1-1 By: Bivins S.B. No. 251
1-2 (In the Senate - Filed January 17, 1995; January 18, 1995,
1-3 read first time and referred to Committee on Natural Resources;
1-4 March 7, 1995, reported adversely, with favorable Committee
1-5 Substitute by the following vote: Yeas 10, Nays 0; March 7, 1995,
1-6 sent to printer.)
1-7 COMMITTEE SUBSTITUTE FOR S.B. No. 251 By: Bivins
1-8 A BILL TO BE ENTITLED
1-9 AN ACT
1-10 relating to the handling and marketing of citrus fruits and
1-11 vegetables and to the produce recovery fund.
1-12 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
1-13 SECTION 1. Section 101.002, Agriculture Code, is amended by
1-14 amending Subsection (a) to read as follows:
1-15 (a) This chapter applies to vegetables, whether or not
1-16 packed in ice or held in cold storage<,> but only if grown in this
1-17 state, and does not apply to vegetables that have been manufactured
1-18 into an article of food of a different kind or character.
1-19 SECTION 2. Section 101.003, Agriculture Code, is amended by
1-20 adding Subsection (c) to read as follows:
1-21 (c) A person who holds a license under this section is also
1-22 considered, without paying an additional fee, to hold a license or
1-23 be registered under Section 102.003 of this code.
1-24 SECTION 3. Section 101.004, Agriculture Code, is amended to
1-25 read as follows:
1-26 Sec. 101.004. License Categories. (a) A person who is
1-27 required by Section 101.003 of this code to be licensed or
1-28 registered shall apply to the department for the appropriate
1-29 <licensing in the> category described by this section that is
1-30 appropriate to the actions of the person.
1-31 (b) A person shall apply for a license <licensing as a
1-32 commission merchant> if the person:
1-33 (1) purchases vegetables on credit;
1-34 (2) takes possession of vegetables for consignment or
1-35 handling on behalf of the producer or owner of the vegetables; or
1-36 (3) takes possession of vegetables for consignment or
1-37 handling in a manner or under a contract that does not require or
1-38 result in payment to the producer, seller, or consignor of the full
1-39 amount of the purchase price in United States currency at the time
1-40 of delivery or at the time that the vegetables pass from the
1-41 producer, seller, or consignor to the person.
1-42 (c) A person shall register <apply for licensing> as a cash
1-43 dealer if the person purchases vegetables and pays for the
1-44 vegetables in United States currency before or at the time of
1-45 delivery or taking possession.
1-46 <(d) A person shall apply for licensing as a retailer if the
1-47 person:>
1-48 <(1) has annual sales of vegetables and citrus fruit
1-49 that comprise 75 percent or more of the retailer's total sales; or>
1-50 <(2) employs a buying agent who buys directly from a
1-51 producer.>
1-52 SECTION 4. Subsection (a), Section 101.005, Agriculture
1-53 Code, is amended to read as follows:
1-54 (a) A person required under Section 101.003 of this code to
1-55 be licensed or registered shall apply <for a license> to the
1-56 department on a form furnished by the department. The application
1-57 must be made under oath and contain the following information:
1-58 (1) the full name of the applicant and whether the
1-59 applicant is an individual, partnership, corporation, exchange, or
1-60 association;
1-61 (2) the full name and address of the principal
1-62 business office of the applicant;
1-63 (3) the address of the applicant's principal business
1-64 office in this state;
1-65 (4) if the applicant is a foreign corporation, the
1-66 state in which the corporation is chartered and the name and
1-67 address of an agent in this state for service of legal process; and
1-68 (5) the length of time that the applicant has been
2-1 engaged in business in this state<; and>
2-2 <(6) the category of license for which the applicant
2-3 is applying>.
2-4 SECTION 5. Section 101.006, Agriculture Code, is amended to
2-5 read as follows:
2-6 Sec. 101.006. <LICENSE> FEE. (a) Except as otherwise
2-7 provided by this section, a person applying for a license shall
2-8 include with the license application a license fee of $75.
2-9 (b) The registration <license> fee for a cash dealer is $25.
