Senate Bill No. 107

Introduced By beck

By Request of the Department of Agriculture

A Bill for an Act entitled: "An Act revising certain provisions regarding agricultural commodity standards, storage, and merchandising; exempting revenue collected from the administration of the state grain laboratory from budget amendment requirements; revising applicable penalties; revising procedures for submitting samples to the state grain laboratory and for appealing analysis results; amending sections 17-7-402, 80-4-402, 80-4-405, 80-4-409, 80-4-421, 80-4-429, 80-4-501, 80-4-536, 80-4-701, 80-4-702, 80-4-703, 80-4-704, 80-4-705, 80-4-706, 80-4-708, 80-4-721, 80-4-722, 80-4-724, and 80-4-725, MCA; repealing sections 80-4-301, 80-4-302, 80-4-303, 80-4-304, 80-4-305, 80-4-306, 80-4-307, 80-4-308, 80-4-423, 80-4-535, 80-4-707, 80-4-710, 80-4-723, and 80-4-727, MCA; and providing an effective date."

Be it enacted by the Legislature of the State of Montana:

Section 1.  Section 17-7-402, MCA, is amended to read:

"17-7-402.   Budget amendment requirements. (1) Except as provided in subsection (6), a budget amendment may not be approved:

(a)  by the approving authority, except a budget amendment to spend:

(i)  additional federal revenue;

(ii) additional tuition collected by the Montana university system;

(iii) additional revenue deposited in the internal service funds within the department or the office of the commissioner of higher education as a result of increased service demands by state agencies;

(iv) Montana historical society enterprise revenue resulting from sales to the public;

(v)  additional revenue that is deposited in funds other than the general fund and that is from the sale of fuel for those agencies participating in the Montana public vehicle fueling program established by Executive Order 22-91; or

(vi) revenue resulting from the sale of goods produced or manufactured by the industries program of an institution within the department of corrections; or

(vii) revenue collected for the administration of the state grain laboratory under the provisions of Title 80, chapter 4, part 7;

(b)  by the approving authority if the budget amendment contains any significant ascertainable commitment for any present or future increased general fund support;

(c)  by the approving authority for the expenditure of money in the state special revenue fund unless an emergency justifies the expenditure;

(d)  by the approving authority unless it will provide additional services;

(e)  by the approving authority for any matter of which the requesting agency had knowledge at a time when the proposal could have been presented to an appropriation subcommittee, the house appropriations committee, or the senate finance and claims committee of the most recent legislative session open to that matter, except when the legislative finance committee is given specific notice by the approving authority that significant identifiable events, specific to Montana and pursuant to provisions or requirements of Montana state law, have occurred since the matter was raised with or presented for consideration by the legislature; or

(f)  to extend beyond June 30 of the last year of any biennium.

(2)  All budget amendments must itemize planned expenditures by fiscal year.

(3)  Each budget amendment must be submitted by the approving authority to the budget director and the legislative fiscal analyst.

(4)  Money from nonstate or nonfederal sources that would be deposited in the state special revenue fund and that is restricted by law or by the terms of a written agreement, such as a contract, trust agreement, or donation, is exempt from the requirements of this part.

(5)  An appropriation that would usually be the subject of a budget amendment that is submitted to the legislature for approval during a legislative session may not include authority to spend money beyond the first fiscal year of the next biennium.

(6)  A budget amendment to spend state funds, other than from the general fund, required for matching funds in order to receive a grant is exempt from the provisions of subsection (1)."

Section 2.  Section 80-4-402, MCA, is amended to read:

"80-4-402.   Definitions. As used in parts 4 through 7 of this chapter, the following definitions apply:

(1)  "Agent" means any a person who contracts for or solicits any agricultural commodities from a producer or warehouse operator or negotiates the consignment or purchase of any agricultural commodity on behalf of any a commodity dealer.

(2)  "Agricultural commodity" means any grain, beans, safflower, sunflower seeds, tame mustards, rapeseed, flaxseed, leguminous seed, or other small seed, and other agricultural commodities oil seed crops, seed, or other crops designated by rule of the department.

(3)  "Bond" means the bond required to be filed by part 5 or 6 of this chapter and includes any equivalent established by department rule, as provided in 80-4-504 and 80-4-604.

