By: Estes S.B. No. 248
(Landtroop)
A BILL TO BE ENTITLED
AN ACT
relating to the regulation of public grain warehouse operators.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
SECTION 1. Section 14.012, Agriculture Code, is amended to
read as follows:
Sec. 14.012. BUSINESS INFORMATION. (a) Except as provided
by Subsection (b), financial information of a warehouse operator
provided to the department [The following information, prepared by
the department in the course of its regulatory authority under this
chapter or required to be submitted to the department in accordance
with the department's administration of this chapter,] is
confidential and not subject to public disclosure[:
[(1) inspection or investigation reports containing
information regarding grain inventory; and
[(2) financial information provided to the department
to establish net worth for purposes of licensing].
(b) Notwithstanding Subsection (a), [inspection reports
containing information regarding grain inventory of a warehouse
operator or] financial information of a warehouse operator provided
to the department [to establish net worth] may be disclosed:
(1) [entered into evidence] without sealing [and made
public] in[:
[(A)] an administrative proceeding commenced by
the department against the [a] warehouse operator;
(2) to a local or state law enforcement officer,
[(B) a civil or criminal proceeding commenced by] a county
attorney, a district attorney, or the attorney general, acting
either independently or on behalf of the department, investigating
the [against a] warehouse operator; [or]
(3) in [(C)] a civil proceeding commenced by the
warehouse operator against the department;
(4) in response to a subpoena from a party in a civil
proceeding commenced against the warehouse operator;
(5) [(2) provided] to the issuer of the [a] warehouse
operator's bond or letter of credit [for the purpose of
establishing a claim on the warehouse operator's bond or letter of
credit];
(6) [(3) disclosed] to the public after:
(A) revocation of the [a] warehouse operator's
license;
(B) a voluntary closeout of all of the license
holder's facilities in this state;
(C) a petition for bankruptcy has been filed; or
(D) a receiver [is appointed] for the warehouse
operator's assets has been appointed; or
(7) [(4) disclosed] to any federal agency or any
agency of another state conducting a compliance inspection or
criminal or civil investigation involving the handling, storing,
shipping, selling, purchasing, or receipt of grain.
(c) In this section, "financial information" means:
(1) a financial statement or other document provided
by the warehouse operator to the department to evaluate net worth
requirements under Section 14.031(e);
(2) a financial audit provided by the warehouse
operator to the department; and
(3) if the warehouse operator is subject to an ongoing
investigation by the department:
(A) the price of grain paid by the warehouse
operator to a depositor or other seller of grain delivered to or
stored or handled by the warehouse operator;
(B) the price of grain paid by or to the warehouse
operator by a depositor or other purchaser of grain delivered to or
stored or handled by the warehouse operator; and
(C) the terms of payment for a price described by
Paragraph (A) or (B).
(d) Notwithstanding any other provisions of this section:
(1) a party to a contract or other agreement with a
warehouse operator may obtain a nonredacted copy of the contract or
agreement; and
(2) a person who authored or contributed to the
creation of financial information may be provided access to the
financial information for the purpose of confirming the
authenticity, truthfulness, or accuracy of the information.
SECTION 2. Subsections (d) and (e), Section 14.031,
Agriculture Code, are amended to read as follows:
(d) The bond must be in an amount of not less than $35,000
[$20,000] and be based on 10 [six] cents per bushel of storage
capacity, not to exceed a maximum of $500,000.
(e) If the actual net worth of an applicant equals less than
the greater of either 25 cents per bushel of storage capacity or
$200,000, the applicant shall file a deficiency bond in an amount
equal to the difference between the actual net worth and the greater
of either $200,000 or the [an] amount determined by multiplying 25
cents times each bushel of storage capacity in the applicant's
warehouse. A deficiency bond is in addition to the bond required of
an applicant by this section.
SECTION 3. Subsection (a), Section 14.066, Agriculture
Code, is amended to read as follows:
(a) A department action or order affecting a warehouse
operator under this chapter[, other than by rulemaking, assessment
of an administrative penalty, or imposition of a license sanction,
including a suspension under Section 14.083(c),] is appealable in
accordance with this section unless the action involves agency
rulemaking, the assessment of an administrative penalty,
imposition of a license sanction, or any other action for which a
specific administrative or judicial remedy is available under this
chapter, Chapter 12 of this code, or Chapter 2001, Government Code.
SECTION 4. Subsections (a) and (f), Section 14.082,
Agriculture Code, are amended to read as follows:
(a) If the department determines that a warehouse operator
does not possess sufficient grain to cover outstanding receipts and
outstanding scale weight tickets issued or assumed by the warehouse
operator, or if a warehouse operator refuses or is unable to submit
records or property for lawful inspection or the department is
unable to conduct an inspection of the warehouse due to the
condition of the warehouse or grain stored in the warehouse, the
department may seal the warehouse to prevent delivery or receipt of
grain except as authorized by the department, suspend the license
of the warehouse operator, and give notice to the warehouse
operator requiring the warehouse operator to submit records or
property for lawful inspection, to correct any condition
interfering with the department's inspection of the warehouse or
grain, or to cover a shortage of a particular type of grain by:
(1) storing to the credit of or delivering to each
depositor affected by the shortage grain of the same type and
quality that is stored at any of the warehouse operator's licensed
warehouses in this state and that has been designated as
company-owned grain by the warehouse operator;
(2) purchasing and storing to the credit of or
delivering to each depositor affected by the shortage grain of the
same type and quality;
(3) selling company-owned grain of a different type
and paying to each depositor affected by the shortage, on a pro rata
basis, the market value of the depositor's grain as determined on
the day the shortage was discovered by the department; or
(4) using any combination of the remedies described by
Subdivisions (1)-(3) or another fair and reasonable method for
meeting the shortage approved by the department.
(f) A license suspension issued under this section remains
in effect until lifted by the department through written notice to
the warehouse operator or as provided by Section 14.066 [At any time
before the 11th day following the day on which the department takes
possession of grain under this section, the warehouse operator may
serve notice on the department to appear in the district court of
the county in which the public grain warehouse is located to show
cause why possession should not be restored to the warehouse
operator. The court shall fix the time of the hearing not less than
5 nor more than 15 days from the date of service of the notice].
SECTION 5. Section 14.083, Agriculture Code, is amended by
amending Subsection (c) and adding Subsection (f) to read as
follows:
(c) In addition to or in lieu of a license suspension
authorized by another provision of this chapter, if [If] the
department considers it necessary, the department may suspend a
license and prohibit the movement of grain into or out of a
warehouse for up to 30 days without a hearing [for one or more
periods not to cumulatively exceed 30 days in one licensing
period]. For good cause, a suspension under this subsection may be
extended for additional periods of up to 30 days each, not to exceed
a total of 90 days of suspension in a licensing period.
(f) A license suspension under Subsection (c) remains in
effect until lifted by the department through written notice to the
warehouse operator or as provided by Section 14.066 or until it
expires by operation of law in accordance with the department's
notice of suspension or the limitations provided by Subsection (c).
SECTION 6. Subsection (a), Section 14.087, Agriculture
Code, is amended to read as follows:
(a) On prevailing in an action commenced by the department
through the attorney general under this chapter [or in a hearing
commenced by the warehouse operator under Section 14.082(f)], the
department and the attorney general are each entitled to recover:
(1) investigation costs and fees;
(2) reasonable attorney's fees;
(3) court costs; and
(4) other costs relating to the action, including the
cost of depositions and other forms of discovery and copying
charges.
SECTION 7. This Act takes effect September 1, 2011.