2-10 <(c) Except as otherwise provided by this section, a person
2-11 who applies for a license as a commission merchant or retailer
2-12 under both this chapter and Chapter 102 of this code is entitled to
2-13 pay a single license fee of $75. The person's license shall
2-14 reflect that the person is licensed to handle both citrus fruit and
2-15 vegetables.>
2-16 <(d) A person who applies for a license under Subsection (b)
2-17 of this section and Subsection (b) of Section 102.006 of this code
2-18 is entitled to pay a single license fee of $25. The person's
2-19 license shall reflect that the person is licensed to handle both
2-20 citrus fruit and vegetables.>
2-21 SECTION 6. Subsections (a) and (b), Section 101.010,
2-22 Agriculture Code, are amended to read as follows:
2-23 (a) In accordance with the rules of the department, a
2-24 license holder <person licensed as a commission merchant or
2-25 retailer> may apply to the department for a reasonable number of
2-26 identification cards for:
2-27 (1) transporting agents to act for the license holder
2-28 <licensee> in the transporting of vegetables; and
2-29 (2) buying agents to act for the license holder
2-30 <licensee> in any act requiring licensing under Section 101.003 of
2-31 this code.
2-32 (b) The department may collect a fee not to exceed $5 for
2-33 each card and shall issue transporting agent cards in a color
2-34 different from buying agent cards.
2-35 SECTION 7. Subsection (a), Section 101.020, Agriculture
2-36 Code, is amended to read as follows:
2-37 (a) A person commits an offense if the person:
2-38 (1) acts in violation of Section 101.003 of this code
2-39 by not <without first> obtaining a license or registration or after
2-40 receiving notice of cancellation of a license or registration;
2-41 (2) <acts or assumes to act as a commission merchant
2-42 without first obtaining a license as a commission merchant;>
2-43 <(3)> acts or assumes to act as a transporting agent
2-44 or buying agent without first obtaining an identification card;
2-45 (3) <(4)> as a transporting agent or buying agent,
2-46 fails and refuses to turn over to the department an identification
2-47 card in accordance with Section 101.010(e) of this code;
2-48 (4) <(5)> as a license holder <licensee>, fails to
2-49 furnish information under Section 101.017 of this code before the
2-50 11th day following the date of demand;
2-51 (5) <(6)> as a license holder <licensee>, fails to
2-52 settle with a producer or seller on the grade and quality of
2-53 vegetables in the manner provided by Section 101.015 of this code;
2-54 (6) <(7)> as a cash dealer, pays for vegetables by a
2-55 means other than United States currency;
2-56 (7) <(8)> as a license holder <licensee>, transporting
2-57 agent, or buying agent, violates a provision of this chapter; or
2-58 (8) <(9) acts or assumes to act as a retailer without
2-59 first obtaining a license as a retailer; or>
2-60 <(10)> acts or assumes to act as a cash dealer without
2-61 first registering <obtaining a license> as a cash dealer.
2-62 SECTION 8. Section 102.003, Agriculture Code, is amended by
2-63 adding Subsection (c) to read as follows:
2-64 (c) A person who holds a license or is registered under this
2-65 section is also considered, without paying an additional fee, to
2-66 hold a license or be registered under Section 101.003 of this code.
2-67 SECTION 9. Section 102.004, Agriculture Code, is amended to
2-68 read as follows:
2-69 Sec. 102.004. License Categories. (a) A person who is
2-70 required by Section 102.003 of this code to be licensed or
3-1 registered shall apply to the department for the appropriate
3-2 <licensing in the> category described by this section that is
3-3 appropriate to the actions of the person.
3-4 (b) A person shall apply for a license <licensing as a
3-5 commission merchant> if the person:
3-6 (1) purchases citrus fruit on credit;
3-7 (2) takes possession of citrus fruit for consignment
3-8 or handling on behalf of the producer or owner of the fruit; or
3-9 (3) takes possession of citrus fruit for consignment
3-10 or handling in a manner or under a contract that does not require
3-11 or result in payment to the producer, seller, or consignor of the
3-12 full amount of the purchase price in United States currency at the
3-13 time of delivery or at the time the citrus fruit passes from the
3-14 producer or seller to the person.
3-15 (c) A person shall register <apply for licensing> as a cash
3-16 dealer if the person purchases citrus fruit and pays for the citrus
3-17 fruit in United States currency before or at the time of delivery
3-18 or taking possession.