(4)  "Commodity dealer" means any a person who engages in a business involving or, as part of the business, participates in buying, exchanging, negotiating, or soliciting the sale, resale, exchange, or transfer of any agricultural commodity in the state of Montana. The term does not include:

(a)  a person engaged solely in storing, shipping, or handling agricultural commodities for hire;

(b)  a person who buys agricultural commodities from a licensed commodity dealer;

(c)  a person who does not purchase more than $30,000 worth of agricultural commodities from producers during a licensing year; however, once a person exceeds the $30,000 exemption, the person shall obtain a license and is not eligible for the exemption for the succeeding year;

(d)  a person who is the producer of agricultural commodities that the person actually plants, nurtures, and harvests;

(e)  a person whose trading in agricultural commodities is limited to trading in commodity futures on a recognized futures exchange; or

(f)  a person who buys agricultural commodities used exclusively for the feeding of livestock and not for resale.

(5)  "Delayed payment contract" means a written contract for the sale of an agricultural commodity when the sale purchase price is to be paid at a date after delivery of the agricultural commodity to the buyer and includes but is not limited to those contracts commonly referred to as deferred payment contracts, deferred pricing contracts, no-price-established contracts, or price-later contracts. A delayed payment contract does not include those contracts in which the parties intend payment to be made immediately upon determination of weights and grades.

(6)  "Department" means the department of agriculture provided for in 2-15-3001.

(7)  "Depositor" means any a person who delivers an agricultural commodity to a commodity dealer for sale, who deposits an agricultural commodity in a warehouse for storage, processing, handling, or shipment, or who is the owner or legal holder of an outstanding warehouse receipt, or who is lawfully entitled to possession of the agricultural commodity.

(8)  "Director" means the director of the department of agriculture.

(9) "FGIS" means the federal grain inspection service, a program administered by the federal grain inspection, packers, and stockyards administration (GIPSA).

(9)(10)  "Grain" means all grains for which standards have been established under the United States Grain Standards Act, 7 U.S.C. 71 through 87, and all other agricultural commodities, such as mustard, oil seed crops, or other crops, which that may be designated by rule of the department.

(11) "Grain standards" means the official standards of quality and condition of grain that establish the grades defined by the Grain Standards Act or those standards adopted by department rule.

(10)(12)  "Grain Standards Act" means the United States Grain Standards Act, 7 U.S.C. 71 through 87.

(11)(13)  "Inspector" means any a person designated by the director to assist in the administration of parts 4 through 6 7 of this chapter. The term includes warehouse auditors or examiners.

(12)(14)  "Official grain agricultural commodity inspectors" means any official personnel who perform or supervise the performance of official inspection services and certify the results of inspections, including the grade of the grain agricultural commodities.

(13)(15)  "Official grain agricultural commodity samplers" or "samplers" means any official personnel who perform or supervise the performance of official sampling services and certify the results of the sampling.

(14) "Official grain standards" means the standards of quality and condition of grain that establish the grades defined by the Grain Standards Act.

(15)(16)  "Official grain agricultural commodity weighers" means any official personnel who perform or supervise the performance of class X or class Y weighing services and certify the results thereof of the services, including the weight of the grain agricultural commodity.

(16)(17)  "Person" means any an individual, firm, association, corporation, partnership, or any other form of business enterprise.

(17)(18)  "Producer" means the owner, tenant, or operator of land in this state who has an interest in and receives all or part of the proceeds from the sale of agricultural commodities produced on that land.

(18)(19)  "Public warehouse" or "warehouse" means any an elevator, mill, warehouse, subterminal grain warehouse, public warehouse, or other structure or facility in which, for compensation, agricultural commodities are received for storage, handling, processing, or shipment. The term includes facilities which that commingle commodities belonging to different lots of agricultural commodities.

(19)(20)  "Purchase contract" means a delayed payment contract or other written contract for the purchase of agricultural commodities by a commodity dealer.

(20)(21)  "Purchase price" means the final price after premiums and discounts are assessed.

(22) "Receipt" means a warehouse receipt.

(21)(23)  "Scale weight ticket" means a load slip or other evidence of delivery, other than a receipt, given to a depositor by a warehouse operator licensed under the provisions of part 5 of this chapter upon initial delivery of the agricultural commodity to the warehouse.

