2005 Idaho Code - 69-503 — LICENSE REQUIREMENTS -- FINANCIAL RESPONSIBILITY

                                  TITLE  69
                                  WAREHOUSES
                                  CHAPTER 5
                             COMMODITY DEALER LAW
    69-503.  LICENSE REQUIREMENTS -- FINANCIAL RESPONSIBILITY. (1) A person
shall not engage in the business of a commodity dealer in this state without
having obtained a license issued by the department.
    (2)  The type of license required shall be determined as follows:
    (a)  A class 1 license is required if the commodity dealer purchases
    agricultural commodities by credit-sale contract or if the value of the
    agricultural commodities purchased by the commodity dealer from producers
    during the previous twelve (12) month period exceeds two hundred and fifty
    thousand dollars ($250,000), or if the value of the agricultural
    commodities expected to be purchased by the commodity dealer from the
    producers during the succeeding twelve (12) month period will exceed two
    hundred and fifty thousand dollars ($250,000). Any other commodity dealer
    may elect to be licensed as a class 1 commodity dealer.
    (b)  A class 2 license is required for any commodity dealer if the value
    of the agricultural commodities purchased by the commodity dealer from
    producers during the previous twelve (12) month period exceeds ten
    thousand dollars ($10,000) and is less than two hundred and fifty thousand
    dollars ($250,000), and if the value of the agricultural commodities
    expected to be purchased by the commodity dealer from producers during the
    succeeding twelve (12) month period will be more than ten thousand dollars
    ($10,000) but less than two hundred and fifty thousand dollars ($250,000).
    A class 2 licensee whose purchases from producers exceed two hundred and
    fifty thousand dollars ($250,000) in value during any twelve (12) month
    [period] shall immediately apply for a class 1 license. If a class 1
    license is denied, the person shall immediately cease doing business as a
    commodity dealer.
    (3)  An application for a license to engage in business as a commodity
dealer shall be filed with the department and shall be on a form prescribed by
the department. A separate license is required for each location at which
records are maintained for transactions of the commodity dealer.
    (4)  A license application shall include the following:
    (a)  The name of the applicant;
    (b)  The names of the officers and directors if the applicant is a
    corporation;
    (c)  The names of the partners if the applicant is a partnership;
    (d)  The location of the principal place of business; and
    (e)  Any other reasonable information the department finds necessary to
    carry out the provisions and purposes of this chapter.
    (5)  A license applicant shall further provide a sufficient and valid bond
as specified in section 69-506, Idaho Code.
    (6)  A license applicant shall further provide a complete financial
statement setting forth the applicant's assets, liabilities and net worth.
This financial statement shall be prepared by an independent certified public
accountant or a licensed public accountant according to generally accepted
accounting principles. The commodity dealer shall have and maintain current
assets equal to or greater than current liabilities. Assets shall be shown at
original cost less depreciation. Upon written request filed with the
department, the director may allow asset valuations in accordance with a
competent appraisal.
    (7)  In order to receive and retain a commodity dealer's license the
following additional conditions must be satisfied:
    (a)  For a class 1 license a commodity dealer shall have and maintain a
    net worth of at least fifty thousand dollars ($50,000) or maintain a bond
    in the amount of two thousand dollars ($2,000) for each one thousand
    dollars ($1,000) or fraction thereof of net worth deficiency; however, a
    person shall not be licensed as a class 1 commodity dealer if the person
    has a net worth of less than twenty-five thousand dollars ($25,000). A
    bond submitted for purposes of this subsection shall be in addition to any
    bond otherwise required under the provisions of this chapter.
    (b)  For a class 2 license a commodity dealer shall have and maintain a
    net worth of at least twenty-five thousand dollars ($25,000) or maintain a
    bond in the amount of two thousand dollars ($2,000) for each one thousand
    dollars ($1,000) or fraction thereof of net worth deficiency; however, a
    person shall not be licensed as a class 2 commodity dealer if the person
    has a net worth of less than ten thousand dollars ($10,000). A bond
    submitted for purposes of this subsection shall be in addition to any bond
    otherwise required under the provisions of this chapter.
    (8)  The department may require additional information or verification
regarding the financial resources of the applicant and the applicant's ability
to pay producers for agricultural commodities purchased from them.