An Act To Amend the Potato Industry Licensing Laws
Maine Legislature, Session 122, LD 1572
Committee: Agriculture, Conservation and Forestry
Sponsors: LUNDEEN, MARTIN, SHERMAN, CLUKEY
Amends: 7 MRSA §1015, 7 MRSA §1017, 7 MRSA §1025, 7 MRSA §1026, 7 MRSA §1028

Legislative Document 
No. 1572 
H.P.111O 
House of Representatives, April 13, 2005 
An Act To Amend the Potato Industry Licensing Laws 
Submitted by the Department of Agriculture, Food and Rural Resources pursuant to Joint 
Rule 204. 
Reference to the Committee on Agriculture, Conservation and Forestry suggested and 
ordered printed. 
Presented by Representative LUNDEEN of Mars Hill. 
Cosponsored by Senator MARTIN of Aroostook and 
!rJ~ 
/J7. 7lldC~{ 
MILLICENT M. MacFARLAND 
Clerk 
Representative: SHERMAN of Hodgdon, Senator: CLUKEY of Aroostook. 
Printed on recycled paper 
Be it enacted by the People of the State of Maine as follows: 
Sec. 1. 7 MRSA §1015, as amended by PL 2003, c. 344, Pt. D, 
§l, is further amended to read: 
§l015. Application and renewal for license 
The applicant shall file an application for a license or 
renewal of a license on forms as prescribed and furnished by the 
commissioner, 
which must contain the full name of the person 
applying for the license and, if the applicant is a corporation, 
partnership, 
association, 
exchange 
or 
legal 
representative, 
officer, 
director, 
partner 
or 
member 
of 
a 
corporation, 
partnership, 
association 
or 
exchange, 
all 
such 
names 
and 
posi tions. If the applicant is a foreign corporation, it shall 
certify that it is authorized to transact business in the State 
under former Title 13-11., chapter 12 or Title 13-C, chapter 15, 
and further state the principal business address of the applicant 
in the State or elsewhere, the address of all places of business 
in the State, and the name or names of the person or persons 
authorized to receive and accept service of lawful process upon 
the applicant within the State. All questions required to be 
answered in the application for licenses must be sworn to, and 
intentionally untruthful answers constitute the crime of perjury. 
Upon 
receipt 
of 
such 
applications, 
the 
commissioner 
immediately shall cause notice of the applications to be provided 
in 
a 
manner 
consistent 
with 
the 
provisions 
of 
the 
Maine 
Administrative Procedure Act as to adjudicatory proceedings and 
shall, in any case, cause a copy of the notice to be served upon 
the Maine Potato Board. 
Any interested person has 
days in 
which to file comments as to the applicant's qualifications, to 
request 
a 
hearing or to file 
a 
verified complaint with the 
commissioner as provided by this Article. 
This applicant shall satisfy the commissioner of his ~ 
applicant's character, financial responsibility and good faith in 
seeking to engage in the business. The commissioner shall, after 
notice and opportunity for 
a 
hearing has been provided in a 
manner consistent with the Maine Administrative Procedure Act as 
to adjudicatory proceedings, issue a license to s~eh gn applicant 
if 
he 
the 
commissioner 
is 
satisfied as 
to 
the 
applicant's 
qualifications, such license entitling the applicant to act in 
the capacity described in the license for a period of one year 
from the date of issuance ~he~eeE. Ne A license shall may not be 
granted to any applicant if such person or officer, director, 
partner, or member thereof, has been convicted in any state or 
federal court of any felony within 5 years of the date of the 
application. 
Page l-LR0545(1) 
In order to insure the licensee's financial responsibility 
and 
to 
protect 
potato 
and 
rotation 
crop 
producers, 
the 
commissioner shall require the licensee to file a 
bond ~ 
prerequisite to the issuance of a license. 
The bond must be in a 
form and amount satisfactory to the commissioner, but not less 
than $50,000 nor more than $300,000 in the case of dealers and 
brokers engaged in buying or selling either potatoes or rotation 
crops, but not both, not less than $50,000 nor more than $400,000 
in the case of dealers and brokers engaged in buying and selling 
both potatoes and rotation crops, or not less than $100,000 nor 
more than $500,000 in the case of processors, payable to the 
commissioner 
in 
the 
commissioner's 
official 
capacity 
and 
conditioned on the full and prompt payment for all potatoes or 
rotation crops received or purchased from producers or other 
licensees during the effective period of the license. In the case 
of processors, the amount of bond required must be based on the 
licensee's anticipated monthly volume of purchases, but may be 
adjusted 
to 
reflect 
other 
federal 
escrow 
accounts 
or 
bond 
requirements met by the licensee that satisfy the purposes of 
this section. 