(22)(24)  "Station" means a warehouse located more than 3 miles from the central office of the warehouse.

(23)(25)  "Subterminal warehouse" means any a warehouse at which where an intermediate function is performed in which agricultural commodities are customarily received from dealers or producers and where the commodities are accumulated prior to shipment.

(24)(26)  "Terminal grain warehouse" means any a warehouse authorized by a grain exchange to receive or disburse grain on consignment as presented by the rules and regulations of a grain exchange.

(25)(27)  "Warehouse operator" means a person operating or controlling a public warehouse.

(26)(28)  "Warehouse receipt" means every receipt, whether negotiable or nonnegotiable, issued under part 5 of this chapter by a warehouse operator, except scale weight tickets."

Section 3.  Section 80-4-405, MCA, is amended to read:

"80-4-405.   Maximum bond amount. The maximum amount of any public warehouse operator bond may not exceed $1 million and the maximum amount of a commodity dealer bond may not exceed $1 million, except:

(1)  any bonds compensating for net asset deficiencies prescribed in parts 5 and 6 of this chapter must be added to the maximum bond amount. In the event that the public warehouse operator is also licensed as a commodity dealer, only one net asset deficiency amount is required; and.

(2)  the maximum bond amount must be adjusted each year based upon the percentage increase or decrease in the annual average index of prices received by Montana farmers for food and feed grains as computed by the Montana crop and livestock reporting service."

Section 4.  Section 80-4-409, MCA, is amended to read:

"80-4-409.   Confidentiality of records. All financial statements of warehouse operators and commodity dealers required under the provisions of parts 5 and 6 of this chapter shall must be kept confidential by the department and are not subject to disclosure except:

(1)  upon written permission of the licensee;

(2)  in actions or administrative proceedings commenced under the provisions of parts 4 through 6 7 of this chapter;

(3)  when required by subpoena or court order;

(4)  when disclosed to law enforcement agencies in connection with the investigation or prosecution of criminal offenses; or

(5)  when released to a bonding company approved by the department."

Section 5.  Section 80-4-421, MCA, is amended to read:

"80-4-421.   License suspension and revocation -- renewal. (1) The department may revoke, suspend, or modify a license when it has reasonable cause to believe that the licensee has committed any of the following acts, each of which is a violation of parts 5 and 6 4 through 7 of this chapter:

(a)  failure to maintain all initial licensing requirements, including insurance, bonding, and net asset requirements. In determining compliance with net asset requirements, the department may consider the licensee's status under any prior or current bankruptcy proceedings, as well as any outstanding civil settlements or judgments.

(b)  aiding or abetting another person in the violation of the licensure or any other provisions of parts 5 and 6 4 through 7 of this chapter;

(c)  conviction of any criminal offense defined under Title 45, after considering Title 37, chapter 1, part 2;

(d)  failure or refusal to allow inspection or maintain and provide records, reports, and other information required by the department;

(e)  failure or refusal to post storage and other charges as filed with the department;

(f)  failure or refusal to accept agricultural commodities for storage as required under 80-4-523;

(g)  failure to comply with the warehouse receipt and scale weight ticket requirements of 80-4-525 and 80-4-527;

(h)  failure of a warehouse operator to maintain and deliver upon request sufficient agricultural commodities to cover outstanding warehouse receipts as required under 80-4-531;

(i)  discrimination in charges by a warehouse operator as provided in 80-4-524;

(j)  failure to provide payment for any agricultural commodity; or

(k)  failure to satisfy a judgment entered as a result of a violation of this chapter; or

(l) violation of or failure or refusal to comply with any other provision of parts 4 through 6 7 of this chapter or any rule adopted by the department pursuant to parts 4 through 7.

(2)  The department may refuse to issue or renew a license if the applicant or licensee:

(a)  has a license as a warehouse operator or commodity dealer that was previously or is currently suspended or revoked. In determining the sufficiency of cause hereunder, the department shall consider the nature and length of the action and any subsequent licensure or other evidence of rehabilitation.

