For Immediate Release
May 16, 2012
Contact: Ryan Green
Sen. Green: Grain industry reform headed to Governor
LANSING, Mich.—Legislation reforming the Grain Dealers Act and the Farm Produce Insurance Fund Act is headed to the governor after being passed by both the House and Senate, announced Sen. Mike Green, R-Mayville, who sponsored the two-bill package.
“Agricultural industry practices have changed dramatically since these laws were first enacted and since last being updated,” Green said. “These bills modernize two public acts that are critical to the success of many farmers and agri-businesses in Michigan by ensuring that state law reflects current practices and provides substantial protection to farmers against losses beyond their control.”
Senate Bill 887 addresses the Grain Dealers Act, which established a licensing and inspection program for grain dealers who store agriculture commodities for producers. Covered commodities include corn, soybeans, dry beans, small grains and cereal grains.
Under the measure, the cap on grain dealer license fees would be increased to a maximum of $1,000 to fund the inspection and licensing programs and to eliminate the need for dealers to purchase separate bailment bonds.
The companion bill, SB 888, updates the Farm Produce Insurance Fund Act of 1939, which set up a voluntary insurance fund for farmers who desire financial protection against losses incurred at these storage facilities. These losses may be due to grain dealer fraud, embezzlement or mismanagement. To account for increased values of crops, the bill utilizes the fee changes to strengthen producer security and to potentially increase the value of the indemnity fund by increasing the administrative fee allocation from $250,000 to $500,000.
“It’s a win-win change for producers and dealers alike,” said Green. “State government will better serve as an asset to the agriculture industry, while participating farmers – a cornerstone of our economy – will get substantially better value for the dollars they voluntarily invest in the insurance fund.”
Michigan Department of Agriculture and Rural Development, Michigan Agri-business, and Michigan Farm Bureau supported the legislation, as well as local grain dealers who requested the changes.
The bills now advance to Gov. Snyder for signature.