SB 0423 - Fiscal Note

Fiscal Note - SB 0423 - Modifies definition of grain dealers

COMMITTEE ON LEGISLATIVE RESEARCH

OVERSIGHT DIVISION

FISCAL NOTE

L.R. NO.: 1933-02

BILL NO.: Truly Agreed To and Finally Passed SCS for SB 423

SUBJECT: Grain Dealers

TYPE: Original

DATE: April 22, 1999

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FISCAL SUMMARY

ESTIMATED NET EFFECT ON STATE FUNDS
FUND AFFECTED	FY 2000	FY 2001	FY 2002
None	$0	$0	$0
Total Estimated Net Effect on All State Funds	$0	$0	$0

ESTIMATED NET EFFECT ON FEDERAL FUNDS
FUND AFFECTED	FY 2000	FY 2001	FY 2002
None	$0	$0	$0
Total Estimated Net Effect on All Federal Funds	$0	$0	$0

ESTIMATED NET EFFECT ON LOCAL FUNDS
FUND AFFECTED	FY 2000	FY 2001	FY 2002
Local Government	$0	$0	$0

Numbers within parentheses: ( ) indicate costs or losses

This fiscal note contains 3 pages.

FISCAL ANALYSIS

ASSUMPTION

The Department of Agriculture (AGR) assumes of the approximately 500 licensed grain dealers in the state, 44 dealers reported less than $100,000 purchases of grain directly from producers in FY 98. If this proposal is passed, the AGR assumes approximately half, or 22, would drop their license. The other half would keep their license because they use the license not only to purchase grain by also to sell their own grain through terminal markets. Many terminal markets require a grain dealer license for a seller to sell grain to a terminal elevator. The AGR assumes they collect $40 for each grain dealer license, therefore, if 22 dealers drop their license there will be a loss of revenue to the AGR of $880 per year.

Oversight assumes there may be a loss of revenue to the Department of Agriculture, however, it would likely be minimal.

FISCAL IMPACT - State Government	FY 2000	FY 2001	FY 2002
	(10 Mo.)
	0	0	0
FISCAL IMPACT - Local Government	FY 2000	FY 2001	FY 2002
	(10 Mo.)
	0	0	0
FISCAL IMPACT - Small Business
Small businesses which purchase less than $100,000 worth of grain directly form grain producers would not require a grain dealer's license. Such small businesses would also not need to post a surety bond or file annual reports with the Department of Agriculture. These business would required to have periodic audits by the Department of Agriculture to verify their purchases from producers were less than $100,000.

DESCRIPTION

This bill exempts from the definition of a "grain dealer," as defined in Chapter 276, any person whose total grain purchases from producers in his or her fiscal year do not exceed $100,000 and who pays for all grain purchased at the time of physical transfer of the grain.

This legislation is not federally mandated, would not duplicate any other program and would not require additional capital improvements or rental space.

SOURCES OF INFORMATION

Department of Agriculture

Jeanne Jarrett, CPA

Director

April 22, 1999