(b)  does not satisfy the bonding, insurance, or net asset requirements as specified in subsection (1)(a) or any other provisions required as a condition to licensing;

(c)  has been convicted of a criminal offense and the denial or refusal is made after considering Title 37, chapter 1, part 2.

(3)  The issuance of a license based on information provided by the applicant which that the department subsequently determines incorrect must be considered is void, and any conduct under that license is a violation.

(4)  All proceedings brought under subsections (1) and (2) must be conducted under the provisions of the Montana Administrative Procedure Act.

(5)  The department is authorized to issue summary revocations, suspensions, or denials without hearing pursuant to the procedures established in 2-4-631."

Section 6.  Section 80-4-429, MCA, is amended to read:

"80-4-429.   Penalty. (1) Except as otherwise provided, any a person who violates any provision of parts 4 through 6 7 of this chapter or rules promulgated under parts 4 through 6 7 or who impedes, obstructs, hinders, or otherwise prevents or attempts to prevent the director or an authorized representative in the performance of a duty under parts 4 through 6 7 of this chapter is guilty of a misdemeanor and is punishable by imprisonment in a county jail not to exceed 6 months or by a fine of not more than $1,000, or both.

(2)  A person who refuses to permit inspection of licensed premises, books, accounts, records, or other documents required by parts 4 through 7 of this chapter or who uses a scale weight ticket or purchase contract that fails to satisfy the requirements of parts 4 through 7 of this chapter is guilty of a misdemeanor.

(3)  A person acting as a commodity dealer or warehouse operator who knowingly sells warehouse-receipted agricultural commodities that the person is not authorized to sell or who fails to pay for purchased agricultural commodities is guilty of a felony.

(4)  A person exempted from licensure as a commodity dealer under the provisions of 80-4-402(4)(f) who fails to pay in full all amounts due to a commodity dealer producer for the sale of agricultural commodities is guilty of a felony and is also subject to any additional administrative penalty authorized by this chapter.

(5) A person is guilty of a felony if that person knowingly delivers to a commodity dealer or warehouse operator or upon the exercise of reasonable diligence should have known of the delivery to that person of an agricultural commodity that contains:

(a) a nitrogen fertilizer added to harvested grain;

(b) a poisonous, deleterious, or other substance not registered or approved by federal or state statutes, regulations, or rules; or

(c) a registered or approved substance that has not been used or applied according to label directions or other government standards."

Section 7.  Section 80-4-501, MCA, is amended to read:

"80-4-501.   License necessary to operate public warehouse. (1) No A person may not act as a warehouse operator without first having obtained an annual license from the department. This requirement does and other requirements in parts 4 through 6 that regulate the activities of a warehouse operator do not apply to operators of warehouses that are federally licensed under the United States Warehouse Act. However, if a federally licensed warehouse operator engages in business as a commodity dealer, the provisions of parts 4 through 7 apply to the commodity dealer activity.

(2)  If a warehouse operator operates two or more warehouses in the same city or immediately adjacent thereto to the city or in the same immediate area, in conjunction with each other and with the same work force workforce, and if one set of books and records is kept for all such the warehouses and, cash slips, scale weight tickets, and warehouse receipts, and if checks of one series are used for agricultural commodities stored therein in the warehouse, only one warehouse operator's license is required for the operation of all such the warehouses."

Section 8.  Section 80-4-536, MCA, is amended to read:

"80-4-536.   Termination of storage contract -- sale of agricultural commodities for charges -- notice required. (1) Storage of agricultural commodities may be terminated by the depositor at any time by the payment or tender of all legal charges and the surrender of the warehouse receipt, together with a demand for delivery of the agricultural commodities or a notice to the warehouse operator to sell the commodities.

(2)  In the absence of a demand for delivery, order to sell, or mutual agreement for the renewal of the storage contract entered into prior to the expiration of the storage contract, the warehouse operator shall may, upon the expiration of the storage contract, sell so much of the stored agricultural commodities at the local market price at the close of business on that day as is sufficient to pay the accrued storage charges. He The warehouse operator shall then issue new warehouse receipts for the balance of the agricultural commodity to the depositor upon the depositor's surrender of the original warehouse receipts. If the warehouse receipt is not returned, the warehouse operator may apply for an encumbrance to the grain settlement records for outstanding storage in lieu of reissuance of the warehouse receipt subject to the provisions of subsection (3). The warehouse operator shall notify all warehouse receipt holders who are subject to the provisions of subsection (3) of the provisions of this section 30 days prior to the end of the storage period license year.

