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MISSISSIPPI LEGISLATURE 2026 Regular Session To: Agriculture By: Senator(s) Whaley Senate Bill 2631 (As Sent to Governor) AN ACT TO CREATE NEW SECTION 75-46-1, MISSISSIPPI CODE OF 1972, TO ESTABLISH THE "MISSISSIPPI GRAIN INDEMNITY ACT"; TO CREATE NEW SECTION 75-46-3, MISSISSIPPI CODE OF 1972, TO DEFINE THE RELEVANT TERMS OF THIS ACT; TO CREATE NEW SECTION 75-46-5, MISSISSIPPI CODE OF 1972, TO CREATE THE MISSISSIPPI GRAIN INDEMNITY BOARD; TO OUTLINE THE PURPOSE, COMPOSITION AND DUTIES OF THE BOARD; TO CREATE THE MISSISSIPPI GRAIN INDEMNITY TRUST FUND WITHIN THE STATE TREASURY; TO CREATE NEW SECTION 75-46-7, MISSISSIPPI CODE OF 1972, TO PROVIDE THAT THE GRAIN INDEMNITY TRUST FUND SHALL BE ADMINISTERED BY THE BOARD; TO CREATE NEW SECTION 75-46-9, MISSISSIPPI CODE OF 1972, TO PROVIDE THAT BEGINNING JANUARY 1, 2027, GRAIN PRODUCERS WILL BE CHARGED AN ASSESSMENT EQUAL TO .2% OF ALL MARKETED GRAIN THAT IS SOLD TO A FIRST PURCHASER LICENSEE; TO CREATE NEW SECTION 75-46-11, MISSISSIPPI CODE OF 1972, TO PROVIDE HOW GRAIN ASSESSMENTS SHALL BE COLLECTED; TO CREATE NEW SECTION 75-46-13, MISSISSIPPI CODE OF 1972, TO PROVIDE THAT THE GRAIN INDEMNITY TRUST FUND SHALL NOT FALL BELOW $20,000,000.00 AT THE END OF THE FISCAL YEAR; TO CREATE NEW SECTION 75-46-15, MISSISSIPPI CODE OF 1972, TO REQUIRE THAT FIRST PURCHASER LICENSEES MUST MAINTAIN A LEDGER OF ALL ASSESSMENTS COLLECTED; TO CREATE NEW SECTION 75-46-17, MISSISSIPPI CODE OF 1972, TO PROVIDE THAT PARTICIPATION IN THE GRAIN INDEMNITY TRUST FUND IS VOLUNTARY, AND HOW TO NOTIFY THE DEPARTMENT IF A PRODUCER DOES NOT WANT TO PARTICIPATE IN ANY GIVEN YEAR; TO CREATE NEW SECTION 75-46-19, MISSISSIPPI CODE OF 1972, TO PROVIDE THAT THE COMMISSIONER SHALL BE RESPONSIBLE FOR DETERMINING WHEN A FIRST PURCHASER LICENSEE HAS FAILED OR WHEN A FAILURE HAS OCCURRED; TO PROVIDE PROCEDURE REGARDING HOW NOTICE SHALL BE GIVEN; TO CREATE NEW SECTION 75-46-21, MISSISSIPPI CODE OF 1972, TO AUTHORIZE THE BOARD TO PROMULGATE RULES AND REGULATIONS NECESSARY FOR THE OPERATION OF THE BOARD AND ADJUDICATION OF CLAIMS; TO CREATE NEW SECTION 75-46-23, MISSISSIPPI CODE OF 1972, TO REQUIRE THAT CLAIMS SUBMITTED TO THE BOARD SHALL BE REVIEW BY A DESIGNEE OR DESIGNEES; TO CREATE NEW SECTION 75-46-25, MISSISSIPPI CODE OF 1972, TO PROVIDE HOW CLAIMS FOR STORAGE LOSS SHALL BE PAID; TO CREATE NEW SECTION 75-46-27, MISSISSIPPI CODE OF 1972, TO PROVIDE THAT WHEN THE TOTAL AMOUNT OF ELIGIBLE CLAIMS EXCEEDS THE FUNDS AVAILABLE, THE BOARD SHALL MAKE PAYMENTS ON A PRO RATA BASIS; TO CREATE NEW SECTION 75-46-29, MISSISSIPPI CODE OF 1972, TO PROVIDE THAT THE COMMISSIONER SHALL HAVE THE AUTHORITY TO REVOKE THE LICENSE OF FIRST PURCHASER LICENSEES FOR FAILURE TO TIMELY COLLECT AND SUBMIT ASSESSMENTS; TO CREATE NEW SECTION 75-46-31, MISSISSIPPI CODE OF 1972, TO REQUIRE THE COMMISSIONER TO ESTABLISH A TOLL-FREE HOTLINE FOR RECEIVING INFORMATION CONCERNING THE FAILURE OF A FIRST PURCHASER LICENSEE TO MAKE TIMELY PAYMENTS FOR THE PURCHASE OF GRAIN AND OTHER SUSPICIONS OF FRAUDULENT ACTIVITY BY A FIRST PURCHASER LICENSEE; TO CREATE NEW SECTION 75-46-33, MISSISSIPPI CODE OF 1972, TO PROVIDE THAT BOARD RECORDS ARE SUBJECT TO AN AUDIT PERFORMED BY THE STATE AUDITOR AT ANY TIME; TO CREATE NEW SECTION 75-46-35, MISSISSIPPI CODE OF 1972, TO PROVIDE THAT CLAIMANTS WHO ARE FULLY COMPENSATED UNDER THIS CHAPTER, SHALL HAVE SUBROGATED ALL CLAIMANTS RIGHTS ON A BOND OR OTHER PLEDGED FINANCIAL ASSETS; TO CREATE NEW SECTION 75-46-37, MISSISSIPPI CODE OF 1972, TO AUTHORIZE THE BOARD TO HAVE THE AUTHORITY TO ADOPT ALL RULES AND REGULATIONS NEEDED TO CARRY OUT THE POWERS AND DUTIES OF THE BOARD; TO AMEND SECTIONS 75-44-29, 75-44-31, 75-44-35, 75-45-304, 75-45-307 AND 75-45-311, MISSISSIPPI CODE OF 1972, TO CONFORM; AND FOR RELATED PURPOSES. BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MISSISSIPPI: SECTION 1. The following shall be codified as Section 75-46-1, Mississippi Code of 1972: 75-46-1. This chapter shall be known as the "Mississippi Grain Indemnity Act." SECTION 2. The following shall be codified as Section 75-46-3, Mississippi Code of 1972: 75-46-3. As used in this act, the following terms shall have the meaning ascribed in this section, unless the context clearly requires otherwise: (a) "Assessment" means the assessment established pursuant to 75-46-9. (b) "Board" means the Mississippi Grain Indemnity Trust Fund Board. (c) "Claimant" means a producer who: (i) Has suffered either a contract loss or storage loss as defined herein; (ii) Has filed a claim pursuant to this chapter and any rules issued by the board under this chapter; (iii) Has paid assessments into the Mississippi Grain Indemnity Trust Fund, including payments made pursuant to 75-46-17(5) or is a new producer; and (iv) Has not opted out of paying the assessments pursuant to 75-46-17. (d) "Commissioner" means the Commissioner of Agriculture and Commerce for the State of Mississippi or his or her designee. (e) "Contract loss" means a loss to a claimant when a first purchaser licensee who has failed has not fully paid the claimant for grain sold to the licensee under any type of sales contract. (f) "Deferred purchase" means a purchase by a first purchaser licensee in which title to grain passes to the first purchaser licensee and by voluntary agreement of the producer full payment to producer is not made for said grain within one (1) calendar year of the date that title to the grain passes to the first purchaser licensee. (g) "Department" means the Mississippi Department of Agriculture and Commerce. (h) "Failed" or "failure," subject to Section 75-46-19, means: (i) Nonpayment of a first purchaser licensee's debts to a producer or inability of a first purchaser licensee to satisfy all financial obligations due to a producer, unless there is a good faith dispute regarding the legitimacy of the debt; (ii) A declaration of insolvency of a first purchaser licensee by the licensee or by the commissioner; (iii) Revocation or suspension of the first purchaser licensee's license by the State of Mississippi or the United States Department of Agriculture, if the licensee has outstanding indebtedness owed to producers or claimants; (iv) Voluntary surrender of a first purchaser licensee's license to the State of Mississippi or the United States Department of Agriculture, if the licensee has outstanding indebtedness owed to producers or claimants; or (v) The filing of an involuntary or voluntary petition for bankruptcy with regard to a first purchaser licensee. (i) "First purchaser licensee" means a person who is the first to purchase grain or is paid to store grain produced in Mississippi from producers and is: (i) Licensed by the State of Mississippi to store grain