266
program fund created in section 926.19 of the Revised Code 1,267
pursuant to itemized vouchers approved by the chairman 1,268
CHAIRPERSON of the commission and the director. 1,270
(I) The director shall designate an official or employee 1,272
of the department of agriculture to act as the executive 1,273
secretary of the commission. The director ALSO may also request 1,274
29
the attendance at meetings of the commission consultants with 1,276
expertise in agricultural law, marketing, statistics, or any 1,277
other subject to advise and consult with the commission on 1,278
matters on the agenda of any regular or special meeting of the 1,279
commission. The expenses incurred by consultants attending those 1,280
meetings shall be reimbursed according to division (H) of this 1,281
section. The executive secretary shall keep or cause to be kept 1,282
a permanent journal of all meetings, proceedings, findings, 1,283
determinations, and recommendations of the commission, including 1,284
an itemized statement of the expenses allowed to each member of 1,285
the commission and consultants under this section. The journal 1,286
shall be a public record. 1,287
(J) In addition to the authority granted in division (F) 1,289
of section 926.05, division (B) of section 926.17, divisions (A) 1,290
and (C) of section 926.18, and division (B) of section 926.19 of 1,291
the Revised Code, the commission shall advise and counsel the 1,292
director on all matters relating to: 1,293
(1) The administration of this chapter; 1,295
(2) The development of rules authorized by section 926.02 1,297
of the Revised Code; 1,298
(3) Any other matters that the commission and the director 1,300
consider appropriate in carrying out this chapter. 1,301
Sec. 926.36. THE DIRECTOR OF AGRICULTURE MAY ENTER INTO A 1,303
CONTRACT WITH A MARKETING ASSOCIATION THAT IS INVOLVED IN A 1,304
PROGRAM DESIGNED TO IMPROVE OR EXPAND THE MARKET FOR AN 1,305
AGRICULTURAL COMMODITY AND FUNDED BY AN ASSESSMENT THAT IS LEVIED 1,307
ON PRODUCERS OF THE AGRICULTURAL COMMODITY AND CALCULATED ON THE 1,308
BASIS OF THE VOLUME OF AGRICULTURAL COMMODITIES PRODUCED BY THE
PRODUCER. UNDER THE CONTRACT, THE MARKETING ASSOCIATION MAY 1,309
AGREE TO PAY THE DIRECTOR A MUTUALLY ACCEPTABLE SUM AND IN 1,310
EXCHANGE THE DIRECTOR MAY AGREE TO FURNISH THE MARKETING 1,311
ASSOCIATION WITH INFORMATION THAT THE DIRECTOR OBTAINS UNDER 1,312
SECTION 926.11 OF THE REVISED CODE REGARDING THE VOLUME OF 1,314
COMMODITIES PRODUCED BY PRODUCERS WHO PARTICIPATE IN THE 1,315
30
MARKETING PROGRAM, AND RELATED FINANCIAL INFORMATION. 1,316
THE MARKETING ASSOCIATION MAY USE THE INFORMATION TO 1,318
DETERMINE WHETHER A PRODUCER HAS TRUTHFULLY DISCLOSED THE VOLUME 1,319
OF AGRICULTURAL COMMODITIES PRODUCED BY THE PRODUCER AND WHETHER 1,320
THE MARKETING ASSOCIATION HAS RECEIVED THE CORRECT AMOUNT IN 1,321
ASSESSMENTS. 1,322
ANY SUM PAID TO THE DIRECTOR UNDER A CONTRACT ENTERED INTO 1,324
UNDER THIS SECTION SHALL BE DEPOSITED IN THE COMMODITY HANDLER 1,325
REGULATORY PROGRAM FUND CREATED IN SECTION 926.19 OF THE REVISED 1,327
CODE. 1,328
Sec. 926.99. (A) Whoever (1) EXCEPT AS PROVIDED IN 1,337
DIVISION (A)(2) OF THIS SECTION, WHOEVER violates section 926.04 1,338
of the Revised Code is guilty of a minor misdemeanor OF THE FIRST 1,340
DEGREE ON A FIRST OFFENSE AND A FELONY OF THE FIFTH DEGREE ON 1,341
EACH SUBSEQUENT OFFENSE.
(2) A PERSON WHO VIOLATES SECTION 926.04 OF THE REVISED 1,346
CODE AND WHO IS INSOLVENT AND FINANCIALLY UNABLE TO SATISFY A 1,347
CLAIMANT AS DEFINED IN SECTION 926.021 OF THE REVISED CODE IS 1,349
GUILTY OF A FELONY OF THE FIFTH DEGREE IF THE FINANCIAL 1,350
OBLIGATION OWED BY THE OFFENDER TO THE CLAIMANT IS FIVE HUNDRED 1,351
DOLLARS OR MORE AND IS LESS THAN FIVE THOUSAND DOLLARS. IF THE 1,352
FINANCIAL OBLIGATION IS FIVE THOUSAND DOLLARS OR MORE AND IS LESS 1,353
THAN ONE HUNDRED THOUSAND DOLLARS, THE OFFENDER IS GUILTY OF A 1,354
FELONY OF THE FOURTH DEGREE. IF THE FINANCIAL OBLIGATION IS ONE 1,355
HUNDRED THOUSAND DOLLARS OR MORE, THE OFFENDER IS GUILTY OF A 1,356
FELONY OF THE THIRD DEGREE. 1,357
(B) Whoever violates division (E) or (F) of section 926.20 1,359
or division (A) of section 926.22 of the Revised Code is guilty 1,360
of a minor misdemeanor on a first offense and a misdemeanor of 1,361
the second degree on each subsequent offense. 1,362
(C) Whoever violates division (G) of section 926.20 or 1,364
section 926.34 or 926.35 of the Revised Code is guilty of a 1,365
felony of the fourth degree. 1,366
(D) Whoever violates division (A) of section 926.28, or 1,370
31
division (B) of section 926.29, of the Revised Code is guilty of
a felony of the fifth degree. 1,371
(E) Whoever violates section 926.31 of the Revised Code is 1,373
guilty of a misdemeanor of the fourth degree. 1,374
Section 2. That existing sections 926.01, 926.021, 926.05, 1,376
926.06, 926.10, 926.16, 926.18, 926.19, 926.29, 926.30, 926.32, 1,377
and 926.99 of the Revised Code are hereby repealed. 1,378