(3) All storage contracts on agricultural commodities evidenced by a warehouse receipt must be terminated within 3 license years. The termination date for those storage contracts must be calculated by considering the license year during which the contract was issued as the first license year, plus 2 additional license years, for a total of 3 license years."

Section 9.  Section 80-4-701, MCA, is amended to read:

"80-4-701.   Official grain agricultural commodity inspectors, samplers, and weighers -- designation of seasonal inspection points -- assignment of inspectors. (1) The department shall provide inspectors, samplers, and weighers to enforce this part. At all inspection points designated by the department, the department shall provide sufficient official grain agricultural commodity inspectors, samplers, and weighers to inspect and weigh all grain agricultural commodities subject to state inspection.

(2)  The department may, during the grain-marketing season, appoint inspectors to visit the grain-growing districts to investigate the grading, dockage, and weighing of grain and to enforce the rules of the department.

(3)  Expenditures for the inspection and weighing at the points designated by the department may not exceed total fee receipts at those points."

Section 10.  Section 80-4-702, MCA, is amended to read:

"80-4-702.   Qualifications of official grain agricultural commodity inspectors, samplers, and weighers. Official grain agricultural commodity inspectors, samplers, and weighers must be qualified in accordance with the Grain Standards Act. Official grain agricultural commodity inspectors, samplers, and weighers may not be directly or indirectly interested in the handling, sorting, shipping, purchasing, or selling of agricultural commodities, grain, or grain commodities."

Section 11.  Section 80-4-703, MCA, is amended to read:

"80-4-703.   Penalty for misconduct. (1) Any An official grain agricultural commodity inspector, sampler, or weigher who is guilty of neglect of duty, or who knowingly or carelessly inspects, samples, or weighs grain agricultural commodities improperly, or who directly or indirectly accepts any money or other consideration for neglect of duty or improper performance of duty is guilty of official misconduct and is punishable as provided in 45-7-401.

(2)  Any A person who improperly influences or attempts to improperly influence any an official grain agricultural commodity inspector, sampler, or weigher in the performance of his the inspector's, sampler's, or weigher's duties is guilty of bribery and is punishable as provided in 45-7-101.

(3)  Upon conviction of an offense described in subsection (1), an officer official agricultural commodity inspector, sampler, or weigher must be removed by the department pursuant to procedures established by department rule."

Section 12.  Section 80-4-704, MCA, is amended to read:

"80-4-704.   Establishment of standard grain agricultural commodity grades. (1) The department shall may by rule establish standard grades to apply to all grain agricultural commodities for which a United States department of agriculture grade has not been established and that are bought by commodity dealers and stored or handled by warehouses in this state. The department shall adopt as state grade and dockage standards all grades for grain agricultural commodities established by the United States department of agriculture. For purposes of this chapter, any reference to a grade also includes a reference to a protein analysis or any other factor provided by department rule if the analysis affects the purchase price.

(2)  Grain Agricultural commodity standards adopted by the department do not apply to grain agricultural commodities contracted for before the effective date of the adoption of such the standards."

Section 13.  Section 80-4-705, MCA, is amended to read:

"80-4-705.   Rules governing dockage -- sample inspection. The department shall adopt rules governing the dockage on inferior grades, which shall apply in all executory contracts entered into after their adoption. If the purchase price or amount to be paid depends on terminal weight or grade, the rules shall control the dockage insofar as dockage affects the purchase price to be paid. The department shall also provide for sample inspection of grain agricultural commodities, adopt rules governing sample inspection, and provide that the sample inspection, when made, is final."

Section 14.  Section 80-4-706, MCA, is amended to read:

"80-4-706.   Special inspection of grain agricultural commodities. (1) If grain is agricultural commodities are sold based on Montana grade and is are to be shipped from places not provided with state inspection, the buyer, seller, or person making the delivery may have it the agricultural commodities inspected by notifying an inspector, who shall have the grain them inspected. After inspection, the inspector shall issue, on request of the buyer, seller, or person delivering the grain agricultural commodity, an inspector's certificate showing the grade of the grain agricultural commodity. The person calling for the inspection shall pay a reasonable fee fixed by department rule.

