HB1389_S_Cmte_Amend

SECTION 1. This act shall be known and may be cited as the "Mississippi Grain Producer Indemnity Act."

SECTION 2. It is the purpose of this act to provide protection and the existence of adequate funds for compensation for losses by grain producers in Mississippi caused by the financial failure of grain dealers and warehouses in order to promote the state's welfare by improving the economic stability of agriculture.

SECTION 3. As used in this act:

(a) "Person" means individuals, corporations, partnerships and all associations of two (2) or more persons having a joint or common interest.

(b) "Commissioner" shall mean the Commissioner of the Mississippi Department of Insurance, or his designated representative.

(c) "Grain" shall mean corn, wheat, soybeans, oats, rice and all grains for which standards have been established under the United States Grain Standards Act and the Agriculture Marketing Act, as amended.

(d) "Board" shall mean the Mississippi Grain Indemnity Fund Board established under this act.

(e) "Stored grain" shall mean any grain received in any grain warehouse located in this state, if same is not purchased and beneficially owned by the grain warehouseman.

(f) "Grain warehouse" shall mean any structure or combination of structures operated together, including the machinery and equipment used in connection therewith, in or by means or which grain is unloaded, elevated, stored, loaded for shipment, dried, leaned, weighed, treated, conditioned or otherwise handled from producers of grain.

(g) "Grain warehouseman" shall mean any person who operates a grain warehouse licensed under the provisions of Section 75-44-1 et seq., Mississippi Code of 1972.

(h) "Grain dealer" shall mean any person engaged in the business of buying grain from producers of grain for resale or for milling or processing, licensed under the provisions of Section 75-45-301 et seq., Mississippi Code of 1972.

(i) "Grain producer" shall mean the owner, tenant or operator of land in this state who has an interest in and receives all or any part of the proceeds from the sale of the grain produced thereon.

(j) "Department" shall mean the Mississippi Department of Insurance.

(k) "Warehouse receipt" shall mean a negotiable grain storage receipt or nonnegotiable scale ticket given by a grain warehouse.

(l) "Failure" means an inability to financially satisfy a claimant in accordance with applicable statute or regulation or contract and the time limits provided therein.

(m) "Obligation" means an order placed, contract awarded, service received, or similar transaction during a given period that will require payments during the same or a future period.

SECTION 4. (1) There is hereby created the Mississippi Grain Indemnity Fund Board (board) to administer the provisions of the Mississippi Grain Indemnity Fund Act.

(2) The board shall consist of eight (8) members as follows:

(a) The Mississippi Commissioner of Insurance, or his designee, who shall serve in an ex officio nonvoting capacity.

(b) The Commissioner of Agriculture and Commerce, or his designee, who shall serve in an ex officio nonvoting capacity.

(d) Three (3) grain producers who are residents of the State of Mississippi and are participating in the program, appointed by the Governor, one (1) from each Mississippi Supreme Court District.

(e) Two (2) grain producers who are residents of the State of Mississippi and are participating in the grain indemnity program, appointed by the Lieutenant Governor from the state at large.

(3) The Commissioner of Insurance shall determine the place and time of the board's meetings and shall spread the same on its minutes. A majority of the voting members shall constitute a quorum, and final action of the board shall require the affirmative vote of a majority of those present and voting. The board shall elect a chairman and a vice chairman and such other officers as it deems necessary, and shall establish rules of order for conducting its meetings. The members of the board appointed by the Governor and the Lieutenant Governor shall receive reimbursement for travel expenses as provided in Section 25-3-41 for expenses incurred in carrying out duties as a member of the Mississippi Grain Indemnity Fund Board.

(4) The board shall have the following powers and duties:

(a) To provide oversight over the Mississippi Grain Indemnity Fund;

(b) To approve any award of a claim made from the Mississippi Grain Indemnity Fund;

(d) To approve all claimants' attorney fees in claims against the fund;

(e) To employ on a full-time or part-time basis a qualified staff attorney and such other staff as it may deem necessary to carry out the purposes of this act and to contract with one or more reputable insurance consulting firms as may be necessary;

(f) To assess premiums prescribed in this act to be paid by grain producers participating in the Mississippi Grain Indemnity Fund and to collect and deposit such assessments;

(g) To make investments of the available funds in the Mississippi Grain Indemnity Fund as authorized by law;

(h) To submit the board's budget request for the initial year of operation and for the appropriation of such State General Funds as may be required for the commencement of its activities and to make compensation payments to claimants for financial loss up to a maximum amount of Five Million Dollars ($5,000,000.00) in the aggregate as more specifically provided in this act;

(i) To subrogate all rights of the claimant, who shall assign all rights, title and interest in any judgment to the board. The board shall have subrogation rights against a third party for amounts paid out of the fund or out of any plan of reinsurance;

(j) To initiate any action it may deem necessary to compel the grain dealer or warehouseman against whom an awarded claim arose to repay the Mississippi Grain Indemnity Fund;

(k) To initiate any action it may deem necessary to compel the claimant whose claim arose due to a failure to participate in any legal proceeding in relation to that claim; and

(l) To do all things necessary to carry out the intent and purpose of this act.

(5) The board may contract with the Mississippi Department of Insurance to administer and enforce the provisions of this act and the department may be reimbursed for necessary expense from the three percent (3%) monies set aside under Section 5(5) of this act.