under Chapter 44, Title 75, Mississippi Code of 1972; (ii) Licensed by the State of Mississippi to act as a grain dealer under Chapter 45, Title 75, Mississippi Code of 1972; or (iii) Licensed by the United States under the United States Warehouse Act to store grain and has entered into a cooperative agreement with the department. (j) "Fund" means the Mississippi Grain Indemnity Trust Fund. (k) "Grain" means whole kernel corn for all purposes, soybeans and wheat grown in the State of Mississippi. Grain does not include sweet corn, popcorn or any other corn for human consumption. (l) "Mississippi Grain Indemnity Trust Fund" or "Grain Indemnity Fund" means the fund established as provided in this chapter. (m) "Mississippi Grain Indemnity Trust Fund Board" means the board established under Section 75-46-5. (n) "New producer" means a producer who produced grain only after the payment and collection of the assessment was suspended pursuant to Section 75-46-13. The term "new producer" does not include a producer who opted out of payment of the assessment pursuant to Section 75-46-17. (o) "Person" means a natural person, trust, partnership, corporation or any other business entity. (p) "Producer" or "producers" means the owner(s), tenant(s) or operator(s) of land in this state who possess an interest in and receives all or any part of the proceeds from the sale of the grain produced thereon. (q) "Storage loss" means a loss to a producer or claimant when a first purchaser licensee who has failed has not fully satisfied the licensee's storage obligations for grain to the producer or claimant, less any allowable charges that have not been paid by the producer or claimant. SECTION 3. The following shall be codified as Section 75-46-5, Mississippi Code of 1972: 75-46-5. (1) There is hereby created the Mississippi Grain Indemnity Board, which is established for the purposes of administering and overseeing the Grain Indemnity Trust Fund and providing a process by which producers growing and selling grain in the State of Mississippi can make claims for contract losses due to a failure of a grain dealer licensed by the State of Mississippi under Chapter 45, Title 75, Mississippi Code of 1972, and/or for contract and storage losses due to the failure of a grain warehouse operator licensed by the State of Mississippi under Chapter 44, Title 75, Mississippi Code of 1972, or by the United States Department of Agriculture under the United States Warehouse Act. (2) The board shall consist of the following seven (7) voting members: (a) The commissioner, who shall be the chairperson of the board; (b) Two (2) members appointed by the Governor; (c) Two (2) members appointed by the Lieutenant Governor; and (d) Two (2) members appointed by the Speaker of the House of Representatives who shall be active Mississippi grain farmers. All board members appointed under paragraphs (b) through (d) of this subsection shall have demonstrated knowledge and/or experience in the production, marketing and storage of grain. (3) Members of the initial board shall be appointed as follows: (a) The Governor shall appoint members for terms of one (1) year and three (3) years; (b) The Lieutenant Governor shall appoint members for two (2) and four (4) years; and (c) The Speaker of the House of Representatives shall appoint members for one (1) year and three (3) years. Following the initial board, subsequent members appointed to the board shall serve a term of four (4) years with staggered expiration dates. Members of the board shall, while serving on business of the board, be entitled to receive as compensation a per diem, as provided by law, in addition to any actual and necessary expenses incurred in the performance of the official duties of the board. The commissioner may call a meeting of the board upon reasonable notice to the board members. (4) There is created in the State Treasury a special fund to be designated the "Mississippi Grain Indemnity Trust Fund." Funds collected by or appropriated to the board shall be held in trust by the State Treasurer for use and benefit of the board, only to pay claimants and to the board for costs for the administration of this chapter. The Grain Indemnity Trust Fund shall consist of: (a) Money collected under this chapter; (b) Interest earned on any money in the Grain Indemnity Trust Fund; (c) Any funds appropriated by the Legislature or any other public or private source; and (d) Any bond proceeds for grain, proceeds from other pledged financial assets for grain set forth in Section 75-44-29 and Section 75-45-305 or other financial obligations in favor of the commissioner as provided in Sections 75-44-29 and 75-45-305. (5) Amounts in the Grain Indemnity Trust Fund may be invested and reinvested at the discretion of the State Treasurer in cooperation with the board. Interest from these investments shall be deposited in the Grain Indemnity Trust Fund and shall be available for the same purposes as other monies deposited in the Grain Indemnity Trust Fund. The monies in the Grain Indemnity Trust Fund shall not be available for any purpose other than those specified in subsection (1) of this section. (6) The Grain Indemnity Trust Fund shall operate on a fiscal year basis of July 1 to June 30. The board may accept and expend funds deposited into the Grain Indemnity Trust Fund and funds not expended at the end of the fiscal year shall remain in the Grain Indemnity Trust Fund and said funds shall not lapse or otherwise be placed into the State General Fund, and any investment earnings or interest earned on such accounts shall be deposited only to the credit of the Grain Indemnity Trust Fund. Administrative costs such as those enumerated in Section 75-46-7 associated with administering the Grain Indemnity Trust Fund shall not exceed Two Hundred Thousand Dollars ($200,000.00) per fiscal year, unless claims are filed and being administered. In such case, the administrative costs shall not exceed Five Hundred Thousand Dollars ($500,000.00) per fiscal year while claims are ongoing and/or being administered from year to year. A report detailing administrative costs shall be filed with the Legislature by the board no later than December 1 of each year. SECTION 4. The following shall be codified as Section 75-46-7, Mississippi Code of 1972: 75-46-7. (1) The Grain Indemnity Trust Fund shall be administered by the board. All payments made to claimants under this chapter may only be made with board approval, and the board shall provide advice to the commissioner on the day-to-day operations of the Grain Indemnity Trust Fund. The board shall have the authority to contract with individuals or entities regarding: (a) Claims administration; (b) Legal, accounting, audit and financial