Surety Bond News

South Dakota enacted a new bill concerning grain warehouseman. The new bill is named HB 1016 and declares that claims can only be made against a grain warehouseman or grain buyer’s bond if the individual informs the Public Utilities Commission, which must specify that it’s not taking an action against the surety bond.

Treasurers of water use districts are affected by new legislation in South Dakota. The new law is titled SB 119 and modifies the bond amount required of treasurers of water use districts. Previous legislation required a surety bond in an appropriate amount to cover all funds that the treasurer manages. SB 119 allows the district’s directors to establish the bond amount required.

South Dakota State implemented a new law affecting grain buyers within said state. The new law is titled SB 55 and boosts the quantity of the surety bond required in relation to licensure as a grain buyer. Under the present law, there are two license classifications, Class A and Class B. A surety bond is required for both and is calculated by a rolling average of the dollar amount of grain that the buyer purchased in South Dakota throughout the last three calendar years. The surety bond is applicable to all grain purchases for all of the buyer’s business sites.

Under SB 55, the quantities and thresholds for a Class A License now are like so:

New Dollar Thresholds Increased Bond Amount

<$2,000,000 No Change

$2,000,001 – $10,000,000 $100,000

$10,000,001 – $25,000,000 $200,000

$25,000,001 – $60,000,000 $350,000

$60,000,001 – $100,000,000 $500,000

For a Class B License, the new law amplified the amount of the surety bond required for purchasers making buys between $2,000,001 and $10,000,000 from a $75,000 surety bond under the previous law to a bond in the quantity of $100,000 under SB 55.

South Dakota grain buyers are affected by a new bill relating to bankruptcy. The new bill, which is referred to as SB 53, authorizes grain buyers in bankruptcy proceedings to file alternative financial documents in the place of the present surety bond if a bond cannot be attained during this period of time. The present law authorizes alternative security should the surety hault writing surety bonds within the State or be insolvent. SB 53 became active upon enactment.

New legislation was enacted in the State of South Dakota relating to mining operations using chemical leaching. The new law, which is named SB 40, boosts the quantity of the additional financial assurance required for mining operations that utilize cyanide leaching or any other chemical/biological leaching procedure to extract raw materials from ore. The previous law stated that the amount must be at a minimum of $25,000 and no more than $500,000. SB 40 states that the assurance can not be above $1 million, while there is no instituted minimum.