Chapter 126

126.40 History History: 2001 a. 16; 2009 a. 296; 2017 a. 155, ss. 20 to 22, 47 to 49.

126.41 126.41 Milk contractors; licensing.

126.41(1) (1) Annual license.

126.41(1)(a) (a) No milk contractor may do any of the following without a current annual license from the department:

126.41(1)(a)1. 1. Receive producer milk in this state.

126.41(1)(a)2. 2. Collect producer milk from a dairy farm in another state for direct shipment to a dairy plant that the milk contractor operates in this state.

126.41(1)(a)3. 3. Acquire the right to market, as a producer agent, producer milk produced in this state.

126.41(1)(b) (b) A milk contractor who is not engaged in any activities under par. (a) may volunteer to be licensed if the milk contractor receives, outside this state, direct shipments of producer milk from dairy farms in this state.

126.41(1)(c) (c) The department shall issue annual milk contractor licenses under pars. (a) and (b). A license expires on the April 30 following its issuance. No person may transfer or assign a license issued under par. (a) or (b).

126.41(2) (2) License application. A milk contractor shall apply for a license under sub. (1) in writing, on a form provided by the department. An applicant shall provide all of the following:

126.41(2)(a) (a) The applicant’s legal name and any trade name under which the applicant proposes to operate as a milk contractor. If the milk contractor is a dairy plant operator licensed under s. 97.20, the milk contractor shall use the same legal name in both license applications.

126.41(2)(b) (b) A statement of whether the applicant is an individual, a corporation, partnership, cooperative, unincorporated cooperative association, limited liability company, trust, or other legal entity. If the applicant is a corporation, a cooperative, or an association, the applicant shall identify each officer of the corporation or cooperative. If the applicant is a partnership, the applicant shall identify each partner.

126.41(2)(c) (c) The mailing address of the applicant’s primary business location and the name of a responsible individual who may be contacted at that location.

126.41(2)(d) (d) The street address of each business location from which the applicant will operate under the license and the name of a responsible person who may be contacted at each location that is staffed.

126.41(2)(e) (e) All license fees and surcharges required under sub. (3).

126.41(2)(g) (g) A financial statement if required under s. 126.44 (1) and not yet filed.

126.41(2)(h) (h) Other relevant information required by the department.

126.41(3) (3) Annual license fees and surcharges. A milk contractor applying for an annual license under sub. (1) shall include the following fees and surcharges with the license application, unless the department specifies a different fee or surcharge amount by rule:

126.41(3)(a) (a) A nonrefundable basic license fee of $25.

126.41(3)(b) (b) A license surcharge of $500 if the department determines that, within 365 days before submitting the license application, the applicant operated without a license in violation of sub. (1). The applicant shall also pay any license fees, license surcharges, and fund assessments that are still due for any license year in which the applicant violated sub. (1).

126.41(3)(c) (c) A license surcharge of $100 if during the preceding 12 months the applicant failed to file an annual financial statement required under s. 126.44 (1) (b) by the applicable deadline.

126.41(3)(d) (d) A license surcharge of $100 if a renewal applicant fails to renew a license by the license expiration date of April 30.

126.41(3m) (3m) Effect of payment of surcharge. Payment under sub. (3) (b) does not relieve the applicant of any other civil or criminal liability that results from the violation of sub. (1), but does not constitute evidence of any law violation.

126.41(4) (4) Fee statement. The department shall provide, with each license application form, a written statement of all license fees and surcharges required under sub. (3).

126.41(5) (5) No license without full payment. The department may not issue a license under sub. (1) until the applicant pays all license fees and surcharges identified in the department’s statement under sub. (4). The department shall refund a fee or surcharge paid under protest if upon review the department determines that the fee or surcharge is not applicable.