matters; and (c) Any other matters the board deems relevant and appropriate. (2) Subject to the approval of the board, the commissioner shall be responsible for the day-to-day operations of the Grain Indemnity Trust Fund, including the disbursement of payments approved by the board under subsection (1) of this section. The department is authorized to make such disbursements to claimants on behalf of the board without further appropriation by the Legislature. SECTION 5. The following shall be codified as Section 75-46-9, Mississippi Code of 1972: 75-46-9. Beginning on January 1, 2027, producers of grain shall be charged an assessment equal to two-tenths percent (0.2%) of the price on all marketed grain that is sold to a first purchaser licensee. SECTION 6. The following shall be codified as Section 75-46-11, Mississippi Code of 1972: 75-46-11. Assessments shall be collected by the first purchaser licensee and by any agent or representative of the licensee. The first purchaser licensee shall deduct the assessment from the purchase price of the grain and shall document the amount of the assessment that was deducted on an invoice provided to the producer. The first purchaser licensee shall submit monthly assessments to the department on behalf of the board by the twentieth day of the following month. SECTION 7. The following shall be codified as Section 75-46-13, Mississippi Code of 1972: 75-46-13. (1) Initial assessments shall be collected beginning January 1, 2027, and shall be collected until the board determines that the amount in the Grain Indemnity Trust Fund is Twenty-five Million Dollars ($25,000,000.00). (2) If the amount in the Grain Indemnity Trust Fund is less than Twenty-five Million Dollars ($25,000,000.00) or the board has determined that the failure of a first purchaser licensee will likely result in the issuance of payments to claimants that will reduce the amount in the Grain Indemnity Trust Fund to less than Twenty Million Dollars ($20,000,000.00) at the end of the current fiscal year, assessments shall be required beginning January 1 of the following calendar year. (3) If the amount in the Grain Indemnity Trust Fund exceeds Twenty-Five Million Dollars ($25,000,000.00) at any time during a calendar year when assessments are being collected, assessments shall continue until the end of such calendar year without regard to the maximum amount authorized to be in the fund. SECTION 8. The following shall be codified as Section 75-46-15, Mississippi Code of 1972: 75-46-15. First purchaser licensees shall maintain a ledger of all assessments collected by the licensee that specifies the date of the collection, from whom the assessment was collected, and the amount of the assessment collected. Ledgers for the corresponding time frame shall be submitted to the department in conjunction with the payment of assessments required by Section 75-46-11. SECTION 9. The following shall be codified as Section 75-46-17, Mississippi Code of 1972: 75-46-17. (1) Participation by producers in the Grain Indemnity Trust Fund is voluntary, pursuant to subsection (2) of this section. (2) During any calendar year in which assessments are collected under this chapter, a producer who does not desire to pay the assessment set forth at Section 75-46-9 must notify the department in writing by March 1 of such year. Such written notice must be submitted on an official form provided by the department. Within thirty (30) days of receipt of the form, the department must send to the producer and the board an executed copy of the form or other official acknowledgement that the producer has opted out of the payment of the assessment. The department shall also enter as soon as practicable the producer's name into a publicly available live registry made available through the department website. The effective opt-out date shall be the date upon which the department sends to the producer an executed copy of the form or other official acknowledgement that the producer has opted out of the payment of the assessment, or March 1 of such year if said executed form or other official acknowledgment is sent after March 1 of such year. (3) Subject to subsections (5) and (8) of this section, a producer, who pursuant to subsection (2) of this section, opts out of the payment of the assessment shall not be eligible to be a claimant or otherwise be eligible to receive any past or future payment or benefit from the Grain Indemnity Trust Fund beginning January 1 of the calendar year in which the producer opted out of the payment of the assessment. A producer who opts out of payment of the assessment, pursuant to subsection (2) of this section, shall remain permanently ineligible to be a claimant until that producer has fully satisfied the requirements of subsection (5) of this section. (4) A producer who, pursuant to subsection (2) of this section, opts out of payment of the assessment must notify any first purchaser licensee of the election to opt out of the payment of the assessment. Subject to Section 75-46-29, the first purchaser licensee may require the producer to provide a copy of the executed copy of the form or other official acknowledgement referenced in subsection (1) of this section. (5) A producer who has, pursuant to subsection (2) of this section, opted out of payment of the assessment, may begin paying assessments only upon the satisfaction of the following requirements: (a) The producer petitions the board for approval of reentry into the grain indemnity program by hand delivering or sending by certified mail, return receipt requested, a written request to begin paying assessments in a form required by the board; (b) The board reviews the producer's petition for reentry and, subject to satisfying the requirement of paragraph (c) of this subsection, approves the petition; (c) The producer pays into the fund: (i) The year-over-year amount that would have been paid in since January 1 of the year in which the producer requested to opt out pursuant to subsection (b) of this section; and (ii) Interest on the year-over-year amount, as determined by the board. (6) A producer who satisfies the requirements of subsection (5) of this section is eligible to be a claimant beginning ninety (90) days after the board approves the petition for reentry. (7) If an assessment is collected by a first purchaser licensee from a producer during the same calendar year the producer opted out of payment of the assessment pursuant to subsection (2) of this section, the producer may obtain a refund of the amount paid in the manner and on a form established by the board. (8) In the event the payment and collection of assessments is suspended, pursuant to Section 75-46-13, but before the payment of assessments is