Each license saall I!ll.!.§..t. plainly state the name and business 
address or addresses of the licensee and saall I!ll.!.§..t. be posted in 
a 
conspicuous 
place 
in 
each 
office 
where 
the 
business 
is 
transacted. The 
i5i~ial fee for each license saall-ee-$8Q is $100 
annually. 
Such license saall m.a,y be 
ali~ema~ieally renewed for 
successive periods of one year each upon payment of the renewal 
fee waiea--&fl.a.l-l--be--$8Q and the submission of proof of financial 
responsibility. 
A license or license renewal issued expires on 
the 
30th day of 
June 
following 
the date of 
issuance. 
The 
department is not required to provide notice and opportunity for 
a hearing as provided in the Maine Administratiye Procedure Act 
for 
license 
renewals. 
If 
the 
licensee desires 
to carryon 
business' in more than one place within the State, ae the licensee 
shall procure additional copies of the license, certified by the 
commissioner, 
for 
each 
place 
where 
the 
business 
is 
to 
be 
conducted. The fee for each such additional certification saall 
ee--$~Q is $100. 
In the event a person required to be licensed 
under this section fails to renew that person's license or submit 
the 
annual 
proof of financial responsibility, 
the department 
shall promptly provide notice to members of the potato producing 
industry through the Maine 
Potato 
Board 
and 
an agricultural 
bargaining council. 
All fees collected under this Article saall I!ll.!.§..t. be paid 
~e~~awi~a to 
the 
Treasurer 
of 
State 
and 
credited 
to 
the 
Department of Agriculture, 
Food 
and Rural 
Resources 
for 
the 
administration of this Article and other expenses incident to the 
administration of saie the department, and saall must be expended 
by the saie commissioner for the purposes for which saie .th.e. 
department is created. If any of such fees are not expended 
during the year in which they are collected, 
the unexpended 
balance saall M~ not lapse, but saall ~ 
be carried as a 
continuing account and available for the purposes specified until 
expended. 
Sec. 2. 7 MRSA §1017, sub-§l, as amended by PL 1997, c. 606, 
§10 and PL 1999, c. 547, Pt. 
B, 
§78 and affected by §80, is 
further amended to read: 
1. 
Acts enumerated. 
The commissioner or the commissioner's 
duly authorized agent may refuse to grant or renew a licenseT 
a'~e~-~~-~-eppe~~~Bi~y--~~-~-~ea~4~~--i&-~~~-~~-a 
maBBe~-~~~4~~e~~-~~~-.a&-MaiBe-A~£4~~~a~4~~~~~-~.-as 
~e--a4}~Qiea~eFY--~F&&&&QiR~ST upon 
a 
finding that any of the 
following acts have existed within 2 years of the date of the 
filing of an application for license: 
A. 
That fraudulent charges or returns have been made by the 
applicant or licensee for the handling, sale or storage of 
potatoes or rotation crops, or for the rendering of any 
service in connection with the handling, sale or storage of 
potatoes or rotation crops; 
B. 
That the applicant or licensee has failed or refused to 
render a true account of sales, or to make a settlement 
thereon, within the time and in the manner required by this 
Article, or has failed or refused to pay for potatoes or 
rotation crops purchased by the applicant or licensee within 
calendar 
days 
after 
acceptance 
of 
the 
potatoes 
or 
rotation crops; 
C. 
That the applicant or licensee has knowingly made any 
false material statement as to the condition, quality or 
quanti ty of potatoes or rotation crops received, handled, 
sold, purchased or stored by the applicant or licensee; 
D. 
That the applicant or licensee directly or indirectly 
has 
purchased 
for 
that 
applicant's 
or 
licensee's 
own 
account, 
potatoes 
or 
rotation 
crops 
received 
by 
the 
applicant 
or 
licensee 
upon 
consignment 
without 
prior 
authorization from consignor together with price fixed by 
consignor or without promptly notifying the consignor of 
such purchase. 