SECTION 5. (1) There is hereby created in the State Treasure a special fund to be known as the "Mississippi Grain Indemnity Fund." All assessments that the Mississippi Grain Indemnity Board receives and collects under the provisions of subsection (2), all funds received from the proceeds of surety bonds executed by grain warehousemen and grain dealers pursuant to law and any funds appropriated by the Legislature for the operation of this act shall be deposited in the fund. All monies in the fund may be expended by the board for any and all purposes for which the board is authorized to expend funds under the provisions of this act. All interest earned from the investment of monies in the fund shall be credited to the fund. Monies remaining in the fund at the end of a fiscal year shall not lapse into the State General Fund.

(2) There shall be levied upon every grain producer in the State of Mississippi who does not opt out of participation in writing as provided in subsection (3) of this section an assessment of two tenths of one percent (.02%) of market price per bushel on all grain to be collected at the site of first purchase. The board shall provide for the collection of the assessment for the purpose of financing or contributing to the financing of the Mississippi Grain Indemnity Fund. The monies in the Mississippi Grain Indemnity Fund shall not be available for any purpose other than for the payment of claims and for the administration of this act. These funds may be invested and reinvested at the discretion of the State Treasurer in any investment of public funds authorized by law, and the interest from these investments shall be deposited to the credit of the fund and shall be available for the same purposes as all other money deposited in the fund. In order to avoid or lessen the possibility and amount of assessments reinstituted or increased as authorized by this act, the Mississippi Commissioner of Insurance shall approve rates for policies of reinsurance issued by the board at least adequate to fund annual reinsurance above a self-insured retention of Twenty Million Dollars ($20,000,000) that combined with any readily available reserves of the board, is sufficient to cover at least the probable maximum losses from a grain warehouseman or grain dealer failure expected to occur as predicted by a model or method approved by the Commissioner of Insurance for the properties covered by the board at the time the reinsurance was negotiated. The commissioner may approve rates in excess of the minimums required by this section as consistent with his duties and the insurance laws of the State of Mississippi.

(3) Any qualified grain producer or grain producer organization may make application to the board requesting nonparticipation in the Mississippi Grain Indemnity program and an exemption from the assessment of the amount specified in subsection (2) of this section. Said application for exemption shall be executed by all applicants on a voluntary basis on or before March 1 of each year on forms prescribed by the board.

(4) Until such time as the balance in the Mississippi Grain Indemnity Fund is equal to or exceeds Twenty Million Dollars ($20,000,000.00), the board shall reimburse grain producers for financial loss from the State General Fund in an amount not to exceed Five Million Dollars ($5,000,000.00) in the aggregate subject to appropriation therefor by the Legislature, as specifically provided in Section 6 of this act. When the balance in the fund is equal to or exceeds Twenty Million Dollars ($20,000,000.00), there shall be no guarantee for reimbursement for such financial loss from the State General Fund.

(5) The assessment authorized under this section shall continue on grain producers until the Mississippi Grain Indemnity Fund is more than Twenty Million Dollars ($20,000,000.00). If and when the fund is more than Twenty Million Dollars ($20,000,000.00), the board shall temporarily suspend the assessment and may in its discretion refund assessments paid in excess of that amount. In the event the amount in the fund shall subsequently drop below the Twenty Million Dollar ($20,000,000.00) threshold, the board may reinstitute the assessment, however the assessment shall not exceed the assessment rate established by subsection (2) of this section. The assessments by the board pursuant to this section are in addition to any other fees or assessments required by law. When the fund is equal to or exceeds Twenty Million Dollars ($20,000,000.00), the board shall reimburse the State General Fund from the Mississippi Grain Indemnity Fund for any appropriations made by the Legislature to the board for the commencement of operation of the program and reimbursement for financial loss.

(6) The board is authorized to set aside an amount not to exceed three percent (3%) of the year-end balance of the fund for necessary expenses relating to the administration of the fund.

(7) In the event of the bankruptcy of a grain warehousemen or grain dealer subject to a claim under this act, the fund shall be subrogated to the rights of any grain producer or the person possessing the warehouse receipt who has received payment from the Mississippi Grain Indemnity Fund, to the extent of such payment.

SECTION 6. Any grain producer or person possessing warehouse receipts covering grain owned or stored by the warehouseman or grain dealer may make a claim to the Mississippi Grain Indemnity Board for compensation for any financial loss due to a failure of such grain warehouseman or grain dealer. For purposes of this section, "failure" means an inability to financially satisfy a claimant in accordance with applicable statute or regulation or contract within the time limits provided therein. Market losses shall not be deemed to be a failure of such grain warehouseman or grain dealer. The grain producer or person possessing warehouse receipts shall have ninety (90) days from the failure to make the claim to the board. Within thirty (30) days of the board's approval of a valid claim, the board shall, in accordance with this section, compensate from the Mississippi Grain Indemnity Fund any claimant who has incurred a financial loss due to a failure of a grain warehouseman or grain dealer. Any claimant who has incurred a financial loss due to the failure of a grain warehouseman and who has surrendered a warehouse receipt for payment or holds a warehouse receipt and cannot receive value shall be compensated for one hundred percent (100%) of the claim. To the extent that there is an insufficient balance in the Mississippi Grain Indemnity Fund to compensate all claims at any date during the fiscal year, the board is authorized to adjust the maximum amount per claimant proportionately in order for each claimant to receive an equal pro rata share at the time of a failure of a grain warehouseman or grain dealer. Until such time as the Mississippi Grain Indemnity Fund has a balance equal to or in excess of Twenty Million Dollars ($20,000,000.00), the board shall make compensation to claimants under this section from the State General Fund up to a maximum amount of Five Million Dollars ($5,000,000.00) in the aggregate, pursuant to specific appropriation therefor by the Legislature.

