S.B. No. 251
AN ACT
1-1 relating to the handling and marketing of citrus fruits and
1-2 vegetables and to the produce recovery fund.
1-3 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
1-4 SECTION 1. Section 101.002, Agriculture Code, is amended by
1-5 amending Subsection (a) to read as follows:
1-6 (a) This chapter applies to vegetables, whether or not
1-7 packed in ice or held in cold storage<,> but only if grown in this
1-8 state, and does not apply to vegetables that have been manufactured
1-9 into an article of food of a different kind or character.
1-10 SECTION 2. Section 101.003, Agriculture Code, is amended by
1-11 adding Subsection (c) to read as follows:
1-12 (c) A person who holds a license under this section is also
1-13 considered, without paying an additional fee, to hold a license or
1-14 be registered under Section 102.003 of this code.
1-15 SECTION 3. Section 101.004, Agriculture Code, is amended to
1-16 read as follows:
1-17 Sec. 101.004. License Categories. (a) A person who is
1-18 required by Section 101.003 of this code to be licensed or
1-19 registered shall apply to the department for the appropriate
1-20 <licensing in the> category described by this section that is
1-21 appropriate to the actions of the person.
1-22 (b) A person shall apply for a license <licensing as a
1-23 commission merchant> if the person:
1-24 (1) purchases vegetables on credit;
2-1 (2) takes possession of vegetables for consignment or
2-2 handling on behalf of the producer or owner of the vegetables; or
2-3 (3) takes possession of vegetables for consignment or
2-4 handling in a manner or under a contract that does not require or
2-5 result in payment to the producer, seller, or consignor of the full
2-6 amount of the purchase price in United States currency at the time
2-7 of delivery or at the time that the vegetables pass from the
2-8 producer, seller, or consignor to the person.
2-9 (c) A person shall register <apply for licensing> as a cash
2-10 dealer if the person purchases vegetables and pays for the
2-11 vegetables in United States currency before or at the time of
2-12 delivery or taking possession.
2-13 <(d) A person shall apply for licensing as a retailer if the
2-14 person:>
2-15 <(1) has annual sales of vegetables and citrus fruit
2-16 that comprise 75 percent or more of the retailer's total sales; or>
2-17 <(2) employs a buying agent who buys directly from a
2-18 producer.>
2-19 SECTION 4. Subsection (a), Section 101.005, Agriculture
2-20 Code, is amended to read as follows:
2-21 (a) A person required under Section 101.003 of this code to
2-22 be licensed or registered shall apply <for a license> to the
2-23 department on a form furnished by the department. The application
2-24 must be made under oath and contain the following information:
2-25 (1) the full name of the applicant and whether the
2-26 applicant is an individual, partnership, corporation, exchange, or
2-27 association;
3-1 (2) the full name and address of the principal
3-2 business office of the applicant;
3-3 (3) the address of the applicant's principal business
3-4 office in this state;
3-5 (4) if the applicant is a foreign corporation, the
3-6 state in which the corporation is chartered and the name and
3-7 address of an agent in this state for service of legal process; and
3-8 (5) the length of time that the applicant has been
3-9 engaged in business in this state<; and>
3-10 <(6) the category of license for which the applicant
3-11 is applying>.
3-12 SECTION 5. Section 101.006, Agriculture Code, is amended to
3-13 read as follows:
3-14 Sec. 101.006. <LICENSE> FEE. (a) Except as otherwise
3-15 provided by this section, a person applying for a license shall
3-16 include with the license application a license fee of $75.
3-17 (b) The registration <license> fee for a cash dealer is $25.
3-18 <(c) Except as otherwise provided by this section, a person
3-19 who applies for a license as a commission merchant or retailer
3-20 under both this chapter and Chapter 102 of this code is entitled to
3-21 pay a single license fee of $75. The person's license shall
3-22 reflect that the person is licensed to handle both citrus fruit and
3-23 vegetables.>
3-24 <(d) A person who applies for a license under Subsection (b)
3-25 of this section and Subsection (b) of Section 102.006 of this code
3-26 is entitled to pay a single license fee of $25. The person's
3-27 license shall reflect that the person is licensed to handle both
4-1 citrus fruit and vegetables.>
4-2 SECTION 6. Subsections (a) and (b), Section 101.010,
4-3 Agriculture Code, are amended to read as follows:
4-4 (a) In accordance with the rules of the department, a
4-5 license holder <person licensed as a commission merchant or
4-6 retailer> may apply to the department for a reasonable number of
4-7 identification cards for:
4-8 (1) transporting agents to act for the license holder
4-9 <licensee> in the transporting of vegetables; and
4-10 (2) buying agents to act for the license holder
4-11 <licensee> in any act requiring licensing under Section 101.003 of
4-12 this code.