reinstituted by the board: (a) A new producer who has experienced a contract loss or a storage loss may elect to be a claimant but in so doing shall not be eligible to opt out of paying the assessment for five (5) calendar years following January 1 of the year in which the payment and collection of assessments is reinstituted by the board; and (b) A producer who, pursuant to subsection (5) of this section, reentered the payment of assessments shall not be eligible to opt out of paying the assessment for five (5) calendar years following January 1 of the year in which the payment and collection of assessments is reinstituted by the board. (9) A producer who, pursuant to subsection (2) of this section, opts out of the payment of the assessment in a calendar year is eligible to be a claimant for a contract loss or a storage loss that occurred in relation to grain delivered during the prior calendar year, if the producer paid the assessments in the prior calendar year, so long as the producer has a binding legal agreement with the first purchaser licensee to receive full payment for said grain from the first purchaser licensee before March 1 of the calendar year in which the producer opted out of the payment of the assessment. SECTION 10. The following shall be codified as Section 75-46-19, Mississippi Code of 1972: 75-46-19. The commissioner shall be responsible for determining when a first purchaser licensee has failed and/or when a failure has occurred. Upon making such a determination, the commissioner shall have the authority to call a special meeting of the board on three (3) days' notice or shorter if agreed to by the board members. The commissioner shall issue a legal notice in a paper of general circulation once a week for two (2) consecutive weeks in the county or counties in which the first purchaser licensee operates setting forth the name of the failed first purchaser licensee and details on how a producer may file a claim for a payment from the Grain Indemnity Trust Fund. The commissioner shall take any other action the commissioner deems to be appropriate to provide notice to affected producers. SECTION 11. The following shall be codified as Section 75-46-21, Mississippi Code of 1972: 75-46-21. (1) The board is authorized to promulgate rules and regulations necessary for the operation of the board and to provide for a timely process to receive and adjudicate claims submitted in connection to the failure of a first purchaser licensee. Claims submitted to the board must, at a minimum, meet the following requirements: (a) Must be on a form prescribed by the board; (b) Must be submitted not later than ninety (90) days after the announcement made by the commissioner under Section 75-46-19; (c) Must include a copy of the written agreement for the sale or storage of grain to the failed first purchaser licensee by the producer; (d) Must be made under oath subject to the penalty of perjury, set forth the relevant circumstances and attest that the amount claimed to be owed for the sale of grain to the failed first purchaser licensee by the producer is true and correct; and (e) Must submit a copy of any warehouse receipt, scale ticket or other similar document showing the delivery of grain by the producer to the failed first purchaser licensee. (f) Cannot be a claim for a contract loss or a storage loss arising from a deferred purchase. (2) Additionally, claimants must file a claim with the commissioner against the bond or other pledged financial assets, as set forth in Sections 75-44-35 and 75-45-311. In the event claimant is fully compensated for his/her storage loss or contract loss, the claimant's claims under the bond shall be assigned as a matter of law to the commissioner. Any such recovery on the bond shall be deposited into the Grain Indemnity Trust Fund by the commissioner. (3) The board may authorize the commissioner to extend the time for filing a claim upon a finding that extenuating circumstances exist that warrant an extension. SECTION 12. The following shall be codified as Section 75-46-23, Mississippi Code of 1972: 75-46-23. (1) All claims submitted to the board shall be reviewed by a designee or designees of the board. The designee(s) shall make a preliminary determination regarding the eligibility for payment from the Grain Indemnity Trust Fund. If the preliminary determination provides that less than the full amount of the claimed loss should be paid, the determination shall set forth an explanation of why the lesser amount, if any, should be paid. All preliminary determinations shall be provided to the board for final review and determination of eligibility for payment from the Grain Indemnity Trust Fund. (2) The board or its designee(s) may request additional information from a claimant determined to be necessary for adjudication of the claim. The claimant may be provided an opportunity to provide oral testimony to the board and/or its designee(s). (3) If a claim is denied in whole or part, the board shall provide a written determination to the claimant which will set forth the amount, if any, to be awarded. The determination shall set forth the basis for the board's decision to include an explanation why a partial payment was made. (4) Within thirty (30) days of the receipt of the determination in which a claim has been denied in whole or part, a claimant may file with the board a request for reconsideration of the claim. The board, in its discretion, may accept or deny the request for reconsideration. The board's decision shall be in writing and forwarded to the claimant. (5) A claimant may seek review of a final determination of the board by filing an appeal with the Chancery Court of the First Judicial District of Hinds County, Mississippi. The appeal must be filed within thirty (30) days of the date of the final determination or where reconsideration has been requested within thirty (30) days of the date of the board's decision to deny reconsideration. The chancery court shall render a decision based on the administrative record prepared by the board without a trial by jury. The chancery court's decision may then be appealed to the Mississippi Supreme Court. Any such appeal to chancery court or to the Supreme Court shall be in accordance with existing laws and regulations governing such appeals. Neither an appeal to chancery court or any other legal or equitable action against the board with regard to payment or reconsideration of a claim shall be appropriate until the board has made a final determination. (6) The board shall have subpoena power for witnesses to attend hearings and for production of documents for any and all proceedings under the board's jurisdiction. The subpoenas shall be enforced by the chancery court of the