SECTION 7. The Mississippi Grain Indemnity Fund Board is authorized to promulgate rules and regulations in accordance with the Mississippi Administrative Procedures Act as may be necessary to effectively and efficiently administer and enforce this act.

SECTION 8. Section 75-44-1, Mississippi Code of 1972, is amended as follows:

75-44-1. This chapter shall be known as the "Mississippi Grain * * * ~~Warehouse~~ Handler Law of 2022."

SECTION 9. Section 75-44-3, Mississippi Code of 1972, is amended as follows:

75-44-3. (1) The provisions of this * * * ~~chapter~~ act shall apply to all grain warehouses and to the operations of such grain warehouses whether or not any of the grain therein is owned by the * * * grain handler.

(2) The provisions and definitions of the Uniform Commercial Code relating to warehouse receipts to the extent not inconsistent with this * * * ~~chapter~~ act shall govern warehouse receipts issued by grain * * * ~~warehousemen~~ handlers.

SECTION 10. Section 75-44-5, Mississippi Code of 1972, is amended as follows:

75-44-5. When used in this chapter:

(a) "Person" includes individuals, corporations, partnerships and all associations of two (2) or more persons having a joint or common interest.

(b) The term "commissioner" shall mean the Commissioner of the Mississippi Department of Agriculture and Commerce, or his designated representative.

(c) "Grain" shall mean all grains for which standards have been established pursuant to the United States Grain Standards Act, as amended, and rice as defined by the Agriculture Marketing Act of 1946, as amended.

(d) "Stored grain" shall mean any grain received in any grain warehouse, located in this state, if same is not purchased and beneficially owned by the grain * * * ~~warehouseman~~ handler.

(e) "Grain handler" or "handler" means any person engaged in the business of buying grain from producers thereof for resale or for milling or processing or a person who operates a warehouse or other facility or group of facilities in which grain is or may be stored for compensation. A producer of grain buying grain for his own use as seed or feed shall not be considered as being engaged in business as a grain handler.

( * * *ef) "Grain warehouse" shall mean any structure or combination of structures operated together, including the machinery and equipment used in connection therewith, in or by means or which grain is unloaded, elevated, stored, loaded for shipment, dried, cleaned, weighed, treated, conditioned or otherwise handled from producers of grain.

* * *

(g) "Inspector" shall mean a person authorized by the * * * ~~warehouseman~~ grain handler to weigh, inspect, grade and/or certificate the weight and grade of grain stored or to be stored in a grain warehouse.

(h) "Warehouse receipt" shall mean a negotiable grain storage receipt and/or a nonnegotiable scale ticket given by a grain warehouse.

(i) "Surety bond" shall mean a guarantee issued by a surety agency on behalf of a client, requiring the agency to pay a sum of money to a third party in the event the client fails to fulfill obligations required under this chapter.

SECTION 11. Section 75-44-7, Mississippi Code of 1972, is amended as follows:

75-44-7. The commissioner shall carry out and enforce the provisions of this * * * ~~chapter~~ act and is hereby empowered to promulgate rules and regulations to carry out necessary inspections and to appoint and fix the duties of his personnel and provide such equipment as may be necessary to assist him in enforcing the provisions thereof.

SECTION 12. Section 75-44-9, Mississippi Code of 1972, is amended as follows:

75-44-9. (1) No person shall (a) operate a grain warehouse with over five hundred thousand (500,000) bushels of licensed capacity; or (b) issue a warehouse receipt for such grain warehouse; or (c) operate as a grain handler selling, transferring or storing over five hundred thousand (500,000) bushels or more annually, without first having obtained a license * * * under the provisions of the United States Warehouse Act, as amended.

(2) No person shall (a) operate a grain warehouse with over fifty thousand (50,000) and less than five hundred thousand (500,000) bushels of licensed capacity; or (b) issue a warehouse receipt for such grain warehouse; or (c) operate as a grain handler selling, transferring or storing over fifty thousand (50,000) and less than five hundred thousand (500,000) bushels annually, without first having obtained either a license under the provisions of the United States Warehouse Act, as amended, or a grain handler license from the Mississippi Department of Agriculture and Commerce under the provisions of this act.

(3) Any person who (a) operates a grain warehouse with less than fifty thousand (50,000) bushels of licensed capacity; or (b) issues a warehouse receipt for such grain warehouse; or (c) operates as a grain handler selling, transferring or storing less than fifty thousand (50,000) bushels annually, shall not be required to have a license issued by the United States Warehouse Act or by the Mississippi Department of Agriculture and Commerce under this act.