4-13 (b) The department may collect a fee not to exceed $5 for
4-14 each card and shall issue transporting agent cards in a color
4-15 different from buying agent cards.
4-16 SECTION 7. Subsection (a), Section 101.020, Agriculture
4-17 Code, is amended to read as follows:
4-18 (a) A person commits an offense if the person:
4-19 (1) acts in violation of Section 101.003 of this code
4-20 by not <without first> obtaining a license or registration or after
4-21 receiving notice of cancellation of a license or registration;
4-22 (2) <acts or assumes to act as a commission merchant
4-23 without first obtaining a license as a commission merchant;>
4-24 <(3)> acts or assumes to act as a transporting agent
4-25 or buying agent without first obtaining an identification card;
4-26 (3) <(4)> as a transporting agent or buying agent,
4-27 fails and refuses to turn over to the department an identification
5-1 card in accordance with Section 101.010(e) of this code;
5-2 (4) <(5)> as a license holder <licensee>, fails to
5-3 furnish information under Section 101.017 of this code before the
5-4 11th day following the date of demand;
5-5 (5) <(6)> as a license holder <licensee>, fails to
5-6 settle with a producer or seller on the grade and quality of
5-7 vegetables in the manner provided by Section 101.015 of this code;
5-8 (6) <(7)> as a cash dealer, pays for vegetables by a
5-9 means other than United States currency;
5-10 (7) <(8)> as a license holder <licensee>, transporting
5-11 agent, or buying agent, violates a provision of this chapter; or
5-12 (8) <(9) acts or assumes to act as a retailer without
5-13 first obtaining a license as a retailer; or>
5-14 <(10)> acts or assumes to act as a cash dealer without
5-15 first registering <obtaining a license> as a cash dealer.
5-16 SECTION 8. Section 102.003, Agriculture Code, is amended by
5-17 adding Subsection (c) to read as follows:
5-18 (c) A person who holds a license or is registered under this
5-19 section is also considered, without paying an additional fee, to
5-20 hold a license or be registered under Section 101.003 of this code.
5-21 SECTION 9. Section 102.004, Agriculture Code, is amended to
5-22 read as follows:
5-23 Sec. 102.004. License Categories. (a) A person who is
5-24 required by Section 102.003 of this code to be licensed or
5-25 registered shall apply to the department for the appropriate
5-26 <licensing in the> category described by this section that is
5-27 appropriate to the actions of the person.
6-1 (b) A person shall apply for a license <licensing as a
6-2 commission merchant> if the person:
6-3 (1) purchases citrus fruit on credit;
6-4 (2) takes possession of citrus fruit for consignment
6-5 or handling on behalf of the producer or owner of the fruit; or
6-6 (3) takes possession of citrus fruit for consignment
6-7 or handling in a manner or under a contract that does not require
6-8 or result in payment to the producer, seller, or consignor of the
6-9 full amount of the purchase price in United States currency at the
6-10 time of delivery or at the time the citrus fruit passes from the
6-11 producer or seller to the person.
6-12 (c) A person shall register <apply for licensing> as a cash
6-13 dealer if the person purchases citrus fruit and pays for the citrus
6-14 fruit in United States currency before or at the time of delivery
6-15 or taking possession.
