Louisiana House Bill HB765

Louisiana 2015 Regular Session

• Introduced: 4/3/15
• Refer: 4/3/15
• Refer: 4/13/15
• Report Pass: 6/1/15
• Engrossed: 6/2/15
• Report Pass: 6/4/15
• Enrolled: 6/10/15
• Chaptered: 7/1/15
• Passed: 7/1/15

Caption

Amends the Agricultural Commodities Dealer and Warehouse Law (EN NO IMPACT See Note)

Impact

The passage of HB 765 is expected to simplify the regulatory landscape for agricultural warehouses and grain dealers by reducing the financial burden associated with maintaining bonds. By allowing for self-insurance, the bill is designed to enhance the ability of producers to receive compensation for agricultural commodities should a dealer or merchant fail to fulfill their obligations. This change aims to promote a more stable agricultural economy by ensuring that agricultural producers are adequately protected against potential losses.

Summary

House Bill 765 amends the Agricultural Commodities Dealer and Warehouse Law in Louisiana. The primary focus of the bill is to update security and insurance requirements related to licensing for agricultural warehouses and grain dealers. It removes the previous bond requirement and instead allows participation in a self-insurance fund as a form of compliance. Additionally, it provides guidelines for the reimbursement mechanisms for producers in case of insolvency of the licensed entities involved in agricultural transactions.

Sentiment

The general sentiment surrounding HB 765 appears to be positive, especially among agricultural stakeholders who appreciate the reduced reliance on traditional bonding methods. However, there are concerns about the effectiveness of the self-insurance fund. Some stakeholders worry that it might not provide sufficient security for producers if a large number of insolvencies occur or if the fund is underfunded. Thus, while the bill is seen as a step toward modernization, the long-term viability of the self-insurance fund remains a point of contention.

Contention

Notable points of contention arise from the discussions regarding the adequacy of the self-insurance mechanism compared to traditional bonding requirements. Some legislators expressed concerns about potential gaps in consumer protection resulting from the removal of bonds, fearing that this could leave producers vulnerable in case of financial failures among grain dealers or agricultural warehouses. The effectiveness of reimbursement processes through the newly established self-insurance fund represents a crucial area for oversight, as it could dictate the overall success of this legislative change.