SECTION 13. Section 75-44-11, Mississippi Code of 1972, is amended as follows:

75-44-11. (1) Applications for combined grain handler licenses under this * * * ~~chapter~~ act are to be made on forms prescribed by the commissioner for each separate warehouse and grain handler's place of business, or, if an applicant owns more than one (1) warehouse or grain handler's place of business at any one (1) location, which does not exceed eight (8) miles in distance, then all the warehouses and grain handler offices at that location may be included in one (1) application. Every application is to be accompanied by an application fee of * * * ~~One Hundred Fifty Dollars ($150.00)~~ Five Hundred Dollars ($500.00) and a certified financial statement in a form prescribed by the commissioner and such further information as the commissioner may by regulation require.

(2) Grain handler licenses shall be nontransferable.

SECTION 14. Section 75-44-13, Mississippi Code of 1972, is amended as follows:

75-44-13. Prior to the issuance of a license, every applicant shall pay an annual license fee based upon the capacity of the warehouse, such fee to be determined by the commissioner, but not to exceed * * * ~~One Hundred Dollars ($100.00)~~ Two Hundred Fifty Dollars ($250.00).

SECTION 15. Section 75-44-15, Mississippi Code of 1972, is amended as follows:

75-44-15. If a grain * * * ~~warehouseman~~ handler desires to renew his license for an additional year, application for such renewal shall be made on a form prescribed by the commissioner. At least sixty (60) days prior to the expiration of each license, the commissioner shall notify each grain * * * ~~warehouseman~~ handler of the date of such expiration and furnish such grain * * * ~~warehouseman~~ handler with the renewal form.

SECTION 16. Section 75-44-17, Mississippi Code of 1972, is amended as follows:

75-44-17. Before a license to * * * ~~conduct a grain warehouse~~ operate as a grain handler is granted under Section 75-44-23, the grain * * * ~~warehouseman~~ handler shall file with the commissioner a copy of his schedule of charges for storage and other services. If the grain * * * ~~warehouseman~~ handler desires to make any change in the schedule of charges during the license period, he shall file with the commissioner a statement in writing showing the change at least thirty (30) days prior to its effective date. Each grain * * * ~~warehouseman~~ handler shall keep conspicuously posted the schedule of charges for storage and other services as so filed, and shall strictly adhere to these charges.

SECTION 17. Section 75-44-19, Mississippi Code of 1972, is amended as follows:

75-44-19. Immediately upon receipt of his license or of any modification or extension thereof, the grain * * * ~~warehouseman~~ handler shall post same and thereafter keep it posted until suspended or terminated in a conspicuous place in the office of the grain warehouse or place of business to which such license applies where receipts issued by such grain * * * ~~warehouseman~~ handler are delivered to depositors.

SECTION 18. Section 75-44-21, Mississippi Code of 1972, is amended as follows:

75-44-21. (1) Each grain * * * ~~warehouseman~~ handler shall have and maintain above all exemptions and liabilities, total net assets available for the payment of any indebtedness arising from the conduct of the grain warehouse or grain handler's place of business in an amount equal to at least Twenty Cents (20¢) multiplied by the maximum number of bushels of grain for which the grain * * * ~~warehouseman~~ handler is licensed, provided that no person may be licensed as a grain * * * ~~warehouseman~~ handler under the regulations * * * ~~in this part~~ under this act unless he has available net assets of at least Twenty Thousand Dollars ($20,000.00); and provided further, that any deficiency in net assets required above the minimum of Twenty Thousand Dollars ($20,000.00) may, at the discretion of the commissioner, be supplied by a commensurate increase in the amount of the grain * * * ~~warehouseman's~~ handler's bond furnished pursuant to Sections 75-44-29, 75-44-31, 75-44-33 and 75-44-35. In determining total available net assets, credit may be given for insurable assets such as buildings, machinery, equipment and merchandise inventory only to the extent of the current market value of such assets and only to the extent that such assets are protected by insurance against loss or damage. Such insurance shall be in the form of lawful policies issued by one or more insurance companies authorized to do business and subject to service of process in suits brought in this state, and which provide that no cancellation shall be effective unless thirty (30) days' advance notice of such cancellation is given to the commissioner.

(2) If a grain * * * ~~warehouseman~~ handler is licensed or is applying for license to operate two (2) or more grain warehouses or grain handler's places of business, the maximum total number of bushels which all such facilities will accommodate when stored in the manner customary to the warehouses, or sold/transferred at the grain handler's place of business, as determined by the commissioner, shall be considered in determining whether the grain * * * ~~warehouseman~~ handler meets the available net assets requirement of subsection (1) of this section.

(3) For the purposes of subsections (1) and (2) of this section only, capital stock as such shall not be considered a liability.

SECTION 19. Section 75-44-23, Mississippi Code of 1972, is amended as follows:

75-44-23. (1) Upon satisfaction of Sections 75-44-9 through 75-44-21, and 75-44-29 through 75-44-33, and any applicable regulations by an applicant, the commissioner shall issue a license to operate a grain warehouse.

(2) If after proper application, the commissioner denies any person, partnership, association or corporation a license to operate a grain warehouse, the commissioner shall transmit immediately to said applicant by certified mail an order so providing which shall state the reasons for said denial. In the event the applicant is dissatisfied at the decision of the commissioner, the applicant may request a hearing within ninety (90) days with the commissioner to appear and defend its compliance with all appropriate regulations and/or give evidence that all deficiencies have been corrected. If after said hearing, the commissioner denies applicant a license, the commissioner shall transmit immediately to applicant by certified mail an order so providing which shall state the reasons for said denial. In the event the applicant is dissatisfied at the decision of the commissioner after the hearing, the applicant may appeal to the chancery court of the county where the grain warehouse or grain handler's place of business is located within thirty (30) days of the date of said order in accordance with the provisions of subsection (2) of Section 75-44-25.