3-19 <(d) A person shall apply for licensing as a retailer if the
3-20 person:>
3-21 <(1) has annual sales of citrus fruit and vegetables
3-22 that comprise 75 percent or more of the retailer's total sales; or>
3-23 <(2) employs a buying agent who buys directly from a
3-24 producer.>
3-25 SECTION 10. Subsection (a), Section 102.005, Agriculture
3-26 Code, is amended to read as follows:
3-27 (a) A person required under Section 102.003 of this code to
3-28 be licensed or registered shall apply for a license or registration
3-29 to the department on a form furnished by the department. The
3-30 application must be made under oath and contain the following
3-31 information:
3-32 (1) the full name of the applicant and whether the
3-33 applicant is an individual, partnership, corporation, exchange, or
3-34 association;
3-35 (2) the full name and address of the principal
3-36 business office of the applicant;
3-37 (3) the address of the applicant's principal business
3-38 office in this state;
3-39 (4) if the applicant is a foreign corporation, the
3-40 state in which the corporation is chartered and the name and
3-41 address of an agent in this state for service of legal process; and
3-42 (5) <the category of license for which the applicant
3-43 is applying; and>
3-44 <(6)> the length of time that the applicant has been
3-45 engaged in business in this state.
3-46 SECTION 11. Section 102.006, Agriculture Code, is amended to
3-47 read as follows:
3-48 Sec. 102.006. <LICENSE> FEE. (a) Except as otherwise
3-49 provided by this section, a person applying for a license shall
3-50 include with the license application a license fee of $75.
3-51 (b) The registration <license> fee for a cash dealer is $25.
3-52 <(c) Except as otherwise provided by this section, a person
3-53 who applies for a license as a commission merchant or retailer
3-54 under both this chapter and Chapter 101 of this code is entitled to
3-55 pay a single license fee of $75. The person's license shall
3-56 reflect that the person is licensed to handle both citrus fruit and
3-57 vegetables.>
3-58 <(d) A person who applies for a license under Subsection (b)
3-59 of this section and Subsection (b) of Section 101.006 of this code
3-60 is entitled to pay a single license fee of $25. The person's
3-61 license shall reflect that the person is licensed to handle both
3-62 citrus fruit and vegetables.>
3-63 SECTION 12. Subsections (a) and (b), Section 102.010,
3-64 Agriculture Code, are amended to read as follows:
3-65 (a) In accordance with the rules of the department, a
3-66 license holder <person licensed as a commission merchant or
3-67 retailer> may apply to the department for a reasonable number of
3-68 identification cards for:
3-69 (1) transporting agents to act for the license holder
3-70 <licensee> in the transporting of citrus fruits; and
4-1 (2) buying agents to act for the license holder
4-2 <licensee> in any act requiring licensing under Section 102.003 of
4-3 this code.
4-4 (b) The department may collect a fee not to exceed $1 for
4-5 each card and shall issue transporting agent cards in a color
4-6 different from buying agent cards.
4-7 SECTION 13. Section 102.016, Agriculture Code, is amended to
4-8 read as follows:
4-9 Sec. 102.016. BUYING BY WEIGHT. A licensee who buys citrus
4-10 fruit by weight shall weigh the fruit on state-registered <state
4-11 tested> scales.
4-12 SECTION 14. Subsection (a), Section 102.021, Agriculture
4-13 Code, is amended to read as follows:
4-14 (a) A person commits an offense if the person:
4-15 (1) acts in violation of Section 102.003 of this code
4-16 by not obtaining <without> a license or after receiving notice of
4-17 cancellation of a license;
4-18 (2) <acts or assumes to act as a commission merchant
4-19 without a license as a commission merchant;>
4-20 <(3)> acts or assumes to act as a transporting agent
4-21 or buying agent without an identification card or after receiving
4-22 notice of cancellation of an identification card;
4-23 (3) <(4)> as a transporting agent or buying agent,
4-24 fails and refuses to turn over to the department an identification
4-25 card in accordance with Section 102.010(e) of this code;
4-26 (4) <(5)> as a license holder <licensee>, fails to
4-27 furnish information under Section 102.018 of this code before the
4-28 11th day following the date of demand;
4-29 (5) <(6)> as a license holder <licensee>, buys citrus
4-30 fruit by weight and does not have the fruit weighed on
4-31 state-registered <state-tested> scales;
4-32 (6) <(7)> as a license holder <licensee>, fails to
4-33 settle with a producer or seller on the grade and quality of citrus
4-34 fruit in the manner provided by Section 102.015 of this code;
4-35 (7) <(8)> as a cash dealer, pays for citrus fruit by a
4-36 means other than United States currency;
4-37 (8) <(9)> fails to maintain records required by
4-38 Section 102.017(b) of this code;
4-39 (9) <(10)> as a license holder <licensee>,
4-40 transporting agent, or buying agent, violates a provision of this
4-41 subchapter; or
4-42 (10) <(11) acts or assumes to act as a retailer
4-43 without a license as a retailer; or>
4-44 <(12)> acts or assumes to act as a cash dealer without
4-45 being registered <a license> as a cash dealer.
