Chapter 126

VEGETABLE CONTRACTORS

Subch. VI of ch. 126 Cross-reference Cross-reference: See also ch. ATCP 101, Wis. adm. code.

126.55 126.55 Definitions. In this subchapter:

126.55(1) (1) “Cash on delivery” means cash payment of the full agreed price for processing vegetables at the time of delivery or, if the vegetables are graded, within 72 hours after the time of delivery.

126.55(2) (2) “Cash payment” means payment in any of the following forms:

126.55(2)(a) (a) Currency.

126.55(2)(b) (b) A cashier’s check, or a check that a bank issues and certifies.

126.55(2)(c) (c) A wire transfer.

126.55(2)(d) (d) Simultaneous barter.

126.55(3) (3) “Contract obligation” means the net amount, whether paid or unpaid, that a vegetable contractor owes a vegetable producer or producer agent under a vegetable procurement contract. “Contract obligation” includes a net amount owed for unharvested acreage.

126.55(4) (4) “Contributing vegetable contractor” means a vegetable contractor who is licensed under s. 126.56 (1), who either has paid one or more quarterly installments under s. 126.60 (6) or is required to contribute to the fund, but the first quarterly installment under s. 126.60 (6) is not yet due, who has not elected not to participate in the fund under s. 126.595 (1), and who is not disqualified under s. 126.59 (2).

126.55(6) (6) “Current ratio” means the ratio of the value of current assets to the value of current liabilities, calculated according to s. 126.58 (6) (c) 1.

126.55(7) (7) “Debt to equity ratio” means the ratio of the value of liabilities to equity, calculated according to s. 126.58 (6) (c) 2.

126.55(8) (8) “Deferred payment contract” means a vegetable procurement contract in which the vegetable producer or a producer agent agrees to accept payment after January 31 for processing vegetables harvested during the previous calendar year.

126.55(9) (9) “Disqualified vegetable contractor” means a vegetable contractor who is disqualified from the fund under s. 126.59 (2).

126.55(10) (10) “Food processing” has the meaning given in s. 97.29 (1) (g).

126.55(10m) (10m) “License year” means the period beginning on February 1 and ending on the following January 31.

126.55(10r) (10r) “Processing potato buyer” means a vegetable contractor who purchases processing potatoes and no other processing vegetables.

126.55(10t) (10t) “Processing potatoes” means potatoes grown or sold for use in food processing, regardless of whether those potatoes are actually harvested or processed as food.

126.55(11) (11) “Processing vegetables” means vegetables grown or sold for use in food processing, regardless of whether those vegetables are actually harvested or processed as food. “Processing vegetables” includes sweet corn grown or sold for use in food processing, but does not include grain.

126.55(12) (12) “Producer agent” means a person who, without taking title to vegetables, acts on behalf of a vegetable producer to market or accept payment for processing vegetables that the vegetable producer grows in this state. “Producer agent” does not include any of the following:

126.55(12)(a) (a) A person who merely brokers a contract between a vegetable producer and a vegetable contractor, without becoming a party to the contract or accepting payment on behalf of the vegetable producer.

126.55(12)(b) (b) A person who merely holds or transports processing vegetables for a vegetable producer, without marketing the vegetables or accepting payment on behalf of the vegetable producer.

126.55(13) (13) “Time of delivery” under a vegetable procurement contract means the time at which one of the following occurs:

126.55(13)(a) (a) The vegetable contractor harvests the vegetables.

126.55(13)(b) (b) The vegetable producer delivers harvested vegetables to the custody or control of the vegetable contractor.

126.55(13)(c) (c) The vegetable contractor notifies the vegetable producer of the vegetable contractor’s refusal to harvest or accept delivery of vegetables.

126.55(14) (14) “Vegetable contractor” means a person who does any of the following:

126.55(14)(a) (a) Contracts with a vegetable producer or a producer agent to procure processing vegetables that a vegetable producer grows in this state.

126.55(14)(b) (b) Contracts with a vegetable producer to market, as a producer agent, processing vegetables that the vegetable producer grows in this state.

126.55(15) (15) “Vegetable procurement contract” means an oral or written agreement under which a vegetable contractor does any of the following:

126.55(15)(a) (a) Contracts with a vegetable producer or a producer agent to procure processing vegetables that a vegetable producer grows in this state.