SECTION 20. Section 75-44-25, Mississippi Code of 1972, is amended as follows:

75-44-25. (1) If a grain * * * ~~warehouseman~~ handler is convicted of any crime involving fraud or deceit or if the commissioner determines that any grain * * * ~~warehouseman~~ handler has violated any of the provisions of this chapter, or any of the rules and regulations adopted by the commissioner pursuant to this chapter, the commissioner may, at his discretion, suspend, cancel or revoke the license of such grain * * * ~~warehouseman~~ handler.

(2) All proceedings for the suspension, cancellation or revocation of licenses shall be before the commissioner, and the proceedings shall be in accordance with rules and regulations which shall be adopted by the commissioner. No license shall be cancelled or revoked except after a hearing before the commissioner upon reasonable notice to the licensee and an opportunity to appear and defend. The commissioner may temporarily suspend the license of a licensee for good and reasonable cause before notice or hearing and the licensee shall be entitled to a hearing on such temporary suspension without undue delay. Whenever the commissioner shall suspend, cancel or revoke any license he shall prepare an order so providing which shall state the reason or reasons for such suspension, cancellation or revocation. Said order shall be sent, by certified mail, by the commissioner to the licensee at the address of the grain warehouse licensed. Within thirty (30) days after the mailing of said order, the licensee, if dissatisfied with the order of the commissioner, may appeal to the chancery court of the county where the grain warehouse is located by filing a written notice of appeal alleging the pertinent facts upon which such appeal is grounded. At the time of the filing of the appeal, the appellant shall give a bond for costs conditioned upon his prosecution of the appeal without delay and payment of all costs assessed against him. Appeal may be with supersedeas and shall be subject to the provisions of Section 11-51-31.

(3) In case a license issued to a grain * * * ~~warehouseman~~ handler expires or is suspended, revoked or cancelled by the commissioner or his designated representative, such license shall be immediately returned to the commissioner and the grain * * * ~~warehouseman~~ handler shall forthwith comply with the provisions of Section 75-44-67.

SECTION 21. Section 75-44-27, Mississippi Code of 1972, is amended as follows:

75-44-27. Upon satisfactory proof of the loss or destruction of a license issued to a grain * * * ~~warehouseman~~ handler, a duplicate thereof, or a new license, may be issued under the same number.

SECTION 22. Section 75-44-29, Mississippi Code of 1972, is amended as follows:

75-44-29. (1) Before any person is granted a license pursuant to Section 75-44-23 such person shall give a bond to the commissioner executed by the grain * * * ~~warehouseman~~ handler as principal and by a corporate surety licensed to do business in this state as a surety in the amount prescribed in Section 75-44-31. The bond shall be in favor of the * * * ~~commissioner~~ Mississippi Grain Indemnity Board established in this act for the benefit of all persons interested, their legal representatives, attorneys or assigns, conditioned upon the faithful compliance by the grain * * * ~~warehouseman~~ handler with the provisions of this chapter and the rules and regulations of the State Department of Agriculture and Commerce applicable thereto. The aggregate liability of the surety to all depositors or storers or purchasers of grain shall not exceed the sum of such bond. The bond may be cancelled at any time by the surety by giving written notice to the Commissioner of Agriculture and Commerce of its intention to cancel the bond and all liability thereunder shall terminate thirty-five (35) days after the mailing of such notice except that such notice shall not affect any claims arising under the bond, whether presented or not, before the effective date of the cancellation notice.

(2) In lieu of the bond required in subsection (1) of this section an applicant for a license may be a self-insurer by posting with the commissioner any of the following:

(a) Cash;

(b) Certificates of deposit from any bank or banking corporation insured by the Federal Deposit Insurance Corporation;

(c) Irrevocable letters of credit from any bank or banking corporation insured by the Federal Deposit Insurance Corporation;

(d) Federal Treasury Bills; or

(e) Notes, securities or bonds secured by the federal government or the State of Mississippi.

Self-insurers shall post an amount equivalent to the amount of the bond required in Section 75-44-31.

SECTION 23. Section 75-44-31, Mississippi Code of 1972, is amended as follows:

75-44-31. (1) The amount of surety bond to be furnished for each grain warehouse shall be fixed at a rate of Twenty-five Cents (25¢) per bushel for the first * * * ~~one million (1,000,000)~~ five hundred thousand (500,000) bushels of licensed capacity; * * * provided that in no case shall the amount of the bond be less than * * * ~~Fifteen Thousand Dollars ($15,000.00)~~ Twenty-five Thousand Dollars ($25,000.00) or more than * * * ~~One Million Dollars ($1,000,000.00)~~ One Hundred Twenty-five Thousand Dollars ($125,000.00), except as prescribed in subsection (3) or (4) of this section. The licensed capacity shall be equal to the maximum number of bushels of grain that the grain warehouse can accommodate for storage or the amount sold or transferred by the licensee acting as a grain handler. In no event shall the liability of the surety accumulate for each successive license period during which this bond is in force, but shall be limited in the aggregate to the bond amount or changed by appropriate rider or endorsement.