6-16 <(d) A person shall apply for licensing as a retailer if the
6-17 person:>
6-18 <(1) has annual sales of citrus fruit and vegetables
6-19 that comprise 75 percent or more of the retailer's total sales; or>
6-20 <(2) employs a buying agent who buys directly from a
6-21 producer.>
6-22 SECTION 10. Subsection (a), Section 102.005, Agriculture
6-23 Code, is amended to read as follows:
6-24 (a) A person required under Section 102.003 of this code to
6-25 be licensed or registered shall apply for a license or registration
6-26 to the department on a form furnished by the department. The
6-27 application must be made under oath and contain the following
7-1 information:
7-2 (1) the full name of the applicant and whether the
7-3 applicant is an individual, partnership, corporation, exchange, or
7-4 association;
7-5 (2) the full name and address of the principal
7-6 business office of the applicant;
7-7 (3) the address of the applicant's principal business
7-8 office in this state;
7-9 (4) if the applicant is a foreign corporation, the
7-10 state in which the corporation is chartered and the name and
7-11 address of an agent in this state for service of legal process; and
7-12 (5) <the category of license for which the applicant
7-13 is applying; and>
7-14 <(6)> the length of time that the applicant has been
7-15 engaged in business in this state.
7-16 SECTION 11. Section 102.006, Agriculture Code, is amended to
7-17 read as follows:
7-18 Sec. 102.006. <LICENSE> FEE. (a) Except as otherwise
7-19 provided by this section, a person applying for a license shall
7-20 include with the license application a license fee of $75.
7-21 (b) The registration <license> fee for a cash dealer is $25.
7-22 <(c) Except as otherwise provided by this section, a person
7-23 who applies for a license as a commission merchant or retailer
7-24 under both this chapter and Chapter 101 of this code is entitled to
7-25 pay a single license fee of $75. The person's license shall
7-26 reflect that the person is licensed to handle both citrus fruit and
7-27 vegetables.>
8-1 <(d) A person who applies for a license under Subsection (b)
8-2 of this section and Subsection (b) of Section 101.006 of this code
8-3 is entitled to pay a single license fee of $25. The person's
8-4 license shall reflect that the person is licensed to handle both
8-5 citrus fruit and vegetables.>
8-6 SECTION 12. Subsections (a) and (b), Section 102.010,
8-7 Agriculture Code, are amended to read as follows:
8-8 (a) In accordance with the rules of the department, a
8-9 license holder <person licensed as a commission merchant or
8-10 retailer> may apply to the department for a reasonable number of
8-11 identification cards for:
8-12 (1) transporting agents to act for the license holder
8-13 <licensee> in the transporting of citrus fruits; and
8-14 (2) buying agents to act for the license holder
8-15 <licensee> in any act requiring licensing under Section 102.003 of
8-16 this code.
8-17 (b) The department may collect a fee not to exceed $1 for
8-18 each card and shall issue transporting agent cards in a color
8-19 different from buying agent cards.
8-20 SECTION 13. Section 102.016, Agriculture Code, is amended to
8-21 read as follows:
8-22 Sec. 102.016. BUYING BY WEIGHT. A licensee who buys citrus
8-23 fruit by weight shall weigh the fruit on state-registered
8-24 <state-tested> scales.
8-25 SECTION 14. Subsection (a), Section 102.021, Agriculture
8-26 Code, is amended to read as follows:
8-27 (a) A person commits an offense if the person:
9-1 (1) acts in violation of Section 102.003 of this code
9-2 by not obtaining <without> a license or after receiving notice of
9-3 cancellation of a license;
9-4 (2) <acts or assumes to act as a commission merchant
9-5 without a license as a commission merchant;>
9-6 <(3)> acts or assumes to act as a transporting agent
9-7 or buying agent without an identification card or after receiving
9-8 notice of cancellation of an identification card;
9-9 (3) <(4)> as a transporting agent or buying agent,
9-10 fails and refuses to turn over to the department an identification
9-11 card in accordance with Section 102.010(e) of this code;
9-12 (4) <(5)> as a license holder <licensee>, fails to
9-13 furnish information under Section 102.018 of this code before the
9-14 11th day following the date of demand;
9-15 (5) <(6)> as a license holder <licensee>, buys citrus
9-16 fruit by weight and does not have the fruit weighed on
9-17 state-registered <state-tested> scales;
9-18 (6) <(7)> as a license holder <licensee>, fails to
9-19 settle with a producer or seller on the grade and quality of citrus
9-20 fruit in the manner provided by Section 102.015 of this code;
9-21 (7) <(8)> as a cash dealer, pays for citrus fruit by a
9-22 means other than United States currency;
9-23 (8) <(9)> fails to maintain records required by
9-24 Section 102.017(b) of this code;
9-25 (9) <(10)> as a license holder <licensee>,
9-26 transporting agent, or buying agent, violates a provision of this
9-27 subchapter; or
10-1 (10) <(11) acts or assumes to act as a retailer
10-2 without a license as a retailer; or>
10-3 <(12)> acts or assumes to act as a cash dealer without
10-4 being registered <a license> as a cash dealer.
