SENATE BILL No. 1211

 

 

May 13, 2004, Introduced by Senator VAN WOERKOM and referred to the Committee on Economic Development, Small Business and Regulatory Reform.

 

 

        

                                                                                

                                                                                

                                                                                

                                                                                

                                                                                

                                                                                

                                                                                

                                                                                

                                                                                

                                                                                

                                                                                

                                                                                

                                                                                

                                                                                

                                                                                

                                                                                

                                                                                

                                                                                

                                                                                

                                                                                

                                                                                

                                                                                

                                                                                

                                                                                 A bill to amend 1937 PA 284, entitled                                             

                                                                                

    "An act to prevent the spread of infectious and contagious                  

    diseases of livestock; to require persons, associations,                    

    partnerships and corporations engaged in the buying, receiving,             

    selling, transporting, exchanging, negotiating, or soliciting               

    sale, resale, exchange or transportation of livestock to be                 

    licensed and bonded by the department of agriculture; to keep a             

    producers' proceeds account; to provide for the refusal,                    

    suspension or revocation of such licenses; to provide for                   

    weighmasters; to provide for the inspection and disinfection of             

    yards, premises and vehicles; and to provide penalties for the              

    violation of this act,"                                                     

                                                                                

    by amending section 3 (MCL 287.123), as amended by 2003 PA 85.              

                                                                                

                THE PEOPLE OF THE STATE OF MICHIGAN ENACT:                      

                                                                                

1       Sec. 3.  (1) A person desiring to act as a dealer, broker,                  

                                                                                

2   or agent shall file an application with the department for a                

                                                                                

3   license to engage in  that  the business of dealer, broker, or              

                                                                                

4   agent.  The application shall state the nature of the business,             

                                                                                

5   the  post-office  mailing address of the applicant, and the                 

                                                                                

6   post-office  mailing address at or from which the business is to           

                                                                                


                                                                                

1   be conducted.  If the applicant desires to operate a livestock              

                                                                                

2   yard where livestock is kept and sold at public or private sale,            

                                                                                

3   the application shall so state.  The application may state                  

                                                                                

4   additional information as requested by the director.                        

                                                                                

5       (2)  Beginning  Subject to subsection (5) and beginning                     

                                                                                

6   October 1, 2003 through September 30, 2007, the  departments                

                                                                                

7   department shall charge and collect the following fees for                  

                                                                                

8   initial and renewal license applications, which shall be                    

                                                                                

9   deposited into the general fund:                                            

                                                                                

10       (a) Class I (livestock auction).................... $400.00.           

                                                                                

11       (b) Class II (collection point/buying station)..... $250.00.           

                                                                                

12       (c) Class III (horse auction)...................... $150.00.           

                                                                                

13       (d) Class IV (dealer/broker/agent).................. $50.00.           

                                                                                

14      (3)  Through  Subject to subsection (5) and through                         

                                                                                

15  September 30, 2003 or after September 30, 2007, the only fee the            

                                                                                

16  department shall charge and collect for the issuance and renewal            

                                                                                

17  of licenses under this section is a fee of $5.00 for a dealer,              

                                                                                

18  broker, or agent license.                                                   

                                                                                

19      (4) A licensee who buys or sells livestock by weight shall                  

                                                                                

20  employ a registered weighmaster to do all the weighing.  The                

                                                                                

21  duties, qualifications, and requirements for registration of                

                                                                                

22  weighmasters shall be established by the director by promulgation           

                                                                                

23  of a rule under section 9.                                                  

                                                                                

24      (5) Beginning the effective date of the amendatory act that                 

                                                                                

25  amended this subsection, the department shall issue an initial or           

                                                                                

26  renewal dealer, broker, or agent license not later than 6 months            

                                                                                

27  after the applicant files a completed application.  If the                  


                                                                                

1   application is considered incomplete by the department, the                 

                                                                                

2   department shall notify the applicant in writing within 10 days             

                                                                                

3   after receipt of the incomplete application, describing the                 

                                                                                

4   deficiency and requesting the additional information.  The                  

                                                                                

