Claims filed by Florida growers against agricultural dealers have increased dramatically this year, according to Florida Agriculture Commissioner Charles H. Bronson.
The number of claims filed for non-payment during the first half of fiscal year 2008-09 has more than doubled to 115, compared to the average of 56 claims for the first six months of each of the last four fiscal years.
"The rise in claims shows that agricultural dealers are being impacted by the current economic conditions," Bronson said. "Increasingly, dealers have found themselves unable to pay for agricultural products they purchased from Florida growers and producers."
The Florida Department of Agriculture and Consumer Services is responsible for the licensing of dealers in agricultural products. Any person who is engaged within the state in the business of buying, receiving, soliciting, handling, or negotiating agricultural products from or for Florida producers, or their agents, must be licensed and bonded.
The Florida License and Bond Law helps assure that producers of products covered by the law receive proper accounting and payment for their products. In order to secure a license, one must file a properly completed application, pay the required license fee, and post an adequate surety bond or certificate of deposit. Any producer or producer's agent who feels he has been damaged by a dealer's failure to make proper accounting or payment for agricultural products may file a complaint.
"Florida's License and Bond Law affords protection to our state's agricultural producers who could otherwise suffer huge financial losses if a buyer failed to live up to the terms of the purchase," Bronson said. "This protection is particularly crucial during the current economic climate that has caused cash-flow issues in the agricultural industry. Without this law, smaller farming operations could literally be put out of business by a buyer who does not pay for shipments."
Florida growers and producers recovered nearly $850,000 as a result of claims filed under the License and Bond Law during the first half of the year. More than $427,000 was paid by surety bond, while more than $421,000 was paid directly by dealers.
Bronson said the rise in non-payment claims shows the importance of growers only doing business with licensed agricultural dealers. Since unlicensed dealers are operating outside state law, it is more difficult for growers to collect from unlicensed dealers when they fail to pay for products that have been delivered to them.
Producers can check to see if an agricultural dealer is licensed and find out the amount of the dealer's bond by visiting http://www.florida-agriculture.com/marketing/licensing/index.htm. In addition, they can quickly find out which agricultural dealers, both licensed and unlicensed, have claims filed against them at http://www.florida-agriculture.com/marketing/licensing_claims.htm. The records displayed constitute cases of alleged non-payment for agricultural products. Liability has not been adjudicated.
"Posting this information on the Web makes it very easy for growers to see if any complaints for non-payment are filed against specific dealers before they contract with them," Bronson said. "Armed with this data, growers can make their own conclusions about who they choose to do business with."