residence of the witness. SECTION 13. The following shall be codified as Section 75-46-25, Mississippi Code of 1972: 75-46-25. (1) Subject to Section 75-46-27, claims for storage losses shall be paid at one hundred percent (100%) of the amount of loss of the claimant less any amount received by the claimant from any other source. The value of the grain, subject to the claim, shall be the market price of the grain as determined by the board as of the date of failure of the first purchaser licensee. The board may adjust the value of the grain, subject to the claim, if there is sufficient evidence on a warehouse receipt, scale ticket or other similar document showing the quality of the grain. (2) (a) Subject to Section 75-46-27, claims for contract losses shall be paid at one hundred percent (100%) of the amount of loss of the claimant less any amount received by the claimant from any other source, including the sale of the grain to another entity. The board shall use the purchase price set forth in the contract for sale to determine the amount of loss. If a specific purchase price amount is not set forth in the contract, the board in its discretion may establish the price of grain to be used to determine claims amounts. In making this determination, the board may consider such factors as it deems are relevant, including, without limitation, normal marketing practices, the need to make timely payments and the risk of harm to producers if payments are delayed due to having to await a future price determination. (b) A claim for a contract loss shall not be approved by the board if the claimant engaged in conduct or practices that differ from generally accepted marketing practices within the grain industry to an extent the claimant's actions have substantially contributed to the claimant's loss. (c) A failed first purchaser licensee may not file a claim for payment from the fund for any loss associated with a grain warehouse owned, in whole or in part, by the licensee or a person that is a grain dealer owned, in whole or in part, by the licensee. (d) Payments from the Grain Indemnity Trust Fund shall be available for storage and contract losses incurred with respect to crops produced after January 1, 2027. SECTION 14. The following shall be codified as Section 75-46-27, Mississippi Code of 1972: 75-46-27. If the total amount of eligible claims exceeds the amount of funds available to the board from the Grain Indemnity Trust Fund, the board shall make payments on a pro rata basis. Assessments subsequently collected and submitted to the Grain Indemnity Trust Fund shall not be used to make an additional payment for prior payments made at less than the full amount. SECTION 15. The following shall be codified as Section 75-46-29, Mississippi Code of 1972: 75-46-29. The failure of a first purchaser licensee to timely collect and submit assessments required by Section 75-46-11 of this act shall be basis for the commissioner to revoke a license issued to the licensee under Sections 75-44-23 and 75-45-309. SECTION 16. The following shall be codified as Section 75-46-31, Mississippi Code of 1972: 75-46-31. The commissioner shall establish a toll-free hotline and other information collection processes for the purposes of receiving information concerning the failure of a first purchaser licensee to make timely payments for the purchase of grain and information concerning any suspected fraudulent activity of a first purchaser licensee. Upon receipt of information from the hotline or other information collection processes established by the commissioner, the commissioner shall take such action as the commissioner determines to be appropriate, including referral of the matter to the Attorney General. Information received through the hotline shall not be subject to disclosure. SECTION 17. The following shall be codified as Section 75-46-33, Mississippi Code of 1972: 75-46-33. All the board's books, records, accounts and other papers shall be subject to inspection, copying and audit by the Office of the State Auditor at any time. SECTION 18. The following shall be codified as Section 75-46-35, Mississippi Code of 1972: 75-46-35. (1) A claimant fully compensated under this chapter shall, as a matter of law, be deemed to have subrogated all claimant's rights on a bond or other pledged financial assets set forth in Sections 75-44-29 and 75-45-305 and all the claimant's rights to any other compensation from the grain dealer or warehouse operator. (2) To the extent that a claimant who is fully compensated under this chapter is also entitled to recover under the bonds, set forth in Sections 75-44-29 and 75-45-305, the amount that would be otherwise owed to the claimant of proceeds of the bonds or other pledged financial assets set forth in Sections 75-44-29 and 75-45-305, as alternatives to posting a bond, shall be deposited in the Grain Indemnity Trust Fund by commissioner for the benefit of the Grain Indemnity Trust Fund. The commissioner shall take such steps, including legal action as required to ensure such bond proceeds shall be deposited in accordance with this section. SECTION 19. The following shall be codified as Section 75-46-37, Mississippi Code of 1972: 75-46-37. The board may adopt any and all rules and regulations deemed necessary or desirable by the board to carry out the powers and duties of the board, including, but not limited to, the collection and receipt of assessments, the procedure for adjudicating the claims of loss by the producers and the refunding of assessment to producers and the subrogation of procedures' claims against a warehouse or dealer in return for payment from the trust fund. SECTION 20. Section 75-44-29, Mississippi Code of 1972, is amended as follows: 75-44-29. (1) Before any person is granted a license, pursuant to Section 75-44-23, such person shall give a bond to the commissioner executed by the grain warehouseman as principal and by a corporate surety licensed to do business in this state as a surety. The bond shall be in favor of the commissioner for the benefit of all persons interested, their legal representatives, attorneys or assigns, conditioned upon the faithful compliance by the grain warehouseman with the provisions of this chapter, the provisions of the "Mississippi Grain Dealers Law of 1978," authorized under Article 7, Title 75, Chapter 45, Mississippi Code of 1972, and the rules and regulations of the State Department of Agriculture and Commerce applicable thereto. The aggregate liability of the surety to all depositors or storers of grain under this chapter and to sellers of grain under the "Mississippi Grain Dealers Law of 1978" shall not exceed the sum of such bond. However, the liability under a bond additionally issued