5   6-month period is tolled upon notification by the department of a           

                                                                                

6   deficiency until the date the requested information is received             

                                                                                

7   by the department.                                                          

                                                                                

8       (6) If the department fails to issue or deny a license within               

                                                                                

9   the time required by this section, the department shall return              

                                                                                

10  the license fee and shall reduce the license fee for the                    

                                                                                

11  applicant's next renewal application, if any, by 15%.  The                  

                                                                                

12  department shall not discriminate against an applicant in the               

                                                                                

13  processing of the application based upon the fact that the                  

                                                                                

14  application fee was refunded or discounted under this                       

                                                                                

15  subsection.                                                                 

                                                                                

16      (7) Beginning January 31, 2005, the director shall submit a                 

                                                                                

17  report by January 31 of each year to the standing committees and            

                                                                                

18  appropriations subcommittees of the senate and house of                     

                                                                                

19  representatives concerned with agriculture issues.  The director            

                                                                                

20  shall include all of the following information in the report                

                                                                                

21  concerning the preceding calendar year:                                     

                                                                                

22      (a) The number of initial and renewal applications the                      

                                                                                

23  department received and completed within the 6-month time period            

                                                                                

24  described in subsection (5).                                                

                                                                                

25      (b) The number of applications requiring a request for                      

                                                                                

26  additional information.                                                     

                                                                                

27      (c) The average time for an applicant to respond to a request               


                                                                                

1   for additional information.                                                 

                                                                                

2       (d) The number of applications rejected, categorized by                     

                                                                                

3   reason for rejection.                                                       

                                                                                

4       (e) The amount of money returned to licensees and registrants               

                                                                                

5   under subsection (6).                                                       

                                                                                

6       (f) The number of applications not issued within the 6-month                

                                                                                

7   period.                                                                     

                                                                                

8       (g) The average processing time for initial and renewal                     

                                                                                

9   applications granted after the time period described in                     

                                                                                

10  subsection (5).                                                             

                                                                                

11      (8)  (5)  The application for that license and bond shall be                

                                                                                

12  submitted to the director on or before October 1 of each year.              

                                                                                

13  Each license issued under this section shall be for a period of 1           

                                                                                

14  year commencing October 1 and ending the following September 30.            

                                                                                

15      (9)  (6)  Each dealer, broker, or agent operating or                        

                                                                                

16  conducting a livestock auction shall file with his or her                   

                                                                                

17  application for a license a surety bond effective during the                

                                                                                

18  period for which the license is issued.  The surety bond shall be           

                                                                                

19  issued by a surety company registered in this state to indemnify            

                                                                                

20  persons from whom livestock is purchased or for whom livestock is           

                                                                                

21  sold or other security and in such amounts, form, and sufficiency           

                                                                                

22  as approved by the director.  The amount of the bond shall be an            

                                                                                

23  amount equal to the amount of gross dollar volume of livestock              

                                                                                

24  business conducted during the average week of the previous                  

                                                                                

25  licensing year by the applicant, but in no case less than                   

                                                                                

26  $1,500.00.  If the average gross weekly livestock business                  

                                                                                

27  conducted by the applicant during the previous licensing year was           


                                                                                

1   greater than $25,000.00, the bond shall be increased above                  

                                                                                

2   $25,000.00, at the rate of $1,000.00 for each $5,000.00 or part             

                                                                                

3   thereof above $25,000.00 on the average gross dollar-volume of              

                                                                                

4   weekly livestock business conducted during the previous year.  A            

                                                                                

5   licensee who owns or operates more than 1 livestock yard or                 

                                                                                

6   livestock auction may file 1 bond in an amount determined by the            

                                                                                

7   formula described in this subsection.  Any dealer, broker, or               

                                                                                

8   agent operating or conducting a livestock yard or livestock                 

                                                                                

9   auction who has filed a surety bond for the livestock yard or               

                                                                                

10  livestock auction and indemnifies persons from whom livestock is            

                                                                                

11  purchased or for whom livestock is sold in accordance with the              

                                                                                

12  terms of any federal act is exempt from the bonding requirements            

                                                                                

