203C.13 - FORM AND AMOUNT OF EVIDENCE OF FINANCIAL RESPONSIBILITY.
203C.13 FORM AND AMOUNT OF EVIDENCE OF FINANCIAL
RESPONSIBILITY.
1. A warehouse operator who stores only agricultural products
other than bulk grain shall have and maintain a net worth of at least
ten percent of the value of the warehouse capacity, or maintain a
deficiency bond or an irrevocable letter of credit in the amount of
two thousand dollars for each one thousand dollars or fraction
thereof of net worth deficiency. However, a person shall not be
eligible for a license to store only agricultural products other than
bulk grain if the person has a net worth of less than ten thousand
dollars.
2. If the agricultural product or products intended to be stored
by the warehouse operator, as specified in the application for a
license or amended license, are other than bulk grain, the quantity
of such product intended to be stored shall be valued at the fair
market price on the date of filing the application, and the minimum
amount of bond shall be determined with reference to such value as
follows:
a. For intended storage of such products of a value less than
twenty thousand dollars the minimum amount of the bond shall be three
thousand dollars, plus one thousand dollars for each two thousand
dollars, or fraction thereof, of value in excess of six thousand
dollars up to twenty thousand dollars.
b. For intended storage of such products of a value not less
than twenty thousand dollars and not more than fifty thousand dollars
the minimum amount of the bond shall be ten thousand dollars plus one
thousand dollars for each three thousand dollars, or fraction
thereof, of value in excess of twenty thousand dollars up to fifty
thousand dollars.
c. For intended storage of such products of a value not less
than fifty thousand dollars the minimum amount of the bond shall be
twenty thousand dollars plus one thousand dollars for each five
thousand dollars, or fraction thereof, of value in excess of fifty
thousand dollars.
3. A bond, deficiency bond, or irrevocable letter of credit on
agricultural products other than bulk grain shall not be canceled by
the issuer on less than one hundred twenty days' notice by certified
mail to the department and the principal. When the department
receives notice from an issuer that it has canceled the bond,
deficiency bond, or irrevocable letter of credit on agricultural
products other than bulk grain of a warehouse operator, the
department shall automatically suspend the warehouse operator's
authorization to store or accept for storage agricultural products
other than bulk grain if a new bond, deficiency bond, or irrevocable
letter of credit is not received by the department within sixty days
of the issuance of the notice of cancellation. The department shall
conduct an inspection of the licensee's warehouse immediately at the
end of the sixty-day period. If a new bond, deficiency bond, or
irrevocable letter of credit is not provided within ninety days of
the issuance of the notice of cancellation, the department shall
revoke the warehouse operator's authorization to store or accept for
storage agricultural products other than bulk grain. The department
shall conduct a further inspection of the licensee's warehouse after
the ninety-day period. When an authorization to store or accept for
storage agricultural products other than bulk grain is revoked, the
department shall give notice of the revocation to all known persons
who have agricultural products other than bulk grain in storage, and
shall notify them that the agricultural products other than bulk
grain must be removed from the warehouse not later than one hundred
twenty days after the issuance of the notice of cancellation. The
revocation notice shall be sent by ordinary mail to the last known
address of each person having agricultural products other than bulk
grain in storage. The department shall cause a final inspection of
the licensee's warehouse after the end of the one hundred twenty-day
period. Section History: Early Form
[C24, 27, 31, § 9725; C35, § 9751-g6; C39, § 9751.06; C46, 50,
54, 58, 62, 66, 71, 73, 75, 77, 79, 81, § 543.13] Section History: Recent Form
86 Acts, ch 1006, § 5; 86 Acts, ch 1152, § 23, 24
C93, § 203C.13