4-46 SECTION 15. Section 103.005, Agriculture Code, is amended to
4-47 read as follows:
4-48 Sec. 103.005. Initiation of Claim. (a) A person who deals
4-49 with a license holder <commission merchant or retailer licensed>
4-50 under Chapter 101 or 102 of this code in the purchasing, handling,
4-51 selling, and accounting for sales of vegetables or citrus fruit and
4-52 who is aggrieved by an action of the license holder <commission
4-53 merchant or retailer> as a result of a violation of terms or
4-54 conditions of a contract made by the license holder for the sale of
4-55 Texas-grown produce <commission merchant or retailer> may initiate
4-56 a claim against the fund by filing with the department:
4-57 (1) a sworn complaint against the license holder
4-58 <commission merchant or retailer>; and
4-59 (2) a filing fee of $15.
4-60 (b) A complaint and the fee under Subsection (a) of this
4-61 section must be filed on or before the first anniversary of the
4-62 date of the violation, or recovery from the fund is barred.
4-63 SECTION 16. Section 103.0055, Agriculture Code, is amended
4-64 to read as follows:
4-65 Sec. 103.0055. Bankruptcy of Merchant or Retailer. For
4-66 purposes of this chapter, the amount due an aggrieved party by a
4-67 license holder <commission merchant or retailer> is not affected by
4-68 a final judgment of a bankruptcy court that releases the license
4-69 holder <commission merchant or retailer> from the legal duty to
4-70 satisfy the claim.
5-1 SECTION 17. Subsection (a), Section 103.006, Agriculture
5-2 Code, is amended to read as follows:
5-3 (a) After a claim is initiated, the department shall
5-4 investigate the complaint and determine the amount due the
5-5 aggrieved party. If the amount determined by the department is
5-6 disputed by the license holder <commission merchant or retailer> or
5-7 the aggrieved party, the board shall conduct a hearing on the claim
5-8 and determine the amount due the aggrieved party.
5-9 SECTION 18. Subsection (a), Section 103.007, Agriculture
5-10 Code, is amended to read as follows:
5-11 (a) If the amount determined by the department's
5-12 investigation to be due the aggrieved party is not disputed by the
5-13 license holder <commission merchant or retailer> or the aggrieved
5-14 party, the department shall pay the claim within the limits
5-15 prescribed by this chapter.
5-16 SECTION 19. Section 103.008, Agriculture Code, is amended by
5-17 amending Subsections (a), (b), (c), and (d) and adding Subsection
5-18 (f) to read as follows:
5-19 (a) In making payments from the fund the department can <may
5-20 not> pay the aggrieved party all of the first $1,000 of any claim
5-21 and no more than 60 percent of the <any> claim above <for more
5-22 than> $1,000.
5-23 (b) The total payment of all claims arising from the same
5-24 contract with a license holder <transaction> may not exceed
5-25 $20,000.
5-26 (c) The total payment of claims against a single license
5-27 holder <commission merchant or retailer> may not exceed $50,000 in
5-28 any one calendar year.
5-29 (d) The department may not pay a claim against:
5-30 (1) a person <commission merchant or retailer> who was
5-31 not licensed on the date the contract <at the time of the
5-32 transaction> on which the claim is based was entered into; or
5-33 (2) a cash dealer licensed under Chapter 101 or 102 of
5-34 this code.
5-35 (f) If a license holder owes money to the produce recovery
5-36 fund at the time the license holder makes a claim against the fund,
5-37 the department shall offset the amount owed to the fund from the
5-38 amount dispensed.
