Grain dealer measure approved

Senators expanded oversight of grain warehouses and dealers with a bill given final approval April 9.

LB894, introduced by Niobrara Sen. Barry DeKay, eliminates an exemption that allowed certain warehouses to avoid classification as grain dealers if grain was first unloaded at their facilities, subjecting those engaged in direct delivery transactions to licensing, bonding and oversight requirements.

The measure also replaces the current $100 annual grain dealer license fee with a fee established by the Nebraska Public Service Commission, capped at $1,500. Existing fees will remain in place until July 1, 2027, and the commission must submit a proposed fee schedule to the Legislature by Dec. 1.

License revenue will continue to be deposited in the state’s General Fund until July 1, 2027, after which it will be redirected to the newly created Grain Dealer and Grain Warehouse Cash Fund.

Additionally, LB894 revises payment provisions to require dealers to pay within 10 business days after receiving a written demand with proof of delivery, unless a contract provides otherwise, with interest accruing after the deadline. The measure also repeals certain notice requirements and streamlines claims against a dealer’s security, allowing unpaid producers to seek recovery during a commission administrative action while excluding obligations not yet due under deferred payment contracts.

Also included in the measure are provisions of DeKay’s LB895, which remove an exemption from licensure for federally licensed warehouses and instead provide that those warehouses automatically qualify for state licensure and are not subject to a state license fee.

Lawmakers passed LB894 on a 44-3 vote.