This does not prevent any dealer, processor, 
broker, 
agent or retailer, 
in order to close the day's 
business, from taking into account in the record of sales 
miscellaneous lots or parcels of potatoes or rotation crops 
remaining unsold, if such dealer, processor, broker, agent 
or retailer on the business day next following properly 
enters 
any 
such 
transaction 
in 
that 
applicant's 
or 
licensee's accounts; 
E. 
That the applicant or licensee has made any substantial 
misrepresentation as to the conditions of the market for 
potatoes or rotation crops; 
F. 
That the applicant or licensee has made fictitious sales 
or has defrauded or attempted to defraud a producer; 
G. 
That a dealer, processor, broker, agent or retailer to 
whom 
any 
consignment 
is 
made 
has 
reconsigned 
such 
consignment to another dealer, processor, broker, agent or 
retailer and has received, 
collected or charged by such 
means more than one commission for making the sale therefor 
for the consignor without written consent of such consignor; 
H. 
That the licensee knowingly made any false material 
statements in the procurement of such license; 
I. 
That 
the 
applicant 
or 
promptly and properly to the 
claim settled or collected by 
such producer; 
licensee 
has 
not 
accounted 
producer with regard to any 
the applicant or licensee for 
J. 
That the applicant or licensee has failed or refused, 
upon 
demand, 
to 
permit 
the 
commissionel 
or 
the 
commissioner's 
agents 
to 
make 
the 
investigations, 
examinations or audits as provided in this Article or that 
the applicant or licensee has 
removed or sequestered any 
books, 
records 
or 
papers 
necessary 
to 
any 
such 
investigations, 
examinations or audits, 
or has 
otherwise 
obstructed the same; 
K. 
That the licensee has failed or refused to keep and 
maintain the records as required by this Article; 
L. 
That the applicant or licensee has committed any act or 
conduct with regard to the handling, 
sale or storage of 
potatoes or rotation crops whether of the same or different 
character 
than 
specified 
in 
this 
subsection, 
which 
constitutes 
or 
demonstrates 
bad 
faith, 
incompetency 
or 
untrustworthiness, 
or 
dishonest, 
fraudulent 
or 
improper 
dealings; at 
M. 
That the applicant or licensee has failed to deliver to 
the seller the confirmation required by section 1022 within 
the time specifiedTL-QI 
N. 
That the applicant or licensee has failed to maintain a 
bond to ensure financial 
responsibility to producers or 
other licensees as required under section 1015. 
The District Court may, in a manner consistent with the Maine 
Administrative Procedure Act, suspend or revoke a license upon 
finding any of the enumerated violations within 2 years of the 
date of the filing of a complaint. 
Sec. 3. 7 MRSA §1017, sub-§4, as amended by PL 1997, c. 606, 
§1l and PL 1999, c. 
547, Pt. 
B, 
§78 and affected by §80, is 
further amended to read: 
4. 
Notification of insufficient or no payment. Producers 
may 
notify 
the 
Department 
of 
Agriculture, 
Food 
and 
Rural 
Resources of insufficient or no payment for potatoes or rotation 
crops aeliveFea-te after acceptance by any processor in the State 
in violation of subsection 1, paragraph B. 
A. 
The 
Commissioner 
of 
Agriculture, 
Food 
and 
Rural 
Resources or the commissioner's agent, upon notification by 
producers of insufficient or no payment .... shall immediately 
investigate the complaint and shall, in a manner consistent 
with the provisions of the Maine Administrative Procedure 
Act as to adjudicatory proceedings, hold a hearing, unless 
such hearing is waived by the processor against whom the 
charge has been made. The processor accused of nonpayment 
shall provide the commissioner with a copy of the contract, 
if any, and all other materials and information to enable 
the 
commissioner 
to 
carry 
out 
the 
provlSlons 
of 
this 
section. Upon finding after investigation that the processor 
has 
violated 
the 
contract, 
express 
or 
implied, 
the 
commissioner may recover the proceeds of the bond required 
by section 1015 and apply those proceeds -against the amounts 
owed 
producers. 
In 
the 
event 
the 
bond 
proceeds 
are 
inadequate 
to 
cover 
the 
debts 
owed 
producers, 
the 
commissioner 
shall 
require 
the 
processor 
to 
post 
a 
an 
additional bond sufficient to cover the remaining debt owed 
to the producer or producers. 