5-39 SECTION 20. Subsections (a), (c), and (d), Section 103.009,
5-40 Agriculture Code, are amended to read as follows:
5-41 (a) If the department pays a claim against a license holder
5-42 <commission merchant or retailer>, the license holder <commission
5-43 merchant or retailer> shall:
5-44 (1) reimburse the fund immediately or agree in writing
5-45 to reimburse the fund on a schedule to be determined by rule of the
5-46 department; and
5-47 (2) immediately pay the aggrieved party any amount due
5-48 that party or agree in writing to pay the aggrieved party on a
5-49 schedule to be determined by rule of the department.
5-50 (c) If the license holder <commission merchant or retailer>
5-51 does not reimburse the fund or pay the aggrieved party, or does not
5-52 agree to do so, in accordance with this section, the department
5-53 shall issue an order canceling the license <of the commission
5-54 merchant or retailer> and may not issue a new license to that
5-55 person for four years from the date of cancellation. If the
5-56 license holder <commission merchant or retailer> is a corporation,
5-57 an officer or director of the corporation or a person owning more
5-58 than 25 percent of the stock in the corporation may not be licensed
5-59 <as a commission merchant or retailer> under Chapter 101 or 102 of
5-60 this code during the four-year period in which the corporation is
5-61 ineligible for licensing.
5-62 (d) This section does not apply to a license holder
5-63 <commission merchant or retailer> who is released by a final
5-64 judgment of a bankruptcy court from the legal duty to satisfy the
5-65 claim paid by the department.
5-66 SECTION 21. Section 103.010, Agriculture Code, is amended to
5-67 read as follows:
5-68 Sec. 103.010. SUBROGATION OF RIGHTS. If the department pays
5-69 a claim against a license holder <commission merchant or retailer>,
5-70 the department is subrogated to all rights of the aggrieved party
6-1 against the license holder <commission merchant or retailer> to the
6-2 extent of the amount paid to the aggrieved party.
6-3 SECTION 22. Section 103.011, Agriculture Code, is amended to
6-4 read as follows:
6-5 Sec. 103.011. Fee. (a) Except as otherwise provided by
6-6 this section, a license holder <commission merchant or retailer>
6-7 licensed under Chapter 101 or 102 of this code shall pay an annual
6-8 fee to the fund of $200.
6-9 (b) <A retailer who is licensed under Chapter 101 or 102 of
6-10 this code and whose annual purchases of vegetables and citrus fruit
6-11 are less than $15,000 a year shall pay an annual fee of $50.>
6-12 <(c) A person who is required by Subsection (a) of this
6-13 section to pay a fee of $200 and who is licensed in one of those
6-14 classifications under both Chapters 101 and 102 of this code may
6-15 pay a single fee of $250. A person who is required by Subsection
6-16 (b) of this section to pay a $50 fee and who is licensed in that
6-17 classification under both Chapters 101 and 102 of this code may pay
6-18 a single fee of $75.>
6-19 <(d)> A person registered <licensed> as a cash dealer or a
6-20 marketing association organized under Chapter 52 of this code that
6-21 handles citrus fruit only for its members is exempt from payment of
6-22 the fee under this section.
6-23 (c) <(e)> The fee is in addition to any licensing fee paid
6-24 and is due at the time of making the license application. The
6-25 department may not issue a license to a person who fails to pay the
6-26 fee.
6-27 SECTION 23. Subsection (a), Section 103.013, Agriculture
6-28 Code, is amended to read as follows:
6-29 (a) A person commits an offense if the person acts or
6-30 assumes to act as a license holder <commission merchant or
6-31 retailer> under Chapter 101 or 102 of this code without first
6-32 paying the fee required by this chapter.
6-33 SECTION 24. A license, registration, or identification card
6-34 that is issued under Chapters 101 and 102, Agriculture Code, and
6-35 that is valid on the effective date of this Act remains valid until
6-36 it expires or is revoked or suspended.
6-37 SECTION 25. This Act takes effect September 1, 1995.
6-38 SECTION 26. The importance of this legislation and the
6-39 crowded condition of the calendars in both houses create an
6-40 emergency and an imperative public necessity that the
6-41 constitutional rule requiring bills to be read on three several
6-42 days in each house be suspended, and this rule is hereby suspended.
6-43 * * * * *