(2) A grain * * * ~~warehouseman~~ handler who is licensed or is applying for licenses to operate two (2) or more grain warehouses or places of grain-handling business may give a single surety bond meeting the requirements of this chapter to cover all such grain warehouses or businesses within the state. In such cases all grain warehouses or grain-handling businesses to be covered by the surety bond shall be deemed to be one (1) warehouse or place of business for purposes of determining the amount of bond required under subsection (1) of this section.

(3) In case of a deficiency in the net assets required by Section 75-44-21, there shall be added to the amount of the surety bond, determined in accordance with subsection (1) of this section, an amount equal to such deficiency. In any other case in which the commissioner finds that conditions exist which warrant requiring additional bond, there shall be added to the amount of bond such further amount as is determined to be reasonable by the commissioner.

(4) The commissioner may, when he questions a grain handler's ability to pay producers for grain purchased, require a grain handler to post an additional surety bond in a dollar amount deemed appropriate by the commissioner. Failure to post such additional surety bond or certificate of deposit or irrevocable letter of credit, constitutes grounds for suspension or revocation of a license issued under this act.

SECTION 24. Section 75-44-33, Mississippi Code of 1972, is amended as follows:

75-44-33. If an application is made for an amendment to a license and no bond previously filed by the grain * * * ~~warehouseman~~ handler under Sections 75-44-29 and 75-44-31 covers obligations arising during the period covered by such amendment, the grain * * * ~~warehouseman~~ handler shall file with the commissioner an additional bond in such amount as may be determined by the commissioner.

SECTION 25. Section 75-44-35, Mississippi Code of 1972, is amended as follows:

75-44-35. (1) It shall be the duty of the grain * * * ~~warehouseman~~ handler to deliver grain to the holder of a warehouse receipt within ten (10) days of the demand for the redemption of such receipt. In the event the grain * * * ~~warehouseman~~ handler fails to deliver grain to the holder of a warehouse receipt within ten (10) days of the demand, the holder of the warehouse receipt may make demand of the surety for payment under the bond. The surety has the responsibility to pay within fifteen (15) days following receipt by the surety of the notice of the demand for redemption. Any holder of a warehouse receipt issued by a grain * * * ~~warehouseman~~ handler who has made demand for redemption of such receipt, which demand was, without lawful excuse, not satisfied within ten (10) days, shall notify the commissioner in writing and shall have the right to bring action against the grain * * * ~~warehouseman~~ handler and the surety on the grain * * * ~~warehouseman's~~ handler's bond for payment of the market value of the grain represented by such warehouse receipt, such market value to be determined as of the date of the demand, plus legal interest accrued from the date of the demand. In the event the grain * * * ~~warehouseman~~ handler is a self-insurer as provided in Section 75-44-29 the holder of a warehouse receipt shall have the right to bring action against the grain * * * ~~warehouseman~~ handler to the extent of the amount posted in lieu of the bond. The commissioner shall pay to the holder of the warehouse receipt, to the extent of the bond posted, any judgment obtained by the holder of a warehouse receipt against a self-insurer. The commissioner may also pay to the holder of a warehouse receipt the amount of the market value of the grain provided that the grain * * * ~~warehouseman~~ handler agrees to such payment; provided, however, the license of the grain * * * ~~warehouseman~~ handler shall be suspended upon such payment until such time as the * * * ~~warehouseman~~ handler posts a bond as provided in this chapter or posts with the commissioner a sum equivalent to that paid by the commissioner on behalf of such * * * ~~warehouseman~~ grain handler.

(2) In all actions in which judgment is rendered against any surety company under the provisions of this section, if it appears from evidence that the surety company has * * * ~~wilfully~~ willfully and without just cause refused to pay the loss upon demand, the court in rendering judgment shall allow the plaintiff the amount of the plaintiff's expenses, including court costs and attorney's fees, to be recovered and collected as part of the costs. The amount of any payment of costs and attorney's fees under this subsection will not reduce the surety's remaining liability on its bond.

(3) If a grain handler should fail or refuse to make payment to a producer for grain purchased when such payment is requested by the producer and the request is made within thirty (30) days of the date of sale or the date of delivery of such grain to the handler, whichever is later, or other period of time specified by contractual arrangement, the producer shall notify the commissioner in writing of such failure or refusal within the period of thirty (30) days thereafter. The commissioner upon receiving such notice shall take whatever action is necessary to investigate the claim and report the findings to the producer within ten (10) days. Grain handler liability under priced-later contracts, open-priced contracts, deferred price contracts, or similar agreements shall accrue under the bond in effect at the date of default as determined by the commissioner.

SECTION 26. Section 75-44-37, Mississippi Code of 1972, is amended as follows:

75-44-37. (1) Every grain * * * ~~warehouseman~~ handler shall at all times keep the grain stored in the grain warehouse insured by an insurance company authorized to do business in this state. The grain is to be insured for its full-market value against loss by fire, inherent explosion, lightning and windstorm, and failure to do so shall make the grain * * * ~~warehouseman~~ handler liable for the same. All such policies shall provide that no cancellations shall be effective unless thirty (30) days' prior notice is given the commissioner.

