Senate Study Bill 3151 - Introduced SENATE FILE _____ BY (PROPOSED COMMITTEE ON AGRICULTURE BILL BY CHAIRPERSON ZUMBACH) A BILL FOR An Act relating to the regulation of grain marketing and 1 storage, by providing for deferred payment contracts. 2 BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF IOWA: 3 TLSB 6018XC (3) 88 da/ns
S.F. _____ Section 1. Section 203.1, subsection 3, Code 2020, is 1 amended to read as follows: 2 3. “Credit-sale contract” means a contract for the sale 3 of grain pursuant to which the sale price is not fixed at 4 the time of sale and the sales price is to be paid more than 5 thirty days after the delivery of the grain to the buyer, or a 6 contract which is titled as a credit-sale contract, including 7 but not limited to those contracts commonly referred to as 8 deferred-payment contracts, deferred-pricing contracts , and 9 price-later contracts. 10 EXPLANATION 11 The inclusion of this explanation does not constitute agreement with 12 the explanation’s substance by the members of the general assembly. 13 This bill amends the definition of a credit-sale contract 14 which involves an instrument used in commercial transactions 15 involving the marketing of grain. The department of 16 agriculture and land stewardship regulates both grain dealers 17 (Code chapter 203) and warehouse operators (Code chapter 18 203C) as well as administers the grain depositors and sellers 19 indemnity fund (fund) (Code chapter 203D). 20 Under a credit-sale contract, grain is delivered to a buyer 21 (licensed grain dealer) who receives title but does not pay 22 the sales price to the seller for 30 or more days from the 23 date of delivery (e.g., for storage in a licensed warehouse). 24 A transaction may involve a deferred-payment contract in 25 which the contract price is fixed at the time of sale and a 26 deferred-pricing contract or price-later contract in which the 27 sale price is not fixed at the time of sale (e.g., determined 28 on the basis of a future market price). The bill provides 29 that a deferred-payment contract is no longer considered a 30 credit-sale contract. A licensed grain dealer purchasing 31 grain under a deferred-payment contract would not be subject 32 to special regulation otherwise applicable to credit-sale 33 contracts under Code section 203.15. A seller would also be 34 entitled to coverage under the fund for 90 percent of losses 35 -1- LSB 6018XC (3) 88 da/ns 1/ 2
S.F. _____ incurred by the grain dealer’s failure to meet a payment 1 obligation for the grain. A grain dealer could also be subject 2 to a per bushel fee assessed on the purchased grain which is 3 deposited into the fund depending upon whether the fee was 4 being assessed. 5 -2- LSB 6018XC (3) 88 da/ns 2/ 2