126.41(6) (6) Applicant statement. As part of a license application under sub. (2), an applicant shall provide a statement, signed by the applicant or an authorized officer of the applicant, that reports all of the following information:

126.41(6)(a) (a) The total milk payroll obligations that the applicant incurred during the applicant’s last completed fiscal year, less the total amount reported under par. (br) 3., if any. If the applicant has not yet operated as a milk contractor in this state, the applicant shall estimate the total milk payroll obligations that the applicant will incur during the applicant’s first complete fiscal year, less the total amount reported under par. (br) 3., if any.

126.41(6)(ag) (ag) The amount of payments under par. (a) made under deferred payment contracts.

126.41(6)(ar) (ar) Whether the applicant has had any obligations under deferred payment contracts, for milk procured in this state, at any time since the beginning of the applicant’s last completed fiscal year.

126.41(6)(b) (b) Either of the following amounts:

126.41(6)(b)1. 1. The highest amount of unpaid milk payroll obligations that the applicant had at any time during the applicant’s last completed fiscal year.

126.41(6)(b)2. 2. The highest amount of milk payroll obligations that the applicant incurred in any single month during the applicant’s last completed fiscal year.

126.41(6)(bg) (bg) The total amount in hundredweight of producer milk that the applicant procured in this state during the applicant’s last completed fiscal year, less the total amount reported under par. (br) 2., if any. If the applicant has not yet operated as a milk contractor in this state, the applicant shall estimate the total amount in hundredweight of producer milk that the applicant will procure in this state during the applicant’s first complete fiscal year, less the total amount reported under par. (br) 2., if any.

126.41(6)(br) (br) All of the following information related to each milk producer or producer agent that under s. 126.70 (1) (b) has permanently waived eligibility to file a default claim against the applicant:

126.41(6)(br)1. 1. A copy of the written waiver that the milk producer or producer agent filed under s. 126.70 (1) (c).

126.41(6)(br)2. 2. The total amount in hundredweight of producer milk that the applicant procured in this state from that milk producer or producer agent during the applicant’s last completed fiscal year. If the applicant has not yet operated as a milk contractor in this state, the applicant shall estimate the total amount in hundredweight of producer milk that the applicant will procure in this state from that milk producer or producer agent during the applicant’s first complete fiscal year.

126.41(6)(br)3. 3. The total milk payroll obligations that the applicant incurred during the applicant’s last completed fiscal year for producer milk that the applicant procured from that milk producer or producer agent. If the applicant has not yet operated as a milk contractor in this state, the applicant shall estimate the total milk payroll obligations that the applicant will incur during the applicant’s first complete fiscal year for producer milk that the applicant will procure from that milk producer or producer agent.

126.41(6)(br)4. 4. The amount of payments under subd. 3. made under deferred payment contracts.

126.41(6)(c) (c) The identity of any producer agents from whom the milk contractor procures producer milk.

126.41(6)(d) (d) Other relevant information required by the department.

126.41(7) (7) Action granting or denying application. The department shall grant or deny a license application under sub. (2) within 30 days after the department receives a complete application. If the department denies a license application, the department shall give the applicant written notice stating the reasons for the denial.

126.41(8) (8) License displayed. A milk contractor licensed under sub. (1) shall prominently display a true copy of that license at each business location from which the milk contractor operates in this state.

126.41 History History: 2001 a. 16; 2005 a. 441; 2009 a. 296; 2017 a. 155.

126.42 126.42 Milk contractors; monthly license fee.

126.42(1) (1) Monthly license fee payment. Except as provided under sub. (5) or (6), a milk contractor licensed under s. 126.41 (1) shall pay to the department, by the 25th day of each month, a monthly license fee of 0.15 cent for each 100 pounds of producer milk that the milk contractor procured in this state during the preceding month. The milk contractor shall submit, with the fee payment, a report stating the number of pounds of producer milk that the milk contractor procured in this state during the preceding month.

126.42(2) (2) Late payment surcharge. If a milk contractor fails to pay a monthly fee under sub. (1) when due, the milk contractor shall pay, in addition to that monthly fee, a surcharge equal to 20 percent of the monthly fee. The milk contractor shall pay the surcharge by the 25th day of the following month.