(2) If fire, inherent explosion, lightning or windstorm shall destroy or damage all or part of the grain stored in any grain warehouse, the grain * * * ~~warehouseman~~ handler shall, upon demand by the holder of any warehouse receipt for such grain, and upon being presented with the warehouse receipt, make settlement for the fair-market value after deducting the warehouse charges.

SECTION 27. Section 75-44-39, Mississippi Code of 1972, is amended as follows:

75-44-39. Every grain * * * ~~warehouseman~~ handler shall receive for storage or shipment, so far as the available capacity for storage of the grain warehouse shall permit, all grain tendered to him in the usual course of business; provided, however, a grain warehouse owned and operated as a cooperative may decline to accept grain tendered by a nonmember if such cooperative reasonably believes that its available capacity will be required to serve the members of the cooperative. All such grain is to be inspected, weighed and graded by an inspector except that:

(a) The depositor and the grain * * * ~~warehouseman~~ handler may agree upon a sample taken from the lot of grain to be offered for storage as being a true and representative sample.

(b) The depositor and the grain * * * ~~warehouseman~~ handler may agree upon the grade of the grain offered for storage and a warehouse receipt may be issued on the agreed grade.

SECTION 28. Section 75-44-41, Mississippi Code of 1972, is amended as follows:

75-44-41. Every grain * * * ~~warehouseman~~ handler shall keep in a place of safety complete, separate and correct records and accounts pertaining to the grain warehouse including, but not limited to, records and accounts of * * * ~~all~~ the number of bushels of grain received therein and withdrawn therefrom, all unissued receipts and tickets in its possession, copies of all receipts and tickets issued by it, and the receipts and tickets returned to and cancelled by it. Such records shall be retained by the grain * * * ~~warehouseman~~ handler for a period of five (5) years.

SECTION 29. Section 75-44-43, Mississippi Code of 1972, is amended as follows:

75-44-43. (1) Every grain warehouse shall be examined by the commissioner each year. The cost of such examination shall be included in the annual license fee. The commissioner, at his discretion, may make additional examinations of any grain warehouse at any time. If any discrepancy is found as a result of additional examination, the cost of such examination is to be paid by the grain * * * ~~warehouseman~~ handler.

(2) Every grain warehouse shall at least annually send to the commissioner a copy of its financial statement prepared by an accountant licensed by the State of Mississippi and sworn to by the accountant and grain * * * ~~warehouseman~~ handler.

(3) The commissioner * * * ~~may, in his discretion,~~ shall also require an unqualified audit by an accountant licensed by the State of Mississippi as a requirement for licensing * * *~~, and~~ to be submitted annually directly to the commissioner. The commissioner shall inspect the grain * * * ~~warehouse's~~ handler's place of business, mode of conducting the same, facilities, equipment, inventories, property, books, records, accounts, papers and minutes of proceedings held at such grain * * * ~~warehouse~~ handler's place of business, and any other records deemed relevant to the operation of the grain * * * ~~warehouse~~ handler's place of business by the commissioner.

(4) All scales used for the weighing of property in grain warehouses shall be subject to tests by any scale inspector duly appointed or authorized by the commissioner during regular business hours.

SECTION 30. Section 75-44-45, Mississippi Code of 1972, is amended as follows:

75-44-45. Each grain warehouse shall employ, during all regular business hours, a grain inspector (who may be the grain * * * ~~warehouseman~~ handler himself if such grain * * * ~~warehouseman~~ handler is a natural person) who shall be responsible for the accuracy of weights and grades noted on all warehouse receipts.

SECTION 31. Section 75-44-47, Mississippi Code of 1972, is amended as follows:

75-44-47. (1) If the condition of any grain offered for storage is such that it probably will affect the condition of grain in the grain warehouse, the grain * * * ~~warehouseman~~ handler shall not receive such grain for storage or store such grain, provided, however, that if the grain warehouse has separate bins or is equipped with proper conditioning apparatus, the grain warehouse may receive such grain for storage in such separate bins or may condition it and then store it in such a manner as will not lower the grade of other grain.

(2) It shall be the grain * * * ~~warehouseman's~~ handler's duty and obligation to condition and maintain the quantity and quality of all grain as receipted.

SECTION 32. Section 75-44-49, Mississippi Code of 1972, is amended as follows:

75-44-49. (1) Every receipt issued for grain stored in a grain warehouse shall conform to the requirements of Section 75-7-202 and in addition shall embody within its written or printed terms:

(a) A statement that the holder of the receipt or the depositor of the grain shall demand the delivery of the grain on or before a date not later than one (1) year from the date specified thereon by the grain * * * ~~warehouseman~~ handler;

(b) The net weight, number of bushels, percentage of dockage and the grading factors and the grade.

(2) A grain * * * ~~warehouseman~~ handler shall not insert any language in any warehouse receipt or make any contract with respect to any warehouse receipt which purports to limit the liabilities or responsibilities imposed on him by law.

(3) The possession of an indorsed warehouse receipt shall be prima facie evidence of grain in storage and the rightful ownership of such document and grain.

SECTION 33. Section 75-44-51, Mississippi Code of 1972, is amended as follows:

75-44-51. The commissioner shall require that at least one (1) actual or skeleton copy of all receipts shall be made and all copies shall have clearly and conspicuously printed or stamped thereon the words "Copy-Not Negotiable."