under the "Mississippi Grain Dealers Law of 1978" shall not be limited by payment under the bond required under this chapter. The bond may be cancelled at any time by the surety by giving written notice to the Commissioner of Agriculture and Commerce of its intention to cancel the bond and all liability thereunder shall terminate thirty-five (35) days after the mailing of such notice except that such notice shall not affect any claims arising under the bond, whether presented or not, before the effective date of the cancellation notice. (2) In lieu of the bond required in subsection (1) of this section an applicant for a license may be a self-insurer by posting with the commissioner any of the following: (a) Cash; (b) Certificates of deposit from any bank or banking corporation insured by the Federal Deposit Insurance Corporation; (c) Irrevocable letters of credit from any bank or banking corporation insured by the Federal Deposit Insurance Corporation; (d) Federal Treasury Bills; or (e) Notes, securities or bonds secured by the federal government or the State of Mississippi. Self-insurers shall post an amount equivalent to the amount of the bond required in Section 75-44-31. SECTION 21. Section 75-44-31, Mississippi Code of 1972, is amended as follows: 75-44-31. (1) The amount of bond to be furnished for each grain warehouse shall be fixed at a rate of Twenty-five Cents (25¢) per bushel for the first one million (1,000,000) bushels of licensed capacity; Twenty Cents (20¢) per bushel for the next one million (1,000,000) bushels of licensed capacity; and Fifteen Cents (15¢) per bushel for all licensed capacity over two million (2,000,000) bushels; provided that in no case shall the amount of the bond be less than Fifteen Thousand Dollars ($15,000.00) or more than One Million Dollars ($1,000,000.00), except as prescribed in subsection (3) of this section. The licensed capacity shall be equal to the maximum number of bushels of grain that the grain warehouse can accommodate for storage. In no event shall the liability of the surety accumulate for each successive license period during which this bond is in force but shall be limited in the aggregate to the bond amount or changed by appropriate rider or endorsement. (2) A grain warehouseman who is licensed or is applying for licenses to operate two (2) or more grain warehouses may give a single bond meeting the requirements of this chapter to cover all such grain warehouses within the state. In such cases all grain warehouses to be covered by the bond shall be deemed to be one (1) warehouse for purposes of determining the amount of bond required under subsection (1) of this section. (3) In case of a deficiency in the net assets required by Section 75-44-21, there shall be added to the amount of the bond, determined in accordance with subsection (1) of this section, an amount equal to such deficiency. In any other case in which the commissioner finds that conditions exist which warrant requiring additional bond, there shall be added to the amount of bond such further amount as is determined to be reasonable by the commissioner. (4) If a public grain warehouseman is licensed under this chapter and also conducts grain transactions under the "Mississippi Grain Dealers Law of 1978" authorized under Article 7 of Title 75, Chapter 45, Mississippi Code of 1972, the entire bond, in addition to any other required bond, shall be available to satisfy claims filed under this chapter and the Mississippi Grain Dealers Law of 1978. SECTION 22. Section 75-44-35, Mississippi Code of 1972, is amended as follows: 75-44-35. (1) It shall be the duty of the grain warehouseman to deliver grain to the holder of a warehouse receipt within ten (10) days of the demand for the redemption of such receipt. In the event the grain warehouseman fails to deliver grain to the holder of a warehouse receipt within ten (10) days of the demand the holder of the warehouse receipt may make demand of the surety for payment under the bond. The surety has the responsibility to pay within fifteen (15) days following receipt by the surety of the notice of the demand for redemption. Any holder of a warehouse receipt issued by a grain warehouseman who has made demand for redemption of such receipt, which demand was, without lawful excuse, not satisfied within ten (10) days, shall notify the commissioner in writing and the holder shall have the right to * * * bring action file a claim with the commissioner against the grain warehouseman and the surety on the grain warehouseman's bond for payment of the market value of the grain represented by such warehouse receipt, such market value to be determined as of the date of the demand, plus legal interest accrued from the date of the demand. In the event the grain warehouseman is a self-insurer as provided in Section 75-44-29 the holder of a warehouse receipt shall have the right to * * * bring action file a claim with the commissioner against the grain warehouseman to the extent of the amount posted in lieu of the bond. * * * The commissioner shall pay to the holder of the warehouse receipt, to the extent of the bond posted, any judgment obtained by the holder of a warehouse receipt against a self‑insurer. The commissioner may also pay to the holder of a warehouse receipt the amount of the market value of the grain provided that the grain warehouseman agrees to such payment * * *; provided, however, the license of the grain warehouseman shall be suspended upon such payment until such time as the warehouseman posts a bond as provided in this chapter or posts with the commissioner a sum equivalent to that paid by the commissioner on behalf of such warehouseman. (2) * * * In all actions in which judgment is rendered against any surety company under the provisions of this section, if it appears from evidence that the surety company has wilfully and without just cause refused to pay the loss upon demand, the court in rendering judgment shall allow the plaintiff the amount of the plaintiff’s expenses including court costs and attorney’s fees, to be recovered and collected as part of the costs. The amount of any payment of costs and attorney's fees under this subsection will not reduce the surety's remaining liability on its bond. (a) Upon receipt of any claim, the commissioner shall provide written notice, via certified mail, return receipt requested, to the warehouseman and the corporate surety of the claims. The notice shall be effective upon receipt of proof of delivery or a receipt marked as refused delivery. If the commissioner determines, in his or her opinion, that there are or may be other competing claims as to bond, the commissioner shall give notice to other interested parties, which shall include the holders