126.42(3) (3) Fee credits. If the balance in the fund contributed by milk contractors exceeds $4,000,000 on February 28 of any license year, the department shall credit 50 percent of the excess amount against fees charged under sub. (1) to contributing milk contractors who file timely renewal applications for the next license year. The department shall credit each contributing milk contractor on a prorated basis, in proportion to the total fees that the milk contractor has paid under sub. (1) for the 4 preceding license years. Each month that a contributing contractor who qualifies for a credit under this subsection pays fees under sub. (1), the department shall credit to the contributing milk contractor one-twelfth of the total annual credit determined under this subsection.

126.42(4) (4) Fee statement. Whenever the department issues an annual license to a milk contractor under s. 126.41 (1), the department shall give the milk contractor notice of the monthly fees required under this section. The department shall specify all of the following:

126.42(4)(a) (a) The method for computing the monthly fee.

126.42(4)(b) (b) The date by which the milk contractor must pay the fee each month.

126.42(4)(c) (c) The late payment surcharge that may apply under sub. (2).

126.42(4)(d) (d) The fee credit, if any, that applies under sub. (3).

126.42(5) (5) Producer agents; exemption. A producer agent is not required to pay the monthly fee under sub. (1) for producer milk that the producer agent markets to a milk contractor who is licensed under s. 126.41 (1) and who pays the monthly fee on the same milk.

126.42(6) (6) Fee changes. The department may modify the license fees under sub. (1) by rule.

126.42 History History: 2001 a. 16; 2009 a. 296.

126.43 126.43 Milk contractors; insurance.

126.43(1) (1) Fire and extended coverage insurance. A milk contractor licensed under s. 126.41 (1) shall maintain fire and extended coverage insurance that covers, at their full value, all milk and milk products in the possession, custody, or control of the milk contractor. If the milk contractor is required to be licensed under s. 126.41 (1) (a), the milk contractor shall maintain insurance issued by an insurance company authorized to do business in this state.

126.43(2) (2) Insurance cancellation; replacement. Whenever an insurance policy under sub. (1) is canceled, the milk contractor shall replace the policy so that there is no lapse in coverage.

126.43(3) (3) Insurance coverage; misrepresentation. No milk contractor may misrepresent any of the following to the department or to any milk producer or producer agent:

126.43(3)(a) (a) That the milk contractor is insured.

126.43(3)(b) (b) The nature, coverage, or material terms of the milk contractor’s insurance policy.

126.43 History History: 2001 a. 16.

126.44 126.44 Milk contractors; financial statements.

126.44(1) (1) Required annual financial statement.

126.44(1)(a) (a) A milk contractor shall file an annual financial statement with the department, before the department first licenses the milk contractor under s. 126.41 (1), if the milk contractor’s license application shows any of the following:

126.44(1)(a)1. 1. That the amount of producer milk reported under s. 126.41 (6) (bg) exceeds 150,000 hundredweight.

126.44(1)(a)2. 2. Any deferred payment contract obligations under s. 126.41 (6) (ar) to a milk producer or producer agent that has not, under s. 126.70 (1) (b), permanently waived eligibility to file a default claim against the milk contractor.

126.44(1)(b) (b) Except as provided in par. (d), a milk contractor licensed under s. 126.41 (1) shall file an annual financial statement with the department during each license year if the milk contractor’s license application for that year shows any of the following:

126.44(1)(b)1. 1. That the amount of producer milk reported under s. 126.41 (6) (bg) exceeds 150,000 hundredweight and the milk contractor is not a contributing milk contractor who procures milk in this state solely as a producer agent.

126.44(1)(b)2. 2. Any deferred payment contract obligations under s. 126.41 (6) (ar) to a milk producer or producer agent that has not, under s. 126.70 (1) (b), permanently waived eligibility to file a default claim against the milk contractor.

126.44(1)(cm) (cm) A milk contractor shall file an annual financial statement under par. (b) by the 15th day of the 4th month following the close of the milk contractor’s fiscal year. The department may extend the filing deadline for up to 30 days if the milk contractor, or the accountant preparing the financial statement, files a written extension request at least 10 days before the filing deadline.