13  of this subsection provided the bond is equivalent in amount to             

                                                                                

14  that which would be required by this act.  The bond shall be for            

                                                                                

15  a  livestock  dealer or broker and his or her agents in which the           

                                                                                

16  department is the obligee for the benefit and purpose of                    

                                                                                

17  protecting all persons selling or consigning livestock to the               

                                                                                

18  licensed dealer, broker, or agent against the licensed dealer's,            

                                                                                

19  broker's, or agent's failure to pay amounts due on livestock                

                                                                                

20  purchased by or consigned to them.                                          

                                                                                

21      (10)  (7)  Each licensee shall keep records and shall                       

                                                                                

22  furnish, upon request, information concerning his or her                    

                                                                                

23  purchases and sales as may be required by the director for the              

                                                                                

24  purpose of establishing the amount of bond required under                   

                                                                                

25  subsection  (6)  (9).  The director, in fixing the amount of the            

                                                                                

26  bond, shall take into consideration the dollar volume of                    

                                                                                

27  livestock business and other information furnished by the                   


                                                                                

1   livestock  dealer, broker, or his or her agent.  If a dealer,              

                                                                                

2   broker, or agent did not operate a livestock auction the previous           

                                                                                

3   licensing year, the bond shall be for an amount as shall be                 

                                                                                

4   established by the director after consideration of all                      

                                                                                

5   information available on the probable weekly gross dollar volume            

                                                                                

6   of business to be conducted by the dealer, broker, or agent                 

                                                                                

7   during the licensing year.                                                  

                                                                                

8       (11)  (8)  If during any licensing year the bond filed by any               

                                                                                

9   licensee becomes less than required by this act because of an               

                                                                                

10  increase in gross dollar volume of livestock sales, the director            

                                                                                

11  may issue an order requiring the licensee to file an additional             

                                                                                

12  bond to cover the increase in gross dollar volume of livestock              

                                                                                

13  sales.  Failure to comply with the orders of the director is                

                                                                                

14  grounds for suspension or revocation of license.  A bond shall be           

                                                                                

15  conditioned upon the faithful performance of the licensee's                 

                                                                                

16  duties as a dealer or broker and on the provisions of law                   

                                                                                

17  relating to the purchase of livestock by the  livestock  dealer             

                                                                                

18  or broker and for the payment by the  livestock  dealer or broker           

                                                                                

19  of all livestock purchased by or consigned to the  livestock                

                                                                                

20  dealer or broker as a dealer or broker in livestock.                        

                                                                                

21      (12)  (9)  A license issued under this section allows the                   

                                                                                

22  holder to conduct the business of dealer or broker at or from the           

                                                                                

23  place named in the application.  A legal entity engaged in the              

                                                                                

24  business of transporting livestock or negotiating or soliciting             

                                                                                

25  the transportation or transfer of livestock that is not engaged             

                                                                                

26  in the buying, selling, reselling, exchanging, negotiating, or              

                                                                                

27  soliciting the sale, resale, or exchange of livestock must obtain           


                                                                                

1   a license under this section but is not required to comply with             

                                                                                

2   bonding provisions of this section.                                         

                                                                                

3       (13)  (10)  A dealer, broker, or agent shall keep adequate                  

                                                                                

4   records of the producers' proceeds account in compliance with               

                                                                                

5   section 3a and of all sales and purchases for a period of 2 years           

                                                                                

6   in the manner required by the director.  The records shall be               

                                                                                

7   open to reasonable inspection by the department.                            

                                                                                

8       (14)  (11)  A dealer, broker, or agent shall notify the                     

                                                                                

9   director of a change of address within 5 days after that change.            

                                                                                

10  Any change in ownership of any livestock auction or market shall            

                                                                                

11  be reported to the director within 5 days by the licensee.  Each            

                                                                                

12  dealer or broker shall file with the director on January 1 of               

                                                                                

13  each year a sworn statement of average weekly sales and a                   

                                                                                

14  statement showing the number and kinds of livestock purchased and           

                                                                                

15  sold during the previous year.