10-5 SECTION 15. Section 103.005, Agriculture Code, is amended to
10-6 read as follows:
10-7 Sec. 103.005. Initiation of Claim. (a) A person who deals
10-8 with a license holder <commission merchant or retailer licensed>
10-9 under Chapter 101 or 102 of this code in the purchasing, handling,
10-10 selling, and accounting for sales of vegetables or citrus fruit and
10-11 who is aggrieved by an action of the license holder <commission
10-12 merchant or retailer> as a result of a violation of terms or
10-13 conditions of a contract made by the license holder for the sale of
10-14 Texas-grown produce <commission merchant or retailer> may initiate
10-15 a claim against the fund by filing with the department:
10-16 (1) a sworn complaint against the license holder
10-17 <commission merchant or retailer>; and
10-18 (2) a filing fee of $15.
10-19 (b) A complaint and the fee under Subsection (a) of this
10-20 section must be filed on or before the first anniversary of the
10-21 date of the violation, or recovery from the fund is barred.
10-22 SECTION 16. Section 103.0055, Agriculture Code, is amended
10-23 to read as follows:
10-24 Sec. 103.0055. Bankruptcy of Merchant or Retailer. For
10-25 purposes of this chapter, the amount due an aggrieved party by a
10-26 license holder <commission merchant or retailer> is not affected by
10-27 a final judgment of a bankruptcy court that releases the license
11-1 holder <commission merchant or retailer> from the legal duty to
11-2 satisfy the claim.
11-3 SECTION 17. Subsection (a), Section 103.006, Agriculture
11-4 Code, is amended to read as follows:
11-5 (a) After a claim is initiated, the department shall
11-6 investigate the complaint and determine the amount due the
11-7 aggrieved party. If the amount determined by the department is
11-8 disputed by the license holder <commission merchant or retailer> or
11-9 the aggrieved party, the board shall conduct a hearing on the claim
11-10 and determine the amount due the aggrieved party.
11-11 SECTION 18. Subsection (a), Section 103.007, Agriculture
11-12 Code, is amended to read as follows:
11-13 (a) If the amount determined by the department's
11-14 investigation to be due the aggrieved party is not disputed by the
11-15 license holder <commission merchant or retailer> or the aggrieved
11-16 party, the department shall pay the claim within the limits
11-17 prescribed by this chapter.
11-18 SECTION 19. Section 103.008, Agriculture Code, is amended by
11-19 amending Subsections (a), (b), (c), and (d) and adding Subsection
11-20 (f) to read as follows:
11-21 (a) In making payments from the fund the department can <may
11-22 not> pay the aggrieved party all of the first $1,000 of any claim
11-23 and no more than 60 percent of the <any> claim above <for more
11-24 than> $1,000.
11-25 (b) The total payment of all claims arising from the same
11-26 contract with a license holder <transaction> may not exceed
11-27 $20,000.
12-1 (c) The total payment of claims against a single license
12-2 holder <commission merchant or retailer> may not exceed $50,000 in
12-3 any one calendar year.
12-4 (d) The department may not pay a claim against:
12-5 (1) a person <commission merchant or retailer> who was
12-6 not licensed on the date the contract <at the time of the
12-7 transaction> on which the claim is based was entered into; or
12-8 (2) a cash dealer licensed under Chapter 101 or 102 of
12-9 this code.
12-10 (f) If a license holder owes money to the produce recovery
12-11 fund at the time the license holder makes a claim against the fund,
12-12 the department shall offset the amount owed to the fund from the
12-13 amount dispensed.