126.44(1)(d) (d) Rather than filing an annual financial statement under par. (b), a milk contractor who is disqualified under s. 126.45 (3) (a) may file, during each fiscal year, a compilation of financial information that is satisfactory to the department. The milk contractor shall file the financial information by the 15th day of the 4th month following the close of the milk contractor’s fiscal year. The department may extend the filing deadline for up to 30 days if the milk contractor, or an accountant preparing the financial information, files a written extension request at least 10 days before the filing deadline.

126.44(1)(e) (e)

126.44(1)(e)1. 1. Except as provided in subd. 2., a milk contractor licensed under s. 126.41 may not incur any obligations under a deferred payment contract for milk procured in this state unless the contractor first notifies the department and files an annual financial statement with the department.

126.44(1)(e)2. 2. A milk contractor licensed under s. 126.41 is not required to notify the department or file an annual financial statement with the department under subd. 1. for an obligation incurred under a deferred payment contract, for milk procured in this state, with a milk producer or producer agent that has, under s. 126.70 (1) (b), permanently waived eligibility to file a default claim against the milk contractor.

126.44(2) (2) Voluntary annual financial statement. A milk contractor licensed under s. 126.41 (1) who is not required to file a financial statement under sub. (1) may file an annual financial statement with the department for any of the following reasons:

126.44(2)(a) (a) To avoid being required to contribute to the fund under s. 126.45 (1) (a).

126.44(2)(b) (b) To qualify for a lower fund assessment under s. 126.46.

126.44(3) (3) Quarterly financial statements. A milk contractor licensed under s. 126.41 (1) who is not a contributing milk contractor shall file quarterly financial statements with the department for the first 3 quarters in each of the milk contractor’s fiscal years. The milk contractor shall file each quarterly financial statement no later than 60 days after the end of the fiscal quarter to which the financial statement pertains.

126.44(5) (5) Reviewed or audited financial statement. A milk contractor filing a financial statement under sub. (1) or (2) may file either a reviewed financial statement or an audited financial statement, except that if the milk contractor reports more than 2,500,000 hundredweight of milk under s. 126.41 (6) (bg), the milk contractor shall file an audited financial statement.

126.44(6) (6) Accounting period. A milk contractor filing an annual financial statement under sub. (1) or (2) shall file a financial statement that covers the milk contractor’s last completed fiscal year unless the milk contractor has been in business for less than one year.

126.44(6m) (6m) Interim financial statement. The department may, at any time, require a milk contractor licensed under s. 126.41 (1) to file an interim financial statement with the department. An interim financial statement need not be a reviewed financial statement or an audited financial statement.

126.44(7) (7) Generally accepted accounting principles.

126.44(7)(a) (a) Except as provided in par. (b), a milk contractor filing an annual financial statement under this section shall file a financial statement that is prepared according to generally accepted accounting principles.

126.44(7)(b) (b) If a milk contractor is a sole proprietor and the milk contractor’s financial statement is not audited, the milk contractor shall file a financial statement that is prepared on a historical cost basis.

126.44(8) (8) Financial statement contents.

126.44(8)(a) (a) Except as provided in par. (b), a milk contractor filing a financial statement under this section shall file a financial statement that consists of a balance sheet, income statement, equity statement, statement of cash flows, notes to those statements, and any other information required by the department. If the milk contractor is a sole proprietor, the milk contractor shall file his or her business and personal financial statements.

126.44(8)(b) (b) If a milk contractor has been in business for less than one year, the milk contractor may file an annual financial statement under sub. (1) or (2) consisting of a balance sheet and notes. A milk contractor may file a quarterly financial statement under sub. (3) consisting of a balance sheet and income statement.

126.44(8)(c) (c) A milk contractor filing a financial statement under this section shall include in the financial statement, or in an attachment to the financial statement, calculations of all of the following: