Tennessee Public Grain Warehouse Surety Bond
The State of Tennessee Department of Agriculture, Division of Consumer and Industry Services, oversees the licensing of Public Grain Warehouses, grain dealers, commercial feed, incidental grain dealer, seed dealer, agriculture liming materials and registering of commercial fertilizer distributors. The Tennessee Code Annotated Title 43 Chapter 32 Section 101 Tennessee Commodity Dealer and Warehouse Law, defines the licensure and surety bond requirements for a public grain dealer.
Surety Bond and License Requirements:
1,000,000 bushel capacity ___ x .20 = ___1,000,000 bushel capacity ___x .15 = ___Over 2,000,000 bushel capacity ___ x .10 = ___Total a).________ Dollar amount of grain purchased from producers in last 12 months $___ x 10% = b.) ____ (Round up to the nearest $1,000, Minimum is $20,000 maximum is $100,000)Dollar amount of grain purchased & priced later, deferred price, or payment delayed (payment made more than 30 days from delivery= $______x 80% =c.) ______ (Round up to the nearest $1,000 minimum (if any) $1,000 & maximum $400,000)Bond amount is the higher of: a., or b. + c. or $500,000Instead of a surety bond, a certificate of deposit or irrevocable letter of credit of a value equal to the bond may be deposited with the state.
- Complete the public grain warehouse application and pay the applicable fee.
- Obtain fire and extended insurance in the amount to be determined by the commissioner.
- Obtain a minimum $20,000 surety bond or an amount determined by the commissioner. Surety bonds will never exceed $500,000 annually. The surety bond requirement may be waived if the business minimum net worth must be three times or more than the required surety bond amount set by the commissioner. A compiled financial statement for Class 2 or Reviewed financials statement for Class 1 is required for the waiver.
- The formula to determine the bond amount is as follows:
How Much Will a Tennessee Public Grain Warehouse Bond Cost?
The premium that you pay for a Tennessee Public Grain Warehouse Surety Bond is dependent on credit and the bond amount required. For bond amounts over $50,000, business and personal financial statements will be required.
Did You Know?
Accounts, books, papers and records can be audited by the Tennessee Department of Agriculture during any normal business hours.
Related Links:Tennessee Commodity Dealer and Warehouse LawTennessee Feed, Seed, Fertilzer and Grain Forms
More Surety Bond Questions?
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