of outstanding and uncanceled receipts and scale tickets, any person having a claim for payment under Section 75-45-311, and any other person or party claiming any rights under the bond. The notice shall be deemed complete and sufficient upon the publication once per week for three (3) consecutive weeks in a newspaper of general circulation. The commissioner shall promulgate regulations which shall govern the procedure and process to be followed in the hearing. The regulations shall, among other things, set forth the county or counties, depending on whether the licensee is a warehouseman, grain dealer, individual or corporate entity or resident or nonresident, in which publication of notice hereunder shall be made. (b) The commissioner or his or her designated representative, hereinafter "hearing officer," shall hear evidence and determine whether a loss has occurred. Upon a determination that a loss has occurred, the hearing officer shall determine the date of the loss, the fair market value at the place of loss or in the region immediately surrounding the place of loss, whether payments should be made by the corporate surety and, if so, to what parties and in what amounts. Recovery under the bond shall be prorated by the hearing officer when the claims exceed the liability of the corporate surety under the bond. The burden of establishing the proration shall be on the corporate surety as a matter of defense. The hearing officer shall enter a written order determining the validity of claims under the bond and setting forth those claimants who are entitled to recover thereunder. The order shall be final, binding and conclusive on all interested parties. The order shall be sent by registered or certified mail to all interested parties who appeared in the hearing. Within thirty (30) days after the mailing of said order, any interested party, if dissatisfied with the order of the hearing officer, may appeal to the Chancery Court of the First Judicial District of Hinds County, Mississippi, by filing a written notice of appeal alleging the pertinent facts upon which the appeal is grounded. At the time of the filing of the appeal, the appellant shall give a bond for costs conditioned upon his or her prosecution of the appeal without delay and payment of all costs assessed against him or her. Appeal may be with supersedeas and shall be subject to the provisions of Section 11-51-31. (3) Where a warehouseman licensed under this chapter is involved in the hearing, the claim determination provisions of this chapter are applicable to claims arising both under this chapter and Article 7, Title 75, Chapter 45, Mississippi Code of 1972. SECTION 23. Section 75-45-304, Mississippi Code of 1972, is amended as follows: 75-45-304. No person shall operate as a grain dealer without first having obtained a license pursuant to this article; provided, however, that grain dealers licensed under the provisions of the United States Warehouse Act, as amended, or the Mississippi Grain Warehouse Law shall not be required to have a license issued pursuant to this article. Notwithstanding this section, a person licensed under the Mississippi Grain Warehouse Law who also conducts grain dealer transactions within the meaning of the Mississippi Grain Dealers Law of 1978 shall be required to post the bond required in Section 75-45-305. SECTION 24. Section 75-45-305, Mississippi Code of 1972, is amended as follows: 75-45-305. (1) Every person licensed as a grain dealer shall have filed with the department a surety bond signed by the dealer as principal and by a responsible company authorized to execute surety bonds within the State of Mississippi. A grain dealer may file with the department, in lieu of a surety bond, a certificate of deposit or irrevocable letter of credit from any bank or banking corporation insured by the Federal Deposit Insurance Corporation, payable to the commissioner, as trustee. The principal amount of the certificate of deposit or the amount of the letter of credit shall be the same as that required for a surety bond under this article and the interest thereon shall be made payable to the purchaser thereof. Such bond shall be a principal amount (to the nearest One Thousand Dollars ($1,000.00)) equal to ten percent (10%) of the aggregate dollar amount paid, by the dealer to producers for grain purchased from them during the dealer's last completed fiscal year or in the case of a dealer who has been engaged in business as a grain dealer for less than one (1) year or who has not theretofore engaged in such business, ten percent (10%) of the estimated aggregate dollar amount to be paid by the dealer to producers for grain purchased from them during the next fiscal year. Such bond shall not be less than Twenty-five Thousand Dollars ($25,000.00) nor more than One Hundred Thousand Dollars ($100,000.00), except as otherwise authorized by this article. The commissioner shall determine the sufficiency of any letter of credit. (2) The commissioner may, when he or she questions a grain dealer's ability to pay producers for grain purchased, require a grain dealer to post an additional bond in a dollar amount deemed appropriate by the commissioner. Failure to post such additional bond or certificate of deposit or irrevocable letter of credit, constitutes grounds for suspension or revocation of a license issued under this article. (3) Any required bond or bonds shall be executed by the grain dealer as principal and by a corporate surety licensed to do business in this state as a surety. The bond shall be in favor of the commissioner for the benefit of all persons interested, their legal representatives, attorneys or assigns, conditioned upon the faithful compliance by the grain dealer with the provisions of this article and the rules and regulations of the State Department of Agriculture and Commerce applicable thereto. The aggregate liability of the surety shall not exceed the sum of such bond. The bond may be cancelled at any time by the surety by giving written notice to the commissioner of its intention to cancel the bond and all liability thereunder shall terminate sixty (60) days after the mailing of such notice except that such notice shall not affect any claims arising under the bond, whether presented or not, before the effective date of the cancellation notice. (4) Any grain dealer who is of the opinion that his or her net worth and assets are sufficient to guarantee payment to producers for grain purchased by him or her may request the commissioner to be relieved of the obligation of filing a bond in excess of the minimum bond of Twenty-five Thousand Dollars ($25,000.00). Such request shall be accompanied by a financial statement of the applicant made within six (6) months