A new Georgia law aims to make sure growers of produce and other commodities get paid by brokers.
HB 268 strengthens Georgia’s existing “Dealer in Agricultural Products” law to provide an additional layer of protection for Georgia farmers, according to a news release from the Georgia Fruit & Vegetable Growers Association.
Brokers play a vital role in finding markets for crops, arranging delivery and supplying input materials needed for production, Jack Spruill, the Georgia Department of Agriculture’s marketing division director, said in the release.
In the vast majority of cases, Spruill said, growers have benefitted from brokers. But in some case, they have had difficulty getting paid under brokerage arrangements.
“In the 2013 crop year, over $4 million was reported in crops not paid for,” Spruill said in the release. “Farmers shouldn’t have that kind of exposure.”
The new law updates and clarifies existing laws. It has two main functions.
One, it requires that anyone who buys a product, and does not pay for it in full with cash, must register annually with the Georgia Department of Agriculture and pay a small licensing fee each year. Under the previous law, a broker could get a lifetime license once with no further review. That made it hard for the department to help protect growers.
The law also makes it clearer how much money brokers need to be bonded for. The minimum bonded amount is $10,000 and the maximum is $230,000, except in the case of pecans, which has a maximum of $500,000.