Legislation endorsed by House raises cap on plan to help protect Indiana farmers from financial failure
For immediate release:
Feb. 9, 2015
INDIANAPOLIS – Legislation co-authored by State Rep. David Niezgodski (D-South Bend) was today unanimously approved by members of the Indiana House of Representatives that raises the cap on the Indiana Grain Indemnity Fund, a farmer paid insurance plan to protect farmers in the case of a first purchaser failure.
House Bill 1549 restructures the fee system and strengthens oversight of first purchasers by reinforcing the Indiana Grain Buyers & Warehouse Licensing Agency. The agency would be able to more closely monitor the activities and assets of grain buyers to ensure the businesses are stable and meeting state requirements.
“The fund currently has about $14 million. However, a single failure could easily wipe that fund out because of increased price volatility,” explained Niezgodski.
“This legislation would help close a portion of a $400,000 budget gap the Grain Buyers & Warehouse Licensing Agency has with the Indiana State Department of Agriculture.”
If a failure were to happen and the fund couldn’t cover the losses, it could devastatingly impact rural communities. Farmers haven’t paid into the fund since 1998 but now want to strengthen the insurance plan that protects them.
“A self-sufficient regulator is a stronger regulator,” said Niezgodski.
“We’ve worked hard with Indiana Soybean Alliance, Indiana Corn Growers Association, Indiana Farm Bureau, Agribusiness Council of Indiana, and the Indiana State Department of Agriculture to craft this bill. Farmers’ payments will restart and amount to approximately $1.17 an acre, providing them up to $25 million in coverage.
“This is a rare occurrence where all major agricultural groups came together, worked, and agreed upon an important piece of legislation. We believe it is good for Indiana, good for agriculture, and good for rural economies,” he added.
The fee restructuring to first purchasers is supported by the Agribusiness Council and will not negatively impact agricultural business in Indiana.
The legislative process for the bill has been bipartisan as Niezgodski partnered with State Reps. Don Lehe (R-Brookston), William Friend (R-Macy), and Jim Baird (R-Greencastle).
HB 1549 passed 95-0 and now moves to the Senate for further legislative action.