of the date of such request certified by a certified public accountant. If such financial statement discloses net assets and a net worth of an amount equal to at least three (3) times the amount of the bond required by this article and the commissioner is otherwise satisfied as to the financial ability and resources of the applicant, the commissioner may waive that portion of the required bond in excess of Twenty-five Thousand Dollars ($25,000.00). However, in the case of a grain dealer whose net worth is not equal to three (3) times the amount of bond required, the commissioner may allow such grain dealer to waive in One Thousand Dollar ($1,000.00) increments a portion of the bond required in excess of Twenty-five Thousand Dollars ($25,000.00). The percentage factor to be applied to the bond required in excess of Twenty-five Thousand Dollars ($25,000.00) shall be determined by dividing actual net worth by the net worth required to waive all bond in excess of Twenty-five Thousand Dollars ($25,000.00). If the result of this computation provides a percentage factor of eighty percent (80%) or greater, then that same percentage of the bond in excess of Twenty-five Thousand Dollars ($25,000.00) may be waived. The grain dealer shall then provide to the commissioner a surety bond in the amount of Twenty-five Thousand Dollars ($25,000.00) plus any additional bond required in excess thereof. (5) Any grain dealer who purchases grain from producers only in connection with or as an incident to some other business and whose total purchases of grain from producers during any fiscal year do not exceed an aggregate amount of One Hundred Thousand Dollars ($100,000.00) may satisfy the bonding requirements of this article by filing with the commissioner a bond, or certificate of deposit or irrevocable letter of credit from any bank or banking corporation insured by the Federal Deposit Insurance Corporation, at the rate of One Thousand Dollars ($1,000.00) for each Ten Thousand Dollars ($10,000.00) or fraction thereof of the dollar amount to be purchased, with a minimum bond, certificate of deposit or irrevocable letter of credit of One Thousand Dollars ($1,000.00) and a current financial statement. (6) Failure of a grain dealer to file a bond, or certificate of deposit, or letter of credit, and to keep such bond, certificate of deposit or line of credit in force, or to maintain assets adequate to assure payment to producers for grain purchased from them shall be grounds for the suspension or revocation of a license issued under this article. (7) When the commissioner has determined that a grain dealer has defaulted payment to producers for grain which he or she has purchased from them, the commissioner shall determine * * *, using the hearing procedures set out in Section 75-44-35, the producers and the amount of defaulted payment and as trustee of the bond shall immediately, after such determination, call for the dealer's surety bond or bonds, or other pledged financial assets, to be paid to him or her for distribution to those producers who should receive the benefits. Should the defaulted amount owed the producers be less than the principal amount of the bond or bonds or pledged financial assets, then the surety bank, or banking corporation shall be obligated to pay only the amount of the default. SECTION 25. Section 75-45-307, Mississippi Code of 1972, is amended as follows: 75-45-307. If the department is satisfied: (a) That the applicant is of good business reputation, (b) That the applicant has adequate bonding under Section 75-45-305, (c) That the applicant maintains a permanent business location in this state, and (d) That the applicant has sufficient financial resources to guarantee payment to producers for grain purchased from them, the commissioner shall issue a license to the applicant or shall renew the applicant's license. Licenses shall be * * * issued or renewed annually * * * for a period ending ninety (90) days after the last day of the applicants fiscal year on July 1. The license or renewal thereof issued by the department under this section shall be posted in the principal office of the licensee in this state. A certificate shall be posted in each location listed on a licensee's application where he engages in the business of buying grain. In the case of a licensee operating a truck or tractor trailer unit the licensee is required to have a certificate that the license is in effect and that a bond or certificate of deposit has been filed and is carried in each truck or tractor trailer unit used in connection with the purchase of grain from producers. Upon request of a licensee and payment of the fee thereof, the commissioner shall issue to the licensee a certificate that a license has been issued or renewed and a bond filed as required by this article. SECTION 26. Section 75-45-311, Mississippi Code of 1972, is amended as follows: 75-45-311. If a grain dealer should fail or refuse to make payment to a producer for grain purchased when such payment is requested by the producer and the request is made within one hundred sixty (160) days of the date of sale or the date of delivery of such grain to the dealer, whichever is later, but in case of deferred pricing, delayed pricing, priced-later, or similar contractual arrangements, no more than two hundred seventy (270) days after the date of delivery, the producer may notify the commissioner in writing, by certified mail when possible, of such failure or refusal within the period of * * * one hundred sixty (160) days or ten (10) days thereafter thirty (30) days after such refusal or failure to pay. The commissioner upon receiving such notice shall * * * take whatever action is necessary initiate a hearing procedure as set forth in Section 75-44-35. The producer shall then file a claim in accordance with any regulations promulgated by the commissioner. The producer furnishing such written notice within the prescribed length of time is entitled to the benefits of the grain dealer's bond. However, if a producer fails to furnish written notice to the commissioner within the prescribed time, then such producer is not entitled to any benefits under the grain dealer's bond. Grain dealer liability under priced-later contracts, open-priced contracts, deferred price contracts, or similar agreements shall accrue under the bond in effect at the date of default as determined by the commissioner. Any bond required under this chapter shall be in addition to the bond required by an entity licensed under the "Mississippi Grain Warehouse Law," established under Section 75-44-1 et seq. SECTION 27. This act shall take effect and be in force from and after July 1, 2026.
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