(2)  Grain An agricultural commodity that is shipped to points in this state where no inspection is maintained may be inspected on request of either the buyer or seller, and a certificate may be issued showing the grade of the grain agricultural commodity. The charge for the service shall must at least equal the entire cost of providing it and shall must be paid by the party calling for the inspection."

Section 15.  Section 80-4-708, MCA, is amended to read:

"80-4-708.   Examination of grain agricultural commodity cars or trucks at destination. (1) An official grain agricultural commodity inspector, sampler, or weigher, before opening the doors or lids of a car or truck containing grain agricultural commodities upon its arrival at any of the places designated by the department for inspection, shall first ascertain the condition of the car or truck and determine whether any leakages have occurred while the car or truck was in transit, determine whether the doors or lids were properly secured and sealed at the point of shipment, and make a record of those facts in all cases, giving seal numbers.

(2)  After examinations have been made, the official grain agricultural commodity inspector, sampler, or weigher shall securely close and reseal the opened doors or lids, using the special seal of the department.

(3)  A record must be kept by the official grain agricultural commodity inspectors, samplers, or weighers of all original seals broken, the number of seals, and the date when broken. An official grain agricultural commodity inspector, sampler, or weigher shall break the seal, weigh, and superintend the loading of all cars or trucks of grain agricultural commodities subject to inspection. Any other person who breaks the seal or officially weighs the cars or trucks of grain agricultural commodities is guilty of a misdemeanor."

Section 16.  Section 80-4-721, MCA, is amended to read:

"80-4-721.   Fees for inspection, testing, and weighing grain agricultural commodities -- disposition -- investment. (1) The department shall by rule fix the fees for inspection, testing, and weighing of grain agricultural commodities.

(2)  Payment of the fees referred to in subsection (1) must be divided equally between the warehouse operator and the holder of the warehouse receipt.

(3)  Those fees or proceeds are a lien upon the grain until paid.

(4)  All fees and other charges fixed by rule, including fees for the inspection, grading, weighing, and protein testing of grain agricultural commodities, shall must reflect as nearly as possible the actual cost of the services.

(5)(3)  All those fees and charges must be paid to the department and deposited with the state treasurer. The state treasurer shall place all money in the state special revenue fund. Fees deposited in the state special revenue fund may must be used to pay approved claims for expenses incurred in inspecting, grading, weighing, and protein testing of grain agricultural commodities.

(6)(4) The department may direct the board of investments to invest funds from the state special revenue fund pursuant to the provisions of the unified investment program for state funds. The income from such the investments must be credited to the proper department account in the state special revenue fund."

Section 17.  Section 80-4-722, MCA, is amended to read:

"80-4-722.   Records of inspection. (1) The official grain agricultural commodity inspectors, samplers, and weighers have exclusive control at places provided for state inspection of the weighing and grading of grain agricultural commodities to be inspected. Suitable books and records must be kept in which must be entered an accurate record of every carload or truckload of grain agricultural commodities inspected or weighed by them. The records must show for each car or truck:

(a)  the number or other designation of the car or truck;

(b)  the net weight of the grain agricultural commodity;

(c)  the kind of grain agricultural commodity and its grade and, if graded below standard No. 1 grade, the reason for such the grade.

(2)  For each carload or truckload of grain agricultural commodities, the official grain agricultural commodity inspector shall give a certificate of inspection, showing the kind and grade of the grain agricultural commodity, the reason for all grades below No. 1, and the amount to be allowed for dockage, if any. For each carload or truckload weighed, the weigher shall give a weight certificate showing the true weight thereof and containing a statement on the condition of the car or truck and evidences of leakage or damage, if any.

(3)  The inspection and weight certificates must be made available to the warehouse loading or unloading the grain agricultural commodity, the shipper or his the shipper's agent, and the railroad company or other carrier by which the grain agricultural commodity was shipped or carried.

(4)  Official grain agricultural commodity inspectors and weighers shall also keep an accurate record of all appeals and decisions and a complete record of every official act, which books and records must be open to inspection by any party of interest."