126.55(15)(b) (b) Contracts with a vegetable producer to market, as a producer agent, processing vegetables that the vegetable producer grows in this state.

126.55(16) (16) “Vegetable producer” means a person who grows processing vegetables in this state.

126.55(17) (17) “Unharvested acreage” means land on which vegetables are grown, under a vegetable procurement contract, that a vegetable contractor leaves unharvested for any reason. “Unharvested acreage” includes all of the following:

126.55(17)(a) (a) Land on which the vegetables are suitable for processing, but are not harvested.

126.55(17)(b) (b) Land on which the vegetables are abandoned as being unsuitable for processing.

126.55 History History: 2001 a. 16; 2005 a. 80.

126.56 126.56 Vegetable contractors; licensing.

126.56(1) (1) License required.

126.56(1)(a) (a) Except as provided in sub. (2), no person may operate as a vegetable contractor without a current annual license from the department.

126.56(1)(b) (b) A license under par. (a) expires on the January 31 following its issuance. No person may transfer or assign a license issued under par. (a).

126.56(2) (2) Exempt contractors. The following vegetable contractors are exempt from licensing under sub. (1):

126.56(2)(a) (a) A vegetable contractor who procures vegetables primarily for unprocessed, fresh market use and is licensed under the federal Perishable Agricultural Commodities Act, 7 USC 499a to 499t.

126.56(2)(b) (b) A restaurant or other retail food establishment that procures processing vegetables solely for retail sale at the restaurant or other retail food establishment.

126.56(2)(c) (c) A vegetable contractor who spends less than $15,000 per license year to procure processing vegetables from vegetable producers and producer agents.

126.56(3) (3) License application. A vegetable contractor shall apply for a license under sub. (1) in writing, on a form provided by the department. The applicant shall provide all of the following:

126.56(3)(a) (a) The applicant’s legal name and any trade name under which the applicant proposes to operate as a vegetable contractor.

126.56(3)(b) (b) A statement of whether the applicant is an individual, a corporation, a partnership, a cooperative, an unincorporated cooperative association, a limited liability company, a trust, or other legal entity. If the applicant is a corporation, a cooperative, or an association, the application shall identify each officer of the corporation or cooperative. If the applicant is a partnership, the application shall identify each partner.

126.56(3)(c) (c) The mailing address of the applicant’s principal business location and the name of a responsible individual who may be contacted at that address.

126.56(3)(d) (d) The street address of each business location from which the applicant operates as a vegetable contractor in this state and the name of a responsible individual who may be contacted at each location that is staffed.

126.56(3)(e) (e) All license fees and surcharges required under sub. (4).

126.56(3)(g) (g) A financial statement if required under s. 126.58 (1) and not yet filed.

126.56(3)(h) (h) Other relevant information required by the department.

126.56(4) (4) License fees and surcharges. A vegetable contractor applying for a license under sub. (1) shall pay the following fees and surcharges in amounts that the department specifies by rule:

126.56(4)(a) (a) A nonrefundable basic license fee.

126.56(4)(b) (b) A fee based on the amount of contract obligations reported under sub. (9) (a), less any credit provided under sub. (6), except that this paragraph does not apply to a vegetable contractor to whom par. (f) applies.

126.56(4)(c) (c) A license surcharge if the department determines that, within 365 days before submitting the license application, the applicant operated as a vegetable contractor 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 the license year in which the applicant violated sub. (1).

126.56(4)(d) (d) A license surcharge if during the preceding 12 months the applicant failed to file an annual financial statement required under s. 126.58 (1) (b) by the applicable deadline.

126.56(4)(e) (e) A license surcharge if a renewal applicant fails to renew a license by the license expiration date of January 31.

126.56(4)(f) (f) A fee if the vegetable contractor is a processing potato buyer who has elected not to participate in the fund in accordance with s. 126.595 (1).

126.56(4m) (4m) Effect of payment of surcharge. Payment of a license surcharge under sub. (4) (c) 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.

126.56(5) (5) License for part of year; fees. A person who applies for an annual vegetable contractor license after the beginning of a license year shall pay the full annual fee amounts required under sub. (4).

126.56(6) (6) Fee credits.