SECTION 34. Section 75-44-53, Mississippi Code of 1972, is amended as follows:

75-44-53. The form of all receipts shall be approved by the commissioner. The commissioner shall be authorized to have printed by the state printer all warehouse receipts issued by grain * * * ~~warehouseman~~ handlers.

SECTION 35. Section 75-44-55, Mississippi Code of 1972, is amended as follows:

75-44-55. If a grain * * * ~~warehouseman~~ handler delivers only a part of a lot of grain for which he has issued a negotiable receipt under this chapter, he shall take up and cancel such receipt and issue a new receipt in accordance with the provisions of Sections 75-44-49 through 75-44-65 for the undelivered portion of grain.

SECTION 36. Section 75-44-57, Mississippi Code of 1972, is amended as follows:

75-44-57. A grain * * * ~~warehouseman~~ handler shall not deliver grain for which he has issued a negotiable receipt until the receipt has been returned to him and cancelled, and shall not deliver grain for which he has issued a nonnegotiable receipt until he has received authority from the person lawfully entitled to such delivery, or his authorized agent.

SECTION 37. Section 75-44-59, Mississippi Code of 1972, is amended as follows:

75-44-59. The commissioner shall require that all warehouse receipts issued by a grain warehouse shall be numbered consecutively, and no two (2) receipts bearing the same number shall be issued from the same warehouse during any one (1) year, except in the case of a lost or destroyed receipt.

SECTION 38. Section 75-44-61, Mississippi Code of 1972, is amended as follows:

75-44-61. The commissioner shall require that no warehouse receipt shall be issued except upon actual delivery of grain into storage in the warehouse from which it purports to be issued, nor shall any receipt be issued for a greater quantity of grain than was contained in the lot or parcel * * * o or received for storage, nor shall more than one (1) receipt be issued for the same lot of grain, except in cases where a receipt for a part of a lot is desired, and then the aggregate receipts for a particular lot shall cover that lot and no more.

SECTION 39. Section 75-44-63, Mississippi Code of 1972, is amended as follows:

75-44-63. A grain * * * ~~warehouseman~~ handler may make a valid sale or pledge of any warehouse receipts issued for grain of which the * * * ~~warehouseman~~ handler is the owner, either solely or jointly or in common with others, and the recital of ownership in the receipt shall constitute notice of the right to sell or pledge the same and of the title or specific lien of the transferee or pledgee upon the * * * ~~warehouseman's~~ grain handler's grain represented by the receipts.

SECTION 40. Section 75-44-65, Mississippi Code of 1972, is amended as follows:

75-44-65. (1) If grain is offered for storage in any licensed grain warehouse and the grain * * * ~~warehouseman~~ handler does not have storage space to handle the same, the grain * * * ~~warehouseman~~ handler, with the written consent of the owner, may accept grain for shipment to another grain warehouse where storage is available.

(2) The receipt to cover grain to be transported to and stored in another grain warehouse shall embody within its written or printed terms, in addition to the requirements of Section 75-44-49, the name and location of the grain warehouse to which the grain will be shipped for storage.

SECTION 41. Section 75-44-67, Mississippi Code of 1972, is amended as follows:

75-44-67. Any * * * ~~person~~ grain handler operating a grain warehouse who desires to discontinue such operation at the expiration of his license or whose license is suspended, revoked or cancelled by the commissioner or his designated representative shall notify the commissioner and all holders of warehouse receipts and all parties storing grain in the grain warehouse, if known, or if not known, by advertising in the newspaper or newspapers of largest general circulation in the community in which the grain warehouse is located once per week for three (3) consecutive weeks, at least thirty (30) days prior to the date of expiration of his license, of his intention to discontinue the grain warehouse business, and the owners of the grain shall remove, or cause to be removed, their grain from such grain warehouse before the expiration of the license.

SECTION 42. Section 75-44-69, Mississippi Code of 1972, is amended as follows:

75-44-69. No inspector or employee of the commissioner's office shall disclose any information obtained by him in the course of his employment related to the affairs or transactions of any grain warehouse without first having obtained the express permission in writing of such grain * * * ~~warehouseman~~ handler.

SECTION 43. Section 75-44-71, Mississippi Code of 1972, is amended as follows:

75-44-71. (1) Any person who issues a warehouse receipt for grain without holding a valid grain * * * ~~warehouse~~ handler license or who commits any willful violation of any provision of this chapter, shall be guilty of a felony, and upon conviction thereof, punishable by a fine of not more than * * * ~~Twenty Thousand Dollars ($20,000.00)~~ Fifty Thousand Dollars ($50,000.00) and/or imprisonment for not more than five (5) years.

(2) Any unintentional or negligent violation of this chapter shall be a misdemeanor, and upon conviction thereof, punishable by a fine of not more than * * * ~~Five Thousand Dollars ($5,000.00)~~ One Thousand Dollars ($1,000.00) and/or imprisonment for not more than one (1) year.

SECTION 44. Sections 75-45-301, 75-45-303, 75-45-304, 75-45-305, 75-45-307, 75-45-309, 75-45-311, 75-45-313 and 75-45-315, Mississippi Code of 1972, which are the "Mississippi Grain Dealers Law of 1978," are hereby repealed.

SECTION 45. This act shall take effect and be in force from and after July 1, 2022.