ARC 9453C

ARC 9453C

Proposing rulemaking related to licensed grain dealers
and providing an opportunity for public comment

Major updates include the following:

1.Transitional provisions for unqualified audit requirement.Between July 1, 2025, and June 30, 2026, grain dealers may receive an extension of up to 12 months to submit an unqualified audit opinion if they provide two items to the Department: a financial statement reviewed by a certified public accountant licensed in Iowa, and an affidavit stating that they either meet the financial requirements outlined in Iowa Code sections 203.3 and 203.15 or will file an additional bond to cover any deficiency. During the extension period, the grain dealer must submit monthly financial statements to the Department, including a balance sheet and income statement prepared in accordance with generally accepted accounting principles (GAAP) to demonstrate ongoing financial compliance.

2.Transitional provisions for bond in lieu of unqualified audit.Between July 1, 2025, and June 30, 2026, the Department may allow a grain dealer to continue issuing credit-sale contracts, even if the grain dealer has not provided an unqualified audit, by filing a $100,000 bond with the Department. The bond allowance was previously allowed by the Iowa Code and is intended to indemnify sellers against losses resulting from a breach of a credit-sale contract. This bond is in addition to any other bond required by law.

3.Acknowledgement of coverage forms.A licensed grain dealer who purchases grain using a credit-sale contract must obtain a signed acknowledgment form from the seller that explains the limited coverage available under the Grain Depositors and Sellers Indemnity Fund. The required notice informs sellers that while ordinary cash sales may be covered up to 90 percent (with a $400,000 cap), deferred-pricing contracts are only covered up to 75 percent, and deferred-payment contracts are not covered at all.For contracts executed between September 1, 2025, and July 1, 2026, the acknowledgment may be a separate document signed and dated by the seller, printed in a legible and reasonably sized font, and attached to both parties’ copies of the contract.Beginning July 1, 2026, the acknowledgment language must be incorporated directly into the contract, placed in bold text above the buyer’s and seller’s signatures.

Additionally, some changes reflect updates required by Executive Order 10, removing rules that are duplicative of statute or outdated, reducing restrictive language, and consolidating chapters. Other minor edits are made throughout for clarity and readability.