CFR > Title 7 - Agriculture > SUBTITLE B—Regulations of the Department of Agriculture > CHAPTER XIV—COMMODITY CREDIT CORPORATION, DEPARTMENT OF AGRICULTURE (parts 1400 to 1499) > SUBCHAPTER B—LOANS, PURCHASES, AND OTHER OPERATIONS (parts 1410 to 1499) > PART 1427—COTTON > SUBPART E—Standards for Approval of Warehouses for Cotton and Cotton Linters (§1427.1081 to §1427.1089) > 1427.1082—Basic standards.

1427.1082—Basic standards.

Unless otherwise provided in this subpart, each warehouseman and each of the warehouses owned or operated by such warehouseman for which CCC approval is sought for the storage or handling of CCC-owned or -loan commodities shall meet the following standards:
(a) The warehouseman shall:
(1) Be an individual, partnership, corporation, association, or other legal entity engaged in the business of storing or handling for hire, or both, the applicable commodity. The warehouseman, if a corporation, shall be authorized by its charter to engage in such business,
(2) Have a current and valid license for the kind of storage operation for which the warehouseman seeks approval if such a license is required by State or local laws or regulations,
(3) Have a net worth which is the greater of $25,000 or the amount which results from multiplying the maximum storage capacity of the warehouse (the total number of bales of cotton or cotton linters which the warehouse can accommodate when stored in the customary manner) times ten (10) dollars per bale. The net worth need not exceed $250,000. If the calculated net worth exceeds $25,000, the warehouseman may satisfy any deficiency in net worth between the $25,000 minimum requirement and such calculated net worth by furnishing bond (or acceptable substitute security) meeting the requirements of § 1427.1083 ,
(4) Have available sufficient funds to meet ordinary operating expenses,
(5) Have satisfactorily corrected, upon request by CCC, any deficiencies in the performance of any storage agreement with CCC,
(6) Maintain accurate and complete inventory and operating records,
(7) Use only card type warehouse receipts which are pre-numbered and pre-punched or such other document as CCC may prescribe,
(8) Have available at the warehouse adequate and operable firefighting equipment for the type of warehouse and applicable stored commodity, and
(9) Have a work force and equipment available to provide adequate storage and handling service.
(b) The warehouseman, officials, or supervisory employees of the warehouseman in charge of the warehouse operation shall have the necessary experience, organization, technical qualifications, and skills in the warehousing business regarding the applicable commodities to enable them to provide proper storage and handling services.
(c) Warehouseman, officials and each of the supervisory employees of the warehouseman in charge of the warehouse operation shall:
(1) Have a satisfactory record of integrity, judgment, and performance, and
(2) Be neither suspended nor debarred under applicable CCC suspension and debarment regulations.
(d) The warehouse shall:
(1) Be of sound construction, in good state of repair, and adequately equipped to receive, handle, store, preserve, and deliver the applicable commodity,
(2) Be under the control of the contracting warehouseman at all times, and
(3) Not be subject to greater than normal risk of fire, flood, or other hazards.

Code of Federal Regulations

[44 FR 67085, Nov. 23, 1979, as amended by Amdt. 3, 50 FR 16455, Apr. 26, 1985]