101ST GENERAL ASSEMBLY
State of Illinois
2019 and 2020
SB3438

 

Introduced 2/14/2020, by Sen. Scott M. Bennett

 

SYNOPSIS AS INTRODUCED:
 
225 ILCS 645/16  from Ch. 111, par. 416

    Amends the Illinois Livestock Dealer Licensing Act. Provides that the form and amount of the surety bond posted by a livestock dealer prior to licensing under the Act shall be prescribed by the Packers and Stockyards Administration of the United States Department of Agriculture. Deletes current provisions related to the form and amount of the surety bond posted by a livestock dealer prior to licensing under the Act.


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A BILL FOR

 

SB3438LRB101 20396 JWD 69945 b

1    AN ACT concerning regulation.
 
2    Be it enacted by the People of the State of Illinois,
3represented in the General Assembly:
 
4    Section 5. The Illinois Livestock Dealer Licensing Act is
5amended by changing Section 16 as follows:
 
6    (225 ILCS 645/16)  (from Ch. 111, par. 416)
7    Sec. 16. Prior to the issuance of a license, as a livestock
8dealer, each applicant therefor shall file a surety bond with
9the Department, conditioned on his performance of all duties
10required by law of a livestock dealer. The form of such bond
11shall be prescribed by the Packers and Stockyards
12Administration of the United States Department of Agriculture
13Department. The bond shall specifically provide that the
14livestock dealer shall pay when due, to the person or persons
15entitled thereto, the purchase price of all livestock purchased
16by the livestock dealer. The surety on any such bond shall be a
17surety company authorized to do business within the State of
18Illinois. The amount of such bond shall be equal to the
19requirements of the bonding requirements of the Packers and
20Stockyards Administration of the United States Department of
21Agriculture. not less than the nearest multiple of $2,000 above
22the average amount of livestock purchases by such livestock
23dealer for 3 business days, based on the total number of

 

 

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1business days, and the total amount of such sales and purchases
2in the preceding 12 months, or in such part thereof in which
3such livestock dealer did business, if any. For the purpose of
4this computation, 260 days shall be deemed the number of
5business days in the year. However, the amount of the bond
6shall not be less than $6,000, and when the bond requirements
7exceed $50,000 calculated on the livestock purchases as
8hereinbefore specified, the amount of the bond need not exceed
9$50,000 plus 15% of the excess. Whenever there has been a
10change in the gross amount of business transacted during the
1112-month period prior to the renewal of any license which would
12warrant an increase or decrease in the amount of bond coverage
13required under this Act, the livestock dealer shall have his
14bond adjusted accordingly upon receipt of notice to that
15effect. A blanket bond based upon the gross amount of business
16transacted on an annual basis for each enterprise operated
17under the same ownership may be furnished by licensees in lieu
18of individual bonds for each enterprise operated if they so
19desire. Such bond shall be continuous in nature and shall
20provide that it may not be cancelled without 30 days written
21notice of termination to the Department prior to the effective
22date of such termination. In cases where a livestock dealer
23under this Act has a bond on file with the United States
24Department of Agriculture, Packers and Stockyards,
25Agricultural Marketing Service, or any successor agency, and
26such bond is in an amount and conditioned upon such terms so as

 

 

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1to meet the requirements of this Act, separate bond coverage
2under this Act is not required. In any case where an applicant
3has sufficient bond posted with the United States Department of
4Agriculture, Packers and Stockyards, Agricultural Marketing
5Service, or any successor agency, to satisfy the provisions of
6this Act, a duplicate original of such bond shall be furnished
7to the Department and such bond shall replace the State bond as
8if it were the State bond.
9    In lieu of filing such bond, the livestock dealer may
10deliver to the Department the receipt of a duly authorized
11bank, savings and loan association or trust company in this
12State showing the deposit with the bank, savings and loan
13association or trust company of cash or of securities endorsed
14in blank by the owner thereof and of a market value equal at
15least to the required principal amount of such bond, such cash
16or securities to be deposited in escrow under agreement
17conditioned as in the case of such bond. Such trust fund
18agreement shall be on forms prescribed by the Department. An
19action for recovery against any such deposit may be brought in
20the same manner as in the case of an action for recovery on a
21bond filed hereunder. Any such receipt shall further be
22accompanied by evidence that there are no unsatisfied judgments
23against the livestock dealer of record in the county where the
24livestock dealer resides.
25    Any livestock dealer required to maintain a surety bond
26under this Act may elect to maintain, in whole or partial

 

 

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1substitution for such surety bond, one or more irrevocable
2letters of credit on which a trustee is authorized to draw
3funds subject to a trust agreement. The amount of such letters
4of credit, surety bond, trust fund agreement, or combination
5thereof, must be the total amount of the surety bond otherwise
6required under this Act. Such letters of credit and trust
7agreements shall be on forms prescribed by the Department. Any
8letter of credit must be issued for a period of not less than
9one year. The Director shall be trustee on any such trust
10agreement. An action for recovery against this trust agreement
11with related letter of credit may be brought in the same manner
12as in case of an action for recovery on a bond filed hereunder.
13This letter of credit with trust agreement may be terminated by
14any party to the agreement by providing the Department with
15written notice of such termination of at least 30 days prior to
16the effective date of termination. In any case when a livestock
17dealer has elected to maintain one or more irrevocable letters
18of credit with related trust agreements, in order to fulfill
19the bonding requirements of the Packers and Stockyards
20Administration, United States Department of Agriculture, or
21any successor agency, such letters of credit with trust
22agreements shall satisfy the provisions of this Act, and such
23letters of credit with trust agreements shall replace the State
24letters of credit with trust agreements as if they were the
25State letters of credit with trust agreements.
26    Whenever the Director has reason to believe that any bond,

 

 

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1or bond substitute, filed or maintained under this Act is
2inadequate to secure the performance of the obligations of the
3livestock dealer covered by such bond, he shall notify the
4livestock dealer to adjust such bond to meet the requirements
5of this Section, or, if such bond is inadequate because of the
6volume of business conducted on a seasonal or otherwise
7irregular basis, to meet such requirements as may be determined
8by the Director to be reasonable based upon such seasonal or
9irregular operation.
10(Source: P.A. 87-160.)