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Current Status Bill Number:View additional legislative information at the LPITS web site.4572 Type of Legislation:General Bill GB Introducing Body:House Introduced Date:20020123 Primary Sponsor:Koon All Sponsors:Koon, Harvin and Vaughn Drafted Document Number:l:\council\bills\dka\4638mm02.doc Residing Body:House Current Committee:Ways and Means Committee 30 HWM Subject:Agriculture; State Warehouse System and Guaranty Fund and Grain Producers Fund, expenditures from History Body Date Action Description Com Leg Involved ______ ________ ______________________________________ _______ ____________ ------ 20020124 Scrivener's error corrected House 20020123 Introduced, read first time, 30 HWM referred to Committee Versions of This Bill Revised on January 24, 2002 - Word format
TO AMEND SECTION 39-22-150, AS AMENDED, CODE OF LAWS OF SOUTH CAROLINA, 1976, RELATING TO THE OPERATION OF THE STATE WAREHOUSE SYSTEM AND THE GUARANTY FUND ORIGINATING FROM FEES CHARGED BY THE SYSTEM, SO AS TO PROVIDE THAT THE DEPARTMENT OF AGRICULTURE MAY RETAIN AND EXPEND THE SUM OF ONE HUNDRED THOUSAND DOLLARS ANNUALLY FROM THE FUND FOR ADMINISTRATION OF THE FUND; AND TO AMEND SECTION 46-41-230, AS AMENDED, RELATING TO THE PURPOSE AND ADMINISTRATION OF THE SOUTH CAROLINA GRAIN PRODUCERS FUND, SO AS TO PROVIDE THAT THE DEPARTMENT OF AGRICULTURE MAY RETAIN AND EXPEND THE SUM OF TWO HUNDRED THOUSAND DOLLARS ANNUALLY FROM THE FUND FOR ADMINISTRATION OF THE FUND.
Be it enacted by the General Assembly of the State of South Carolina:
SECTION 1. Section 39-22-150 of the 1976 Code, as last amended by Act 375 of 1998, is further amended to read:
"Section 39-22-150. All net revenues derived from operation of the state warehouse system must be transferred annually to a special account in the State Treasury until the sum of three million dollars accrues. Transfers must cease when the fund reaches three million dollars, these transfers shall cease;. however, All interest and investment revenue shall must accrue solely to the fund and be returned annually to the fund. In order To support the increase of this fund, the funds monies must be invested at interest by the State Treasurer who shall credit the interest earned on the funds them to the increase of the fund up to and above three million dollars. In addition to the interest, the commissioner shall assess an amount ratably against each warehouseman in this State issuing warehouse receipts a special additional fee not to exceed ten cents a bale of cotton or one cent a bushel of soybeans and one-half cent a bushel of any other stored feed grains or oil seeds for which warehouse receipts have been issued. The additional assessment may be charged not more than only once for each receipt issued on a bale of cotton or bushel of grain. The special additional assessment must be discontinued when the fund has reached the total sum of one million five hundred thousand dollars, the special additional assessment must be discontinued. The assessment must be resumed if the fund is reduced to below one million dollars, the assessment must be resumed. The funds must be used to guarantee state warehouse receipts in excess of an amount recovered from the bonds required by this chapter, and to protect and reimburse depositors against losses as defined in Section 39-22-15. If there is an insufficient amount of money in the fund is not sufficient to cover all claims against the fund, payments must be made on a pro rata basis up to one hundred percent of the total loss of each claimant. If payment is not received in the amount of one hundred percent, then additional amounts must be paid as funds become available until payment of one hundred percent of the total is attained. The state's guarantee of warehouse receipts is based on monies available through the required bonds and the fund. Upon approval of a claim to the fund and before payment from the fund, the claimant shall subrogate his interest, if any, to the department in a cause of action against all parties relating to the claim. In no event may The funds be are not available for the reimbursement of an insurer or surety on the bonds required by this chapter, Chapter 19 of this title, or Chapter 7 of Title 36, who has paid a loss under pursuant to this chapter. All income, interest, or otherwise, other monies derived from this guaranty fund must be reinvested in the fund. Fifty thousand dollars of the income must be paid into the general fund of the State. Any of the funds not appropriated for the employment of additional auditors for the warehousemen and Dealers and Handlers Division of the Department of Agriculture must be returned to the fund.
The sum of one hundred thousand dollars may be retained annually from this fund by the Department of Agriculture to be used to offset the expense of administering this fund program by the department."
SECTION 2. Section 46-41-230 of the 1976 Code, as last amended by Act 435 of 1988, is further amended to read:
"Section 46-41-230. The State Treasurer shall administer the investment of the fund. and the department shall administer the collection of assessments and investigate losses for which payment is requested. Unless the grain dealer who allegedly occasioned the loss has filed for bankruptcy or is audited pursuant to other judicial proceedings, the department, in conjunction with the State Auditor's Office, shall conduct a financial audit of the grain dealer to verify the loss before it may request payment from the fund. The fund must bear all expenses incurred in conducting the audit. After verification, the department shall request that payment for verified losses be made by the State Treasurer to the person incurring a loss. The fund must be established for the benefit of producers who have delivered grain to grain dealers licensed under pursuant to this chapter and compensate producers for losses relative to grain delivered to a grain dealer licensed under pursuant to this chapter, except losses covered by the grain dealer's surety bond. The assessment ceases when the fund reaches four million dollars the assessment ceases. If the four million dollars is attained prior to before the end of a harvest season, the assessment continues until the end of that season. The assessment must be reinstituted as necessary to maintain a balance of four million dollars in the fund. The first one hundred thousand dollars collected in assessment must be paid into the general fund of the State. Any of these funds not appropriated for the employment of additional auditors for the Warehouse and Dealers and Handlers Division of the Department of Agriculture must be returned to the fund. The sum of two hundred thousand dollars may be retained annually from this fund by the Department of Agriculture to be used to offset the expense of administering this fund program by the department. All income, interest, or otherwise, other monies derived from this fund must be reinvested in the fund.
When a loss is incurred for grain which has been delivered to a grain dealer licensed under pursuant to this chapter, the producer, shall within ninety days, shall present his claim, which must be under oath, to the department on a form supplied by the department. To verify his claim, the producer shall present any evidence of loss the department considers necessary. The price for each bushel of grain must be established on the day of the loss and must be for the fair market value on that day at the location of loss. The price for each bushel may not be higher than the contract price, if a price has been established. All persons filing claims under pursuant to this section are bound by the value determined by the department.
The department, within thirty days from verification of loss, shall request payment of one hundred percent of the approved claim. At no time may The fund may not be reduced to less than one hundred thousand dollars.
If there is an insufficient amount of money in the fund is not sufficient to cover all claims, payments must be made on a pro rata basis up to one hundred percent of the total loss of each producer. If payment is not received in the amount of one hundred percent of total loss then additional amounts must be paid as funds become available until payment of one hundred percent of total loss is attained. Claims against the fund must be paid in the order in which they have been verified and approved.
Upon approval of his claim by the department, the producer shall subrogate his interest, if any, to the department in a cause of action against any and all parties. An independent law firm may be hired and paid by the fund for the purpose of collecting losses subrogated to the department. Payments start when the fund exceeds one hundred thousand dollars."
SECTION 3. This act takes effect upon approval by the Governor.
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