12-14 SECTION 20. Subsections (a), (c), and (d), Section 103.009,
12-15 Agriculture Code, are amended to read as follows:
12-16 (a) If the department pays a claim against a license holder
12-17 <commission merchant or retailer>, the license holder <commission
12-18 merchant or retailer> shall:
12-19 (1) reimburse the fund immediately or agree in writing
12-20 to reimburse the fund on a schedule to be determined by rule of the
12-21 department; and
12-22 (2) immediately pay the aggrieved party any amount due
12-23 that party or agree in writing to pay the aggrieved party on a
12-24 schedule to be determined by rule of the department.
12-25 (c) If the license holder <commission merchant or retailer>
12-26 does not reimburse the fund or pay the aggrieved party, or does not
12-27 agree to do so, in accordance with this section, the department
13-1 shall issue an order canceling the license <of the commission
13-2 merchant or retailer> and may not issue a new license to that
13-3 person for four years from the date of cancellation. If the
13-4 license holder <commission merchant or retailer> is a corporation,
13-5 an officer or director of the corporation or a person owning more
13-6 than 25 percent of the stock in the corporation may not be licensed
13-7 <as a commission merchant or retailer> under Chapter 101 or 102 of
13-8 this code during the four-year period in which the corporation is
13-9 ineligible for licensing.
13-10 (d) This section does not apply to a license holder
13-11 <commission merchant or retailer> who is released by a final
13-12 judgment of a bankruptcy court from the legal duty to satisfy the
13-13 claim paid by the department.
13-14 SECTION 21. Section 103.010, Agriculture Code, is amended to
13-15 read as follows:
13-16 Sec. 103.010. SUBROGATION OF RIGHTS. If the department pays
13-17 a claim against a license holder <commission merchant or retailer>,
13-18 the department is subrogated to all rights of the aggrieved party
13-19 against the license holder <commission merchant or retailer> to the
13-20 extent of the amount paid to the aggrieved party.
13-21 SECTION 22. Section 103.011, Agriculture Code, is amended to
13-22 read as follows:
13-23 Sec. 103.011. Fee. (a) Except as otherwise provided by
13-24 this section, a license holder <commission merchant or retailer>
13-25 licensed under Chapter 101 or 102 of this code shall pay an annual
13-26 fee to the fund of $200.
13-27 (b) <A retailer who is licensed under Chapter 101 or 102 of
14-1 this code and whose annual purchases of vegetables and citrus fruit
14-2 are less than $15,000 a year shall pay an annual fee of $50.>
14-3 <(c) A person who is required by Subsection (a) of this
14-4 section to pay a fee of $200 and who is licensed in one of those
14-5 classifications under both Chapters 101 and 102 of this code may
14-6 pay a single fee of $250. A person who is required by Subsection
14-7 (b) of this section to pay a $50 fee and who is licensed in that
14-8 classification under both Chapters 101 and 102 of this code may pay
14-9 a single fee of $75.>
14-10 <(d)> A person registered <licensed> as a cash dealer or a
14-11 marketing association organized under Chapter 52 of this code that
14-12 handles citrus fruit only for its members is exempt from payment of
14-13 the fee under this section.
14-14 (c) <(e)> The fee is in addition to any licensing fee paid
14-15 and is due at the time of making the license application. The
14-16 department may not issue a license to a person who fails to pay the
14-17 fee.
14-18 SECTION 23. Subsection (a), Section 103.013, Agriculture
14-19 Code, is amended to read as follows:
14-20 (a) A person commits an offense if the person acts or
14-21 assumes to act as a license holder <commission merchant or
14-22 retailer> under Chapter 101 or 102 of this code without first
14-23 paying the fee required by this chapter.
14-24 SECTION 24. A license, registration, or identification card
14-25 that is issued under Chapters 101 and 102, Agriculture Code, and
14-26 that is valid on the effective date of this Act remains valid until
14-27 it expires or is revoked or suspended.
15-1 SECTION 25. This Act takes effect September 1, 1995.
15-2 SECTION 26. The importance of this legislation and the
15-3 crowded condition of the calendars in both houses create an
15-4 emergency and an imperative public necessity that the
15-5 constitutional rule requiring bills to be read on three several
15-6 days in each house be suspended, and this rule is hereby suspended.