Section 18.  Section 80-4-724, MCA, is amended to read:

"80-4-724.   Coloration of grain agricultural commodities treated with injurious or toxic substances -- exception. (1) Any grain agricultural commodity treated with any injurious or toxic substance or chemical must at the same time be colored or dyed a color contrasting with the natural color of the grain agricultural commodity so that the treated grain agricultural commodity is readily identifiable as having been treated with an injurious or toxic substance or chemical. This subsection does not apply to the application of pesticides to agricultural commodities according to label directions for the treatment of pests that might be present in the agricultural commodity.

(2) A person who fails to comply with the requirements of this section is subject to the penalty provisions of 80-4-429. "

Section 19.  Section 80-4-725, MCA, is amended to read:

"80-4-725.   Sale or offering for sale of treated product prohibited. No A person may not sell or offer for sale grain an agricultural commodity that has been treated with any injurious or toxic substance or chemical unless the grain agricultural commodity has been colored or dyed a color contrasting with the natural color of the grain agricultural commodity. Section 80-4-724 and this section do not apply to the treatment of grain an agricultural commodity solely for the killing of insects which that might be present therein. A person violating this section is guilty of a misdemeanor."

NEW SECTION. Section 20.  Agricultural commodity sampling -- appeal procedure. (1) At the time of delivery of an agricultural commodity to a warehouse operator or commodity dealer for storage or sale, each warehouse operator or commodity dealer shall take a representative sample from each load of agricultural commodity delivered and preserve the sample in a moistureproof container with the owner's name marked on the container. A composite sample consisting of a minimum of 1 1/2 quarts or 1,050 grams of the representative sample must, upon written request of the depositor, be submitted directly to the state grain laboratory for analysis as to grade, dockage, protein, and other factors that the laboratory is able to analyze that affect the purchase price. The warehouse operator or commodity dealer shall retain a minimum of 1 1/2 quarts or 1,050 grams of the remaining sample for 60 days.

(2) If a request for a state grain laboratory analysis is not made pursuant to subsection (1) and the depositor, warehouse operator, or commodity dealer is dissatisfied with the results of a private analysis, the depositor, warehouse operator, or commodity dealer may appeal to the state grain laboratory. When an appeal is made, the warehouse operator or commodity dealer shall submit 1 1/2 quarts or 1,050 grams of the representative sample to the state grain laboratory for appeal analysis.

(3) If the depositor, warehouse operator, or commodity dealer is dissatisfied with the results of a state grain laboratory analysis, as provided in subsection (1) or (2), the depositor, warehouse operator, or commodity dealer may appeal to the FGIS, United States department of agriculture. A FGIS appeal must be made within 10 working days of the state grain laboratory's analysis. The sample for FGIS appeal must be a portion of that agricultural commodity retained by the state grain laboratory when it conducted its analysis. The results on the state grain laboratory appeal sample are final and binding. In the absence of an appeal to FGIS or in the case of an agricultural commodity for which there are no FGIS standards, the state grain laboratory's analysis is final and binding.

(4) Each warehouse operator or commodity dealer shall post in a conspicuous place a placard, issued by the department, stating the procedures provided for in this section.

(5) All samples submitted for analysis are the property of the state grain laboratory and subject to its disposition.

(6) An agricultural commodity purchased for resale as seed is exempt from the requirements of this section.

NEW SECTION. Section 21.  Repealer. Sections 80-4-301, 80-4-302, 80-4-303, 80-4-304, 80-4-305, 80-4-306, 80-4-307, 80-4-308, 80-4-423, 80-4-535, 80-4-707, 80-4-710, 80-4-723, and 80-4-727, MCA, are repealed.

NEW SECTION. Section 22.  Severability. If a part of [this act] is invalid, all valid parts that are severable from the invalid part remain in effect. If a part of [this act] is invalid in one or more of its applications, the part remains in effect in all valid applications that are severable from the invalid applications.

NEW SECTION. Section 23.  Codification instruction. [Section 20] is intended to be codified as an integral part of Title 80, chapter 4, part 7, and the provisions of Title 80, chapter 4, part 7, apply to [section 20].

NEW SECTION. Section 24.  Effective date. [This act] is effective July 1, 1997.

-END-