126.56(6)(a) (a) If the balance in the fund contributed by vegetable contractors exceeds $825,000 on November 30 of any license year, the department shall credit 50 percent of the excess amount against fees charged under sub. (4) (b) to contributing vegetable contractors who file timely license renewal applications for the next license year. The department shall credit each contributing vegetable contractor on a prorated basis, in proportion to the total fees that the vegetable contractor has paid under sub. (4) (b) for the 4 preceding license years.

126.56(6)(b) (b) The fee under sub. (4) (b) is reduced by one cent for each $100 in contract obligations reported under sub. (9) (a) if the department, under a contract with the applicant, grades all of the graded vegetables that the applicant procures from vegetable producers or producer agents.

126.56(7) (7) Fee statement. The department shall provide, with each license application form, a written statement of all license fees and surcharges required under sub. (4). The department shall specify any fee credits for which the applicant may qualify under sub. (6).

126.56(8) (8) 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. (7). 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.

126.56(9) (9) Applicant statement. As part of a license application under sub. (3), an applicant shall provide a statement, signed by the applicant or an officer of the applicant, that reports all of the following:

126.56(9)(a) (a) The total amount of contract obligations that the applicant incurred during the applicant’s last completed fiscal year. If the applicant has not yet operated as a vegetable contractor, the applicant shall estimate the amount of contract obligations that the applicant will incur during the applicant’s first complete fiscal year.

126.56(9)(am) (am) The amount of contract obligations under par. (a) less any amount under par. (i) 2.

126.56(9)(b) (b) The largest amount of unpaid contract obligations that the vegetable contractor had at any time during the vegetable contractor’s last completed fiscal year.

126.56(9)(c) (c) The amount of unpaid contract obligations that the vegetable contractor has at the time of application.

126.56(9)(d) (d) The amount of unpaid contract obligations under par. (c) that are due for payment before the license year for which the applicant is applying.

126.56(9)(e) (e) The amount of unpaid obligations under par. (c) that the contractor has under deferred payment contracts.

126.56(9)(f) (f) Whether the applicant and the applicant’s affiliates and subsidiaries will collectively grow more than 10 percent of the total acreage of any vegetable species grown or procured by the applicant during the license year for which the applicant is applying.

126.56(9)(g) (g) Whether the applicant will pay cash on delivery under all vegetable procurement contracts during the license year for which the applicant is applying.

126.56(9)(h) (h) Whether the applicant is a producer-owned cooperative or unincorporated cooperative association or organization that procures vegetables solely from its producer owners on the basis of a cooperative marketing method under which the producer-owned cooperative, unincorporated cooperative association, or organization pays its producer owners a prorated share of sales proceeds for the marketing year after a final accounting and the deduction of marketing expenses.

126.56(9)(i) (i) All of the following information related to each vegetable producer or producer agent that under s. 126.70 (1) (b) has permanently waived eligibility to file a default claim against the applicant:

126.56(9)(i)1. 1. A copy of the written waiver that the vegetable producer or producer agent filed under s. 126.70 (1) (c).

126.56(9)(i)2. 2. The total amount of contract obligations that the applicant incurred during the applicant’s last completed fiscal year under vegetable procurement contracts with that vegetable producer or producer agent. If the applicant has not yet operated as a vegetable contractor, the applicant shall estimate the total amount of contract obligations that the applicant will incur during the applicant’s first complete fiscal year under vegetable procurement contracts with that vegetable producer or producer agent.

126.56(10) (10) Action granting or denying application.

126.56(10)(a) (a) The department shall grant or deny a license application under sub. (3) within 30 days after the department receives a complete application. If the department denies a license application, the department shall give the applicant a written notice stating the reasons for the denial.

126.56(10)(b) (b) A license becomes invalid after February 5 of the license year for which it is issued unless the license holder has by February 5 paid all producer obligations that were due and payable during the preceding license year.

126.56(11) (11) License displayed. A vegetable contractor licensed under sub. (1) shall prominently display a copy of that license at each business location from which the vegetable contractor operates in this state.

126.56(12) (12) Monthly reports. A vegetable contractor who files security under s. 126.61 shall provide a monthly report to the department showing the highest amount of the vegetable contractor’s unpaid contract obligations at any time during the preceding month and the total amount of unpaid contract obligations under deferred payment contracts.

126.56 History History: 2001 a. 16; 2005 a. 80, 441; 2009 a. 296; 2015 a. 55; 2017 a. 155.

126.57 126.57 Vegetable contractors; insurance.

126.57(1) (1) Fire and extended coverage insurance.