(1) 
The commissioner may require the licensee, who has 
been 
accused 
or 
found 
guilty 
after 
a 
hearing 
of 
insufficient payment or 
nonpayment of debts 
owed 
a 
producer, to formulate a schedule of payments to the 
producer that is satisfactory to the commissioner. The 
schedule of payments may not exceed a 30-day period. 
(2) 
The licensee accused of or found by a hearing to 
be in default of payment to a producer shall submit a 
payment schedule to the commissioner wi thin one week 
from the commissioner's request for a payment schedule. 
In the event that 
the 
schedule of payment is not 
satisfactory 
to 
the 
commissioner, 
the 
commissioner 
shall establish the schedule of payment not to exceed a 
3~-day period. 
(3) 
The commissioner shall file a complaint with the 
District Court seeking to suspend the license of any 
licensee who fails to conform to the payment schedule 
established in this section until the producer is paid 
the total claim to which the producer is entitled. 
(4) 
Upon the filing of a complaint by the commissioner 
in the District Court, the licensee shall post a bond 
sufficient to cover the total claim owed the producer 
on the date on which the complaint is filed. The bond 
required for an appeal procedure may be waived by the 
District Court in the event that the bond required in 
paragraph A is valid and sufficient to cover the total 
claim owed the producer. 
(5) 
Nothing 
in this 
section 
may 
be 
construed 
to 
prohibit 
a 
producer 
from 
seeking 
redress 
for 
insufficient payment or nonpayment from licensees in 
any court or in accordance wi th any federal procedure 
established to obtain redress. 
Sec. 4. 7 MRSA §1025, as amended by PL 1977, c. 696, §358, is 
further amended to read: 
§1025. Forfeiture of bond; recovery on bond 
If any licensee 
saaJJ--~ail ~ 
to make such payment as 
provided 
in 
section 
1017, 
subsection 
1, 
paragraph 
B, 
such 
licensee, by reason of such nonpayment saall-Be is in default as 
to all producers or licensees whose accounts saall-t.aeR remain 
unpaid, and the bond provided for saall-ee is forfeited to the 
extent of all sums then due from such licensee to saie1 those 
producers or licensees, 
and by nature of 
such default, 
the 
conditions of such bond saall-Be are deemed to be broken, and any 
such producer or licensee may bring an action on the defaulted 
bond in the name of the commissioner for the benefit of saie1 the 
producer or licensee. 
A producer or 
a 
licensee bringing an 
action against the bond must provide the department with notice 
of intent to file a claim within 30 days of the payment due 
date. 
A formal verified complaint and supporting documentation 
must be filed with the department within 90 days of the payment 
due date. 
The right of a producer or a licensee to bring an action 
against the bond is subject to the department's right to apply 
the proceeds of the bond against the producer's or licensee's 
debts in accordance with section 1017. 
Sec. 5. 7 MRSA §1026, as repealed and replaced by PL 1977, c. 
696, §84, is amended to read: 
§1026. Enforcement 
The 
commissioner 
may 
recover 
the 
penalties 
imposed 
for 
violations 
of 
this 
Article 
and 
any 
rules 
and 
regulations 
promulgated thereunder in a 
civil action brought in ais the 
commissioner's 
own 
name, 
the venue to be 
as in other civil 
actions and, if ae the commissioner prevails in that action, ae 
the 
commissioner 
may 
recover full costs, 
including, 
but not 
limited 
to, 
attorney's 
fees. 
The 
commissioner 
saa~~--Be is 
entitled to 
aREi-~la-l-l--.£e€eive ~ assistance of the Attorney 
General and of the several district attorneys. 
Sec. 6. 7 MRSA §1028, as repealed and replaced by PL 1977, c. 
696, §86, is amended by adding at the end a new paragraph to read: 
Each day a violation under this section remains uncorrected 
may be counted as a separate offense. 
Penalties may be imposed 
for each violation. 
SUMMARY 
This 
bill 
amends 
the 
laws 
governing 
potato 
industry 
licensing 
and 
bonding 
to 
provide 
additional 
protection 
for 
producers and licensees in the event that a person required to be 
licensed under these laws becomes insolvent. 
The bill requires 
the submission of 
a 
bond as 
a 
prerequisite for obtaining a 
license; 
requires 
licensees 
to 
apply 
for 
a 
license 
renewal 
annually; 
establishes 
a 
June 
30th 
expiration 
date 
for 
all 
licenses; increases the license fee from $80 to $100 per year; 
and makes other administrative changes.